What changed in this filing

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Item 1. Financial Statements

2021-05-10 compared with 2020-10-27 · 166 added, 256 removed, 232 unchanged (65% of the section changed)

1 unchanged sentence

UNAUDITED CONSOLIDATED BALANCE SHEETS

September 30,

(in thousands, except share and per share amounts)

1 unchanged sentence

Cash and cash equivalents

Accounts receivable and accrued income from related party

Accounts receivables

Prepaid expenses

Other current assets and receivables

Other current assets

Total current assets

Non-current assets

Property, plant and equipment, net of accumulated depreciation of $ 33.2 million as of September 30, 2020 and $ 28.6 million as of December 31, 2019, respectively

Property, plant and equipment, net of accumulated depreciation of $ 35.9 million as of March 31, 2021 and $ 35.2 million as of December 31, 2020, respectively

Operating lease right-of-use assets

1 unchanged sentence

Restricted cash

Deferred tax asset

Total non-current assets

3 unchanged sentences

Current portion of operating lease liabilities

Current portion of deferred revenue

Total current liabilities

2 unchanged sentences

Operating lease liabilities, net of current portion

Deferred revenue, net of current portion

Derivative financial instruments related party

Other non-current liabilities

4 unchanged sentences

Ordinary shares, € 0.05 par value:

60,000,000 shares authorized at September 30, 2020 and December 31, 2019 and 44,487,510 and 43,711,954 ordinary shares issued and outstanding at September 30, 2020 and December 31, 2019, respectively

60,000,000 shares authorized as of March 31, 2021 and December 31, 2020 and 45,924,729 and 44,777,799 ordinary shares issued and outstanding as of March 31, 2021 and December 31, 2020, respectively

Additional paid-in-capital

Accumulated other comprehensive loss

Accumulated other comprehensive income

Accumulated deficit

4 unchanged sentences

COMPREHENSIVE LOSS

Three months ended September 30,

Nine months ended September 30,

(in thousands, except share and per share amounts)

Three months ended March 31,

(in thousands, except share and per share amounts)

License revenues from related party

Collaboration revenues

Collaboration revenues from related party

8 unchanged sentences

Interest expense

Foreign currency (losses) / gains, net

Other non-operating gains / (losses), net

Other comprehensive income / (loss):

Foreign currency gains, net

Other non-operating gains, net

Loss before income tax expense

Income tax expense

Other comprehensive loss:

Foreign currency translation adjustments

4 unchanged sentences

UNAUDITED CONSOLIDATED STATEMENTS OF SHAREHOLDERS’ EQUITY

FOR THE THREE-MONTH PERIOD ENDED SEPTEMBER 30

Ordinary shares

comprehensive

shareholders’

(loss)/income

(in thousands, except share and per share amounts)

Balance at June 30, 2019

Loss for the period

Other comprehensive loss

Follow-on public offering

Exercise of share options

Restricted and performance share units distributed during the period

Share-based compensation expense

Issuance of ordinary shares relating to employee stock purchase plan

Balance at September 30, 2019

Balance at June 30, 2020

Loss for the period

Other comprehensive income

Exercise of share options

Restricted and performance share units distributed during the period

Share-based compensation expense

Issuance of ordinary shares relating to employee stock purchase plan

Balance at September 30, 2020

The accompanying notes are an integral part of these unaudited consolidated financial statements.

UNAUDITED CONSOLIDATED STATEMENTS OF SHAREHOLDERS’ EQUITY

FOR THE NINE-MONTH PERIOD ENDED SEPTEMBER 30

FOR THE THREE-MONTH PERIOD ENDED MARCH 31

Ordinary shares

2 unchanged sentences

(loss)/income

(in thousands, except share and per share amounts)

(in thousands, except share data)

Balance at December 31, 2019

1 unchanged sentence

Other comprehensive loss

Follow-on public offering

Hercules warrants exercise

Exercise of share options

2 unchanged sentences

Issuance of ordinary shares relating to employee stock purchase plan

Balance at September 30, 2019

Balance at March 31, 2020

Balance at December 31, 2020

Loss for the period

Other comprehensive income

Other comprehensive loss

Issuance of ordinary shares

Exercise of share options

2 unchanged sentences

Issuance of ordinary shares relating to employee stock purchase plan

Balance at September 30, 2020

Balance at March 31, 2021

The accompanying notes are an integral part of these unaudited consolidated financial statements.

UNAUDITED CONSOLIDATED STATEMENTS OF CASH FLOWS

Nine months ended September 30,

Three months ended March 31,

(in thousands)

4 unchanged sentences

Change in fair value of derivative financial instruments

Unrealized foreign exchange losses / (gains)

Unrealized foreign exchange gains

Deferred tax expense

Change in deferred revenue

Changes in operating assets and liabilities:

Accounts receivable and accrued income, prepaid expenses and other current assets and receivables

Accounts receivable, prepaid expenses, and other current assets

Accounts payable

Accrued expenses, other liabilities, and operating leases

Deferred revenue

Net cash used in operating activities

4 unchanged sentences

Cash flows from financing activities

Proceeds from loan increment, net of debt issuance costs

Proceeds from issuance of ordinary shares

Share issuance costs from issuance of ordinary shares

Proceeds from issuance of shares related to employee stock option and purchase plans

Proceeds from public offering of shares, net of issuance costs

Proceeds from exercise of warrants

Net cash generated from financing activities

Currency effect on cash, cash equivalents and restricted cash

Net (decrease) / increase in cash, cash equivalents and restricted cash

Net increase / (decrease) in cash, cash equivalents and restricted cash

Cash, cash equivalents and restricted cash at beginning of period

5 unchanged sentences

Cash paid for interest

Non-cash increases in accounts payables and accrued expenses and other current liabilities related to purchases of intangible assets and property, plant and equipment

The accompanying notes are an integral part of these unaudited consolidated financial statements.

13 unchanged sentences

The Company prepared these unaudited consolidated financial statements in compliance with generally accepted accounting principles in the United States of America (“U.S.

GAAP”) and applicable rules and regulations of the SEC regarding interim financial reporting.

GAAP”) and applicable rules and regulations of the Securities and Exchange Commission (“SEC”) regarding interim financial reporting.

Any reference in these notes to applicable guidance is meant to refer to authoritative U.S.

9 unchanged sentences

GAAP have been omitted.

The results of operations for the nine months ended September 30, 2020, are not necessarily indicative of the results to be expected for the full year ending December 31, 2020 or for any other future year or interim period.

The results of operations for the three months ended March 31, 2021, are not necessarily indicative of the results to be expected for the full year ending December 31, 2021 or for any other future year or interim period.

The accompanying financial statements should be read in conjunction with the audited financial statements and the related notes thereto included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2020, filed with the SEC on March 1, 2021 .

5 unchanged sentences

The principal accounting policies applied in the preparation of these unaudited consolidated financial statements are described in the Company’s audited financial statements as of and for the year ended December 31, 2020, and the notes thereto, which are included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2020, filed with the SEC on March 1, 2021 .

There have been no material changes in the Company’s significant accounting policies during the nine months ended September 30, 2020.

There have been no material changes in the Company’s significant accounting policies during the three months ended March 31, 2021.

2.5 Recent accounting pronouncements

There have been no new accounting pronouncements or changes to accounting pronouncements during the nine months ended September 30, 2020, as compared to the recent accounting pronouncements described in Note 2.3.23 of the Company’s Annual Report on Form 10-K for the year ended December 31, 2019 , which could be expected to materially impact the Company’s unaudited consolidated financial statements.

The Company has adopted ASU 2018-13, Fair Value Measurement (Topic 820) and additional disclosures related to significant unobservable inputs have been included within footnote 4 Fair value measurement.

There have been no new accounting pronouncements or changes to accounting pronouncements during the three months ended March 31, 2021, as compared to the recent accounting pronouncements described in Note 2.3.22 of the Company’s Annual Report on Form 10-K for the year ended December 31, 2020 , which could be expected to materially impact the Company’s unaudited consolidated financial statements.

Collaboration arrangements and concentration of credit risk

1 unchanged sentence

On June 24, 2020, uniQure biopharma B.V., a wholly-owned subsidiary of uniQure N.V., entered into a commercialization and license agreement (the “CSL Behring Agreement”) with CSL Behring LLC, (“CSL Behring”), pursuant to which CSL Behring will receive exclusive global rights to etranacogene dezaparvovec, the Company’s investigational gene therapy for patients with hemophilia B, (the “Product”).

Under the terms of the CSL Behring Agreement, the Company will receive a $ 450 million upfront cash payment upon the closing of the CSL Behring Agreement and be eligible to receive up to $ 1.6 billion in additional payments based on regulatory and commercial milestones.

Under the terms of the CSL Behring Agreement, the Company is entitled to receive a $ 450.0 million upfront cash payment upon the closing of the transaction contemplated by the CSL Behring Agreement and will be eligible to receive up to $ 1.6 billion in additional payments based on regulatory and commercial milestones.

The CSL Behring Agreement also provides that the Company will be eligible to receive tiered double-digit royalties in a range of up to a low-twenties percent of net sales of the Product based on sales thresholds.

3 unchanged sentences

CSL Behring will be responsible for global regulatory submissions and commercialization requirements for the Product.

Closing of the CSL Behring Agreement is contingent on the successful completion of reviews under antitrust laws in the United States, Australia, and the United Kingdom, which has not occurred to date.

Closing of the transaction is dependent on the timing, extent, and result of the regulatory review process.

The Company does not believe that the consummation of the transaction will result in a violation of any applicable antitrust laws.

However, there can be no assurance that a challenge on antitrust grounds will not be made, or if such a challenge is made, what the result would be.

In accordance with its existing license and other agreements, the Company is contractually required to pay in total a low to high single digit percentage of any upfront payment to its licensors and financial advisor (“License Fees”).

As of September 30, 2020, the Company concluded it has no enforceable right to receive any of the upfront payment, the regulatory and sales milestone payments or the royalties (together “CSL License Revenue”) that it may receive in accordance with the CSL Behring Agreement, as all payments are contingent upon the successful completion of reviews under antitrust laws in the United States, Australia and the United Kingdom.

Therefore, the Company determined it will not recognize any revenue in relation to the CSL License Revenue, in accordance with ASC 606.

The Company determined that in accordance with Dutch tax law it will recognize the CSL Behring License Revenue as well as the License Fees as taxable results as of the date on which the Company is contractually entitled to receive (or obligated to make) a payment under the CSL Behring Agreement.

The Company expects to continue to incur taxable losses in the Netherlands except for the period in which it receives the $ 450 million upfront payment under the CSL Behring Agreement.

In the event that the Company recognizes the $ 450 million upfront payment in 2020, such payment is expected to be subject to Dutch corporate income tax at a rate of 25.0 %.

However, the Company does not expect it will be required to pay any income taxes in the period in which it recognizes the $ 450 million upfront payment as taxable revenue, as such payment is not expected to exceed the net operating losses the Company has carried forward in the Netherlands.

The Company has historically recorded a full valuation allowance against its net deferred tax assets.

Future taxable income or losses of the Company and a potential reversal of the valuation allowance will be impacted by a variety of factors, of which some are outside of the Company’s control.

Such factors include the outcome and timing of the reviews under antitrust laws in the United States, Australia, and the United Kingdom, additional net operating losses the Company may generate in relation to the CSL Behring Agreement, and the amount of License Fees the Company is required to pay.

The Company recognizes deferred tax assets to the extent that it determines that these assets are more likely than not to be realized.

In making such a determination, the Company weighed all available positive and negative evidence, including future income projections from the CSL Behring Agreement, and concluded that it is more likely than not that the deferred tax assets will not be realized.

Accordingly, the Company continued to record a full valuation allowance as of September 30, 2020.

The effectiveness of the transaction contemplated by the CSL Behring Agreement was contingent on completion of review under antitrust laws in the United States, Australia, and the United Kingdom.

As of March 31, 2021, such regulatory approvals had not been received in the United States.

On May 5, 2021 the waiting period under the Hart-Scott-Rodino Antitrust Improvements Act of 1976 (the “HSR Act”) expired, and as such the CSL Behring Agreement became fully effective on May 6, 2021.

As of March 31, 2021, the Company concluded it has no enforceable right to the upfront payment, the regulatory and sale milestone payments, or the royalties (together “CSL Behring License Revenue”) that the Company will receive in accordance with the CSL Behring Agreement, as all payments were contingent upon the successful completion of reviews, or the expiration of the waiting period, under the HSR Act, which had not occurred as of March 31, 2021.

Therefore, the Company determined to not recognize any revenue in relation to the CSL Behring License Revenue, in accordance with ASC 606 during the three-month period ended March 31, 2021.

The Company did no t record any License Fees for the three-month period ended March 31, 2021, as the Company had no t recognized the upfront payment as of this date.

The Company incurred $ 5.0 million of expenses related to the obligations related to the CSL Behring Agreement that had not been satisfied as of March 31, 2021.

The Company capitalized these expenses as contract fulfillment costs (presented within Other current assets).

As of March 31, 2021, the Company also recognized a $ 5.0 million receivable (presented within Accounts receivable) from CSL Behring for expenses for which the Company has a right of reimbursement.

A contract liability was also recognized for the entire amount of expenses for which the Company has a right to reimbursement (presented within Accrued expenses and other current liabilities).

In accordance with ASC 606 it cannot recognize any CSL Behring License Revenue as of this date.

Bristol-Myers Squibb collaboration

In May 2015, the Company entered into a collaboration and license agreement (the “BMS CLA”) and various related agreements with Bristol-Myers Squibb Company (“BMS”) that provide BMS with exclusive access to the Company’s gene therapy technology platform for the research, development and commercialization of therapeutics aimed at multiple targets in cardiovascular and other diseases (“Collaboration Targets”).

In May 2015, the Company and Bristol-Myers Squibb (“BMS”) entered into a collaboration and license agreement and various related agreements with BMS (“BMS CLA”).

The initial four-year research term under the collaboration terminated on May 21, 2019.

During the initial research term of the BMS CLA, the Company supported BMS in discovery, non-clinical, analytical and process development efforts in respect of the Collaboration Targets.

For any Collaboration Targets that may be advanced, the Company will be responsible for manufacturing of clinical and commercial supplies using the Company’s vector technologies and industrial, proprietary insect-cell based manufacturing platform.

BMS reimbursed the Company for all its research and development costs in support of the collaboration during the initial research term, and will lead development, regulatory and commercial activities for any Collaboration Targets that may be advanced.

The BMS CLA provides that the Company and BMS may collaborate on up to ten Collaboration Targets in total.

As of September 30, 2020, BMS has designated a total of four Collaboration Targets.

In February 2019, BMS requested a one-year extension of the research term.

In April 2019, following an assessment of the progress of this collaboration and the Company’s expanding proprietary programs, the Company notified BMS that the Company did not intend to agree to an extension of the research term but rather preferred to restructure or amend the collaboration to reduce or eliminate certain of the Company’s obligations under it.

The Company has agreed to certain restrictions on its ability to work independently of the collaboration, either directly or indirectly through any affiliate or third party, on certain programs that would be competitive with the collaboration programs.

The Company is currently in discussions with BMS potentially to amend the BMS CLA and other related agreements following the expiration of the research term.

It is currently uncertain whether a change to the BMS CLA will be agreed and, if agreed, what the specific terms of any such change may be.

As a consequence, the Company has not taken into account the impact of such change, if any, on the timing of recognition of the prepaid License Revenue if and when the BMS CLA and other related agreements have been restructured or amended.

The final resolution of these discussions may or may not result in material changes to the Company’s collaboration with BMS.

The Company agreed, subject to certain conditions, to continue providing limited support of the pre-clinical Collaboration Targets, and any related costs will be reimbursed by BMS during these discussions.

The Company evaluated the BMS CLA and determined that its performance obligations are as follows:

(i) Providing access to its technology and know-how in the field of gene therapy as well as actively contributing to the target selection, the collaboration as a whole, the development during the target selection, the pre-clinical and the clinical phase through participating in joint steering committee and other governing bodies (“License Revenue”);

(ii) Providing pre-clinical Collaboration Target specific, non-clinical, analytical and process development services during the initial research term, which ended on May 21, 2019 (“Collaboration Revenue”);

(iii) Providing clinical and commercial manufacturing services for Collaboration Targets (“Manufacturing Revenue”).

To date the Company has not generated any Manufacturing Revenue.

Amounts owed by BMS in relation the collaboration services are as follows:

September 30,

(in thousands)

Bristol Myers Squibb

License Revenue

The Company recognized $ 1.8 million and $ 3.4 million of License Revenue for the three and nine months ended September 30, 2020, respectively, compared to $ 0.8 million and $ 3.5 million during the same periods in 2019 in relation to a $ 60.1 million upfront payment recorded on May 21, 2015, as well as $ 15.0 million received in relation to the designation of the second, third and fourth Collaboration Targets in August 2015 (together “Consideration”).

The Company would be entitled to an aggregate $ 16.5 million in target designation payments upon the selection of the fifth through tenth Collaboration Targets.

The Company would also be eligible to receive research, development and regulatory milestone payments of up to $ 217.0 million for each Collaboration Target, if defined milestones are achieved.

The Company would include the variable consideration related to the selection of the fifth to tenth Collaboration Target, or any of the milestones, in the transaction price once it is considered probable that including these payments in the transaction price would not result in the reversal of cumulative revenue recognized.

The Company would recognize significant amounts of License Revenue for services performed in prior periods if and when the Company considers this probable.

Due to the significant uncertainty surrounding the development of gene-therapy product candidates and the dependence on BMS’s performance and decisions, the Company does not currently consider this probable.

Additionally, the Company is eligible to receive net sales-based milestone payments and tiered mid-single to low double-digit royalties on product sales.

The royalty term is determined on a licensed-product-by-licensed-product and country-by-country basis and begins on the first commercial sale of a licensed product in a country and ends on the expiration of the last to expire of specified patents or regulatory exclusivity covering such licensed product in such country or, with a customary royalty reduction, ten years after the first commercial sale if there is no such exclusivity.

These revenues will be recognized when performance obligations are satisfied.

The Company recognizes License Revenue over the expected performance period based on its measure of progress towards the completion of certain activities related to its services.

The Company determines such progress by comparing activities performed at the end of each reporting period with total activities expected to be performed.

The Company estimates total expected activities using a number of unobservable inputs, such as the probability of BMS designating additional targets, the probability of successfully completing each phase and estimated time required to provide services during the various development stages.

If available, the Company uses product candidate-specific research and development plans.

Alternatively, the Company assumes that completion of the pre-clinical phase requires an average of four years and that clinical development and commercial launch on average require 8.5 years.

On December 1, 2020, the Company and BMS amended the BMS CLA (“amended BMS CLA”).

Under the amended BMS CLA, BMS is limited to four Collaboration Targets.

BMS may until November 30, 2021 replace up to two of these four Collaboration Targets with up to two new targets in the field of cardiovascular disease.

The Company continues to be eligible to receive research, development, and regulatory milestone payments of up to $ 217.0 million for each Collaboration Target, if defined milestones are achieved.

For as long as any of the four Collaboration Targets are being advanced, BMS may place a purchase order to be supplied with research, clinical and commercial supplies.

Subject to the terms of the amended BMS CLA, BMS has the right to terminate the research, clinical and commercial supply relationships, and has certain remedies for failures of supply, up to and including technology transfer for any such failure that otherwise cannot be reasonably resolved.

Both BMS and the Company may agree to a technology transfer of manufacturing capabilities pursuant to the terms of the amended BMS CLA.

The amended BMS CLA does not extend the initial four-year research term.

BMS may place purchase orders to provide limited services primarily related to analytical and development efforts in respect of the four Collaboration Targets.

BMS may request such services for a period not to exceed the earlier of (i) the completion of all activities under a Research Plan and (ii) either (A) three years after the last replacement target has been designated by BMS during the one-year replacement period ending on November 30, 2021, or (B) November 30, 2023 if no replacement targets are designated.

BMS continues to reimburse the Company for these services.

The Company evaluated the impact of the amended BMS CLA in relation to its performance obligation to provide access to BMS to its technology and know-how in the field of gene therapy and to participate in joint steering committee and other governing bodies (“License Revenue”).

The Company determined that its remaining performance obligation under the amended BMS CLA was immaterial and recognized the remaining balance of unrecognized License Revenue as of November 30, 2020.

The Company includes variable consideration related to any research, development, and regulatory milestone payments, in the transaction price once it is considered probable that including these payments in the transaction price would not result in the reversal of cumulative revenue recognized.

Fair value measurement

The Company measures certain assets and liabilities at fair value, either upon initial recognition or for subsequent accounting or reporting.

The Company measures certain financial assets and liabilities at fair value, either upon initial recognition or for subsequent accounting or reporting.

GAAP requires disclosure of methodologies used in determining the reported fair values, and establishes a hierarchy of inputs used when available.

6 unchanged sentences

A financial instrument’s level within the fair value hierarchy is based on the lowest level of any input that is significant to the fair value measurement.

The carrying amount of cash and cash equivalents, accrued income from the related party, prepaid expenses, other assets, accounts payable, accrued expenses and other current liabilities reflected in the Consolidated balance sheets approximate their fair values due to their short-term maturities.

The following table sets forth the Company’s assets and liabilities that are required to be measured at fair value on a recurring basis as of September 30, 2020, and December 31, 2019:

The carrying amount of cash and cash equivalents, accounts receivable, prepaid expenses, other assets, accounts payable, accrued expenses and other current liabilities reflected in the Consolidated balance sheets approximate their fair values due to their short-term maturities.

The following table sets forth the Company’s assets and liabilities that are required to be measured at fair value on a recurring basis as of March 31, 2021, and December 31, 2020:

Quoted prices

6 unchanged sentences

restricted cash

Derivative financial instruments - related party

Derivative financial instruments

Other non-current liabilities

Total liabilities

At September 30, 2020

At March 31, 2021

Cash, cash equivalents and restricted cash

1 unchanged sentence

restricted cash

Derivative financial instruments - related party

Derivative financial instruments

Other non-current liabilities

Total liabilities

Changes in Level 3 items during the nine months ended September 30, 2020, are as follows:

Changes in Level 3 items during the three months ended March 31, 2021, are as follows:

(in thousands)

Balance at December 31, 2020

Net gains recognized in profit or loss

Currency translation effects

Balance at September 30, 2020

Net (gains) / losses recognized in profit or loss

Balance at March 31, 2021

Derivative financial instruments

The Company issued derivative financial instruments related to its collaboration with BMS.

The fair value of the BMS derivative financial instruments (“BMS warrants”) as of September 30, 2020, was $ 0.5 million compared to a fair value of $ 3.1 million as of December 31, 2019.

Changes in the fair value of the BMS warrants are primarily impacted by changes in the Company’s share price, whereby a decrease in share price generally results in a decrease of the fair value.

In addition, the Company revised certain unobservable inputs as well as valuation techniques in March 2020 which resulted in a further decrease in fair value of $ 0.7 million when compared to December 31, 2019.

These BMS warrants are described in more detail below.

The Company granted BMS two warrants:

● A warrant allowing BMS to purchase a specific number of the Company’s unregistered ordinary shares such that its ownership will equal 14.9 % immediately after such purchase (“1 st warrant”).

The 1 st warrant can be exercised on the later of (i) the date on which the Company receives from BMS the Target Designation Fees (as defined in the BMS CLA) associated with the first six new targets (a total of seven Collaboration Targets);

and (ii) the date on which BMS designates the sixth new target (the seventh Collaboration Target).

● A warrant allowing BMS to purchase a specific number of the Company’s unregistered ordinary shares such that its ownership will equal 19.9 % immediately after such purchase (“2 nd warrant” and together with the 1 st warrant, the “warrants”).

The 2 nd warrant can be exercised on the later of (i) the date on which the Company receives from BMS the Target Designation Fees associated with the first nine new targets (a total of ten Collaboration Targets);

and (ii) the date on which BMS designates the ninth new target (the tenth Collaboration Target).

Pursuant to the terms of the BMS CLA, the exercise price in respect of each warrant is equal to the greater of (i) the product of (A) $ 33.84 and (B) a compounded annual growth rate of 10 % (or approximately $ 56.41 as of September 30, 2020) and (ii) the product of (A) 1.10 and (B) the VWAP for the 20 trading days ending on the date that is five trading days prior to the date of a notice of exercise delivered by BMS.

As of September 30, 2020, BMS had designated a total of four Collaboration Targets, and as such, the warrants were not exercisable.

The Company estimated the exercise of warrants to occur within three and five years after the balance sheet date.

The significant unobservable inputs that the Company uses to develop Level 3 fair value measurements include the number of ordinary shares outstanding at the time of BMS’s warrant exercises.

The number of such ordinary shares outstanding at the time of exercise determines the number of unregistered ordinary shares to be issued in connection with the BMS warrants.

The warrants can only be exercised following the occurrence of events contractually defined in the warrant agreements.

The probability of the occurrence of these events represent another significant unobservable input used in the calculation of the fair value of the warrants.

The Company estimates that the probability of the occurrence of events allowing BMS to exercise the 1 st warrant is within a range of 0 % to 44 % and between 0 % to 11 % with respect to the 2 nd warrant.

The arithmetic averages related to these ranges are 24 % and 5 % for the 1 st and 2 nd warrant, respectively.

Right-of-use assets and lease liabilities

The Company’s most significant leases relate to office and laboratory space under the following operating lease agreements:

Lexington, Massachusetts / United States

In July 2013, the Company entered into a lease for a facility in Lexington, Massachusetts, United States.

In November 2018, the term was expanded by five years from 2024 to June 2029.

The lease is renewable for two subsequent five-year terms.

Additionally, the lease was expanded to include an additional 30,655 square feet within the same facility and for the same term.

The lease of the expansion space commenced on June 1, 2019.

Amsterdam / The Netherlands

In March 2016, the Company entered into a 16-year lease for a facility in Amsterdam, the Netherlands, and amended this agreement in June 2016.

The lease for this facility terminates in February 2032, with an option to extend in increments of five-year periods.

The lease contract includes variable lease payments related to annual increases in payments based on a consumer price index.

On December 1, 2017, the Company entered into an agreement to sub-lease three of the seven floors of its Amsterdam facility for a ten-year term ending on December 31, 2027, with an option for the sub-lessee to extend until December 31, 2031.

In February 2020, the Company amended the agreement to sub-lease to take back one of the three floors effective March 1, 2020.

The fixed lease payments to be received during the remaining term under the agreement to sub-lease amount to $ 6.4 million (EUR 5.5 million) as of September 30, 2020.

The table below presents the components of the Company’s lease costs for the periods indicated:

Three months ended September 30,

Nine months ended September 30,

(in thousands)

Operating lease cost

Variable lease cost

Sublease income

Total lease cost

The table below presents the lease-related assets and liabilities recorded on the Consolidated balance sheets for the periods indicated.

September 30,

(in thousands)

Operating lease right-of-use assets

Current operating lease liabilities

Non-current operating lease liabilities

Total lease liabilities

Other information

The weighted-average remaining lease term as of September 30, 2020 is 9.6 years, compared to 10.3 years as of December 31, 2019 and the weighted-average discount rate as of September 30, 2020 is 11.35 %, compared to 11.33 % as of December 31, 2019.

The Company derived the weighted-average discount rate, adjusted for differences such as in the term and payment patterns, from the Company’s loan from Hercules Capital which was refinanced immediately prior to the January 1, 2019 adoption date in December 2018.

Cash paid for amounts included in the measurement of lease liabilities for the periods indicated below was as follows:

Three months ended September 30,

Nine months ended September 30,

(in thousands)

Operating cash flows for operating leases 1)

( 1) The Company has received $ 0.5 million of landlord incentive payments in the three months ended September 30, 2019, which are not included in the cash paid amounts for the three and nine months ended September 30, 2019.)

The Company did not obtain any right-of-use assets in exchange for lease obligations in the three and nine months ended September 30, 2020.

Besides the initial recognition of operating right-of-use assets of $ 19.0 million upon adoption of the new lease standards on January 1, 2019, the Company obtained $ 0.4 million and $ 9.0 million of additional right-of-use assets in exchange for lease obligations in the three and nine months ended September 30, 2019, respectively.

Undiscounted cash flows

The table below reconciles the undiscounted cash flows as of September 30, 2020, for each of the first five years and the total of the remaining years to the operating lease liabilities recorded on the Consolidated balance sheet as of September 30, 2020.

(in thousands)

2020 (three months remaining)

Total lease payments

amount of lease payments representing interest payments

Present value of lease payments

current operating lease liabilities

Non-current operating lease liabilities

( 1) Payments are due in EUR and have been translated at the foreign exchange rate as of September 30, 2020, of $ 1.17 / €1.00).

In 2015, the Company granted BMS two warrants that were subsequently terminated in connection with the amendment to the BMS CLA on December 1, 2020.

On December 1, 2020, the Company and BMS agreed that upon the consummation of a change of control transaction of uniQure that occurs prior to December 1, 2026 or BMS’ delivery of a target cessation notice for all four Collaboration Targets, the Company (or its third party acquirer) shall pay to BMS a one-time, non-refundable, non-creditable cash payment of $ 70.0 million, provided that (x) if $ 70.0 million is greater than five percent ( 5.0 %) of the net proceeds (as contractually defined) from such change of control transaction, the payment shall be an amount equal to five percent of such net proceeds, and (y) if $ 70.0 million is less than one percent of such net proceeds, the change of control payment shall be an amount equal to one percent of such net proceeds (“CoC-payment”).

The Company has not consummated any change of control transaction as of March 31, 2021 that would obligate it to make a CoC-payment.

The Company determined that the CoC-payment should be recorded as a derivative financial liability as of December 1, 2020 and that subsequent changes in the fair market value of this derivative financial liability should be recorded in profit and loss.

The fair market value of the derivative financial liability is materially impacted by probability that market participants assign to the likelihood of the occurrence of a change of control transaction that would give rise to a CoC-payment.

This probability represents an unobservable input.

The Company determined the fair market value of the derivative financial liability by using a present value model based on expected cash flow.

The expected cash flows are materially impacted by the probability that market participants assign to the likelihood of the occurrence of a change of control transaction within the biotechnology industry.

The Company estimated this unobservable input using the best information available as of March 31, 2021 and December 31, 2020.

The Company obtained reasonably available market information that it believed market participants would use in determining the likelihood of the occurrence of a change-of control transaction within the biotechnology industry.

Selecting and evaluating market information involves considerable judgement and uncertainty.

Based on all such information and its judgment the Company estimated that the fair market value of the derivative financial liability (presented within “Other non-current liabilities”) as of March 31, 2021 and December 31, 2020 was $ 2.6 million.

Accrued expenses and other current liabilities

Accrued expenses and other current liabilities include the following items:

September 30,

(in thousands)

1 unchanged sentence

Personnel related accruals and liabilities

Contract liability (see Note 3.

"Collaboration arrangements")

6 Long-term debt

On June 14, 2013, the Company entered into a venture debt loan facility with Hercules Growth Capital, Inc.

(“Hercules”), which was amended and restated on June 26, 2014, and again on May 6, 2016 (“2016 Amended Facility”).

On December 6, 2018, the Company signed an amendment to the Second Amended and Restated Loan and Security Agreement that both refinanced the then-existing $ 20 million 2016 Amended Facility and provided an additional unconditional commitment of $ 15 million as well as a conditional commitment of $ 15 million that expired on June 30, 2020 (the “2018 Amended Facility”).

At signing of the 2018 Amended Facility, the Company drew down an additional $ 15 million for a total of $ 35 million outstanding.

On June 14, 2013, the Company entered into a venture debt loan facility with Hercules Capital, Inc.

(formerly known as Hercules Technology Growth Capital, Inc.) (“Hercules”), which was amended and restated on June 26, 2014, and again on May 6, 2016 (“2016 Amended Facility”).

On December 6, 2018, the Company signed an amendment that both refinanced the then-existing $ 20.0 million 2016 Amended Facility and allowed the Company to draw down an additional $ 15.0 million (“2018 Amended Facility”).

The 2018 Amended Facility extended the loan’s maturity date from May 1, 2020 until June 1, 2023.

The interest-only period was initially extended from November 2018 to January 1, 2021 and was further extended to January 1, 2022 as a result of meeting the provision in the 2018 Amended Facility of raising more than $ 90.0 million in equity financing in September 2019.

The Company is required to repay the facility in equal monthly installments of principal and interest between the end of the interest-only period and the maturity date.

The interest rate continues to be adjustable and is the greater of (i) 8.85 % and (ii) 8.85 % plus the prime rate less 5.50 % per annum.

Under the 2018 Amended Facility, the Company paid a facility fee of 0.50 % of the $ 35 million outstanding as of signing and owes a back-end fee of 4.95 % of the outstanding debt.

The interest-only period was initially extended from November 2018 to January 1, 2021 and was further extended to January 1, 2022 as a result of raising more than $ 90.0 million in equity financing in September 2019.

The interest only period was again further extended to June 1, 2023 as a result of the January 2021 amendment (see below).

The interest rate is adjustable and is the greater of (i) 8.85 % and (ii) 8.85 % plus the prime rate less 5.50 % per annum.

Under the 2018 Amended Facility, the Company owes a back-end fee of 4.95 % of the outstanding debt.

In addition, in May 2020 the Company paid a back-end fee of $ 1.0 million in relation to the 2016 Amended Facility.

The amortized cost (including interest due presented as part of accrued expenses and other current liabilities) of the 2018 Amended Facility was $ 35.8 million as of September 30, 2020, compared to $ 36.3 million as of December 31, 2019, and is recorded net of discount and debt issuance costs.

The foreign currency gain on the loan in the three and nine months ended September 30, 2020, was $ 1.5 million and $ 1.5 million compared to a foreign currency loss of $ 1.5 million and $ 1.7 million during the same periods in 2019.

Interest expense associated with the 2018 Amended Facility during the three and nine months ended September 30, 2020 was $ 0.9 million and $ 2.7 million, respectively, compared to $ 0.9 million and $ 2.8 million during the same periods in 2019.

As a covenant in the 2018 Amended Facility, the Company has periodic reporting requirements and is required to keep a minimum cash balance deposited in bank accounts in the United States, equivalent to the lesser of (i) 65 % of the outstanding balance of principal due or (ii) 100% of worldwide cash and cash equivalents.

On January 29, 2021, the Company and Hercules amended the 2018 Amended Facility (“2021 Amended Facility”).

Pursuant to the 2021 Amended Facility, Hercules agreed to an additional Facility of $ 100.0 million (“Tranche B”), increasing the aggregate principal amount of the term loan facilities from $ 35.0 million to up to $ 135.0 million.

On January 29, 2021, the Company drew down $ 35.0 million of the Tranche B.

The Company may draw down the remaining $ 65.0 million under the Tranche B in a series of one or more advances of not less than $ 20.0 million each until December 15, 2021.

Advances under Tranche B bear interest at a rate equal to the greater of (i) 8.25 % or (ii) 8.25 % plus the prime rate, less 3.25 % per annum.

The principal balance and all accrued but unpaid interest on advances under Tranche B is due on June 1, 2023, which date may be extended by the Company by up to two twelve-month periods.

Advances under Tranche B may not be prepaid prior to July 29, 2021, following which the Company may prepay all such advances without charge.

The Company owes a back-end fee of 4.85 % of amounts outstanding under Tranche B.

The back-end fee is reduced if prepayment occurs at an earlier date.

The amortized cost (including interest due presented as part of accrued expenses and other current liabilities) of the 2018 Amended Facility and 2021 Amended Facility was $ 71.0 million as of March 31, 2021, compared to $ 35.9 million amortized cost for the 2018 Amended Facility as of December 31, 2020, and is recorded net of discount and debt issuance costs.

The foreign currency loss on the facilities in the three months ended March 31, 2021, was $ 3.2 million compared to a foreign currency loss of $ 0.7 million during the same period in 2020 for the 2018 Amended Facility.

Interest expense associated with the 2018 Amended Facility and 2021 Amended Facility during the three months ended March 31, 2021 was $ 1.5 million, compared to $ 0.9 million during the same periods in 2020 for the 2018 Amended Facility.

As a covenant in the 2018 Amended Facility and 2021 Amended Facility, the Company has periodic reporting requirements and is required to keep a minimum cash balance deposited in bank accounts in the United States, equivalent to the lesser of (i) 65 % of the outstanding balance of principal due or (ii) 100% of worldwide cash and cash equivalents.

This restriction on cash and cash equivalents only relates to the location of the cash and cash equivalents, and such cash and cash equivalents can be used at the discretion of the Company.

In combination with other covenants, the 2018 Amended Facility restricts the Company’s ability to, among other things, incur future indebtedness and obtain additional debt financing, to make investments in securities or in other companies, to transfer assets, to perform certain corporate changes, to make loans to employees, officers and directors, and to make dividend payments and other distributions.

In combination with other covenants, the 2018 Amended Facility and 2021 Amended Facility restricts the Company’s ability to, among other things, incur future indebtedness and obtain additional debt financing, to make investments in securities or in other companies, to transfer assets, to perform certain corporate changes, to make loans to employees, officers, and directors, and to make dividend payments and other distributions to its shareholders.

The Company secured the facilities by directly or indirectly pledging its total assets of $ 363.9 million with the exception of $ 97.6 million of cash and cash equivalents and other current assets held by uniQure N.V.

The 2018 Amended Facility contains provisions that include the occurrence of a material adverse effect, as defined therein, which would entitle Hercules to declare all principal, interest and other amounts owed by the Company immediately due and payable.

As of September 30, 2020, the Company was in compliance with all covenants and provisions.

The 2018 Amended Facility and 2021 Amended Facility contain provisions that include the occurrence of a material adverse effect, as defined therein, which would entitle Hercules to declare all principal, interest and other amounts owed by the Company immediately due and payable.

As of March 31, 2021, the Company was in material compliance with all covenants and provisions.

7 Shareholders’ Equity

On March 1, 2021, the Company entered into a Sales Agreement with SVB Leerink LLC (“SVB Leerink”) with respect to an at-the-market (“ATM”) offering program, under which the Company may, from time to time in its sole discretion, offer and sell through SVB Leerink, acting as agent, its ordinary shares, up to an aggregate offering price of $ 200.0 million.

The Company will pay SVB Leerink a commission equal to 3 % of the gross proceeds of the sales price of all ordinary shares sold through it as sales agent under the Sales Agreement.

Through March 31, 2021 the Company issued 859,885 ordinary shares at a weighted average price of $ 33.42 per share, with net proceeds of $ 27.6 million, after deducting underwriting discounts and net of offering expenses.

The Company defers direct, incremental costs associated to this offering, except for the commission costs to SVB Leerink, which are a reduction to additional paid-in capital, and will deduct these costs from additional paid-in capital in the consolidated balance sheets proportionately to the amount of proceeds raised.

As of March 31, 2021, $ 1.0 million of direct, incremental costs were deducted from additional paid-in capital.

8 Share-based compensation

3 unchanged sentences

Share-based compensation expense recognized by classification included in the Consolidated statements of operations and comprehensive loss in relation to the 2014 Plans for the periods indicated below was as follows:

Three months ended September 30,

Nine months ended September 30,

(in thousands)

Three months ended March 31,

(in thousands)

1 unchanged sentence

Selling, general and administrative

Share-based compensation expense recognized by award type for the periods indicated below was as follows:

Three months ended September 30,

Nine months ended September 30,

(in thousands)

Share-based compensation expense recognized by award type was as follows:

Three months ended March 31,

(in thousands)

Share options

Restricted share units (“RSUs”)

Performance share units (“PSUs”)

As of September 30, 2020, the unrecognized share-based compensation expense related to unvested awards under the 2014 Plans were:

Restricted share units

Performance share units

As of March 31, 2021, the unrecognized share-based compensation expense related to unvested awards under the 2014 Plans were:

Weighted average

3 unchanged sentences

Performance share units

The Company satisfies the exercise of share options and vesting of RSUs and PSUs through newly issued ordinary shares.

The Company satisfies the exercise of share options and vesting of Restricted Share Units (“RSUs”) and Performance Share Units (“PSUs”) through newly issued ordinary shares.

Share options

The following table summarizes option activity for the nine months ended September 30, 2020:

Share options are priced on the date of grant and, except for certain grants made to non-executive directors, vest over a period of four years .

The first 25 % vests after one year from the initial grant date and the remainder vests in equal quarterly installments over years two, three and four.

Certain grants to non-executive directors vest in full after one year .

Any options that vest must be exercised by the tenth anniversary of the initial grant date.

The following tables summarize option activity under the Company’s 2014 Plans for the three months ended

March 31, 2021:

Weighted average

2 unchanged sentences

Outstanding at December 31, 2020

Outstanding at September 30, 2020

Thereof, fully vested and exercisable at September 30, 2020

Thereof, outstanding and expected to vest after September 30, 2020

Outstanding at March 31, 2021

Thereof, fully vested and exercisable at March 31, 2021

Thereof, outstanding and expected to vest after March 31, 2021

Total weighted average grant date fair value of options issued during the period (in $ millions)

Proceeds from option sales during the period (in $ millions)

Share options are priced on the date of grant and, except for certain grants made to non-executive directors, vest over a period of four years , the first 25 % vests after one year from the grant date and the remainder vests in equal quarterly installments, over years two, three and four.

Any options that vest must be exercised by the tenth anniversary of the grant date.

The fair value of each option issued is estimated at the respective grant date using the Hull & White option pricing model with the following weighted-average assumptions:

Three months ended September 30,

Nine months ended September 30,

Three months ended March 31,

Expected volatility

2 unchanged sentences

1.21 % - 1.71 %

1.92 % - 2.87 %

Expected dividend yield

Restricted share units (“RSUs”)

The following table summarizes the RSUs activity for the nine months ended September 30, 2020:

The following table summarizes the RSUs activity for the three months ended March 31, 2021:

Weighted average

2 unchanged sentences

Non-vested at December 31, 2020

Non-vested at September 30, 2020

Non-vested at March 31, 2021

Total weighted average grant date fair value of RSUs granted during the period (in $ millions)

2 unchanged sentences

Performance share units (“PSUs”)

The following table summarizes the PSUs activity for the nine months ended September 30, 2020:

The following table summarizes the PSUs activity for the three months ended March 31, 2021:

Weighted average

2 unchanged sentences

Non-vested at December 31, 2020

Non-vested at September 30, 2020

Total weighted average grant date fair value of PSUs granted during the period (in $ millions)

In January 2019, the Company awarded PSUs to its executives and certain other members of senior management.

These PSUs were earned as of January 2020 based on an assessment by the Company’s board of directors of the level of achievement of agreed upon performance targets through December 31, 2019.

PSUs vest after three years .

Non-vested at March 31, 2021

The PSUs will vest on the third anniversary of the grant, subject to the grantee’s continued employment.

b) Employee Share Purchase Plan (“ESPP”)

3 unchanged sentences

The purchase price of the ordinary shares on each purchase date is equal to 85 % of the lower of the closing market price on the offering date and the closing market price on the purchase date of each three-month offering period.

During the nine months ended September 30, 2020, 3,282 ordinary shares were issued under the ESPP compared to 7,018 during the same period in 2019.

As of September 30, 2020, a total of 134,925 ordinary shares remains available for issuance under the ESPP plan compared to a total of 140,391 as of September 30, 2019.

Deferred tax assets and deferred tax liabilities are recognized based on the expected future tax consequences of temporary differences between the financial statement carrying amounts and the income tax basis of assets and liabilities, using current statutory rates.

A valuation allowance is recorded against deferred tax assets if it is more likely than not that some or all the deferred tax assets will not be realized.

The Company reassessed the need for a full valuation allowance in conjunction with entering into the CSL Behring Agreement.

Closing of the CSL Behring Agreement is contingent on the successful completion of reviews under the antitrust laws in the United States, Australia, and the United Kingdom, which has not occurred to date.

Closing of the transaction is dependent on the timing, extent and result of the regulatory review process.

In its assessment of whether or not it was more likely than not that the Company’s deferred tax assets will be realized, the Company considered all relevant facts and circumstances, including in particular similar regulatory reviews as well as the three-year cumulative losses reported by the Company.

The Company concluded that it should continue to record a full valuation allowance as of September 30, 2020.

As of December 31, 2019, the Company’s valuation allowance amounted to $ 109.9 million.

During the three months ended March 31, 2021, 1,174 ordinary shares were issued under the ESPP compared to 1,801 during the same period in 2020.

As of March 31, 2021, a total of 130,852 ordinary shares remain available for issuance under the ESPP plan compared to a total of 136,406 as of March 31, 2020.

The Company released its valuation allowance against the Company’s deferred tax assets in the United States as of December 31, 2020.

The Company recorded $ 0.2 million deferred tax expense in relation to its operations in the United States during the three month period ended March 31, 2021.

The Company recorded a nil net deferred tax expense in the prior year as it had recorded a valuation allowance against its net deferred tax assets in the United States as of March 31, 2020.

The effective income tax rate of 0.5 % during the three months ended March 31, 2021 is substantially lower than the enacted rated of 25 % in the Netherlands as the Company recorded a valuation allowance against its net deferred tax assets in the Netherlands.

Refer to Note 3 “Collaboration arrangements and concentration of credit risk” for discussion on the effectiveness of the CSL Behring Agreement.

The effective income tax rate during the three months ended March 31, 2020 was 0 % as the Company had recorded a valuation allowance against all its net deferred tax assets.

The closing of the transaction contemplated by the CSL Behring agreement on May 6, 2021 is expected to materially impact the Company’s operating result as well as the taxable income for the year ended December 31, 2021 as well as in future periods.

The Company expects to utilize a material portion of its net operating loss carryforwards in the Netherlands during 2021 as a result of closing the transaction.

As of March 31, 2021 the Company expects to continue incurring tax losses in the years thereafter and expects to record a valuation allowance against all its Dutch net deferred tax assets as of December 31, 2021.

The Company determined the impact which recognition of CSL Behring License Revenue is estimated to have, with regards to the expected effective tax rate of 0 % that was applied with respect to the Company’s Dutch operations as of March 31, 2021, is immaterial.

10 Basic and diluted earnings per share

1 unchanged sentence

As the Company has incurred a loss, all potentially dilutive ordinary shares would have an antidilutive effect, if converted, and thus have been excluded from the computation of loss per share.

The shares are presented without giving effect to the application of the treasury method or exercise prices that would be above the share price as of September 30, 2020 and September 30, 2019, respectively.

In addition, the BMS warrants were not exercisable as of these dates since this would have required the prior designation of Collaboration Targets by BMS.

The shares are presented without giving effect to the application of the treasury method or exercise prices that would be above the share price as of March 31, 2021 and March 31, 2020, respectively.

In addition, the BMS warrants were not exercisable as of March 31, 2020 since this would have required the prior designation of Collaboration Targets by BMS.

This would generally result in a lower number of potentially dilutive ordinary shares as some stock option grants as well as the BMS warrants would have been excluded.

The potentially dilutive ordinary shares are summarized below:

September 30,

(ordinary shares)

BMS warrants (derecognized as of December 1, 2020 - see Note 4, "Fair value measurement")

Stock options under 2014 Plans

4 unchanged sentences

11 Subsequent events

Appointment of Chief Operating Officer

Effective May 17, 2021, Pierre Caloz will be appointed as Chief Operating Officer and will be based out of the Amsterdam facility.

Caloz will be responsible for all Manufacturing Operations, Global Chemistry, Manufacturing and Controls development and innovation, and Supply Chain and Facilities.

As a result, Alex Kuta, Ph.D., will transition from Executive Vice President, Operations to Executive Vice President, Quality and Regulatory.

Closing of Collaboration and Licensing transaction with CSL Behring (see also note 3)

On May 5, 2021, the waiting period under the HSR Act expired, and on May 6, 2021 the CSL Behring Agreement became fully effective.

Under the CSL Behring Agreement, the upfront payment of $ 450.0 million was paid to the Company on May 7, 2021.

Additionally, the Company is eligible to receive more than $ 300 million in regulatory and first commercial sale milestones, up to an additional $ 1.3 billion in commercial milestones, and tiered double-digit royalties of up to a low-twenties percentage of net sales of the Product arising from the collaboration.

The Company contractually owes a single-digit percentage of revenue from the collaboration to its licensors.

The Company expects to utilize a material portion of its net operating loss carryforwards in the Netherlands during 2021 as a result of closing the transaction contemplated by the CSL Behring Agreement.

The Company will be responsible for the completion of the HOPE-B clinical trial, manufacturing process validation, and the manufacturing supply of the Product until such time that these capabilities may be transferred to CSL Behring or its designated contract manufacturing organization.

Clinical development and regulatory activities performed by the Company pursuant to the CSL Behring Agreement will be reimbursed by CSL Behring.

CSL Behring will be responsible for global regulatory submissions and commercialization requirements for the Product.

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-Q

Item 1. Financial Statements