What changed in this filing

/stocks — the workspaceLOADING

Item 9A. Controls and Procedures

2025-02-27 compared with 2024-02-28 · 413 added, 352 removed, 983 unchanged (44% of the section changed)

16 unchanged sentences

During the fourth quarter of 2024, the Company did no t adopt or terminate a Rule 10b5-1 trading arrangement (as defined in Item 408(a)(1)(i) of Regulation S-K) for the purchase or sale of securities of the Company, whether or not intended to satisfy the affirmative defense conditions of Rule 10b5-1(c) of the Exchange Act.

On February 16, 2024, we received approval from the FDA for Amtagvi™, a tumor-derived autologous T cell immunotherapy indicated for the treatment of adult patients with unresectable or metastatic melanoma previously treated with a PD-1 blocking antibody, and if BRAF V600 mutation positive, a BRAF inhibitor with or without a MEK inhibitor.

This indication is approved under accelerated approval based on an endpoint of overall response rate.

On February 22, 2024, we announced the closing of the sale of an aggregate of 23,014,000 shares of our common stock, pursuant to an underwriting agreement with Jefferies, Barclays Capital Inc., and Goldman Sachs & Co.

LLC at a public offering price of $9.15 per share, before underwriting discounts and commissions.

The total estimated net proceeds to us from the offering are expected to be approximately $197.1 million after deducting underwriting discounts and commissions and estimated offering expenses payable by us.

Certain information required by Part III is omitted from this Annual Report on Form 10-K because we will file a definitive Proxy Statement for the Annual Meeting of Stockholders pursuant to Regulation 14A of the Securities Exchange Act of 1934 (the Proxy Statement), not later than 120 days after the end of the fiscal year covered by this Annual Report on Form 10-K, and the applicable information included in the Proxy Statement is incorporated herein by reference.

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Cooperative Research and Development Agreement for Intramural-PHS Clinical Research, dated August 5, 2011, by and between the U.S.

Department of Health and Human Services, as represented by the National Cancer Institute, and Genesis Biopharma, Inc.

Department of Health and Human Services, as represented by the National Cancer Institute, and Genesis

Biopharma, Inc.

(incorporated herein by reference to Exhibit 10.1 to the Registrant’s Current Report on Form 8-K/A (Amendment No.

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and the Investors thereunder (incorporated herein by reference to Exhibit 10.2 to the Registrant’s Current Report on Form 8-K filed with the Commission on June 3, 2016).

Amendment #1 to the Cooperative Research and Development Agreement #02734, dated January 22, 2015, by and between the National Cancer Institute and Lion Biotechnologies, Inc.

(incorporated herein by reference to Exhibit 10.1 to the Registrant’s Current report on Form 8-K filed with the Commission on January 27, 2015).

Amendment #2 to the Cooperative Research and Development Agreement #02734, dated August 18, 2016, by and between the National Cancer Institute and Lion Biotechnologies, Inc.

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2 to Registrant’s Registration Statement on Form S-1 filed with the Commission on August 31, 2016).

Amendment #3 to the Cooperative Research and Development Agreement #02734, dated September 7, 2021, by and between the National Cancer Institute and Iovance Biotechnologies, Inc.**+

Amendment #4 to the Cooperative Research and Development Agreement #02734, dated August 26, 2024, by and between the National Cancer Institute and Iovance Biotherapeutics, Inc.**+

Manufacturing Services Agreement, dated November 23, 2015, by and between WuXi Advanced Therapies, Inc.

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(incorporated herein by reference to Exhibit 10.4 of the Registrant’s Current Report on Form 10-K filed with the Commission on May 6, 2021).#+

Executive Employment Agreement, effective as of January 10, 2022, by and between Raj K.

Puri, M.D., Ph.D.

and Iovance Biotherapeutics, Inc.**+

Executive Employment Agreement, effective as of January 25, 2025, by and between Daniel Gordon Kirby and Iovance Biotherapeutics, Inc.**+

Office Lease, effective as of August 4, 2016, by and between Lion Biotechnologies, Inc.

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63, LLC (incorporated herein by reference to Exhibit 10.1 of the Registrant’s Current Report on Form 8-K filed with the Commission on February 9, 2021).

Sublease, effective as of November 15, 2024, by and between Iovance Biotherapeutics, Inc.

and Vaxcyte, Inc.**+

Termination Agreement, effective as of November 15, 2024, by and between Iovance Biotherapeutics, Inc.

and ARE – San Francisco No.

Option Agreement, dated January 23, 2023, by and among Iovance Biotherapeutics, Inc., Iovance Biotherapeutics UK Ltd, Clinigen Holdings Limited, Clinigen Healthcare Limited, and Clinigen, Inc.

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Vogt, Ph.D., J.D.

General Counsel (Principal Executive Officer)

General Counsel (Principal Executive Officer) and Director

/s/ Jean-Marc Bellemin

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(Principal Financial Officer and Accounting Officer)

/s/ Merrill A.

February 28, 2024

/s/ Michael Weiser

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We believe that our audits provide a reasonable basis for our opinion.

Critical Audit Matters

The critical audit matters communicated below are matters arising from the current period audit of the financial statements that were communicated or required to be communicated to the audit committee and that:

(1) relate to accounts or disclosures that are material to the financial statements and (2) involved our especially challenging, subjective or complex judgments.

The communication of critical audit matters does not alter in any way our opinion on the consolidated financial statements, taken as a whole, and we are not, by communicating the critical audit matters below, providing separate opinions on the critical audit matters or on the accounts or disclosures to which they relate.

Accrued clinical development costs

Description of the Matter

During 2023, the Company incurred $344.1 million of research and development expenses and accrued $10.9 million of clinical development costs as of December 31, 2023.

As described in Note 2 to the Financial Statements, the Company determines accruals for clinical development costs based on the various clinical trial activities performed pursuant to contracts with third-party contract research organizations (“CROs”), which comprise a significant component of the Company’s research and development expenses.

Clinical development costs are accrued and expensed based on the percentage of work completed in accordance with agreements established with CROs.

The timing and amount of payments required under each individual arrangement are often different from the pattern of costs actually incurred.

The Company accrues clinical development costs under its contracts with third-party service providers based on the progress or stage of completion of trials or services completed by vendors over the life of the individual trial, number of subjects enrolled, and number of sites activated.

Auditing management’s accounting for accrued clinical development costs is especially challenging because the evaluation is dependent on a high volume of data exchanged between third-party service providers, internal clinical personnel, and the Company’s finance team.

Determining accrued amounts is based on an evaluation of the unique terms and conditions set in each respective CRO agreement.

Additionally, due to the duration of clinical trial activities and the timing of invoices received from third parties, the determination of the accrual for services incurred requires management to ensure they have complete and accurate information from vendors.

How We Addressed the Matter in Our Audit

We evaluated the design and tested the operating effectiveness of the Company’s internal control related to the Company’s accrued clinical development costs processes.

To test accrued clinical development costs, our audit procedures included, among others, testing the accuracy and completeness of the inputs used in management’s analysis to determine costs incurred.

We also inspected terms and conditions for selected CRO contracts and change orders and compared these to the cost models management used in tracking the progress of service agreements.

We met with internal clinical personnel to understand the status of significant clinical activities.

We evaluated services provided by third parties by understanding the terms and timeline of significant projects, evaluated management’s determination of work performed, subjects enrolled, sites activated and costs incurred, and obtained external confirmation of direct costs incurred, and contracts and change orders executed by the Company for selected CROs as well as key terms and conditions of those contracts.

Further, we inspected selected invoices received from third parties after the balance sheet date and evaluated whether services performed prior to the balance sheet date had been properly included in costs accrued.

Asset acquisition accounting

Critical Audit Matter

The critical audit matter communicated below is a matter arising from the current period audit of the financial statements that was communicated or required to be communicated to the audit committee and that:

(1) relates to accounts or disclosures that are material to the financial statements and (2) involved our especially challenging, subjective, or complex judgments.

The communication of critical audit matter does not alter in any way our opinion on the consolidated financial statements, taken as a whole, and we are not, by communicating the critical audit matter below, providing a separate opinion on the critical audit matter or on the accounts or disclosures to which it relates.

Revenue recognition

Description of the Matter

As described in Note 4 to the Financial Statements, on May 18, 2023, the Company acquired the worldwide rights for the manufacturing, supply, commercialization and sale of Proleukin® (aldesleukin) (the “Acquisition”).

The Company determined substantially all the fair value of the acquired assets was concentrated in the acquired developed technology related to the intellectual property rights of Proleukin ® .

Therefore, the Company concluded the Acquisition did not meet the definition of a business in accordance with ASC 805 and was accounted for as an asset acquisition.

Total Acquisition consideration was $222.7 million, which was allocated among the liabilities assumed and assets acquired, including $232.7 million of the acquired developed technology intangible asset.

The prospective financial information used in the fair value of the acquired developed technology intangible asset was derived using internal management estimates.

The Company’s most significant assumptions related to projected revenues.

Auditing management’s accounting for the Acquisition was especially challenging because of the judgement involved in developing the prospective financial information used to estimate the fair value of the Proleukin ® acquired intangible asset, which required the use of subjective inputs.

The considerations included assessing whether substantially all the fair value of the gross assets acquired was concentrated in a single identifiable asset or group of similar identifiable assets.

In particular, the fair value of the acquired developed technology intangible asset.

This required a high degree of auditor judgement, subjectivity, and effort, including the use of professionals with specialized skill and knowledge, in performing procedures to assess the reasonableness of management’s assumptions of projected revenues used in estimating the fair value of the acquired developed technology intangible asset.

For the year ended December 31, 2024, the Company recognized product revenue of $164 million related to the sales of Amtagvi ® and Proleukin ® .

As described in Note 2 to the Financial Statements, the Company recognizes revenue when a customer obtains control of promised goods.

In the case of Amtagvi ® , revenue is recognized upon infusion while for Proleukin ® , transfer of control occurs either upon shipment or upon receipt of the product after considering when the customer obtains legal title to the product.

The principal consideration for our determination that performing procedures relating to product revenue is a critical audit matter is a high degree of auditor effort in performing procedures related to revenue recognition cut-off given the magnitude of revenue transactions near the end of the fiscal year.

How We Addressed the Matter in Our Audit

We obtained an understanding, evaluated the design, and tested the operating effectiveness of controls over the Company’s processes for estimating the prospective financial information used in determining the fair value of the acquired developed technology intangible asset.

Our audit procedures also included, but was not limited to, evaluating the methodology used and significant assumptions discussed above, and testing the completeness and accuracy of the underlying data used by the Company.

We involved our strategy and valuation specialists to assist in assessing the reasonableness of the methodologies used by management and certain significant assumptions related to projected revenue.

Evaluating the reasonableness of management’s assumptions included, among others, consideration of (i) relevant industry forecasts, (ii) consistency with external market research and industry data, and (iii) inquiries of individuals outside the finance function who are knowledgeable about the revenue forecast.

Our procedures also included testing the completeness and accuracy of the data underlying these estimates and projections.

We evaluated the design and tested the operating effectiveness of the Company’s internal control related to the Company’s revenue recognition processes.

To test the cut off of revenue recognition, our audit procedures included, among others, (i) testing the completeness, accuracy and occurrence of revenue recognized for a sample of revenue transactions that took place near the end of fiscal year by obtaining and inspecting source documents, such as sales contracts, purchase orders, customer invoices, proof of delivery, and infusion confirmations and (ii) confirming a sample of outstanding customer invoice balances as of December 31, 2024 and, for confirmations not returned, obtaining and inspecting source documents, such as invoices, proof of delivery, and subsequent cash receipts.

/s/ Ernst & Young LLP

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Accounts payable

Accrued expenses

Accrued expenses and other liabilities

Operating lease liabilities

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Common stock, $ 0.000041666 par value;

500,000,000 , and 300,000,000 shares authorized , 256,135,715 and 187,812,072 shares issued and outstanding as of December 31, 2023 and December 31, 2022, respectively

Accumulated other comprehensive income (loss)

500,000,000 shares authorized, 305,252,194 and 256,135,715 shares issued and outstanding as of December 31, 2024 and December 31, 2023, respectively

Accumulated other comprehensive loss (income)

Additional paid-in capital

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Loss from operations

Interest income, net

Interest and other income, net

Net Loss before income taxes

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Other comprehensive loss:

Unrealized gain/(loss) on investments

Unrealized gain on investments

Foreign currency translation adjustment

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Stockholders’

Balance - January 1, 2021

Balance - December 31, 2021

( 1,172,445 )

Stock-based compensation expense

Common stock issued upon purchase through employee stock purchase plan

Vesting of restricted shares issued for services

Tax payments related to shares retired for vested restricted stock units

Common stock issued upon purchase of employee stock purchase plan

Common stock issued upon exercise of stock options

Common stock sold in public offering, net of offering costs

Common stock issued from preferred stock conversion

Unrealized loss on investments

Unrealized gain on investments

Balance - December 31, 2022

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Stock-based compensation expense

Common stock issued upon purchase through employee stock purchase plan

Vesting of restricted shares issued for services

Tax payments related to shares retired for vested restricted stock units

Common stock issued upon purchase of employee stock purchase plan

Common stock issued upon exercise of stock options

Unrealized loss on investments

Common stock sold in public offering, net of offering costs

Common stock sold in public and/or at the market offerings, net of offering costs

Unrealized gain on investments

Foreign currency cumulative translation adjustment

Balance - December 31, 2023

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Stock-based compensation expense

Common stock issued upon purchase through employee stock purchase plan

Vesting of restricted shares issued for services

Tax payments related to shares retired for vested restricted stock units

Common stock sold in public and/or at the market offerings, net of offering costs

( 1,098,388 )

Common stock issued upon purchase of employee stock purchase plan

Common stock issued upon exercise of stock options

Common stock sold in public and/or at the market offering, net of offering costs

Unrealized gain on investments

Foreign currency cumulative translation adjustments

Foreign currency cumulative adjustments

Balance - December 31, 2024

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Stock-based compensation expense

Unrealized exchange gains

Unrealized foreign exchange gains

Amortization of intangible assets

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Accretion of discounts and premiums on investments

Loss on write-off of fixed assets

Impairment of long-lived assets

Gain on derecognition of lease assets and liabilities

Changes in assets and liabilities:

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Purchase of investments

Cash paid for acquisition, net of cash acquired

Cash paid for acquisition, including contingent consideration, net of cash acquired

Purchase of property and equipment

Net cash provided by / (used in) investing activities

Net cash used in investing activities

Cash Flows from Financing Activities

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Proceeds from the issuance of common stock upon exercise of options

Vesting of restricted shares issued for services

Proceeds from the issuance of common stock, net

Proceeds from the issuance of debt

Net cash provided by financing activities

Effect of exchange rate changes

Effect of foreign exchange rate changes

Net increase in cash, cash equivalents and restricted cash

3 unchanged sentences

Fair value of net assets acquired

Net unrealized gain (loss) on investments

Net unrealized gain on investments

Acquisition of property and equipment included in accounts payable and accrued expenses

Conversion of convertible preferred stock to common stock

Intangible asset and deferred tax liability arising from contingent consideration

Lease liabilities arising from obtaining right-of-use asset from new leases

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The Company’s mission is to be the global leader in innovating, developing, and delivering tumor infiltrating lymphocyte (“TIL”) cell therapies for patients with solid tumor cancers.

With the recent approval of the biologics license application (the “BLA”), the Company is executing the U.S.

launch of Amtagvi™ (lifileucel), the first product within its autologous TIL cell therapy platform, and Proleukin ® (aldesleukin), an interleukin-2 (“IL-2”) product used in the Amtagvi™ treatment regimen.

The Company is executing the U.S.

launch of Amtagvi ® (lifileucel), the first product within its autologous TIL cell therapy platform, while also marketing Proleukin ® (aldesleukin), an interleukin-2 (“IL-2”) product used in the Amtagvi ® treatment regimen and in other applications.

Amtagvi ® is the first and the only one-time, individualized T cell therapy to receive U.S.

Food and Drug Administration (“FDA”) approval for a solid tumor cancer.

Amtagvi ® is a tumor-derived autologous T cell immunotherapy indicated for the treatment of adult patients with unresectable or metastatic melanoma previously treated with a PD-1 blocking antibody, and if BRAF V600 mutation positive, a BRAF inhibitor with or without a MEK inhibitor.

This indication is approved under accelerated approval based on overall response rate (“ORR”).

This indication was approved under accelerated approval based on overall response rate (“ORR”).

Continued approval for this indication may be contingent upon verification and description of clinical benefit in future confirmatory trials.

Amtagvi™ is the first and the only one-time, individualized T cell therapy to receive FDA approval for a solid tumor cancer.

Amtagvi ® and Proleukin ® are part of a treatment regimen that includes lymphodepletion.

The Company was founded to build upon the promise of TIL cell therapy that was previously demonstrated in single-center clinical trials at academic centers, including the National Cancer Institute (“NCI”).

The Company’s multi-center trials, novel TIL products, manufacturing processes, facilities, and bioanalytical platforms have transformed TIL cell therapy into a commercially viable treatment which many more patients with cancer can access.

The Company manufactures Amtagvi™ and its investigational TIL cell therapies using a centralized, scalable and proprietary 22-day manufacturing process which rejuvenates and multiplies polyclonal T cells unique to each patient into the billions and yields a cryopreserved, individualized therapy.

The Company’s development pipeline includes multicenter trials of TIL cell therapies in additional treatment settings for solid tumor cancers.

The Company is investigating TIL monotherapies for patients with later stage disease who were previously treated with standard of care therapies and TIL combinations with standard of care therapies to potentially improve outcomes in patients who are earlier in their disease.

These trials two ongoing registrational trials to support a supplementary BLA (“sBLA”), of its TIL cell therapies in frontline advanced melanoma and in advanced non-small cell lung cancer following standard of care chemo-immunotherapy.

The Company is also developing next generation therapies using TIL, such as genetically modified TIL cell therapy.

The Company is currently engaged in the development of therapeutics to fight cancer, specifically solid tumors.

With the recent approval of the BLA, the Company expects to generate revenue from the sale of its product Amtagvi™.

Furthermore, following the acquisition of the worldwide rights to Proleukin ® (as discussed below in Note 4 - Proleukin ® Acquisition) in the second quarter of 2023, the Company began to generate revenue from the sales of Proleukin ® during the year ended December 31, 2023.

However, such revenues for Amtagvi™ and Proleukin ® may not be material during the 12 months from the date the consolidated financial statements are issued and this Annual Report on Form 10-K is filed.

The Company has incurred a net loss of $444.0 million for the year ended December 31, 2023 and used $ 361.8 million of cash in its operating activities during the year ended December 31, 2023.

As of December 31, 2023, the Company had $ 346.3 million in cash, cash equivalents, investments, and restricted cash ($ 114.9 million of cash and cash equivalents, $ 165.0 million in short-term investments and $ 66.4 million in restricted cash).

The Company expects to continue to incur significant expenses to support its execution of the commercial launch of Amtagvi™, fund ongoing clinical programs, including its NSCLC registration study, IOV-LUN-202, and its frontline advanced melanoma Phase 3 confirmatory trial, TILVANCE-301, continue the development of its pipeline candidates, and for other general corporate purposes.

Based on the funds the Company has available as of the date these consolidated financial statements are issued, which include estimated net proceeds (after deducting underwriting and other offering expenses) of approximately $ 197.1 million from the public offering of its common stock completed on February 22, 2024, the Company believes that it has sufficient capital to fund its anticipated operating expenses and capital expenditures as planned for at least the next twelve months from the date these consolidated financial statements are issued.

Beyond the U.S., the Company plans to launch Amtagvi ® into additional markets with a high prevalence of advanced melanoma, including the European Union, United Kingdom, Canada, Switzerland, and Australia.

In June 2024, the Company submitted a centralized marketing authorization application (“MAA”) to the European Medicines Agency (“EMA”) for lifileucel.

In August 2024, the MAA was validated and accepted for review by the EMA.

In October 2024, an MAA was submitted to the Medicines and Healthcare products Regulatory Agency in the United Kingdom.

A new drug submission (“NDS”) was deemed eligible for Notice of Compliance with Conditions (“NOC/c”) by Health Canada and submitted in December 2024 and then accepted in January 2025.

The NOC/c policy includes a prioritized 200-day review process for potential NDS approval in mid-2025.

If approved, lifileucel is expected to be the first and only approved therapy in this treatment setting in these markets.

Across the U.S.

and other targeted global markets, Amtagvi ® has the potential to address more than 20,000 previously treated advanced melanoma patients annually.

The Company was founded to build upon the promise of TIL cell therapy that was previously demonstrated in single-center clinical trials at academic research centers, including the National Cancer Institute (“NCI”).

The Company manufactures Amtagvi ® and its investigational TIL cell therapies using centralized, scalable, and proprietary manufacturing processes which rejuvenate and multiply polyclonal T cells unique to each patient into the billions and yields a cryopreserved, individualized therapy.

Amtagvi ® is manufactured for commercial use at the Company’s manufacturing facility, the Iovance Cell Therapy Center (the “ i CTC”), and by a contract manufacturing organization (“CMO”).

The Company’s development pipeline includes multicenter trials of TIL cell therapies in additional treatment settings and indications for solid tumor cancers.

To potentially improve outcomes for patients, the Company is investigating TIL monotherapies for patients previously treated with standard of care therapies and TIL cell therapy in combination with standard of care therapies for patients in earlier treatment settings.

The Company is conducting two ongoing registrational trials to support a supplementary BLA (“sBLA”), of lifileucel in frontline advanced melanoma and in advanced non-small cell lung cancer (“NSCLC”) following standard of care chemo-immunotherapy.

The Company is also developing next generation therapies, such as genetically modified TIL cell therapy and next generation cytokines for use in the TIL cell therapy regimen.

As of December 31, 2024, the Company had $ 330.1 million in cash, cash equivalents, short term-investments, and restricted cash ($ 115.7 million of cash and cash equivalents, $ 208.1 million in short-term investments, and $ 6.4 million in restricted cash).

The Company has recently launched its first internally developed commercial product and continues to be engaged in the development of therapeutics to fight cancer, specifically solid tumors.

With the recent approval of the BLA, the Company began to generate revenue from the sale of its product Amtagvi ® in the second quarter of 2024.

However, such revenues for Amtagvi ® and Proleukin ® may not be material enough to generate

IOVANCE BIOTHERAPEUTICS, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

positive operational cash flows during the 12 months from the date the consolidated financial statements are issued and this Form 10-K is filed.

The Company has incurred a net loss of $ 372.2 million for the year ended December 31, 2024 and used $ 353.0 million of cash in its operating activities during the year ended December 31, 2024.

The Company expects to continue to incur significant expenses to support its execution of the commercial launch of Amtagvi ® , fund ongoing clinical programs, including its NSCLC registrational study, IOV-LUN-202, and its frontline advanced melanoma Phase 3 confirmatory trial, TILVANCE-301, continue the development of its pipeline candidates, and for other general corporate purposes.

Based on the funds the Company has available as of the date these consolidated financial statements for December 31, 2024 are issued, which includes net proceeds of approximately $ 122.3 million raised through the open market sales agreement through February 14, 2025, the Company believes that it has sufficient capital to fund its anticipated operating expenses and capital expenditures as planned for at least the next twelve months from the date these consolidated financial statements are issued.

Concentrations of Risk

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Restricted Cash

The Company maintains a required minimum balance in a segregated bank account in connection with its letters of credit for which amounts are restricted as to their use by the Company.

Currently, the Company’s letters of credit are primarily comprised of one for the benefit of the landlord for the Iovance Cell Therapy Center (the “ i CTC”) used as a security deposit for the lease in the amount $ 5.45 million (See Note 14 - Leases) and a letter of credit for $ 0.6 million for the benefit of the landlord for the Company’s current headquarters’ lease (See Note 14 - Leases), as well as a letter of credit for $ 60.0 million, for the future milestone payment as required by the terms of the Option Agreement for the Proleukin ® acquisition (See Note 4 – Proleukin ® Acquisition).

This letter of credit expires on May 5, 2024, however, it will be automatically extended, without written agreement, for one-year periods to May in each succeeding calendar year and the final expiration date will be July 20, 2026.

Furthermore, the letter of credit will not be automatically extended if a thirty-day written notice is provided prior to the annual extension.

As of December 31, 2024 and December 31, 2023, restricted cash totaled $ 6.4 million and $ 66.4 million, respectively.

These amounts have been classified as either current or non-current assets in the Company’s consolidated balance sheet based on the maturity date of the underlying letter of credit agreement.

The Company maintains a required minimum balance in segregated bank accounts in connection with its letters of credit for which amounts are restricted as to their use by the Company.

As of December 31, 2024, the Company’s letters of credit were primarily comprised of a letter of credit for the benefit of the i CTC used as a security deposit for the lease in the amount of $ 5.45 million and a letter of credit for $ 0.6 million for the benefit of the landlord for the Company’s headquarters lease (See Note 15 - Leases).

The letter of credit for $ 5.45 million originally expired on May 28, 2020, however, it automatically extends for additional one-year periods, without written agreement, to May 28 in each succeeding calendar year, through at least 60 days after the lease expiration date.

Further, on the expiration of the seventh year of the lease, and each anniversary date thereafter, the letter of credit may be decreased by $ 1.0 million, with a minimum security deposit of $ 1.5 million maintained through the end of the lease term.

The letter of credit with the landlord for the Company’s current headquarters’ lease expires on February 1, 2032, however, it will be automatically extended, without written agreement, for one-year periods to February in each succeeding calendar year.

As of December 31, 2023 and December 31, 2022, Restricted cash totaled $ 66.4 million and $ 6.4 million, respectively.

This amount has been classified as a non-current asset in the Company’s consolidated balance sheets.

The letter of credit with the landlord for the Company’s headquarters lease expires on February 1, 2032, however, it will be automatically extended, without written agreement, for one-year periods to February in each succeeding calendar year.

IOVANCE BIOTHERAPEUTICS, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

A letter of credit in the amount of $ 60.0 million for the regulatory approval milestone payment as required by the terms of the Option Agreement for the Proleukin ® acquisition (See Note 4 – Proleukin ® Acquisition) was cancelled in March 2024 following the milestone payment of $ 52.6 million (£ 41.7 million) during the first quarter of 2024.

The following table provides a reconciliation of cash, cash equivalents and restricted cash reported within the consolidated balance sheets that sum to the total of the same such amounts shown in the consolidated statements of cash flows (in thousands):

2 unchanged sentences

Total cash, cash equivalents and restricted cash

IOVANCE BIOTHERAPEUTICS, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

Asset Acquisitions

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Inventory is stated at the lower of cost or net realizable value on a first-in, first-out basis.

Cost includes amounts related to materials, labor and overhead.

Cost includes amounts related to materials, internal labor, costs of external manufacturing, and allocable depreciation of manufacturing facilities, equipment and overhead.

Net realizable value is the estimated selling price in the ordinary course of business less reasonably predictable costs of completion, disposal and transportation.

Inventories presented in the consolidated balance sheet as of December 31, 2023 pertain solely to Proleukin ® and include a step-up of the fair value of inventories as a result of the acquisition of the worldwide rights to Proleukin ® .

Inventoriable costs incurred such as manufacturing costs for the Company’s product candidates, including Amtagvi™, are expensed as incurred as research and development expenses prior to regulatory approval.

When regulatory approval of a product is obtained and the approved product is commercially launched, the Company will begin capitalizing manufacturing costs related to the approved product into inventory.

Cost of sales includes the cost of Proleukin ® inventories and other costs that are directly associated with the purchase and sales of Proleukin ® .

In addition, amortization expense for the fair value step up of Proleukin ® inventories and the acquired intangible assets related to the developed technology are included in cost of sales in the Company’s consolidated statement of operations.

Inventoriable c osts incurred, such as manufacturing costs incurred prior to regulatory approval that did not qualify for capitalization and clinical manufacturing costs, are expensed as incurred as research and development expenses.

Upon the February 2024 approval of Amtagvi ® , the Company began capitalizing inventory and manufacturing costs for the commercial manufacturing of Amtagvi ® .

Additionally, inventory that initially qualifies for capitalization but that may ultimately be used for the production of clinical drug product or utilized in research and development programs is expensed as research and development expense when it has been designated for the manufacture of clinical drug product or use in research and development activities.

Proleukin ® inventories presented in the consolidated balance sheet as of December 31, 2024 and 2023 include a step-up of the fair value of inventories as a result of the acquisition of the worldwide rights to Proleukin ® .

The Company periodically reviews inventory for excess and obsolescence, considering factors such as its most recent sales forecast compared to quantities on hand and the expiration date of the product and materials.

The Company adjusts its inventory that is obsolete or otherwise unmarketable to its estimated net realizable value in the period in which the impairment is first identified.

Any such adjustments are included as a component of cost of sales within the Company’s consolidated statements of operations.

IOVANCE BIOTHERAPEUTICS, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

Cost of sales includes inventory and period costs related to overhead and manufacturing costs of Amtagvi ® during the period from approval through December 31, 2024, as well as the cost of inventories and other costs that are directly associated with the purchase and sales of Proleukin ® .

In addition, cost of sales in the Company’s consolidated statements of operations includes royalties payable on sales of its products, as well as non-cash expenses including amortization of the fair value step-up of acquired Proleukin ® inventory which is recognized as the acquired inventory units are sold, the acquired intangible asset related to developed technology, and the intellectual property license intangible assets.

During the Company’s commercial manufacturing process, certain Amtagvi ® product may become out-of-specification, meaning they fall outside commercial specifications.

This out-of-specification product can still be utilized by patients in a clinical trial, an expanded or early access program, or single-patient investigational new drug, at which point the costs associated with these batches are classified as research and development expense based on the fact that the Company receives clinical data related to these infusions.

Trade Accounts Receivable

1 unchanged sentence

The estimate of allowance for credit losses considers factors, including existing contractual payment and the aging of receivable from its customers.

To date, the Company has determined that an allowance for doubtful accounts is not required.

To date, the Company has determined that an allowance for credit losses is not required.

Intangible Assets

3 unchanged sentences

When this occurs, the Company will recognize amortization expense on the incremental cost prospectively from the date the incremental costs are capitalized.

IOVANCE BIOTHERAPEUTICS, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

The Company reviews intangible assets for impairment at least annually and whenever events or changes in circumstances have occurred which could indicate that the carrying value of the assets are not recoverable.

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For lease agreements entered into by the Company that include lease and non-lease components, such components are generally accounted for separately.

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Property and Equipment, net

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Fair Value Measurements

Under ASC Topic 820, Fair Value Measurements and Disclosures (“ASC 820”), fair value is defined as the price at which an asset could be exchanged, or a liability transferred in a transaction between knowledgeable, willing parties in the principal or most

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advantageous market for the asset or liability.

Where available, fair value is based on observable market prices or parameters or derived from such prices or parameters.

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When quoted market prices are not available for a specific security, the Company estimates the fair value by using quoted prices for identical or similar instruments in markets that are not active and model-based valuation techniques for which all significant inputs are observable in the market or can be corroborated by observable market data for substantially the full term of the assets.

Where applicable, these models project future cash flows and discount the future amounts to a present value using market-based observable inputs obtained from various third-party data providers, including but not limited to, benchmark yields, interest rate curves, reported trades, broker/dealer quotes, and market reference data.

Level 2 assets consist of commercial paper, corporate securities and government agency securities.

Level 2 inputs for the valuations are limited to quoted prices for similar assets or liabilities in active markets and inputs other than quoted prices that are observable for the asset.

Where applicable, these models project future cash flows and discount the future amounts to a present value using market-based observable

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NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

inputs obtained from various third-party data providers, including but not limited to, benchmark yields, interest rate curves, reported trades, broker/dealer quotes, and market reference data.

Revenue Recognition

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To the extent the transaction price includes variable consideration, the Company estimates the amount of variable consideration that should be included in the transaction price using the most likely method based on historical experience, as well as applicable information currently available.

In the U.S., products are sold principally to hospitals and clinics, as well as distributors and wholesalers, and outside of the U.S.

to hospitals and clinics.

Contractual performance obligations are usually limited to transfer of control of the product to the customer.

Revenue is measured as the amount of consideration the Company expects to receive in exchange for transferring its products and is generally based on a list of fixed prices less allowances for chargebacks, product returns, rebates and discounts.

The Company’s payment terms to customers range from 45 to 105 days ;

payment terms differ by customer and by product.

Revenue is reduced at the time of recognition for expected chargebacks, product returns, discounts, rebates, and sales allowances, collectively referred to as gross to net adjustments (“GTN adjustments”).

In the U.S., these GTN adjustments are attributable to various commercial arrangements and government programs.

In addition, non-U.S.

government programs include different pricing schemes such as cost caps and volume discounts.

Cash discounts are recorded as a reduction to receivables and settled through the issuance of credits, typically within one month.

All other GTN adjustments are recorded as a liability and settled through cash payments to the customer.

Significant judgment is required in estimating GTN adjustments considering legal interpretations of applicable laws and regulations, historical experience, payer channel mix, current contract prices under applicable programs, processing time lags and inventory levels in the distribution channel.

Indirect taxes collected from customers and remitted to government authorities that are related to sales of the Company’s products, primarily in Europe, are excluded from revenues.

Subsequent to the closing of the acquisition of Proleukin ® in May 2023, the Company began to sell Proleukin ® in licensed markets outside of the U.S.

To date, there have been no product sales from Proleukin ® in the U.S.

Revenue recognized for the year ended December 31, 2023 was not material to the Company’s consolidated financial statements.

Stock-Based Compensation

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Forfeitures are recognized in the period in which they occur.

The Company accounts for stock option grants to non-employees in a similar manner as stock option grants to employees except for the term used in the grant date fair value, therefore no longer requiring a re-measurement at the then-current fair

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NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

values at each reporting date until the shares underlying the options have vested.

The non-employee awards that contain a performance condition that affects the quantity or other terms of the award are measured based on the outcome that is probable.

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In addition to RSUs that have time-based vesting requirements, from time to time the Company may issue RSUs that include certain performance vesting criteria based upon the satisfaction of stated objectives (“PRSUs”).

The Company measures the compensation cost with respect to PRSUs issued to employees based upon the estimated fair value of the equity instruments at the date of grant, which is recognized as an expense over the period that achievement is determined to be probable through the stated service period associated with the award.

The Company measures the compensation cost

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NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

with respect to PRSUs issued to employees based upon the estimated fair value of the equity instruments at the date of grant, which is recognized as an expense over the period that achievement is determined to be probable through the stated service period associated with the award.

Accrued Research and Development Costs

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Inputs used in the determination of estimates discussed above may vary from actual, which will result in adjustments to research and development expense in future periods.

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NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

Selling, general, and administrative expense

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Selling, general, and administrative costs are expensed as incurred, and the Company accrues for services provided by third parties related to such expenses by monitoring the status of services provided and receiving estimates from its service providers and adjusting its accruals as actual costs become known.

The Company accounts for income taxes using the asset and liability method whereby deferred tax assets are recognized for deductible temporary differences, and deferred tax liabilities are recognized for taxable temporary differences.

Temporary differences are the differences between the reported amounts of assets and liabilities and their tax bases.

The Company accounts for income taxes using the asset and liability method whereby deferred tax assets and liabilities are recognized for the differences between the carrying amounts of existing assets and liabilities for financial reporting purposes and their respective tax bases.

In addition, deferred tax assets are recorded for the future benefit of utilizing net operating losses and research and

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development credit carryforwards.

Deferred tax assets and liabilities are measured using the enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled.

The effect of changes in tax laws and rates on deferred tax assets and liabilities is recognized in income in the period of enactment.

Deferred tax assets are reduced by a valuation allowance when, in the opinion of management, it is more likely than not that some or all of the deferred tax assets will not be realized.

Deferred tax assets and liabilities are adjusted for the effects of changes in tax laws and rates on the date of enactment.

ASC Topic 740, Income Taxes (“ASC 740”), clarifies the accounting for uncertainty in income taxes recognized in an enterprise’s financial statements and prescribes a recognition threshold and measurement attribute for the financial statement recognition and measurement of a tax position taken or expected to be taken in a tax return.

ASC 740 provides guidance on de-recognition, classification, interest and penalties, accounting in interim periods, disclosure, and transition.

The Company will classify as income tax expense any interest and penalties.

The Company has no material uncertain tax positions for any of the reporting periods presented.

The Company is required to use significant judgment in determining any valuation allowance recorded against its deferred tax assets.

In assessing the need for a valuation allowance, the Company considers all available evidence, including scheduled reversal of deferred tax liabilities, past operating results, the feasibility of tax planning strategies and estimates of future taxable income.

The Company bases its estimates of future taxable income on assumptions that are consistent with its operating plans, and such assumptions represent its best estimates and involve inherent uncertainties and the application of judgment.

Should actual amounts differ from estimates, the amount of tax expense and liabilities recognized could be materially impacted.

The Company recognizes the tax benefit from an uncertain tax position if it is more likely than not that the tax position will be sustained upon examination by the tax authorities, based on the merits of the position.

The Company’s policy is to recognize interest and penalties related to the underpayment of income taxes as a component of income tax expense or benefit.

To date, there have been no interest or penalties incurred in relation to the unrecognized tax benefits.

Net Loss per Share

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Diluted net loss per share is computed by dividing the net loss by the sum of the weighted average number of shares of common stock outstanding and the dilutive common stock equivalent outstanding during the period.

The Company’s potentially dilutive common stock equivalent shares, which include incremental common shares issuable upon (i) the exercise of outstanding stock options, (ii) purchases though the 2020 Employee Stock Purchase Plan (the “2020 ESPP”), (iii) vesting of restricted stock units, and (vi) conversion of preferred stock, are only included in the calculation of diluted net loss per share when their effect is dilutive.

The Company’s potentially dilutive common stock equivalent shares, which include incremental common shares issuable upon (i) the exercise of outstanding stock options, (ii) purchases through the 2020 Employee Stock Purchase Plan (the “2020 ESPP”), (iii) vesting of restricted stock units, and (vi) conversion of preferred stock, are only included in the calculation of diluted net loss per share when their effect is dilutive.

As of December 31, 2024, 2023, and 2022, the following outstanding common stock equivalents have been excluded from the calculation of net loss per share because their impact would be anti-dilutive.

1 unchanged sentence

Stock options

Employee Stock Purchase Plan

Restricted stock units

Employee Stock Purchase Plan

Series A Convertible Preferred Stock*

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Under the treasury stock method, an increase in the fair market value of the Company's common stock could result in a greater dilutive effect from potentially dilutive securities.

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Use of Estimates

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Actual results could differ from those estimates.

Significant items subject to such estimates and assumptions include assumptions made in the fair value of intangible assets, inventories acquired as part of the acquisition of Proleukin ® , equity awards and related stock-based compensation, assumptions used in measuring operating right-of-use assets and operating lease liabilities, accounting for potential liabilities, including estimates inherent in accruals related to clinical trials, and the realizability of the Company’s deferred tax assets .

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of-use assets and operating lease liabilities, accounting for potential liabilities, including estimates inherent in accruals related to clinical trials, and the realizability of the Company’s deferred tax assets .

Principles of Consolidation

The accompanying consolidated financial statements include the accounts of Iovance Biotherapeutics, Inc.

and its wholly-owned subsidiaries, Iovance Biotherapeutics Manufacturing LLC, Iovance Biotherapeutics GmbH, and Iovance Biotherapeutics B.V., Iovance Biotherapeutics UK Ltd and Iovance Biotherapeutics UK SP Ltd (together, the “UK subsidiaries”), and Iovance Biotherapeutics Canada, Inc.

and its wholly-owned subsidiaries, Iovance Biotherapeutics Manufacturing LLC, Iovance Biotherapeutics GmbH, Iovance Biotherapeutics B.V ., Iovance Biotherapeutics UK Ltd, Iovance Biotherapeutics UK SP Ltd, Iovance Biotherapeutics Canada, Inc., and Iovance Australia Pty Ltd.

All intercompany accounts and transactions have been eliminated.

Certain prior year amounts in the notes to these consolidated financial statements have been reclassified for consistency with the current year presentation.

These reclassifications had no effect on the previously reported consolidated balance sheets, consolidated statements of operations, consolidated statements of other comprehensive loss, consolidated statements of stockholder’s equity or consolidated statements of cash flows.

Foreign Currency Translation

The consolidated financial statements are presented in U.S.

dollars, which is the Company’s reporting currency.

The assets and liabilities of the Company’s subsidiaries whose functional currencies are not in U.S.

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dollars at the related period-end exchange rate.

dollar effects that arise from translation of net assets of these subsidiaries at changing rates are recognized in Accumulated Other Comprehensive Income (Loss) in the consolidated balance sheets.

dollar effects that arise from translation of net assets of these subsidiaries at changing rates are recognized in accumulated other comprehensive loss in the consolidated balance sheets.

The subsidiaries’ net loss is translated into U.S.

dollars by using the average exchange rate for the applicable period.

The consolidated financial statements are presented in U.S.

dollars, which is the Company’s reporting currency.

Segment Reporting

The Company operates in one segment, focused on developing and commercializing therapies using autologous TIL for the treatment of metastatic melanoma and other solid tumor cancers.

The Company operates in one segment, focused on innovating, developing, and commercializing therapies using autologous TIL for patients with solid tumor cancers.

Refer to Note 11 to the consolidated financial statements included in this Annual Report on Form 10-K for details.

Concentrations

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The Company does not believe it is exposed to any significant concentrations of credit risk from these financial instruments.

The Company maintains cash, cash equivalents and investment balances at four financial institutions.

The Company maintains cash, cash equivalents and investment balances at three financial institutions.

Management believes that the financial institutions which hold its cash are financially sound and, accordingly, minimal credit risk exists.

As of December 31, 2024 and 2023, respectively, the Company’s cash balances were in excess of insured limits maintained at the financial institutions.

Recent Accounting Standards Issued But Not Yet Adopted

Recent Accounting Standards

In November 2023, FASB issued Accounting Standard Update (“ASU”) ASU 2023-07, Segment Reporting (Topic 280):

Improvements to Reportable Segment Disclosures, which enhances the disclosures required for operating segments in annual and interim consolidated financial statements.

ASU 2023-07 was effective for us in our annual reporting starting in fiscal year 2024 and for interim period reporting beginning in fiscal year 2025 on a retrospective basis.

The Company adopted ASU 2023-07 as of December 31, 2024, and the enhanced disclosures as required are included in Note 11 – Segments.

In December 2023, the FASB issued ASU 2023-09, Income Taxes (Topic 740):

Improvements to Income Tax Disclosures, which enhances the disclosures of income taxes.

ASU 2023-09 is effective for the Company in its annual reporting for fiscal 2025 on a prospective basis.

Improvements to Income Tax Disclosures, which requires public entities, on an annual basis, to provide disclosure of specific categories in the rate reconciliation, as well as disclosure of income taxes paid disaggregated by jurisdiction.

ASU 2023-09 is effective for fiscal years beginning after December 15, 2024 on a prospective basis.

Early adoption and retrospective reporting are permitted.

The Company is currently evaluating the impact of ASU 2023-09 on its consolidated financial statements.

In November 2023, the FASB issued ASU 2023-07, Segment Reporting (Topic 280):

Improvements to Reportable Segment Disclosures, which enhances the disclosures required for operating segments in annual and interim consolidated financial statements.

ASC 2023-07 is effective for the Company in its annual reporting for fiscal year 2024 and for interim period reporting beginning in

In November 2024, the FASB issued ASU 2024-03, Income Statement-Reporting Comprehensive Income-Expense Disaggregation Disclosures (Subtopic 220-40):

Disaggregation of Income Statement Expenses, which requires the disaggregation of certain expense captions into specified categories in disclosures within the notes to the financial statements to provide enhanced transparency into the expense captions presented on the face of the income statement.

ASU 2024-03 is effective for annual reporting periods beginning after December 15, 2026 and interim periods beginning after December 15, 2027, with early adoption permitted, and may be applied either prospectively or retrospectively to financial statements issued for reporting periods after the effective date of ASU

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NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

fiscal year 2025 on a retrospective basis.

Early adoption is permitted.

The Company is currently evaluating the impact of ASC 2023-07 on its consolidated financial statements.

2024-03 or retrospectively to any or all prior periods presented in the financial statements.

The Company is currently evaluating the impact of adopting ASU 2024-03.

CASH EQUIVALENTS AND INVESTMENTS

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treasury securities

government agency securities

Corporate securities

Commercial paper

Money market funds

6 unchanged sentences

Cash equivalents in the tables above exclude cash demand deposits of $ 54.3 million and $ 80.8 million as of December 31, 2024 and 2023, respectively.

Unrealized gains and losses are included in accumulated other comprehensive (loss) income, and as of December 31, 2023 and 2022 no unrealized losses on available-for-sale securities have resulted from credit risk.

Unrealized gains and losses are included in accumulated other comprehensive loss, and as of December 31, 2024 and 2023 no unrealized losses on available-for-sale securities have resulted from credit risk.

All available-for-sale securities held as of December 31, 2024 and December 31, 2023 had contractual maturities of less than one year.

1 unchanged sentence

To date, the Company has not recorded any impairment charges on its investments.

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NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

Recurring Fair Value Measurements

3 unchanged sentences

Money market funds

Total investments

Assets at Fair Value as of December 31, 2023

treasury securities

government agency securities

Corporate securities

Commercial paper

Money market funds

Level 2 assets consist of commercial paper and government agency securities.

Level 2 inputs for the valuations are limited to quoted prices for similar assets or liabilities in active markets and inputs other than quoted prices that are observable for the asset.

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NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

PROLEUKIN ® ACQUISITION

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The Proleukin ® Business operations have been included in the Company’s consolidated financial statements commencing from the acquisition date.

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NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

The following table summarizes the total cash consideration and allocated acquisition date fair values of assets acquired and liabilities assumed (in thousands):

The following table summarizes the total cash consideration and allocated acquisition date fair values of assets acquired and liabilities assumed at the time of the acquisition (in thousands):

Developed technology

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These contingent payments were determined to be within the scope of ASC 450 and will be recognized when they are both probable and estimable.

The recognition criteria have not been met as of the acquisition date or as of December 31, 2023.

During the first quarter of 2024, the Company made the required milestone payment of $ 52.6 million (£ 41.7 million) upon the approval of the Company’s BLA of Amtagvi ® , which was capitalized as an intangible asset and is being amortized over the remaining useful life of such asset.

Additionally, $ 17.5 million (£ 13.9 million) was added to the carrying value of the acquired developed technology intangible asset, which reflects the deferred tax liability recognized on the temporary differences related to the book and tax basis of the acquired intangible assets.

The net assets acquired in the Acquisition were recorded by allocating the total cost of the Acquisition to the assets acquired on a relative fair value basis based on their estimated fair values as of May 18, 2023, which is the date that the Acquisition was completed.

1 unchanged sentence

The fair value of the developed technology is being amortized over an expected useful life of 15 years and is recorded as Cost of Sales in the Company’s consolidated statement of operations.

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NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

The fair value of the assembled workforce was estimated using a replacement cost less depreciation method.

The fair value of the assembled workforce is being amortized over an expected useful life of 3 years and is recorded as selling, general, and administrative expense in the Company’s consolidated statement of operations.

The weighted average amortization period the developed technology and assembled workforce is 14.8 years.

The fair value of the acquired inventory was determined using the comparative sales method of the market approach, which uses historical and expected average selling prices of inventory as the base amount to which adjustment for costs to complete for work-in-process, cost of disposal and reasonable profit allowance are applied.

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The tax rate used is based on the estimated statutory rates in the United Kingdom as this is where the intangible assets are domiciled.

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NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

INTANGIBLE ASSETS, NET

The gross carrying amounts and net book value of intangible assets as of December 31, 2024 are as follows (in thousands):

December 31, 2023

Gross carrying amounts

Accumulated amortization

Intangible assets, net

Intangible assets:

Developed technology

Assembled workforce

Intellectual property license

Total intangible assets

* Amounts are translated using the foreign exchange rate as of 12/31/2023.

The Company recognized amortization expense of $9.9 million during the year ended December 31, 2023.

accumulated amortization

Intangible assets, net

The Company recognized amortization expense of $ 21.2 million and $ 9.8 million during the years ended December 31, 2024 and December 31, 2023, respectively.

Amortization expense for the developed technology and assembled workforce is recorded in cost of sales and selling, general, and administrative expense, respectively, in the consolidated statement of operations for the year ended December 31, 2024.

There was no such expense recorded in the year ended December 31, 2022.

The total estimated amortization of the Company’s intangible assets the years ending December 31, 2025, 2026, 2027, 2028 and 2029 are $ 21.5 million, $ 21.4 million, $ 21.3 million, $ 21.3 million, and $ 21.3 million, respectively.

Inventory presented in the consolidated balance sheet as of December 31, 2023 pertains solely to Proleukin ® .

Inventory classified as work in process are unlabeled vials of Proleukin ® .

As of December 31, 2024 and December 31, 2023, inventory consists of the following (in thousands):

Raw materials

Work in process

1 unchanged sentence

Total inventory

Product sales for the year ended December 31, 2023 was $ 1.2 million and represented sales of Proleukin ® made primarily in licensed markets outside of the U.S.

To date, there have been no product sales from Proleukin ® in the U.S.

IOVANCE BIOTHERAPEUTICS, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

Net revenue for the periods presented represents sales of Amtagvi ® and Proleukin ® as follows (in thousands):

Years Ended December 31,

Total net revenue

Revenue from Proleukin® was primarily related to sales made to specialty distributors and authorized treatment centers (“ATCs”) in the U.S.

market to support the commercialization of Amtagvi®.

Amtagvi® revenue is recognized upon patient infusion, while Proleukin® revenue is recognized upon transfer of control, either upon shipment or upon delivery to customers, which include specialty distributors, clinical manufacturers, research organizations, and ATCs.

Revenue from product sales was recorded net of GTN adjustments.

The following table summarizes GTN adjustments for the periods presented (in thousands):

Years Ended December 31,

Gross revenue

GTN adjustments:

Government rebates and chargebacks

Wholesaler fees and cash discounts

Other rebates, returns, discounts and adjustments

Total GTN adjustments

Consolidated net product revenue by geographic area for the periods presented is as follows (in thousands):

Years Ended December 31,

United States

Rest of world

Net product revenue in the U.S.

is comprised of Amtagvi ® revenue, as well as Proleukin ® sales to support the ongoing commercialization of Amtagvi ® .

Net product revenue to date for the rest of world is comprised of sales of Proleukin ® into markets outside of the U.S., primarily into European markets.

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NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

The following table summarizes the amount and percentage of gross revenue attributable to customers that represented more than 10 % of the Company’s gross revenue and all other customers as a group for the years ended December 31, 2024 and December 31, 2023, respectively (in thousands, except percentages):

Year Ended December 31, 2024

Year Ended December 31, 2023

Other customers

Gross revenue

GTN adjustments

PROPERTY AND EQUIPMENT, NET

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Property and equipment, net

Depreciation expense for the years ended December 31, 2023, 2022, and 2021 was approximately $ 11.6 million, $ 9.3 million and $ 3.1 million, respectively.

During the years ended December 31, 2023 and 2022, the Company placed $ 2.6 million and $ 27.2 million of assets related to the i CTC in service, respectively, and initiated depreciation of these assets.

Depreciation and amortization expense for the years ended December 31, 2024, 2023, and 2022 was approximately $ 12.0 million, $ 11.6 million and $ 9.3 million, respectively.

As a result of the early termination of the former headquarters lease for the Company’s prior offices, the Company impaired approximately $ 7.4 million of long-lived assets, which included leasehold improvements, computer equipment and furniture and fixtures (See Note 15 – Leases).

ACCRUED EXPENSES

Accrued expenses consist of the following (in thousands):

Employee and consultant related expenses

Accrued payroll and employee related expenses

Clinical related

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Legal and related services

Inventory related

Inventory and distribution related

Other accrued expenses

Total accrued expenses

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NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

STOCKHOLDERS’ EQUITY

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Public Offerings

On February 22, 2024, the Company closed an underwritten public offering of 23,014,000 shares of its common stock at a public offering price of $ 9.15 per share, before underwriting discounts and commissions.

The total net proceeds to the Company from the offering were $ 197.4 million after deducting underwriting discounts and commissions and offering expenses payable by the Company.

On July 13, 2023, the Company closed an underwritten public offering of 23,000,000 shares of the Company’s common stock, which included 3,000,000 shares of common stock issued pursuant to the exercise of the option granted to the underwriters, at a public offering price of $ 7.50 per share, before underwriting discounts and commissions.

The total net proceeds to the Company from the offering, including the exercise of the option by the underwriters, were $ 161.5 million after deducting underwriting discounts and commissions and offering expenses payable by the Company.

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At the Market Offering Program

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The offering of Common Shares pursuant to the 2023 Sale Agreement will terminate upon the earlier to occur of (i) the issuance and sale, through Jefferies, of all Common Shares subject to the 2023 Sale Agreement and (ii) termination of the 2023 Sale Agreement in accordance with its terms.

For the years ended December 31, 2023 and 2022, the Company received $ 301.7 million and $ 189.5 million in net proceeds, net of offering costs, through the sale of 44,080,226 shares and 29,788,993 shares of its common stock through the 2023 Sale Agreement and/or the 2022 Sale Agreement at a weighted average price per share of $ 6.99 and $ 6.52 , respectively.

For the years ended December 31, 2024, 2023 and 2022, the Company received $ 200.0 million, $ 301.7 million, and $ 189.5 million in net proceeds, net of offering costs, through the sale of 23,127,726 shares, 44,080,226 shares and 29,788,993 shares of its common stock through the 2023 Sale Agreement and/or the 2022 Sale Agreement at a weighted average price per share of $ 8.82 , $ 6.99 and $ 6.52 , respectively.

Preferred Stock

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As of December 31, 2024, 17,000 shares were designated as Series A Convertible Preferred Stock and 11,500,000 shares were designated as Series B Convertible Preferred Stock.

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NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

Series A Convertible Preferred Stock

8 unchanged sentences

As of December 31, 2024, and 2023, 194 shares of Series A Convertible Preferred Stock (that are convertible into 97,000 shares of common stock) remained outstanding.

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NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

Series B Convertible Preferred Stock

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The Company has multiple equity incentive plans under which it grants awards.

As of December 31, 2023, there are 275,625 shares available to grant under the 2014 Equity Incentive Plan (the “2014 Plan”).

As of June 11, 2024, the Company’s stockholders approved the termination of the 2014 Equity Incentive Plan (the “2014 Plan”).

In addition, the Company’s stockholders approved the recapture by the 2018 Equity Incentive Plan (the “2018 Plan”) of awards granted under the 2014 Plan that expire, terminate, or are cancelled or forfeited without being settled, vested, or exercised after the stockholders’ approval.

On April 22, 2018, the Company’s Board of Directors (the “Board”) adopted the Iovance Biotherapeutics, Inc.

1 unchanged sentence

The 2018 Plan as approved initially authorized the issuance up to an aggregate of 6,000,000 shares of common stock in the form of incentive (qualified) stock options, non-qualified options, common stock, stock appreciation rights, restricted stock awards, restricted stock units, other stock-based awards, other cash-based awards or any combination of the foregoing.

On June 8, 2020, the Company's stockholders approved an amendment to the 2018 Plan to increase the number of shares available for issuance upon the exercise of stock options under the 2018 Plan from 6,000,000 to 14,000,000 shares, which became effective immediately.

On June 8, 2020, the Company's stockholders approved an amendment to the 2018 Plan to increase the number of shares available for issuance upon the exercise of stock options under the 2018 Plan from

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NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

6,000,000 to 14,000,000 shares, which became effective immediately.

Additionally, on June 10, 2022, the Company’s stockholders approved an amendment to the 2018 Plan to increase the number of shares available for issuance upon the exercise of stock options under the 2018 Plan from 14,000,000 to 20,700,000 shares, which became effective immediately.

On June 6, 2023, the Company’s stockholders approved an amendment to the 2018 Plan to increase the number of shares available for issuance under the 2018 Plan from 20,700,000 to 29,700,000 , which became effective immediately.

As of December 31, 2023, 9,906,666 shares of common stock were available for grant under the Company’s 2018 Plan.

On June 11, 2024, the Company’s stockholders approved an amendment to the 2018 Plan to increase the number of shares available for issuance under the 2018 Plan from 29,700,000 to 36,700,000 and permit share recapture from the 2014 Plan, which became effective immediately.

As of December 31, 2024, 8,917,507 shares of common stock were available for grant under the Company’s 2018 Plan, including shares recaptured from the 2014 Plan.

On September 22, 2021, the Board adopted the Iovance Biotherapeutics, Inc.

4 unchanged sentences

On January 12, 2022, the Compensation Committee approved an amendment to the 2021 Inducement Plan solely to increase the number of shares reserved for issuance under the 2021 Inducement Plan from 1,000,000 shares of the Company’s common stock to 1,750,000 shares of the Company’s common stock without stockholder approval pursuant to Rule 5635(c)(4) of the Nasdaq Listing Rules.

IOVANCE BIOTHERAPEUTICS, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

On March 13, 2023, the Compensation Committee approved an additional amendment to the 2021 Inducement Plan solely to increase the number of shares reserved for issuance under the 2021 Inducement Plan from 1,750,000 shares of the Company’s common stock to 2,250,000 shares of the Company’s common stock without stockholder approval pursuant to Rule 5635(c)(4) of the Nasdaq Listing Rules.

The Compensation Committee approved additional amendments to the 2021 Inducement Plan solely to increase the number of shares reserved for issuance under the 2021 Inducement Plan from 1,750,000 to 2,250,000 shares of the Company’s common stock on March 13, 2023, from 2,250,000 to 2,750,000 shares of the Company’s common stock on February 26, 2024, and from 2,750,000 shares to 4,750,000 shares on November 22, 2024 without stockholder approval pursuant to Rule 5635(c)(4) of the Nasdaq Listing Rules.

In accordance with Rule 5635(c)(4) of the Nasdaq Listing Rules, equity awards under the 2021 Inducement Plan may only be made to an employee if such employee is granted such equity awards in connection with his or her commencement of employment with the Company or a subsidiary and such grant is an inducement material to his or her entering into employment with the Company or such subsidiary.

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As of December 31, 2024, there was $ 20.8 million of total unrecognized compensation expense related to unvested employee stock options, which the Company expects to recognize over a remaining weighted average period of 1.71 years.

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NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

The weighted average grant date fair value for employee options granted under the Company's stock option plans during the years ended December 31, 2024, 2023, and 2022 was $ 6.97 , $ 4.91 , and $ 8.29 per option, respectively.

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On June 6, 2023, the Company's stockholders approved an amendment to the 2020 ESPP to increase the number of shares reserved for issuance under the 2020 ESPP from 500,000 shares of the Company’s common stock to 1,400,000 shares of the Company’s common stock, which became effective immediately.

Under the 2020 ESPP, employees of the Company can purchase shares of our common stock based on a percentage of their compensation subject to certain limits.

The purchase price per share is equal to the lower of 85 % of the fair market value of its common

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NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

stock on the offering date or the purchase date with a six-month look-back feature.

On June 11, 2024, the Company's stockholders approved an amendment to the 2020 ESPP, to increase the number of shares reserved for issuance under the 2020 ESPP from 1,400,000 to 1,900,000 shares of the Company’s common stock, which became effective immediately.

Under the 2020 ESPP, employees of the Company can purchase shares of its common stock based on a percentage of their compensation subject to certain limits.

The purchase price per share is equal to the lower of 85 % of the fair market value of its common stock on the offering date or the purchase date with a six-month look-back feature.

The 2020 ESPP purchases are settled with common stock from the 2020 ESPP’s previously authorized and available pool of shares.

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Compensation expense related to PRSUs is based on the grant date fair value of the award and recorded from the period that achievement is determined to be probable through the stated service period associated with the award.

There were no unvested PRSUs outstanding as of December 31, 2024.

Activity for RSUs and PRSUs during the years ended December 31, 2024 and 2023 is presented in the following table:

RSUs and PRSUs

Outstanding, non-vested as of December 31, 2022

Outstanding at December 31, 2023

Vested/Released

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Canceled/Forfeited

Outstanding as of December 31, 2023

Outstanding at December 31, 2024

Ending vested and expected to vest at December 31, 2024

As of December 31, 2023 and 2022, there was $ 19.9 million and $ 20.6 million of unrecognized stock-based compensation expense associated with unvested RSUs, which the Company expects to recognize over a remaining weighted-average period of 1.65 and 1.72 years, respectively.

The aggregate intrinsic value of the unvested RSUs and PRSUs outstanding as of December 31, 2023 and 2022, was $ 28.1 million and $ 14.5 million, respectively.

As of December 31, 2024 and 2023, there was $ 84.3 million and $ 19.9 million of unrecognized stock-based compensation expense associated with unvested RSUs, which the Company expects to recognize over a remaining weighted-average period of 1.61

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NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

and 1.65 years, respectively.

The aggregate intrinsic value of the unvested RSUs outstanding as of December 31, 2024 was $ 70.7 million and the aggregate intrinsic value of the unvested RSUs and PRSUs as of December 31, 2023 was $ 28.1 million.

Stock-Based Compensation

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Years Ended December 31,

Cost of sales

Research and development

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Total stock-based compensation expense

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NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

The amount included in capitalized inventory for stock-based compensation expense for personnel engaged with manufacturing activities was $ 1.2 million as of December 31, 2024.

No such cost was included in inventory as of December 31, 2023.

Total stock-based compensation expense by type of award was as follows (in thousands):

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The following table summarizes the assumptions relating to options granted pursuant to the Company’s equity incentive plans for the years ended December 31, 2023, 2022, and 2021:

Stock Options

Years Ended December 31,

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Each of the inputs discussed above is subjective and generally requires significant management judgment.

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NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

SEGMENT INFORMATION

The Company operates in one segment, focusing on innovating, developing, and commercializing therapies using its autologous TIL cell therapies for patients with solid tumor cancers.

The Company is executing the U.S.

launch of Amtagvi ® , the first product within its autologous TIL cell therapy platform, while also marketing and distributing its Proleukin ® product used in the Amtagvi ® treatment regimen.

The Company’s Chief Operating Decision Maker (“CODM”) is the Chief Executive Officer, who uses net loss as measurement of segment loss and monitors results against budget to evaluate and assess performance of the Company and resource allocation within the Company.

The measure of segment assets is reported on the balance sheet as total consolidated assets.

The table below highlights the Company’s revenue, expenses and net loss for the segment and is reconciled to net loss on a consolidated basis for the year ended December 31, 2024 and 2023.

Years Ended December 31,

Increase (Decrease)

(in thousands)

Direct cost of goods sold (a)

Acquisition related cost of sales (b)

Total cost of sales

Research and development

General and administrative

Sales and marketing

Other segment items (c)

Total expenses

Direct cost of goods sold represents inventory and period costs related to overhead and manufacturing costs of Amtagvi® as well as costs associated with the purchases and sales of Proleukin ® .

Also included are manufacturing and period costs incurred for Amtagvi ® that do not meet specifications or a patient is unable to receive the infusion (i.e., scrap) unless they can be administered as part of a clinical trial in an expanded or early access program, or single-patient IND, in which cases related costs are recorded as research and development expenses based on the fact the Company receives clinical data related to these infusions.

This category is provided to the CODM on a quarterly basis in comparison to that of previous quarters for review as these costs are controllable costs that indicate operating performance of the Company.

Acquisition related cost of sales represents amortization expenses for the developed technology intangible assets and the milestone payment recorded as part of the acquisition of Proleukin ® and the fair value step-up of acquired Proleukin® inventory which is recognized as the acquired inventory units are sold.

This category is provided to the CODM on a quarterly basis as costs in this category are often reviewed separately in evaluating the performance of the Company because these costs are fixed and uncontrollable costs in nature, and do not affect cashflows of the Company.

Other segment items include costs that are not considered significant expense segments nor reviewed by the CODM on a regular basis.

Such amount includes stock-based compensation expenses, interest income, other income and expenses, and income tax benefits .

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NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

EMPLOYEE BENEFIT PLAN

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The Company's matching contribution to the defined contribution plan was $ 4.7 million, $ 4.1 million, and $ 3.0 million for the years ended December 31, 2024, 2023 and 2022, respectively.

The Company recorded an income tax benefit of $ 3.5 million for the year ended December 31, 2023, but did no t record a provision or benefit for income taxes for the years ended December 31, 2022 or 2021.

Upon the completion of the Acquisition on May 18, 2023, a deferred tax liability of $ 20.4 million was recognized on the temporary differences related to the book and tax basis of the acquired intangible assets.

The deferred tax liability and resulting adjustment to the carrying amount of the acquired intangibles was calculated using the simultaneous equations method under ASC 740.

The tax rate used is based on the estimated statutory rates in the United Kingdom as this is where the intangible assets are domiciled.

The Company recorded a tax benefit of $ 3.5 million for the year ended December 21, 2023, which resulted in an effective tax rate of 0.78 %.

The effective tax rate is different from U.S.

statutory rate of 21 % due to the full valuation allowance against tax losses in

IOVANCE BIOTHERAPEUTICS, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

Loss before provision of income taxes consisted of U.S.

losses of $ 359.9 million, $ 433.5 million, and $ 395.8 million, and foreign losses of $ 15.1 million, $ 14.0 million, and $ 0.1 million for the years ended December 31, 2024, December 31, 2023, and December 31, 2022, respectively.

The Company recorded a tax benefit of $ 2.8 million and $ 3.5 million for the years ended December 31, 2024 and December 31, 2023, respectively, which resulted in an effective tax rate of 0.75 % and 0.78 % respectively.

The income tax benefit for the periods presented primarily relates to operations in the United Kingdom and the movement of deferred tax assets and liabilities.

No income tax benefit was recorded for the year ended December 31, 2022.

The significant components of the Company’s net deferred tax assets and liabilities are summarized as follows (in thousands):

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Effective tax rate

The Company had net operating loss carryforwards (“NOLs”) for federal and state income tax purposes of approximately $ 1.2 billion and $ 180 million, respectively, as of December 31, 2023.

The Company had net operating loss carryforwards (“NOLs”) for federal, state, and foreign income tax purposes of approximately $ 1.3 billion, $ 331.9 million, and $ 15.2 million, respectively, as of December 31, 2024.

$ 142.4 million of federal NOLs will expire beginning in 2027, while $ 1.2 billion generated after the recently enacted tax reform will have an indefinite life under the Tax Cuts and Jobs Act of 2017 (the “Tax Act”).

The state NOLs will expire if unused in years 2030 through 2044.

The Company’s utilization of NOLs is subject to an annual limitation due to ownership changes that have occurred previously or that could occur in the future as provided in Section 382 of the Internal Revenue Code (“Section 382”), as well as similar state provisions.

Section 382 limits the utilization of NOLs when there is a greater than 50% change of ownership as determined under the regulations.

The foreign NOLs do not expire.

The Company had $ 80.6 million of federal and $ 19.0 million of California research and development tax credit and other tax credit carryforwards available to offset future taxable income.

The federal credits begin to expire in 2033, and the California research credits have no expiration dates.

IOVANCE BIOTHERAPEUTICS, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

The Company’s utilization of NOLs and tax credits is subject to an annual limitation due to ownership changes that have occurred previously or that could occur in the future as provided in Section 382 of the Internal Revenue Code (“Section 382”), as well as similar state provisions.

Section 382 limits the utilization of NOLs and tax credits when there is a greater than 50% change of ownership as determined under the regulations.

Since its formation, the Company has raised capital through the issuance of capital stock and various convertible instruments which, combined with the purchasing shareholders’ subsequent disposition of these shares, has resulted in multiple ownership changes as defined by Section 382, and could result in ownership change in the future upon subsequent disposition.

The Company’s utilization of NOLs may also be adversely affected by future changes in federal and state tax laws and regulations.

In assessing the realization of U.S.

deferred tax assets, management considers whether it is more likely than not that some portion or all the deferred tax assets will not be realized.

The Company’s utilization of NOLs and Tax Credits may also be adversely affected by future changes in federal and state tax laws and regulations.

In assessing the realization of deferred tax assets, management considers whether it is more likely than not that some portion or all the deferred tax assets will not be realized.

The ultimate realization of deferred tax assets is dependent upon future generation for taxable income during the periods in which temporary differences representing net future deductible amounts become deductible.

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After consideration of all the information available, management continues to maintain a full valuation allowance against U.S.

federal and state net deferred tax assets as it expected to be in a cumulative loss position and does not have

IOVANCE BIOTHERAPEUTICS, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

sufficient positive evidence to support the realizability of its U.S.

net deferred tax assets For the years ended December 31, 2023, 2022 and 2021, the change in the valuation allowance was approximately $ 96.4 million, $ 82.9 million, and $ 78.1 million, respectively.

For the year ended December 31, 2023, the Company recorded approximately $ 17.3 million of net deferred tax liability from its operation in the United Kingdom.

The basis difference resulted from acquisition of Proleukin business.

federal and state net deferred tax assets due to the Company’s cumulative loss position and lack of sufficient positive evidence to support the realizability of its U.S.

net deferred tax assets.

For the years ended December 31, 2024, 2023 and 2022, the change in the valuation allowance was approximately $ 110.7 million, $ 96.4 million, and $ 82.9 million, respectively.

The Company evaluated the provisions of ASC 740 related to the accounting for uncertainty in income taxes recognized in an enterprise’s financial statements.

1 unchanged sentence

For those benefits to be recognized, a tax position must be more-likely-than-not to be sustained upon examination by taxing authorities.

Differences between tax positions taken or expected to be taken in a tax return and the net benefit recognized and measured pursuant to the interpretation are referred to as “unrecognized benefits.” A liability is recognized (or amount of net operating loss carry forward or amount of tax refundable is reduced) for unrecognized tax benefit because it represents an enterprise’s potential future obligation to the taxing authority for a tax position that was not recognized as a result of applying the provisions of ASC 740.

Differences between tax positions taken or expected to be taken in a tax return and the net benefit recognized and measured pursuant to the interpretation are referred to as “unrecognized benefits.” A liability is recognized (or amount of NOL carry-forward or amount of tax refundable is reduced) for unrecognized tax benefits because it represents an enterprise’s potential future obligation to the taxing authority for a tax position that was not recognized as a result of applying the provisions of ASC 740.

If applicable, interest costs related to the unrecognized tax benefits are required to be calculated and would be classified as income tax expenses in the consolidated statements of operations.

Penalties would be recognized as a component of “General and Administrative Expenses” in the consolidated statements of operations.

Penalties would be recognized as a component of selling, general and administrative expenses in the consolidated statements of operations.

A reconciliation of the beginning and ending balances of the unrecognized tax benefits during the years ended December 31, 2024, 2023 and 2022 is as follows (in thousands):

2 unchanged sentences

Gross decreases - prior period tax positions

Gross increase current period tax positions

Gross increases - current period tax positions

Unrecognized benefit - end of period

1 unchanged sentence

The Company does not anticipate any significant changes within 12 months of this reporting date of its uncertain tax positions.

The Company files tax returns in the U.S.

federal and state jurisdictions.

The Company files tax returns in U.S.

federal and state jurisdictions, as well as foreign jurisdictions.

federal and U.S.

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The Act is effective for tax years beginning after December 31, 2022;

however, the provisions of the Act will not have a material impact on the Company’s consolidated financial statements.

IOVANCE BIOTHERAPEUTICS, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

provisions of the Act will not have an impact on the Company’s consolidated financial statements.

The Company will continue to monitor the effect of the Act and its impact on the Company.

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Cooperative Research and Development Agreement (the “CRADA”)

In August 2011, the Company signed a five-year CRADA with the NCI to work on the development of adoptive cell immunotherapies in multiple solid tumor types, including unmodified TIL as a stand-alone therapy or in combination, improved methods for the generation and selection of TIL cell therapy with anti-tumor reactivity, and strategies for more potent TILs that are designed to destroy metastatic melanoma cells.

The CRADA was amended in 2015 and 2016 to, among other things, extend the term of the CRADA through August 2021, include new indications such as the development of TIL cell therapy for the treatment of patients

IOVANCE BIOTHERAPEUTICS, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

with bladder, lung, triple-negative breast, and Human Papilloma Virus (“HPV”)-associated cancers, and modify the focus on the development of unmodified TIL as a stand-alone therapy or in combination.

The parties have continued the development of improved methods for the generation and selection of TIL with anti-tumor reactivity in metastatic melanoma, bladder, lung, breast, and HPV-associated cancers.

In August 2021, the NCI and the Company entered into a third amendment to the CRADA.

The third amendment, among other things, extended the term of the CRADA by three years to August 2024.

The research plan in this amendment includes the evaluation in clinical trials of strategies for development of more potent TILs, such as selection of CD39/69 double negative cells and the use of certain inhibitors or other reagents in TIL expansion cultures.

Pursuant to the terms of the CRADA, as amended, the Company is required to make quarterly payments of $ 0.5 million to the NCI for support of research activities.

The CRADA has been amended since then to, among other things, extend the term of the CRADA, include new indications such as bladder, lung, triple-negative breast, and Human Papilloma Virus (“HPV”)-associated cancers, and modify the focus on the development of unmodified TIL as a stand-alone therapy or in combination, the evaluation in clinical trials of strategies for development of more potent TILs, such as selection of CD39/69 double negative cells and the use of certain inhibitors or other reagents in TIL expansion cultures.

In July 2024, the NCI and the Company entered into a fourth amendment to the CRADA to extend its term by an additional five years to August 2029.

The fourth amendment also includes collaboration on preclinical and clinical development of enhanced tumor reactive TIL products for the treatment of a broad range of common epithelial cancers.

Pursuant to the terms of the CRADA, as amended, the Company was required to make quarterly payments of $ 0.5 million to the NCI for support of research activities through the end of 2024.

Commencing in 2025, the Company is required to make quarterly payments of $ 0.9 million to the NCI for support of research activities through the end of the CRADA’s term.

To the extent the Company licenses patent rights relating to a TIL-based product candidate, the Company will be responsible for all patent-related expenses and fees, past and future, relating to the TIL-based product candidate.

In addition, the Company may be required to supply certain test articles, including TIL, grown and processed under Current Good Manufacturing Practice (“cGMP”) conditions, suitable for use in clinical trials.

The extended CRADA has a three-year term expiring in August 2024.

The Company or the NCI may unilaterally terminate the CRADA for any reason or for no reason at any time by providing written notice at least 60 days before the desired termination date.

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Pursuant to the Patent License Agreement, as amended, the NIH granted the Company licenses, including exclusive, co-exclusive, and non-exclusive licenses, to certain technologies relating to autologous tumor infiltrating lymphocyte adoptive cell therapy products for the treatment of metastatic melanoma, lung, breast, bladder and HPV-positive cancers.

Effective May 6, 2021, the Company entered into an Amended and Restated Patent License Agreement with NIH, which included the grant of additional exclusive, worldwide patent rights in the indications to interleukin-15 and interleukin-21 cytokine-tethered TIL technology, and expanded the non-exclusive, worldwide field of use to all cancers.

Effective August 1, 2022, the Company entered into a Second Amended and Restated Patent License Agreement with NIH to include additional exclusive, worldwide patent rights to TIL products expressing interleukin-12, expanded rights to TIL selection technologies previously licensed under the Exclusive Patent License Agreement below, and additional non-exclusive, worldwide patent rights to certain technologies related to enhancing TIL potency.

In May 2021, the Company entered into an Amended and Restated Patent License Agreement with NIH, which included the grant of additional exclusive, worldwide patent rights in the indications to interleukin-15 and interleukin-21 cytokine-tethered TIL technology, and expanded the non-exclusive, worldwide field of use to all cancers.

In August 2022, the Company entered into a Second Amended and Restated Patent License Agreement with NIH to include additional exclusive, worldwide patent rights to TIL products expressing interleukin-12, expanded rights to TIL selection technologies previously licensed under the Exclusive Patent License Agreement below, and additional non-exclusive, worldwide patent rights to certain technologies related to enhancing TIL potency.

The Second Amended and Restated Patent License Agreement requires the Company to pay royalties based on a percentage of net sales in jurisdictions where patent rights exist, which percentage can fall into a tier that may be less than one percent to mid-single digits depending upon certain events, including the exclusivity of the rights, and the Company expects lower overall royalty payments as a result.

The Company also agreed to potential milestone payments on the achievement of certain clinical, regulatory, and commercial sales milestones for each of the indications and other direct costs incurred by the NIH pursuant to the Second Amended and Restated Patent License Agreement.

The Company anticipates making additional payments that could range from several hundred thousand dollars to the mid-single-digit millions of dollars in conjunction with certain development milestones, the approval of a BLA or its foreign equivalent, or the first U.S.

and foreign commercial sales of any of our product candidates covered by the Second Amended and Restated Patent License Agreement.

The term of the Second Amended and Restated Patent License Agreement continues until the expiry of the last-to-expire patent rights licensed thereunder, and the agreement contains standard termination provisions.

The Company recorded milestone costs associated with the Second Amended and Restated Patent License Agreement, specifically for the completion of the first licensee-sponsored Phase 2 trial of $ 0.6 million for the year ended December 31, 2023.

In addition, with the approval of Amtagvi™, we will be required to remit $ 1.5 million within 60 days of the approval date in accordance with the requirements of the Second Amended and Restated Patent License Agreement.

No expenses were recorded for the years ended December 31, 2022 and 2021, respectively.

The Company is also required to pay potential milestone payments on the achievement of certain clinical, regulatory, and commercial sales milestones for each of the indications and other direct costs incurred by the NIH pursuant to the Second Amended and Restated Patent License Agreement.

The Company has made and anticipates making additional payments that could range from several hundred thousand dollars to the mid-single-digit millions of dollars in conjunction with certain development milestones, the approval of a BLA or its foreign equivalent, or the first U.S.

and foreign commercial sales of any of its product candidates covered by the Second

IOVANCE BIOTHERAPEUTICS, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

Amended and Restated Patent License Agreement.

The Company paid and recorded a $ 0.6 million milestone payment for an intellectual property license that was payable within 60 days of successful completion of the first Company-sponsored Phase 2 clinical study in melanoma, as research and development expenses, for the year ended December 31, 2023.

The Company also paid a $ 1.5 million milestone payment for an intellectual property license that was payable within 60 days of the approval of Amtagvi ® for use in the treatment of melanoma, and a $ 6.0 million milestone payment for an intellectual property license that was payable within 60 days of the approval of the first commercial sale of Amtagvi ® for use in the treatment of melanoma in the U.S.

in accordance with the requirements of the Second Amended and Restated Patent License Agreement.

Both aforementioned milestone payments have been capitalized and recorded as intangible assets on the consolidated balance sheet.

During the year ended December 31, 2024, the Company recorded $ 0.7 million, as a component of cost of sales related to amortization of the milestone payments.

No expenses were recorded for the years ended December 31, 2023 and 2022.

Exclusive Patent License Agreement Related to TIL Selection

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Research Collaboration and Clinical Grant Agreements with Moffitt

In June 2020, the Company entered into a Sponsored Research Agreement (the “Research Agreement”) with the H.

Lee Moffitt Cancer Center (“Moffitt”), with a term that ends either upon completion of the research thereunder or on July 1, 2022, whichever is sooner.

In June 2022, this agreement was extended until the later of December 19, 2022 or a mutually acceptable completion of the Research Agreement, which was expected in mid-2023.

In August 2023, this agreement was extended until September 2023, at which point it expired.

In December 2023, this agreement was extended until the later of November 30, 2024 or a mutually agreed determination of the completion of the Research Agreement.

In June 2020, the Company entered into a Sponsored Research Agreement (the “SRA”) with the H.

Lee Moffitt Cancer Center (“Moffitt”), with a term that ended either upon completion of the research thereunder or on July 1, 2022, whichever is sooner.

The SRA has been extended multiple times and currently has an expiration date of May 31, 2025.

The Company recorded research and development costs of $ 0.2 million, $ 0.2 million and $ 0.6 million for each of the years ended December 31, 2024, 2023 and 2022, respectively.

In December 2016, the Company entered into a clinical grant agreement with Moffitt to support an ongoing clinical trial at Moffitt that combines TIL cell therapy with nivolumab for the treatment of patients with metastatic melanoma.

In June 2017, the Company entered into a second clinical grant agreement with Moffitt to support a new clinical trial at Moffitt that combines TIL cell therapy with nivolumab for the treatment of patients with non-small cell lung cancer, under which the Company obtained a non-exclusive, royalty-free license to any new Moffitt inventions made in the performance of the agreement.

Under both clinical grant agreements with Moffit, the Company has non-exclusive rights to clinical data arising from the respective clinical trials, which are now closed.

No expense was recorded for the years ended December 31, 2023, and for the year ended December 31, 2022 and 2021 the Company recorded $ 0.1 million of research and development costs, in connection with the research collaboration and clinical grant agreements with Moffitt.

Exclusive License Agreements with Moffitt

The Company entered into a license agreement with Moffitt (the “First Moffitt License”), effective as of June 28, 2014, under which the Company received a worldwide license to Moffitt’s rights to patent-pending and patented technologies related to methods for improving TIL for adoptive cell therapy using toll-like receptor agonists.

Unless earlier terminated, the term of the license extends until the earlier of the expiration of the last issued patent related to the licensed technology or 20 years after the effective date of the license agreement.

Pursuant to the First Moffitt License, the Company paid an upfront licensing fee in the amount of $ 0.1 million, which was recorded as research and development expense.

A patent issuance fee will also be payable under the First Moffitt License, upon the issuance of the first U.S.

patent covering the subject technology.

In addition, the Company agreed to pay milestone license fees upon completion of specified milestones, customary royalties based on a specified percentage of net sales (which percentage is in the low single digits) and sublicensing payments, as applicable, and annual minimum royalties beginning with the first sale of products based on the licensed technologies, which minimum royalties will be credited against the percentage royalty payments otherwise payable in that year.

The Company will also be responsible for all costs associated with the preparation, filing, maintenance and prosecution of the patent applications and patents covered by the First Moffitt License related to the treatment of any cancers in the U.S., Europe and Japan and in other countries designated by the Company in agreement with Moffitt.

No expenses were recorded for the First Moffitt License for the years ended December 31, 2023, 2022, and 2021.

The Company entered into a second license agreement with Moffitt effective as of May 7, 2018 (the “Second Moffitt License”), under which the Company received a license to Moffitt’s rights to patent-pending technologies related to the use of 4-1BB agonists in conjunction with TIL manufacturing processes and therapies.

Pursuant to the Second Moffitt License, the Company paid an upfront licensing fee in the amount of $ 0.1 million in 2018.

An annual license maintenance fee is also payable commencing on the first anniversary of the effective date.

The Company agreed to pay an annual commercial use payment for each indication for which a first sale has occurred, which in the aggregate amounts to up to $ 0.4 million a year.

The Company recorded $ 0.1 million, $ 0.2 million and $ 0.1 million for the years ended December 31, 2023, 2022 and 2021, respectively, as research and development expenses in connection with this agreement.

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NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

The Company subsequently exercised an option to exclusively license Moffitt’s rights to patent pending technologies related to the use of tumor digests in conjunction with TIL manufacturing processes and therapies and entered into an amended and restated Second Moffitt License in October 2021 (the “Amended & Restated Second Moffit License”), to include these rights.

Pursuant to the Amended & Restated Second Moffitt License, the Company paid an upfront licensing fee in the amount of $ 0.2 million in 2021, which was recorded as research and development expense.

In addition, the Company agreed to pay an annual commercial use payment for each indication for which a first sale has occurred for products relating to the use of 4-1BB agonists and for products relating to the use of tumor digests covered by the license.

The University of Texas M.D.

1 unchanged sentence

Strategic Alliance Agreement

On April 17, 2017, the Company entered into a Strategic Alliance Agreement (the “SAA”) with The University of Texas M.D.

In April 2017, the Company entered into a Strategic Alliance Agreement (the “SAA”) with The University of Texas M.D.

Anderson Cancer Center (“MDACC”) under which the Company and MDACC agreed to conduct clinical and preclinical research studies.

The Company agreed in the SAA to provide total funding not to exceed approximately $ 14.2 million for the performance of the multi-year studies under the SAA, of which approximately $ 5.3 million has been funded cumulatively through December 31, 2023 and has been recorded as research and development expense.

The Company agreed in the SAA to provide total funding not to exceed approximately $ 14.2 million for the performance of the multi-year studies under the SAA, of which approximately $ 5.3 million has been funded to date and has been recorded as research and development expense.

In return, the Company acquired all rights to inventions resulting from the studies and has been granted a non-exclusive, sub-licensable, royalty-free, and perpetual license to specified background intellectual property of MDACC reasonably necessary to exploit, including the commercialization thereof.

1 unchanged sentence

The SAA’s term shall continue in effect until the later of the fourth anniversary of the SAA or the completion or termination of the research and receipt by the Company of all deliverables due from MDACC thereunder.

The Company recorded zero , $ 0.2 million and $ 0.5 million associated with the SAA for the years ended December 31, 2023, 2022 and 2021 as research and development expenses, respectively.

On March 28, 2024, the Company and MDACC entered into the first amendment to the SAA, under which both parties agreed to conduct additional preclinical research studies.

The Company recorded a benefit of $ 0.4 million, for the year ended December 31, 2024, as a result of finalization of the cost reconciliation.

For the years ended December 31, 2023 and 2022, the Company recorded $ 0.0 and $ 0.2 million associated with the SAA as research and development expenses, respectively.

WuXi Advanced Therapies, Inc.

First WuXi Manufacturing and Services Agreement

In November 2016, the Company entered into a three-year manufacturing and services agreement (the “First Wuxi MSA”) with WuXi Advanced Therapies, Inc.

(“WuXi”) pursuant to which WuXi agreed to provide manufacturing and other services, which has since been amended and assigned to its subsidiary Iovance Biotherapeutics Manufacturing LLC.

Under the First WuXi MSA, the Company entered into two statements of work for two cGMP manufacturing suites to be operated by WuXi for the Company.

The terms of one of these statements of work expired in December 2022.

Second WuXi Manufacturing and Services Agreement

In October 2022, the Company’s subsidiary Iovance Biotherapeutics Manufacturing LLC entered into an additional three-year manufacturing and services agreement (the “Second WuXi MSA”) with WuXi and its parent company WuXi Apptec, Co.

Ltd pursuant to which WuXi agreed to provide commercial and clinical manufacturing services and related testing services.

Under the Second WuXi MSA, the Company entered into a statement of work for the two cGMP manufacturing suites to be operated by WuXi for the Company.

Both suites are expected to be capable of being used for the commercial and clinical manufacture of the Company’s products.

The Second WuXi MSA and its related statement of work will supersede the statements of work under the First WuXi MSA with respect to commercial and clinical manufacturing and the two manufacturing suites.

Certain other statements of work for related services will also be covered by the Second WuXi MSA.

The First WuXi MSA addressed development services provided by WuXi to the Company.

Prior to regulatory approval, or if the Company experiences a material adverse event, the Company may unilaterally terminate the statement of work for commercial and clinical manufacturing under the Second WuXi MSA at any time by providing written notice of at least 120 days .

Post regulatory approval, the Company may unilaterally terminate the statement of work for commercial and clinical manufacturing with written notice of 15 month in year 1 of the term, written notice of 9 months in year 2 of the term, and written notice of 6 months in year 3 of the term.

If WuXi fails a pre-licensing inspection and does not address any related issues within 90 days of receipt of the FDA response letter, the Company may either terminate the statement of work for commercial and clinical manufacturing under the Second WuXi MSA immediately or shorten the term of this statement of work to June 30, 2024.

The Company recorded costs associated with agreements with WuXi of $ 17.3 million, $ 14.2 million, and $ 17.5 million for the years ended December 31, 2023, 2022, and 2021 respectively, as research and development expenses.

In November 2016, the Company entered into a manufacturing services agreement (the “First Wuxi MSA”) with WuXi Apptec, Inc.

(“WuXi Apptec”) pursuant to which WuXi Apptec agreed to provide manufacturing and other services for two cGMP manufacturing suites for clinical manufacturing and related testing services.

The First WuXi MSA was amended and restated in December 2017, further amended and restated and assigned to the Company’s subsidiary Iovance Biotherapeutics Manufacturing LLC (“Iovance Manufacturing LLC”), and Wuxi Advanced Therapies, Inc.

in January 2020, and further amended in November 2020 and December 2021.

The First WuXi MSA expired in November 2022.

IOVANCE BIOTHERAPEUTICS, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

In October 2022, Iovance Manufacturing LLC entered into an additional three-year manufacturing and services agreement (the “Second Wuxi MSA”) with WuXi Advance Therapies, Inc.

and its parent company, WuXi Apptec Co., Ltd (collectively, “WuXi”).

Under the Second WuXi MSA, Iovance Manufacturing LLC entered into a statement of work for two cGMP manufacturing suites to be operated by WuXI for Iovance Manufacturing LLC to support clinical and commercial manufacturing and related testing services.

The Second WuXi MSA and its related statement of work superseded the statements of work under the First WuXi MSA with respect to manufacturing in the two suites and expire on December 31, 2025.

Iovance Manufacturing LLC may unilaterally terminate the statement of work for clinical and commercial manufacturing with written notice of written notice of 6 months in year 3 of the term.

The Company recorded costs associated with agreements with WuXi of $ 25 .0 million, $ 17.3 million, and $ 14.2 million for the years ended December 31, 2024, 2023, and 2022, respectively, as costs and expenses included in the consolidated statement of operations or as inventory in the consolidated balance sheets.

Cellectis S.A .

On December 31, 2019, the Company entered into a research collaboration and exclusive worldwide license agreement whereby the Company will license gene-editing technology from Cellectis S.A.

In December 2019, the Company entered into a research collaboration and exclusive worldwide license agreement whereby the Company will license gene-editing technology from Cellectis S.A.

(“Cellectis”), a clinical-stage biopharmaceutical company, to develop TIL cell therapies that have been genetically edited, including a PD-1 inactivated product that the Company refers to as IOV-4001.

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The Company recorded costs associated with the license agreement with Cellectis of $ 0.4 million for each of the years ended December 31, 2024, 2023, and 2022, respectively, as research and development expense.

Novartis Pharma AG

On January 9, 2020, the Company obtained a license from Novartis Pharma AG (“Novartis”) to develop and commercialize an antibody cytokine engrafted protein, which the Company refers to as IOV-3001.

Novartis Pharma AG and Related Entities

In January 2020, the Company obtained a license from Novartis Pharma AG (“Novartis”) to develop and commercialize an antibody cytokine engrafted protein, which the Company refers to as IOV-3001.

Under the agreement, the Company paid an upfront payment to Novartis and may pay future milestones related to initiation of patient dosing in various phases of clinical development for IOV-3001 and approval of the product in the U.S., EU and Japan.

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The Company recorded costs associated with the license agreement from Novartis of $ 10.0 million as research and development expenses for the year ended December 31, 2020.

No expenses were recorded for the years ended December 31, 2023 and 2022.

No expenses were recorded for the years ended December 31, 2024, 2023 and 2022, respectively.

On May 18, 2023, as part of the completion of the Acquisition, the Company inherited two historical asset purchase agreements, one historical master cell bank license and working cell bank transfer agreement and one historical license agreement from Clinigen with Novartis AG, Novartis Pharma AG and Novartis Vaccines and Diagnostics, Inc.

pursuant to which, among other things, the Company may be required to make future milestone payments based on net sales (as defined in the relevant underlying agreements) in the United States and the rest of world, which includes any and all sales outside of the United States.

pursuant to which, among other things, the Company may be required to make future milestone payments based on net sales (as defined in the relevant underlying agreements) in the U.S.

and the rest of world, which includes any and all sales outside of the U.S.

The maximum amount of these milestone payments payable under these agreements is $ 30.0 million upon reaching several certain net sales amounts in the United States and $ 15.0 million upon reaching several certain net sales amounts in the rest of the world, of which 25 % of each milestone payment will be reimbursed by Clinigen by deduction from the deferred consideration due under the Option Agreement in the period such milestone payment is made.

To date, the net sales milestones have not been achieved, and, therefore, no payments were made under these agreements for the year ended December 31, 2023.

To date, the net sales milestones have not been achieved, and, therefore, no payments were made under these agreements for the years ended December 31, 2024 and 2023, respectively.

Boehringer Ingelheim Biopharmaceuticals GmbH

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Under this agreement, the Company must purchase a minimum number of vials each year at fixed prices determined by vial batch size.

The total estimated purchase obligations under this agreement for the years ending December 31, 2024, 2025, 2026 and 2027, are $ 8.2 million, $ 11.4 million, $ 7.3 million, and $ 7.3 million, respectively.

The total estimated purchase obligations under this agreement for the years ending December 31, 2025, 2026 and 2027, are $ 13.6 million, $ 7.2 million, and $ 6.4 million, respectively.

IOVANCE BIOTHERAPEUTICS, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

Operating Leases

The Company leases corporate office space in California, including 49,918 square feet for its current corporate headquarters’ office space in San Carlos, California, manufacturing, research and development lab facilities and office space in Philadelphia, Pennsylvania, including 136,000 square feet of commercial manufacturing and lab space at the i CTC, and research and development lab facilities in Tampa, Florida.

The determination if an arrangement is a lease occurs at inception, and for leases with terms greater than 12 months , the Company records a related right-of-use asset and lease liability at the present value of lease payments over the term.

The Company leases corporate office space in San Carlos, California, manufacturing, research and development lab facilities and office space in Philadelphia, Pennsylvania, including 136,000 square feet of commercial manufacturing and lab space at the i CTC, and research and development lab facilities in Tampa, Florida.

The determination whether an arrangement is a lease occurs at inception, and for leases with terms greater than 12 months , the Company records a related right-of-use asset and lease liability at the present value of lease payments over the term.

Many leases include fixed rental escalation clauses, renewal options and/or termination options that are factored into the determination of lease payments when appropriate.

The Company’s leases do not provide an implicit rate, and thus the Company estimated the incremental borrowing rate in calculating the present value of the lease payments.

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NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

The Company’s leases have remaining lease terms that range from less than one year to approximately 16 years .

Some of our leases include one or more options to renew with renewal terms that can extend the lease for additional years, or options to terminate the leases, both at the Company’s discretion.

Some of the Company’s leases include one or more options to renew with renewal terms that can extend the lease for additional years, or options to terminate the leases, both at the Company’s discretion.

The Company’s leases may include options to extend or terminate the lease, which is considered in the lease term when it is reasonably certain that the Company will exercise any such options.

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The Company also leases certain furniture and equipment that has a lease term of 12 months or less.

Since the lease agreement do not include an option to purchase the underlying asset, the Company elected not to apply the recognition requirements of Topic 842 for short-term leases, however, the lease costs that pertain to the short-term leases are disclosed in the components of lease costs table below.

Since the lease agreements do not include an option to purchase the underlying asset, the Company elected not to apply the recognition requirements of Topic 842 for short-term leases, however, the lease costs that pertain to the short-term leases are disclosed in the components of lease costs table below.

Relocation of the Headquarters Office Lease

On November 15, 2024, the Company entered into a sublease agreement (the “New Headquarters Lease”) to relocate its office within the same building of its former San Carlos headquarters to lease approximately 16,731 square feet office space with the lease term of 24 months .

The New Headquarters Lease commenced on December 15, 2024 and includes two options to extend the terms of the lease for 12 months each, exercisable under certain conditions and at a rate increase by 3 % from the applicable monthly base rent of approximately $ 0.1 million.

Upon the commencement date, the Company recognized operating lease liabilities and right-of-use assets of $ 2.3 million.

Simultaneously, the Company entered into an Agreement for Termination of Lease and Voluntary Surrender of Premises with its landlord related to its lease for its then existing and now former headquarters location to surrender 49,918 square feet office and laboratory space and paid an early lease termination payment to its landlord of $ 0.6 million and $ 2.5 million of related brokerage fees.

In accordance with ASC 842, the termination of this lease resulted in derecognition of right-of-use assets and corresponding lease liabilities of $ 13.7 million and $ 22.3 million, respectively, which resulted in a $ 8.6 million gain, partially offset by the aforementioned lease termination related fees, recorded as interest and other income, net in the consolidated statement of operations for the year ended December 31, 2024.

In addition, as a result of the early termination of the former headquarters lease, the Company impaired approximately $ 7.4 million of long-lived assets, which included leasehold improvements, and furniture and fixtures, previously funded by the landlord through a tenant improvement allowance for the former corporate headquarters office lease (as discussed further below), and is included in the research and development expenses and selling, general and administrative expenses in the consolidated statement of operations for the year ended December 31, 2024.

Manufacturing Contracts

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The CMO contractual obligations consist of the use of manufacturing facilities and minimum fixed commitment fees, such as personnel, general support fees, and minimum production or material fees.

In addition to the minimum fixed commitment fees, the CMO contractual obligations include variable costs such as production and material costs in excess of the minimum quantity specified in each CMO agreement.

In addition to the minimum fixed commitment fees, the CMO contractual obligations include variable costs such as production and material costs in

IOVANCE BIOTHERAPEUTICS, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

excess of the minimum quantity specified in each CMO agreement.

During the term of each CMO agreement, the Company has access to and control of the use of a dedicated suite in each of the CMOs’ facilities for manufacturing activities.

The contracts with CMOs generally contain embedded operating leases based on the fact that the suites are used for the Company’s production are implicitly identified, are used exclusively by the Company during the contractual term of the arrangements, and the CMOs have no substantive contractual rights to substitute the facilities used by the Company.

Further, the Company controls the use of the facilities by obtaining all of the economic benefits from the use of the facilities and direct the use of the facilities throughout the period of use.

Further, the Company controls the use of the facilities by obtaining all of the economic benefits from the use of the facilities and directs the use of the facilities throughout the period of use.

The terms of the CMO contracts include options to terminate the lease with advance notice of five to six months.

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Total operating lease liabilities

IOVANCE BIOTHERAPEUTICS, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

The following table summarizes components of lease expenses, which were included in total expenses in the Company’s consolidated statements of operations, and other information related to our operating leases as follows (in thousands, except weighted-average remaining lease terms and discount rates):

The following table summarizes components of lease expenses, which were included in total expenses in the Company’s consolidated statements of operations and in inventory in the consolidated balance sheets, and other information related to the Company’s operating leases as follows (in thousands, except weighted-average remaining lease terms and discount rates):

December 31, 2024

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Cash paid for amounts included in the measurement of lease liabilities included in cash flows from operations

Tenant improvement allowance received for amounts included in the measurement of lease liabilities included in cash flows from operations

Right-of-use assets obtained from entering new leases

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Weighted-average discount rates

IOVANCE BIOTHERAPEUTICS, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

As of December 31, 2024, maturities of the Company's operating lease liabilities were as follows (in thousands):

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Operating lease liabilities

For its corporate headquarters’ office, the lease agreement includes a tenant improvement allowance of $ 8.2 million.

For the years ended December 31, 2023 and 2022, the Company has received reimbursements associated with this tenant improvement allowance of zero and $ 6.4 million, respectively.

The Company does not expect to receive additional reimbursement associated with this tenant improvement allowance.

For its former corporate headquarters office, the lease agreement included a tenant improvement allowance of up to $ 8.2 million that was utilized to fund the acquisition of certain assets in the former corporate headquarters.

In the years ended December 31, 2022, and 2021, the Company received reimbursements associated with this tenant improvement allowance of $ 6.4 million and $ 1.6 million, respectively.

As the tenant improvement allowance was fully utilized, no additional reimbursements were received subsequent to December 31, 2022.

LEGAL PROCEEDINGS

Derivative Lawsuit.

Shumacher Derivative Lawsuit.

On December 11, 2020, a purported stockholder derivative complaint was filed by plaintiff Leo Shumacher against the Company, as nominal defendant, and then current directors, as defendants, in the Court of Chancery in the State of Delaware (the “Court of Chancery”).

The complaint alleges breach of fiduciary duty and a claim for unjust enrichment in connection with alleged excessive compensation of certain non-executive directors of the Company and seeks unspecified damages on behalf of the Company.

The parties have agreed to a proposed settlement, which was submitted to the Court of Chancery on June 15, 2022.

The parties agreed to a proposed settlement, which was submitted to the Court of Chancery on June 15, 2022.

After a hearing on November 17, 2022, the Court of Chancery required the parties to take additional steps before it would approve the settlement.

The Company, as nominal defendant, and its current directors, as defendants, answered the complaint on Feb.

IOVANCE BIOTHERAPEUTICS, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

The Company, as nominal defendant, and its current directors, as defendants, answered the complaint on February 3, 2023.

The parties agreed to a revised proposed settlement, which was submitted to the Court of Chancery on March 12, 2024.

On July 17, 2024, the Court of Chancery declined to approve the settlement.

The case will proceed to discovery.

On January 17, 2025, a non-party stockholder (The Paul Berger Revocable Trust), which objected to the revised proposed settlement, filed a derivative complaint and letter with the Court suggesting consolidation.

The Company intends to vigorously defend against these complaints.

Ohio Laborers Derivative Lawsuit.

On September 11, 2024, a purported stockholder derivative complaint was filed by plaintiff Northern California Pipe Trades Trust Fund against the Company, as nominal defendant, and certain directors, as defendants, in the Court of Chancery.

The complaint alleges breach of fiduciary duty in connection with the February 2024 underwritten public offering of 23,014,000 shares of the Company’s common stock.

On November 22, 2024, the defendants filed a motion to dismiss the complaint.

On December 5, 2024, the plaintiff filed an amended complaint adding an additional director defendant.

On January 10, 2025, defendants filed a motion to dismiss the amended complaint.

On February 3, 2025, the Court approved substitution of Laborers’ District Council and Contractors’ Pension Fund of Ohio (“Ohio Laborers”) as representative plaintiff.

The Company intends to vigorously defend against this complaint.

Solomon Capital, LLC.

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The Solomon Plaintiffs allege that, between June and November 2012, they provided the Company $ 0.1 million and that they advanced and paid on behalf of the Company an additional $ 0.2 million.

The complaint further alleges that the Company agreed to (i) provide them with promissory notes totaling $ 0.2 million, plus interest, (ii) issue a total of 1,110 shares to the Solomon Plaintiffs (after the 1-for-100 reverse split of the Company’s common stock effected in March 2013) (the “Equity Claim”), and (iii) allow the Solomon Plaintiffs to convert the foregoing funds into its securities in the next financing of the Company on the same terms offered to other investors, which Solomon Plaintiffs allege, should have given them the right to convert their advances and payments into shares of the Company's common stock in the restructuring that took effect in May 2013.

IOVANCE BIOTHERAPEUTICS, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

the next financing of the Company on the same terms offered to other investors, which Solomon Plaintiffs allege, should have given them the right to convert their advances and payments into shares of the Company's common stock in the restructuring that took effect in May 2013.

Based on the foregoing, the Solomon Plaintiffs allege causes for breach of contract and unjust enrichment and demand judgment against the Company in an unspecified amount exceeding $ 1.5 million, plus interest.

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On May 11, 2021, the Appellate Division upheld the court’s grant of the Solomon Plaintiffs’ motion for reconsideration of the dismissal of the First Solomon Suit for want of prosecution.

On January 22, 2025, Solomon Sharbat and Shelhav Raff (through new legal counsel) filed a motion for leave to file an amended complaint in the First Solomon Suit.

On September 27, 2019, the Solomon Plaintiffs filed a new lawsuit (through new legal counsel) (the “Second Solomon Suit”) titled Solomon Capital, LLC, Solomon Capital 401(K) Trust, Solomon Sharbat and Shelhav Raff v.

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On May 26, 2021, the Company and Singh filed motions for judgment on the pleadings with respect to the second and third claims asserted against the Company and all claims asserted against Singh, respectively, in the Second Solomon Suit.

On January 5, 2022, the District Court granted the Company’s motions for judgement on the pleadings, dismissing the second and third claims against the Company and dismissing all claims against Singh.

On January 5, 2022, the District Court granted the Company’s motions for judgment on the pleadings, dismissing the second and third claims against the Company and dismissing all claims against Singh.

On January 4, 2023, the District Court granted in part the Company’s motion for sanctions against the Solomon Plaintiffs for violating Rule 11 of the Federal Rules of Civil Procedure, in a decision and order that dismissed the Solomon Plaintiffs’ first claim against the Company, denied the Solomon Plaintiffs’ motion for leave to amend the complaint, and ordered the Solomon Plaintiffs to pay the Company’s attorneys’ fees incurred in connection with the Rule 11 motion.

Following the District Court’s decision and order on the Rule 11 motion, only the Solomon Plaintiffs’ fifth and sixth claims, for unjust enrichment and indemnification, respectively, remain pending against the Company.

On October 26, 2023, the District Court granted the Company’s motion for summary judgment and dismissed the Solomon Plaintiffs’ fifth and sixth claims.

1 unchanged sentence

On November 10, 2023, the Company filed a motion for attorneys’ fees as the prevailing party in the action.

On December 1, 2023, the Solomon Plaintiffs filed a notice of appeal to

IOVANCE BIOTHERAPEUTICS, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

On December 1, 2023, the Solomon Plaintiffs filed a notice of appeal to the U.S.

Court of Appeals for the Second Circuit, appealing the District Court’s orders (a) granting the motions for judgment on the pleadings filed on behalf of Singh and the Company, (b) granting the Company’s Rule 11 motion, (c) denying the Solomon Plaintiffs’ motions to compel discovery and re-open discovery, and (d) granting the Company’s summary judgment motion.

On December 22, 2023, the Company filed a motion for an order requiring the Solomon Plaintiffs to post an appeal bond, to ensure payment of the Company’s appellate fees and costs should the Company prevail on the appeal.

On May 9, 2024, the District Court issued an order granting the Company’s motions for attorneys’ fees and for an appeal bond.

On June 28, 2024, the Company filed motions to dismiss the appeal on the grounds that the Solomon Plaintiffs (a) do not have an opening brief on file, which the Second Circuit Court denied, and (b) have not filed an appeal bond.

The District Court entered judgment in favor of the Company on September 23, 2024, including

IOVANCE BIOTHERAPEUTICS, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

a monetary award pursuant to the District Court’s Rule 11 order and orders for attorneys’ fees and costs.

On October 9, 2024, the Second Circuit Court stated that it will dismiss the appeal unless the Solomon Plaintiffs post the appeal bond by October 23, 2024.

The Solomon Plaintiffs then moved for an extension of time until November 23, 2024 to post the appeal bond.

The Company filed an opposition to the motion.

The Second Circuit Court denied the Solomon Plaintiffs’ motion for an extension of time on November 7, 2024, and dismissed the appeal on November 8, 2024.

The Company intends to vigorously defend these complaints and pursue its counterclaims, as applicable.

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While there can be no assurances as to the ultimate outcome of any legal proceeding or other loss contingency involving the Company, management does not believe any pending matter will be resolved in a manner that would have a material adverse effect on its financial position, results of operations or cash flows.

LONG-TERM NOTE PAYABLE

On January 26, 2021, the Company entered into a Loan Note and accompanying Economic Stimulus Program Loan Agreement with PIDC – Local Development Corporation, a Pennsylvania nonprofit corporation (the “Lender”), pursuant to which the Lender agreed to make a loan (the “Job Creation Loan”) to the Company in a principal amount of $ 1.0 million.

The Job Creation Loan will be for a term of five years starting on February 18, 2021, the date of the issuance of a final certificate of occupancy for the Company’s leased premises in Philadelphia, Pennsylvania.

The Job Creation Loan is unsecured, bears no interest, and will be forgiven by the Lender in the amount of $ 2,000 per full-time or “full time equivalent” (defined as two or more part time employees whose working hours total at least 35 hours a week) employee with an average salary of at least $ 80,000 (“FT Employees”), up to a maximum amount equal to the amount of the Job Creation Loan, as calculated based on the average number of FT Employees employed at the Company’s premises during the period of the 5-year term beginning on the date that is nine months prior to the maturity date and ending on the maturity date.

If the Job Creation Loan is not forgiven in full by the maturity date, the remaining balance of the loan not forgiven will become payable on the maturity date.

The Loan Note includes customary events of default.

Upon the occurrence of an event of default, the Lender will have the right to exercise remedies against the Company, including the right to require immediate payment of all amounts due under the Loan Note.

The Company concluded that it is not reasonably assured that all or a portion of the loan will be forgiven as of December 31, 2023, and therefore accounted for the Job Creation Loan as debt in accordance with ASC Topic 470, Debt, as opposed to an in-substance government grant, and classified as a long-term debt in its consolidated balance sheets as of December 31, 2023 and 2022.

SUBSEQUENT EVENTS

FDA Approval of Amtagvi™ ( lifileucel)

On February 16, 2024, the Company announced that the FDA approved Amtagvi™ ( lifileucel), a tumor-derived autologous T cell immunotherapy indicated for the treatment of adult patients with unresectable or metastatic melanoma previously treated with a PD-1 blocking antibody, and if BRAF V600 mutation positive, a BRAF inhibitor with or without a MEK inhibitor.

This indication is approved under accelerated approval based on an endpoint of ORR.

Public Offering

On February 22, 2024, the Company closed the sale of an aggregate of 23,014,000 shares of its common stock, pursuant to an underwriting agreement with Jefferies, Barclays Capital Inc., and Goldman Sachs & Co.

LLC at a public offering price of $ 9.15 per share, before underwriting discounts and commissions.

The total estimated net proceeds to the Company from the offering are expected to be approximately $ 197.1 million after deducting underwriting discounts and commissions and estimated offering expenses payable by the Company.

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 9A. Controls and Procedures