What changed in this filing

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Item 2. Management’s Discussion and Analysis

2022-08-08 compared with 2022-05-02 · 280 added, 112 removed, 203 unchanged (66% of the section changed)

5 unchanged sentences

We are a leader in the field of gene therapy and seek to deliver to patients suffering from rare and other devastating diseases single treatments with potentially curative results.

We are advancing a pipeline of innovative gene therapies, including product candidates for the treatment of Huntington’s disease, hemophilia B, temporal lobe epilepsy and Fabry disease.

We are advancing a pipeline of innovative gene therapies, including product candidates for the treatment of Huntington’s disease, hemophilia B, which effective May 6, 2021, we licensed to CSL Behring LLC (“CSL Behring”), temporal lobe epilepsy and Fabry disease.

We believe our validated technology platform and manufacturing capabilities provide us distinct competitive advantages, including the potential to reduce development risk, cost, and time to market.

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AMT-130 utilizes our proprietary, gene-silencing miQURE platform and incorporates an AAV vector carrying a micro ribonucleic acid (“miRNA”) specifically designed to silence the huntingtin gene and the potentially highly toxic exon 1 protein fragment.

We are currently conducting a Phase I/II clinical trial for AMT-130 in the U.S.

and a Phase Ib/II study in the EU.

We are currently conducting a Phase I/II clinical trial for AMT-130 in the United States (“U.S.”) and a Phase Ib/II study in the European Union (“EU”).

Together, these studies are intended to establish safety, proof of concept, and the optimal dose of AMT-130 to take forward into Phase III development or into a confirmatory study should an accelerated registration pathway be feasible.

1 unchanged sentence

Food and Drug Administration (“FDA”) and Orphan Medicinal Product Designation from the European Medicines Agency (“EMA”).

In February 2022, the first two patients were dosed in our European Phase Ib/II study of AMT-130.

The open-label study will enroll a total of 15 patients in two dose cohorts.

The first and second dose cohorts will include 6 patients and 9 patients, respectively.

On March 21, 2022, we announced that we have completed the enrollment of all 26 patients in the first two cohorts of our randomized, double-blinded, Phase I/II clinical trial of AMT-130 taking place in the U.S.

In the study, patients are randomized to either treatment with AMT-130 or to an imitation surgical procedure.

The first dose cohort includes 10 patients, of which six patients received treatment with AMT-130 and four patients received imitation surgery.

The second dose cohort includes 16 patients, of which ten patients received treatment with AMT-130 and six patients received imitation surgery.

The Phase I/II clinical trial consists of a blinded 12-month period followed by unblinded long-term follow-up for five years.

The treated patients have received a single administration of AMT-130 using MRI-guided, convection-enhanced stereotactic neurosurgical delivery directly into the striatum (caudate and putamen).

The third cohort, which will include up to 18 additional randomized patients receiving the higher dose, will explore the use of alternative stereotactic navigation systems to simplify placement of catheters for infusions of AMT-130.

The treated patients have received a single administration of AMT-130 using MRI-guided, convection-enhanced stereotactic neurosurgical delivery directly into the striatum (caudate and putamen).The trial consists of a blinded 12-month period followed by unblinded long-term follow-up for five years.

The low-dose cohort includes 10 patients, of which six patients received treatment with AMT-130 and four patients received imitation surgery.

The higher-dose cohort includes 16 patients, of which 10 patients received treatment with AMT-130 and six patients received imitation surgery.

A third cohort, which will include up to 18 additional randomized patients receiving the higher dose, will explore the use of alternative stereotactic navigation systems to simplify placement of catheters for infusions of AMT-130.

On June 23, 2022, we announced safety and biomarker data from the 10 patients enrolled in the low-dose cohort.

At 12 months of follow-up on the patients in the low-dose cohort:

● AMT-130 was generally well-tolerated with no serious adverse events related to AMT-130 reported in the treated patients.

There were two serious adverse events unrelated to AMT-130, including a deep-vein thrombosis in the elbow of one patient that was resolved with anticoagulants and transient post-operative delirium in a second patient that was resolved through supportive care.

● In the four treated patients with evaluable data, mean levels of mutant Huntingtin protein in the cerebral spinal fluid (“CSF mHTT”) declined at all timepoints compared to baseline and decreased by 53.8% at 12 months of follow-up (range 44% decrease to 71% decrease).

In the three control patients with evaluable data, mean levels of CSF mHTT showed an increase compared to baseline at one, three, six and nine months of follow-up, and decreased by 16.8% compared at 12 months of follow-up (range 35% increase to 47% decrease).

● In the six treated patients, measurements of neurofilament light chain in the cerebral spinal fluid (“CSF NfL”), a biomarker of neuronal damage, initially increased as expected following the AMT-130 surgical procedure and declined thereafter, nearing baseline at 12 months of follow-up.

At 12 months, mean CSF NfL showed an 8% increase compared to baseline (range 46% increase to 14% decrease).

Two of the six treated patients were at or below baseline at 12 months of follow-up, with an additional patient below baseline at 15 and 18 months of follow-up.

In the four control patients, mean CSF NfL remained stable or slightly declined over 12 months (range 1% increase to 35% decrease).

Also on June 23, 2022, we announced that 10 patients in our European Phase Ib/II study had been treated with AMT-130.

The open-label study will enroll a total of 15 patients in two dose cohorts.

In July 2022, we learned that three patients of the 14 patients that were treated with the higher dose of AMT-130 in our Phase Ib/II clinical trial had experienced certain serious adverse reactions that were potentially attributable to AMT-130.

Two patients experienced localized inflammatory responses and related symptoms shortly after the procedure, while the third patient experienced severe headaches and other related symptoms.

All three patients were treated and released from the hospital.

The reactions in these three patients each have been classified as suspected unexpected serious adverse reactions (“SUSARs”) and reported to the appropriate regulatory agencies in the U.S.

Following a review of these SUSARs by the independent Data Safety Monitoring Board for the clinical trial (the “DSMB”), the DSMB did not believe that such reactions represented dose limiting toxicities, but did recommend postponement of further enrollment and dosing of high dose patients and postponement of further site activation until the DSMB conducts a comprehensive safety review.

We are following the DSMB’s recommendations and expect to hold the safety review in the third quarter or early fourth quarter of 2022.

While the DSMB recommended postponement of dosing of patients with the AMT-130 high dose, it also stated that eligible trial participants that did not initially receive treatment in the U.S.

low dose cohort could cross over to receive a low dose intervention.

The Company expects that such control patients from the U.S.

low dose cohort will cross over to receive the low dose intervention during the third quarter of 2022.

Phase I/II clinical trial, all 26 patients in the first two dose cohorts have been enrolled.

In the European Phase Ib/II study, the six patient lower dose cohort is fully enrolled.

Four of nine patients in the European clinical trial have been enrolled in the higher dose cohort.

To date, a total of 36 patients have been enrolled across the two clinical trials including 10 control patients and 26 patients treated with AMT-130, of which 14 patients received the higher dose and 12 patients received the low dose.

CSL Behring collaboration

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The transaction became fully effective on May 6, 2021, one day after the waiting period under the Hart-Scott-Rodino Antitrust Improvements Act of 1976 expired (“Closing”).

In March 2022, CSL Behring submitted certain global regulatory submissions for etranacogene dezaparvovec.

On March 28, 2022, CSL Behring announced that the EMA accepted one of the global regulatory submissions - the Marketing Authorization Application (“MAA”) - under its accelerated assessment procedure.

As of March 31, 2022, we received $20.0 million of the $55.0 million owed to us by CSL Behring related to the global regulatory submissions.

The remaining $35.0 million was received in April 2022.

In March and April 2022, CSL Behring submitted marketing applications for etranacogene dezaparvovec in the U.S.

and European Union.

On March 28, 2022, CSL Behring announced that EMA had accepted the Marketing Authorization Application (“MAA”).

On May 24, 2022, we announced that the FDA had accepted for review the Biologics License Application (“BLA”).

As of June 30, 2022, we received the $55.0 million owed to us by CSL Behring related to the global regulatory submissions.

In July 2022, CSL Behring was notified by the Committee for Advanced Therapies (“CAT”) in Europe that they will be unable to complete their review in accordance with the accelerated assessment timetable and will now switch to a standard review procedures.

In the United States, the BLA remains under Priority Review at this time.

In July 2022, following a comprehensive multi-day facility inspection, the EMA notified us that Good Manufacturing Practice (“GMP”) certification can be issued for our Lexington manufacturing site to produce commercial supply of etranacogene dezaparvovec.

Preclinical programs

On May 2, 2022 we announced that we will be presenting certain preclinical findings on our gene therapy candidates for Huntington’s disease, refractory temporal lobe epilepsy, Fabry disease, Parkinson’s disease, Amyotrophic lateral sclerosis, and Alzheimer’s disease at the American Society of Gene and Cell Therapy Hybrid Congress in May 2022.

In May 2022, we presented certain preclinical findings on our gene therapy candidates for refractory temporal lobe epilepsy, Fabry disease, Parkinson’s disease, Amyotrophic lateral sclerosis, and Alzheimer’s disease at the American Society of Gene and Cell Therapy Hybrid Congress.

Covid pandemic

5 unchanged sentences

We continue to monitor local government rules and recommendations and office protocols will be aligned with these rules and recommendations.

Effective March 1, 2022, we have implemented our base Covid-19 Protocol within the Lexington facility which requires only unvaccinated employees to wear facemasks and apply social distancing at the office.

All non-essential Lexington employees are allowed to return to the office as space at the office allows and there is no longer a limitation on in-person meetings, although meetings organizers should still provide remote options for employees.

This protocol will remain in place until July 1, 2022, unless extended or otherwise amended.

Effective February 28, 2022, the Amsterdam location is open to all employees and visitors, in line with the most updated Dutch government measures.

Effective June 9, 2022, we strongly encourage all vaccinated employees to wear facemasks in the Lexington facility, particularly for in-person meetings and when social distancing is not possible.

The Covid-19 Protocol in the Lexington facility continues to require unvaccinated employees to wear facemasks and apply social distancing at the office.

All non-essential employees in the Lexington facility are allowed to return to the office, but have the option to work from home or from another remote location through at least August 31, 2022.

Effective February 28, 2022, the Amsterdam facility is open to all employees and visitors, in line with the most updated Dutch government measures.

We will continue to comply with additional Dutch measures, which amongst others is recommended for employers to make agreements with employees that allow working from home to continue to the extent applicable.

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On May 11, 2021, Pfizer, Inc.

filed three petitions at the USPTO seeking Inter Partes Review of U.S.

filed three petitions at the United States Patent & Trademark Office (“USPTO”) seeking Inter Partes Review of U.S.

9,982,248 (the “‘248 Patent”) and 10,465,180 (the “‘180 Patent” and together with the ‘248 Patent, the “Patents”).

1 unchanged sentence

In August 2021, we filed our responses asking the USPTO to deny institution of the IPR proceedings.

On November 17, 2021, the PTAB issued decisions granting institution on all three IPR proceedings.

Our response to the petition was filed on March 3, 2022.

Pfizer’s reply to our response is due not later than June 17, 2022.

On November 17, 2021, the Patent Trials and Appeals Board (“PTAB”) issued decisions granting institution on all three IPR proceedings.

The parties completed briefing of the substantive issues in July 2022 and a hearing is planned before the PTAB in August 2022.

Financial Overview

Key components of our results of operations include the following:

Three months ended March 31,

Three months ended June 30,

Six months ended June 30,

(in thousands)

Total revenues

Cost of contract revenues

Cost of contract manufacturing

Research and development expenses

Selling, general and administrative expenses

As of March 31, 2022 and December 31, 2021, we had cash and cash equivalents of $524.9 million and $556.3 million, respectively.

We had a net loss of $46.7 million in the three months ended March 31, 2022 compared to a net loss of $41.6 million for the same period in 2021.

As of March 31, 2022 and December 31, 2021, we had accumulated deficits of $501.8 million and $455.1 million, respectively.

We anticipate that our expenses will increase substantially as we:

● advance the clinical development of AMT-130 for our Huntington’s disease gene therapy program;

● advance multiple research programs related to gene therapy candidates targeting liver-directed and CNS diseases;

● continue to expand our employee base to support research and development, as well as general and administrative functions;

● acquire or in-license rights to new therapeutic targets or product candidates;

● continue to expand, enhance and optimize our technology platform, including our manufacturing capabilities, next-generation viral vectors and promoters, and other enabling technologies;

● maintain, expand, and protect our intellectual property portfolio, including in-licensing additional intellectual property rights from third parties;

● make potential future milestone payments related to the acquisition of Corlieve, if any.

Net (loss) / income

As of June 30, 2022 and December 31, 2021, we had cash and cash equivalents of $500.5 million and $556.3 million, respectively.

We had a net loss of $39.1 million and $85.7 in the three and six months ended June 30, 2022, respectively, compared to net income of $399.5 and $357.9 million for the same periods in 2021.

As of June 30, 2022 and December 31, 2021, we had accumulated deficits of $540.9 million and $455.1 million, respectively.

We anticipate that our expenses will increase for the foreseeable future and will include costs related to:

● advancing AMT-130 for our Huntington’s disease gene therapy program into phase III clinical study;

● advancing our gene therapy programs for temporal lobe epilepsy and Fabry into Phase I/II clinical studies;

● advancing preclinical research and development for gene therapy product candidates targeting other diseases;

● continuing to invest in expanding, developing and optimizing our manufacturing capabilities and other enabling technologies, such as next-generation viral vectors, promoters and re-dosing;

● potentially acquiring or in-licensing rights to new therapeutic targets, product candidates and technologies;

● making potential future milestone payments related to the acquisition of Corlieve, if any.

See “Results of Operations” below for a discussion of the detailed components and analysis of the amounts above.

6 unchanged sentences

A summary of our critical accounting policies as well as a discussion of our critical accounting estimates are presented in our Annual Report .

There were no material changes to our critical accounting policies during the three months ended March 31, 2022 or reasonably possible changes of our critical accounting estimates as of March 31, 2022 that could have had a material impact on our results of operations for the three-month period ended March 31, 2022.

There were no material changes to our critical accounting policies during the six months ended June 30, 2022 or reasonably possible changes of our critical accounting estimates as of June 30, 2022 that could have had a material impact on our results of operations for the three and six-month period ended June 30, 2022.

Cost of contract revenues

We expense contract fulfillment costs associated with license revenue recognized under the CSL Behring Agreement as cost of contract revenues.

Cost of contract manufacturing

Since April 1, 2022, we expense cost to manufacture the Product under the CSL Behring June 2020 Development and Commercial Supply Agreement as cost of contract manufacturing.

We capitalize the cost to manufacture the Product as inventory to the extent we expect to realize probable future benefits.

Research and development expenses

We expense research and development (“R&D”) expenses as incurred.

Research and development expenses include costs which relate to our primary activities of biopharmaceutical research and development.

Our R&D expenses generally consist of costs incurred for the development of our target candidates, which include:

3 unchanged sentences

● costs incurred for the development and improvement of our manufacturing processes and methods;

● costs incurred for the supply of materials for our target candidates;

● costs associated with research activities for enabling technology platforms, such as next-generation vectors, promoters and re-administration of gene therapies;

● costs associated with the rendering of collaboration services as well as the continued development of Product between the Signing Date and Closing;

● costs associated with the rendering of collaboration services as well as the continued development of the Product between the Signing Date and Closing;

● facilities, depreciation, and other expenses, which include direct and allocated expenses for rent and maintenance of facilities, insurance, and other supplies;

14 unchanged sentences

We incurred expenses associated with operating as a public company, including expenses for personnel, legal, accounting and audit fees, board of directors’ costs, directors' and officers' liability insurance premiums, Nasdaq listing fees, expenses related to investor relations and fees related to business development and maintaining our patent and license portfolio.

Our selling costs in the three months ended March 31, 2021 included employee expenses, as well as professional fees related to the preparation of a commercial launch of etranacogene dezaparvovec.

Our selling costs in the three and six months ended June 30, 2021 included employee expenses, as well as professional fees related to the preparation of a commercial launch of etranacogene dezaparvovec and advisory fees related to obtaining the CSL Behring Agreement.

Other items, net

Our other income primarily consists of income from the subleasing of our Amsterdam facility.

Our other income primarily consists of payments received to subsidize our research and development efforts and income from the subleasing of our Amsterdam facility.

For the three and six months ended June 30, 2021, other income also consisted of the recognition of the equity stake received in VectorY B.V., as well as an employee retention credit under the U.S.

Coronavirus Aid, Relief, and Economic Security Act (“CARES Act”).

Our other expense primarily consists of expenses we incur in relation to our subleasing income.

Results of Operations

Comparison of the three months ended March 31, 2022 and 2021

The following table presents a comparison of our results of operations for the three months ended March 31, 2022 and 2021.

Three months ended March 31,

Comparison of the three months ended June 30, 2022 and 2021

The following table presents a comparison of our results of operations for the three months ended June 30, 2022 and 2021.

Three months ended June 30,

(in thousands)

1 unchanged sentence

Operating expenses:

Cost of contract revenues

Cost of contract manufacturing

Research and development expenses

2 unchanged sentences

Other expense

Loss from operations

(Loss) / income from operations

Other non-operating items, net

Net loss before income tax income / (expense)

Income tax income / (expense)

Our collaboration revenue for the three months ended March 31, 2022 and 2021 was as follows:

Three months ended March 31,

Net (loss) / income before income tax benefit / (expense)

Income tax benefit / (expense)

Net (loss) / income

Our revenue for the three months ended June 30, 2022 and 2021 was as follows:

Three months ended June 30,

(in thousands)

Collaboration revenue CSL Behring

Collaboration revenue BMS

License revenue

Collaboration revenue

Total revenues

We did not recognize any license revenue related to the CSL Behring Agreement in the three months ended June 30, 2022.

In the three months ended June 30, 2021, we recognized $462.4 million in license revenue related to the sale of the exclusive global rights to the Product (“License Sale”) on Closing of the CSL Behring Agreement in May 2021.

We recogniz ed nil collaboration revenue in the three months ended June 30, 2022, compared to $0.4 million for the same period in 2021.

Since May 6, 2021, we recognize collaboration revenue related to services we provide in accordance with the CSL Behring Agreement.

We recognized $0.5 million collaboration revenue in the three months ended June 30, 2022 compared to $1.1 million for the three months ended June 30, 2021.

Cost of contract revenues

We did not recognize any cost of contract revenues for the three months ended June 30, 2022 compared to $23.2 million for the three months ended June 30, 2021.

The cost recorded in 2021 included $16.7 million of expenses related to payments owed to our licensors on Closing as well as $6.5 million of other external expenses incurred to fulfill the License Sale to CSL Behring.

Cost of contract manufacturing

We incurred $0.8 million of cost of contract manufacturing related to the manufacture of the Product in the three months ended June 30, 2022, which we did not capitalize as inventory in accordance with our accounting policies.

Research and development expenses

Research and development expenses for the three months ended March 31, 2022 were $45.0 million, compared to $32.7 million for the same period in 2021.

Research and development expenses for the three months ended June 30, 2022 were $46.2 million, compared to $32.7 million for the same period in 2021.

Other research and development expenses are separately classified in the table below.

These other expenses are not allocated as they are deployed across multiple projects under development.

Three months ended March 31,

Three months ended June 30,

(in thousands)

Temporal lobe epilepsy (AMT-260)

Huntington's disease (AMT-130)

10 unchanged sentences

Direct research and development expenses

Temporal lobe epilepsy (AMT-260)

In the three months ended June 30, 2022, and June 30, 2021, we incurred $6.3 million and nil, respectively for the preclinical development of temporal lobe epilepsy, which we acquired from Corlieve Therapeutics SAS (“Corlieve”) on July 30, 2021.

Huntington disease (AMT-130)

In the three months ended March 31, 2022, and March 31, 2021, our external costs for the development of AMT-130 were primarily related to the execution of our Phase I/II clinical trial in the United States.

The costs incurred for the three months ended March 31, 2022 also included costs related to our Phase I/IIb clinical trial in Europe .

In the three months ended June 30, 2022 and June 30, 2021, our external costs for the development of AMT-130 were primarily related to the execution of our Phase I/II clinical trial in the United States.

Expenses incurred for the three months ended June 30, 2022 also included costs related to our Phase Ib/II clinical trial in Europe .

Preclinical programs & platform development

In the three months ended March 31, 2022, we incurred $4.6 million of costs primarily related to our preclinical activities associated with product candidates for the treatment of Fabry disease (AMT-191) and temporal lobe epilepsy (AMT-260), as well as various other research programs and technology innovation projects.

In the three months ended March 31, 2021, we incurred $2.3 million of costs primarily related to our preclinical activities primarily associated with product candidates for the treatment of SCA3 (AMT-150) and Fabry disease (AMT-190), as well as various other research programs and technology innovation projects.

In the three months ended June 30, 2022, we incurred $2.2 million of costs primarily related to our preclinical activities associated with product candidates for the treatment of Fabry disease (AMT-191), as well as various other research programs and technology innovation projects.

In the three months ended June 30, 2021, we incurred $2.4 million of costs primarily related to our preclinical activities associated with product candidates for the treatment of SCA3 (AMT-150) and Fabry disease (AMT-190), as well as various other research programs and technology innovation projects.

Hemophilia B (AMT-060/061)

In the three months ended March 31, 2022 and March 31, 2021, the external costs for our hemophilia B program were primarily related to the execution of our Phase III clinical trial.

Up to the Closing of the CSL Behring Agreement in May 2021 we also incurred costs related to the preparation of the global regulatory submissions and for commercialization of the Product.

We also incurred costs for Manufacturing Development.

After the Closing, CSL Behring is responsible for the clinical and regulatory development and commercialization of the Product, with the Company managing the existing trials on behalf of CSL Behring.

Direct research and development expenses related to clinical development incurred in the three months ended March 31, 2022 are presented net of reimbursements due from CSL Behring.

I n the same period in 2021, we also incurred costs related to the long-term follow-up of patients in our Phase I/II clinical trial of AMT-060 and our Phase IIb clinical trial of etranacogene dezaparvovec.

In the three months ended June 30, 2022 and June 30, 2021, the external costs for our hemophilia B program were primarily related to the execution of our Phase III clinical trial and Manufacturing Development.

Up to the Closing of the CSL Behring Agreement in May 2021, we also incurred costs related to the preparation of the global regulatory submissions and to prepare for the commercialization of the Product.

After the Closing, CSL Behring is responsible for the clinical and regulatory activities and commercialization of the Product, with the Company managing the existing trials on behalf of CSL Behring.

Direct research and development expenses related to clinical development incurred in the three months ended June 30, 2022 are presented net of reimbursements due from CSL Behring.

I n the same periods in 2022 and 2021, we also incurred costs related to the long-term follow-up of patients in our Phase I/II clinical trial of AMT-060 and our Phase IIb clinical trial of etranacogene dezaparvovec.

Our Phase IIb dose-confirmation study was initiated in January 2018 and dosing occurred in July and August 2018.

Patients were dosed as part of our Phase I/II clinical trial of AMT-060 in 2015 and 2016.

These costs are presented net of reimbursements due from CSL Behring.

Other research & development expenses

● We incurred $16.2 million in personnel and contractor related expenses in the three months ended March 31, 2022, compared to $11.6 million for the same period in 2021.

● We incurred $15.1 million in personnel and contractor related expenses in the three months ended June 30, 2022, compared to $13.1 million for the same period in 2021.

The increase was primarily a result of the recruitment of personnel to support the development of our product candidates;

● We incurred $5.3 million in operating expenses and depreciation expenses related to our rented facilities in the three months ended March 31, 2022, compared to $4.6 million in the same period in 2021;

● We incurred $5.4 million in operating expenses and depreciation expenses related to our rented facilities in the three months ended June 30, 2022, compared to $4.4 million in the same period in 2021 as a result of investments we made to expand our facilities;

● We incurred $4.5 million in disposable costs compared to $3.6 million for the same period in 2021;

● We incurred $4.1 million in share-based compensation expenses in the three months ended March 31, 2022, compared to $2.7 million for the same period in 2021.

● We incurred $4.3 million in share-based compensation expenses in the three months ended June 30, 2022, compared to $3.3 million for the same period in 2021.

The increase was primarily a result of an increase in awards granted, including those to newly recruited personnel;

● We incurred $2.6 million of other expenses for the three months ended March 31, 2022, compared to $2.5 million for the same period in 2021;

● We incurred $2.2 million of expenses in the three months ended March 31, 2022 related to an increase in the fair value of contingent consideration associated with the acquisition of Corlieve Therapeutics SAS (“Corlieve”), compared to nil for the same period in 2021.

● We incurred $2.1 million of other expenses for the three months ended June 30, 2022, compared to $1.2 million for the same period in 2021.

Selling, general and administrative expenses

Selling, general and administrative expenses for the three months ended March 31, 2022 were $11.0 million, compared to $12.4 million for the same period in 2021.

● We incurred $4.4 million in personnel and contractor related expenses in the three months ended March 31, 2022, compared to $3.9 million in the same period in 2021.

The increase in the three months ended March 31, 2022, relates to the recruitment of personnel;

● We incurred $2.8 million in share-based compensation expenses in the three months ended March 31, 2022, compared to $3.1 million in the same period in 2021;

● We incurred $1.1 million in professional fees in the three months ended March 31, 2022, compared to $2.9 million in the same period in 2021.

Selling, general and administrative expenses for the three months ended June 30, 2022 were $12.5 million, compared to $17.3 million for the same period in 2021.

● We incurred $5.2 million in personnel and contractor related expenses in the three months ended June 30, 2022, compared to $4.2 million in the same period in 2021;

● We incurred $3.4 million in share-based compensation expenses in the three months ended June 30, 2022, compared to $3.7 million in the same period in 2021;

● We incurred $1.5 million in professional fees in the three months ended June 30, 2022, compared to $2.0 million in the same period in 2021.

We regularly incur accounting, audit and legal fees associated with operating as a public company ;

The decrease from the prior period is primarily related to a decrease in professional fees related to the licensing transaction with CSL Behring.

● We incurred nil financial advisory fees in relation to our licensing transaction with CSL Behring in the three months ended June 30, 2022, compared to $4.5 million in the same period in 2021.

Other items, net

Other items, net for the periods presented primarily relate to income from the subleasing of our Amsterdam facility and expenses we incur in relation to the subleasing facility.

In the three months ended June 30, 2022, we recognized $0.3 million in other income in relation to the equity stake received in VectorY B.V.

in conjunction with a settlement agreement entered into in April 2021 compared to $3.0 million such income for the same period in 2021.

We recognized nil in other income related to the employee retention credit under the U.S.

CARES Act in the three months ended June 30, 2022, compared to $1.3 million for the same period in 2021.

We recognized $2.6 million in other income from payments received from European authorities to subsidize our research and development efforts in the Netherlands in the three months ended June 30, 2022, compared to $3.0 million for the same period in 2021.

Other income also includes income from subleasing of a portion of our Amsterdam facility.

We present expenses related to such income as other expense.

Other non-operating items, net

Our other non-operating items, net, for the three months ended March 31, 2022 and 2021 were as follows:

Three months ended March 31,

Our other non-operating items, net, for the three months ended June 30, 2022 and 2021 were as follows:

Three months ended June 30,

(in thousands)

2 unchanged sentences

Foreign currency gains, net

Other non-operating gains

Other non-operating losses

Total other non-operating income, net

2 unchanged sentences

We recognize foreign exchange results related to changes in these foreign currencies.

We recognized a net foreign currency gain, related to our borrowings from Hercules and our cash and cash equivalents as well as loans between entities within the uniQure group, of $19.4 million during the three months ended June 30, 2022, compared to a net gain of $6.6 million during the same period in 2021.

We recognize fair value changes related to the derivative financial liability related to a contingent payment due to BMS upon the consummation of a change of control transaction (“CoC-payment”) as described elsewhere in this Quarterly Report on Form 10-Q.

We recognized a net foreign currency gain, related to our borrowings from Hercules and our cash and cash equivalents as well as loans between entities within the uniQure group, of $8.6 million during the three months ended March 31, 2022, compared to a net gain of $4.6 million during the same period in 2021.

Income tax benefit / (expense)

We recognized $0.6 million of deferred tax benefit in the three months ended March 31, 2022, and $0.2 million of deferred tax expense for the same period in 2021.

We recognized $0.3 million of deferred tax benefit in the three months ended June 30, 2022, and $3.3 million of deferred tax expense for the same period in 2021.

Comparison of the six months ended June 30, 2022 and 2021

The following table presents a comparison of our results of operations for the six months ended June 30, 2022 and 2021.

Six months ended June 30,

(in thousands)

Total revenues

Operating expenses:

Cost of contract revenues

Cost of contract manufacturing

Research and development expenses

Selling, general and administrative expenses

Total operating expenses

Other expense

(Loss) / income from operations

Non-operating items, net

(Loss) / income before income tax benefit / (expense)

Income tax benefit / (expense)

Net (loss) / income

Our revenue for the six months ended June 30, 2022 and 2021 was as follows:

Six months ended June 30,

(in thousands)

License revenue

Collaboration revenue

Total revenues

We did not recognize any license revenue related to the CSL Behring Agreement in the six months ended June 30, 2022.

In the six months ended June 30, 2021, we recognized $462.4 million in license revenue related to the License Sale on Closing of the CSL Behring Agreement in May 2021.

We recognized $1.4 million collaboration revenue in the six months ended June 30, 2022, compared to $0.4 million for the same period in 2021.

Since May 6, 2021, we recognize collaboration revenue related to services we provide in accordance with the CSL Behring Agreement.

We recognized $0.8 million collaboration revenue in the six months ended June 30, 2022 compared to $1.5 million for the six months ended June 30, 2021.

Cost of contract revenues

We did not recognize any cost of contract revenues for the six months ended June 30, 2022 compared to $23.2 million for the six months ended June 30, 2021.

Cost of contract manufacturing

We incurred $0.8 million of cost of contract manufacturing related to the manufacture of the Product in the six months ended June 30, 2022, which we did not capitalize as inventory in accordance with our accounting policies.

Research and development expenses

Research and development expenses for the six months ended June 30, 2022 were $91.2 million, compared to $64.8 million for the same period in 2021.

Other research and development expenses are separately classified in the table below.

These other expenses are not allocated as they are deployed across multiple projects under development.

Six months ended June 30,

(in thousands)

Huntington's disease (AMT-130)

Temporal lobe epilepsy (AMT-260)

Programs in preclinical development and platform related expenses

Etranacogene dezaparvovec (AMT-060/061)

Total direct research and development expenses

Employee and contractor-related expenses

Facility expenses

Share-based compensation expense

Other expenses

Fair value changes related to contingent consideration

Total other research and development expenses

Total research and development expenses

Direct research and development expenses

Huntington disease (AMT-130)

In the six months ended June 30, 2022 and June 30, 2021, our external costs for the development of AMT-130 were primarily related to the execution of our Phase I/II clinical trial in the United States.

Expenses incurred for the six months ended June 30, 2022 also included costs related to our Phase Ib/II clinical trial in Europe .

Temporal lobe epilepsy (AMT-260)

In the six months ended June 30, 2022 and June 30, 2021, we incurred $8.9 million and nil, respectively for the preclinical development of temporal lobe epilepsy, which we acquired from Corlieve on July 31, 2021.

Preclinical programs & platform development

In the six months ended June 30, 2022, we incurred $4.1 million of costs primarily related to our preclinical activities associated with product candidates for the treatment of Fabry disease (AMT-191), as well as various other research programs and technology innovation projects.

In the six months ended June 30, 2021, we incurred $4.7 million of costs primarily related to our preclinical activities associated with product candidates for the treatment of SCA3 (AMT-150) and Fabry disease (AMT-190), as well as various other research programs and technology innovation projects.

Hemophilia B (AMT-060/061)

In the six months ended June 30, 2022 and June 30, 2021, the external costs for our hemophilia B program were primarily related to the execution of our Phase III clinical trial and Manufacturing Development.

After the Closing, CSL Behring is responsible for the clinical and regulatory activities and commercialization of the Product, with the Company managing the existing trials on behalf of CSL Behring.

Direct research and development expenses related to clinical development incurred in the six months ended June 30, 2022 are presented net of reimbursements due from CSL Behring.

In the same periods in 2022 and 2021, we also incurred costs related to the long-term follow-up of patients in our Phase I/II clinical trial of AMT-060 and our Phase IIb clinical trial of etranacogene dezaparvovec.

Our Phase IIb dose-confirmation study was initiated in January 2018 and dosing occurred in July and August 2018.

Patients were dosed as part of our Phase I/II clinical trial of AMT-060 in 2015 and 2016.

These costs are presented net of reimbursements due from CSL Behring.

Other research & development expenses

● We incurred $31.2 million in personnel and contractor related expenses in the six months ended June 30, 2022, compared to $24.7 million for the same period in 2021.

The increase was primarily a result of the recruitment of personnel to support the development of our product candidates;

● We incurred $10.7 million in operating expenses and depreciation expenses related to our rented facilities in the six months ended June 30, 2022, compared to $9.0 million in the same period in 2021 as a result of investments we made to expand our facilities;

● We incurred $9.1 million in disposable costs compared to $6.9 million for the same period in 2021;

● We incurred $8.4 million in share-based compensation expenses in the six months ended June 30, 2022, compared to $6.0 million for the same period in 2021.

The increase was primarily a result of an increase in awards granted, including those to newly recruited personnel;

● We incurred $4.7 million of other expenses for the six months ended June 30, 2022, compared to $3.0 million for the same period in 2021;

● We incurred $2.0 million of expenses in the six months ended June 30, 2022 related to an increase in the fair value of contingent consideration associated with the acquisition of Corlieve Therapeutics SAS (“Corlieve”), compared to nil for the same period in 2021.

Selling, general and administrative expenses

Selling, general and administrative expenses for the six months ended June 30, 2022 were $23.5 million, compared to $30.3 million for the same period in 2021.

● We incurred $9.5 million in personnel and contractor related expenses in the six months ended June 30, 2022, compared to $8.1 million in the same period in 2021.

The increase in the six months ended June 30, 2022, relates to the recruitment of personnel;

● We incurred $6.2 million in share-based compensation expenses in the six months ended June 30, 2022, compared to $6.8 million in the same period in 2021;

● We incurred $2.7 million in professional fees in the six months ended June 30, 2022, compared to $5.0 million in the same period in 2021.

We regularly incur accounting, audit and legal fees associated with operating as a public company.

The decrease from the prior period is primarily related to a decrease in professional fees related to the licensing transaction with CSL Behring;

● We incurred nil financial advisory fees in relation to our licensing transaction with CSL Behring in the six months ended June 30, 2022, compared to $4.5 million in the same period in 2021.

Other items, net

In the six months ended June 30, 2022, we recognized $0.3 million in other income in relation to the equity stake received in VectorY B.V.

in conjunction with a settlement agreement entered into in April 2021 compared to $3.0 million such income for the same period in 2021.

We recognized nil in other income related to the employee retention credit under the U.S.

CARES Act in the six months ended June 30, 2022, compared to $1.3 million in other income for the same period in 2021.

We recognized $2.7 million in other income from payments received from European authorities to subsidize our research and development efforts in the Netherlands in the six months ended June 30, 2022, compared to $3.0 million for the same period in 2021.

Other income also includes income from subleasing of a portion of our Amsterdam facility.

We present expenses related to such income as other expense.

Other non-operating items, net

Our other non-operating items, net, for the six months ended June 30, 2022 and 2021 were as follows:

Six months ended June 30,

(in thousands)

Interest income

Interest expense

Foreign currency gains, net

Other non-operating gains

Total non-operating income, net

We recognize interest income associated with our cash and cash equivalents.

We hold monetary items and enter into transactions in foreign currencies, predominantly in euros and U.S.

We recognize foreign exchange results related to changes in these foreign currencies.

We recognized a net foreign currency gain, related to our borrowings from Hercules and our cash and cash equivalents as well as loans between entities within the uniQure group, of $28.0 million during the six months ended June 30, 2022, compared to a net gain of $11.2 million during the same period in 2021.

We recognize fair value changes related to the derivative financial liability related to a contingent payment due to BMS upon a change of control as described elsewhere in this Quarterly Report on Form 10-Q.

Income tax benefit / expense

We recognized $0.9 million of deferred tax benefit in the six months ended June 30, 2022, and $3.5 million of deferred tax expense for the same period in 2021.

Financial Position, Liquidity and Capital Resources

As of March 31, 2022, we had cash, cash equivalents and restricted cash of $528.1 million.

As of June 30, 2022, we had cash, cash equivalents and restricted cash of $503.7 million.

U ntil such time, if ever, as we can generate substantial cash flows from successfully commercializing our proprietary product candida tes, we expect to finance our cash needs through a combination of equity offerings, debt financings, collaborations, strategic alliances and marketing, distribution, and licensing arrangements.

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Our material cash requirements include the following contractual and other obligations:

As of March 31, 2022, we had an outstanding loan amount owed to Hercules Capital, Inc.

(“Hercules”) for an aggregate principal amount of $100.0 million, with $8.3 million payable within 12 months.

Future interest payments and financing fees associated with the loan total $34.5 million, with $8.3 million payable within 12 months.

As of June 30, 2022, we had an outstanding loan amount owed to Hercules Capital, Inc.

(“Hercules”) for an aggregate principal amount of $100.0 million.

We are contractually required to repay the $100.0 million in equal installments between December 2024 and December 2025, or in full in December 2025 if, prior to June 30, 2024, either (a) the Biologics License Application (“BLA”) for AMT-061 is approved by the FDA, or (b) AMT-130 is advanced into a pivotal trial.

Future interest payments and financing fees associated with the loan total $36.2 million, with $12.1 million payable within 12 months.

We entered into lease arrangements for facilities, including corporate, manufacturing and office space.

As of March 31, 2022, we had fixed lease payment obligations of $63.3 million, with $7.0 million payable within 12 months.

The fixed lease payment obligations include payments owed under signed lease arrangements that are expected to commence in 2022.

As of June 30, 2022, we had fixed lease payment obligations of $60.3 million, with $7.0 million payable within 12 months.

Commitments related to Corlieve acquisition (nominal amounts)

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The commitments include payments related to post-acquisition services that we agreed to as part of the Stock Purchase Agreement between the Company and Corlieve (“SPA”).

As of March 31, 2022, our commitment amount is $223.7 million.

The timing of achieving these milestones and consequently the timing of payments, as well as whether the milestone will be achieved at all, is generally uncertain with the exception of a payment we made in February 2022 to acquire the remaining outstanding shares as well as certain payments for post-acquisition services in 2022.

These payments are owed in Euro and have been translated at the foreign exchange rate as of March 31, 2022, of $1.11/€1.00.

As of March 31, 2022, we expect these obligations will become payable between 2022 and 2031.

As of June 30, 2022, our commitment amounts include up to $43.1 million in potential milestone payments through Phase I/II development and $167.2 million in potential milestone payments associated with Phase III development and the approvals of AMT-260 in the United States and European Union.

The timing of achieving these milestones and consequently the timing of payments, as well as whether the milestone will be achieved at all, is generally uncertain.

These payments are owed in Euro and have been translated at the foreign exchange rate as of June 30, 2022, of $1.05/€1.00.

As of June 30, 2022, we expect these obligations will become payable between 2023 and 2031.

If and when due, up to 25% of the milestone payments can be settled with our ordinary shares.

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We also owe payments to a financial advisor related to any payments we will collect under the CSL Behring Agreement.

The table below summarizes our consolidated cash flow data for the three months ended:

Three months ended March 31,

The table below summarizes our consolidated cash flow data for the six months ended:

Six months ended June 30,

(in thousands)

Cash, cash equivalents and restricted cash at the beginning of the period

Net cash used in operating activities

Net cash (used in) / generated from operating activities

Net cash used in investing activities

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We continue to incur losses in the current period.

We recorded a net loss of $46.7 million in the three months ended March 31, 2022, compared to a net loss of $41.6 million during the same periods in 2021.

As of March 31, 2022, we had an accumulated deficit of $501.8 million.

We recorded a net loss of $39.1 million and $85.7 million in the three and six months ended June 30, 2022, compared to a net income of $399.5 million and $357.9 million during the same periods in 2021.

As of June 30, 2022, we had an accumulated deficit of $540.9 million.

Sources of liquidity

4 unchanged sentences

We 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 a sales agent under the Sales Agreement.

In the year ended December 30, 2021, we received net proceeds of $29.6 million from the issuance of 921,730 ordinary shares that took place during March and April of last year.

In the year ended December 30, 2021, we received net proceeds of $29.6 million from the issuance of 921,730 ordinary shares that took place during March and April 2021.

On January 29, 2021, we drew down $35 million under our 2021 amendment (“2021 Amended Facility”) with Hercules.

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Net Cash used in operating activities

Net cash used in operating activities was $25.7 million for the three months ended March 31, 2022 and consisted of net loss of $46.7 million adjusted for non-cash items, including depreciation and amortization expense of $2.1 million, share-based compensation expense of $6.9 million, changes in the fair value of contingent consideration and the derivative financial liability of $1.5 million, unrealized foreign exchange gains of $7.4 million and a change in deferred taxes of $0.6 million.

Net cash used in operating activities was $41.4 million for the six months ended June 30, 2022 and consisted of net loss of $85.7 million adjusted for non-cash items, including depreciation and amortization expense of $4.1 million, share-based compensation expense of $14.7 million, changes in the fair value of contingent consideration and the derivative financial liability of $1.4 million, unrealized foreign exchange gains of $24.5 million and a change in deferred taxes of $0.9 million.

Net cash generated from operating activities also included favorable changes in operating assets and liabilities of $49.9 million.

There was a net decrease in accounts receivable and contract asset, prepaid expenses, and other current assets and receivables of $17.2 million, primarily related to the collection of $20.0 million of the contract asset related to CSL milestones of $55.0 million in March 2022.

These changes also relate to a net increase in accounts payable, accrued expenses, other liabilities, and operating leases of $1.2 million.

Net cash used in operating activities was $41.3 million for the three months ended March 31, 2021 and consisted of a net loss of $41.6 million adjusted for non-cash items, including depreciation and amortization expense of $1.9 million, share-based compensation expense of $5.8 million, unrealized foreign exchange gains of $5.3 million and deferred tax expense of $0.2 million.

Net cash used in operating activities also included unfavorable changes in operating assets and liabilities of $2.2 million.

These changes primarily related to a net increase in accounts receivable, prepaid expenses, and other current assets and receivables of $8.0 million primarily related to the increase in a contract asset and receivable recorded for CSL expenses to be reimbursed as well as an increase in various prepayments for the year and a net increase in accounts payable, accrued expenses, other liabilities, and operating leases of $5.8 million primarily related to an increase in contract liability for CSL expenses to be reimbursed and an increase in accruals for services provided by vendors not yet billed offset by the pay-out of employee bonuses.

There was a net decrease in accounts receivable and contract asset, prepaid expenses, and other current assets and receivables of $46.5 million, primarily related to the collection of $55.0 million of the contract asset related to CSL milestones of $55.0 million in March 2022 and April 2022.

There was an increase in inventory balances of $2.9 million related to the production of etranacogene dezaparvovec under the CSL Behring Agreement.

These changes also relate to a net increase in accounts payable, accrued expenses, other liabilities, and operating leases of $6.3 million, primarily related to an increase in accounts payable.

Net cash generated from operating activities was $375.2 million for the six months ended June 30, 2021 and consisted of a net income of $357.9 million adjusted for non-cash items, including depreciation and amortization expense of $3.7 million, share-based compensation expense of $12.8 million, unrealized foreign exchange gains, net of $12.3 million, deferred tax expense of $3.5 million and other non-cash items of $2.9 million.

Net cash used in operating activities also included favorable changes in operating assets and liabilities of $12.6 million.

These changes primarily related to a net increase in accounts receivable, prepaid expenses, and other current assets and receivables of $3.4 million primarily related to the increase in a contract asset and receivable recorded for CSL expenses to be reimbursed as well as an increase in various prepayments for the year and a net increase in accounts payable, accrued expenses, other liabilities, and operating leases of $15.9 million primarily related to an increase in amounts to be paid to licensors upon the CSL Behring Closing.

Net income primarily consisted of $462.4 million license revenue recognized on Closing.

Net cash used in investing activities

In the three months ended March 31, 2022, we used $4.9 million in our investing activities compared to $3.9 million for the same period in 2021.

Three months ended March 31,

In the six months ended June 30, 2022, we used $9.5 million in our investing activities compared to $6.2 million for the same period in 2021.

Six months ended June 30,

(in thousands)

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Total investments

The build out of the Amsterdam site consumed $3.7 million cash during the three months ended March 31, 2022, compared to $2.4 million for the same period in 2021.

The build out of the Amsterdam site and Lexington site consumed $6.4 million and $2.2 million cash respectively during the six months ended June 30, 2022, compared to $4.5 million and $1.7 million for the same period in 2021.

The increase is a result of additional investments to support the expansions of our research and development activities.

Net cash generated from financing activities

In the three months ended March 31, 2022, we generated $0.5 million in our financing activities compared to $62.6 million for the same period in 2021.

Three months ended March 31,

In the six months ended June 30, 2022, we generated $0.5 million in our financing activities compared to $65.1 million for the same period in 2021.

Six months ended June 30,

(in thousands)

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Net cash generated from financing activities

During the three months ended March 31, 2022, we received $0.5 million from the exercise of options to purchase ordinary shares in relation to our share incentive plans compared to $0.4 million for the same period in 2021.

During the six months ended June 30, 2022, we received $0.5 million from the exercise of options to purchase ordinary shares in relation to our share incentive plans compared to $1.0 million for the same period in 2021.

In January 2021, we received $34.6 million net proceeds from the Hercules 2021 Amended Facility (nil for same period in 2022).

We received net proceeds of $27.6 million associated with our ATM offering in March 2021 (nil for same period in 2022).

We received net proceeds of $29.6 million associated with our ATM offering in March and April 2021 (nil for same period in 2022).

Funding requirements

Our future capital requirements will depend on many factors, including but not limited to:

● achieving the first commercial sales milestones and royalties as defined within the CSL Behring Agreement.

Achieving the first commercial sales milestones amongst others are subject to CSL Behring obtaining required regulatory approvals, including MAA approval from the EMA, BLA approval from the FDA, and approval of a diagnostic test for neutralizing antibodies from the FDA;

● the payment of milestone payments that we might owe to former shareholders of Corlieve;

● the repayments of the principal amount of our venture debt loan with Hercules, which following the December 15, 2021 amendment will be due in equal installments between December 2024 and December 2025 or in full in December 2025 if, prior to June 30, 2024, either (a) the BLA for AMT-061 is approved by the FDA or (b) AMT-130 is advanced into a pivotal trial;

● contractual milestone payments and royalties we might be owed in accordance with the CSL Behring Agreement, which are subject to CSL Behring obtaining required regulatory approvals, including MAA approval from the EMA, BLA approval from the FDA, and approval of a diagnostic test for neutralizing antibodies from the FDA;

● earnout payments we might owe the former shareholders of Corlieve, which are subject to the achievement of specific development and regulatory milestones;

● repayments of the principal amount of our venture debt loan with Hercules, which following the December 15, 2021 amendment will be due in equal installments between December 2024 and December 2025 or in full in December 2025 if, prior to June 30, 2024, either (a) the BLA for AMT-061 is approved by the FDA or (b) AMT-130 is advanced into a pivotal trial;

● the scope, timing, results, and costs of our current and planned clinical trials, including those for AMT-130 in Huntington’s disease;

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

What changed 10-Q

Item 2. Management’s Discussion and Analysis