What changed in this filing

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Item 1. Financial Statements

2024-11-05 compared with 2024-08-01 · 175 added, 135 removed, 375 unchanged (45% of the section changed)

1 unchanged sentence

UNAUDITED CONSOLIDATED BALANCE SHEETS

September 30,

(in thousands, except share and per share amounts)

5 unchanged sentences

Prepaid expenses

Assets held for sale

Other current assets and receivables

1 unchanged sentence

Non-current assets

Property, plant and equipment, net of accumulated depreciation of $ 27.9 million as of June 30, 2024 and $ 55.7 million as of December 31, 2023

Property, plant and equipment, net of accumulated depreciation of $ 30.8 million as of September 30, 2024 and $ 55.7 million as of December 31, 2023

Other investments

Operating lease right-of-use assets

Intangible assets, net, including in-process research and development asset of $ 57.4 million as of June 30, 2024 and $ 59.1 million as of December 31, 2023

Intangible assets, net, including in-process research and development asset of $ 59.8 million as of September 30, 2024 and $ 59.1 million as of December 31, 2023

Deferred tax assets, net

6 unchanged sentences

Current portion of operating lease liabilities

Liabilities held for sale

Total current liabilities

5 unchanged sentences

Deferred tax liability, net

Other non-current liabilities

Other non-current liabilities, net of current portion

Total non-current liabilities

3 unchanged sentences

Ordinary shares, € 0.05 par value:

80,000,000 shares authorized as of June 30, 2024 and December 31, 2023 and 48,694,569 and 47,833,830 ordinary shares issued and outstanding as of June 30, 2024 and December 31, 2023, respectively

80,000,000 shares authorized as of September 30, 2024 and December 31, 2023 and 48,738,874 and 47,833,830 ordinary shares issued and outstanding as of September 30, 2024 and December 31, 2023, respectively

Additional paid-in-capital

7 unchanged sentences

COMPREHENSIVE LOSS

Three months ended June 30,

Six months ended June 30,

Three months ended September 30,

Nine months ended September 30,

(in thousands, except share and per share amounts)

14 unchanged sentences

Interest expense

Foreign currency losses, net

Foreign currency gains / (losses), net

Loss before income tax (expense) / benefit

Income tax (expense) / benefit

Other comprehensive (loss) / income:

Foreign currency translation (loss) / gains, net

Income tax benefit / (expense)

Other comprehensive loss:

Foreign currency translation loss, net

Defined benefit pension gain, net of taxes

4 unchanged sentences

UNAUDITED CONSOLIDATED STATEMENTS OF SHAREHOLDERS’ EQUITY

FOR THE THREE MONTHS ENDED JUNE 30, 2024 AND 2023

FOR THE THREE MONTHS ENDED SEPTEMBER 30, 2024 AND 2023

Ordinary shares

2 unchanged sentences

(in thousands, except share and per share amounts)

Balance at March 31, 2023

Balance at June 30, 2023

Loss for the period

Other comprehensive income

Other comprehensive loss, net

Exercises of share options

2 unchanged sentences

Issuance of ordinary shares relating to employee stock purchase plan

Balance at September 30, 2023

Balance at June 30, 2024

Balance at March 31, 2024

( 1,012,326 )

Loss for the period

Other comprehensive loss, net

Exercises of share options

Restricted share units distributed during the period

Share-based compensation expense

Issuance of ordinary shares relating to employee stock purchase plan

Balance at June 30, 2024

Balance at September 30, 2024

( 1,056,704 )

1 unchanged sentence

UNAUDITED CONSOLIDATED STATEMENTS OF SHAREHOLDERS’ EQUITY

FOR THE SIX MONTHS ENDED JUNE 30, 2024 AND 2023

FOR THE NINE MONTHS ENDED SEPTEMBER 30, 2024 AND 2023

Ordinary shares

4 unchanged sentences

Loss for the period

Other comprehensive income

Other comprehensive loss, net

Exercises of share options

2 unchanged sentences

Issuance of ordinary shares relating to employee stock purchase plan

Balance at June 30, 2023

Balance at September 30, 2023

Balance at December 31, 2023

1 unchanged sentence

Other comprehensive loss, net

Exercises of share options

Restricted share units distributed during the period

1 unchanged sentence

Issuance of ordinary shares relating to employee stock purchase plan

Balance at June 30, 2024

Balance at September 30, 2024

( 1,056,704 )

1 unchanged sentence

UNAUDITED CONSOLIDATED STATEMENTS OF CASH FLOWS

Six months ended June 30,

Nine months ended September 30,

(in thousands)

8 unchanged sentences

Provision for inventory write-downs

Unrealized foreign exchange losses, net

Unrealized foreign exchange (gains) / losses, net

Other items, net

3 unchanged sentences

Accrued expenses, other liabilities, and operating leases

Contingent consideration milestone payment

Net cash used in operating activities

2 unchanged sentences

Investment in debt securities

Divestment of commercial manufacturing facility

Purchases of property, plant, and equipment

Net cash generated from investing activities

Net cash generated from / (used in) investing activities

Cash flows from financing activities

2 unchanged sentences

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

Net cash generated from financing activities

Repayment of long-term debt

Contingent consideration milestone payment

Net cash generated (used in) / generated from financing activities

Currency effect on cash, cash equivalents and restricted cash

33 unchanged sentences

The interim financial statements and related disclosures are unaudited, have been prepared on the same basis as the annual financial statements and, in the opinion of management, reflect all adjustments, which include only normal recurring adjustments, necessary for a fair statement of the financial position, results of operations and changes in financial position for the period presented.

There has been a reclassification of $ 2.2 million from Other non-current assets to Other investments within the comparative consolidated balance sheets at December 31, 2023 to improve the consistency and comparability of the consolidated financial statements.

Certain information and footnote disclosures normally included in annual financial statements prepared in accordance with U.S.

GAAP have been omitted.

The results of operations for the three and six months ended June 30, 2024, are not necessarily indicative of the results to be expected for the full year ending December 31, 2024, or for any other future year or interim period.

The results of operations for the three and nine months ended September 30, 2024, are not necessarily indicative of the results to be expected for the full year ending December 31, 2024, 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, 2023 filed by the Company with the SEC on February 28, 2024 (the “Annual Report”).

6 unchanged sentences

statements are described in the Company’s audited financial statements as of and for the year ended December 31, 2023, and the notes thereto, which are included in the Annual Report .

There have been no material changes in the Company’s significant accounting policies during the six months ended June 30, 2024 except as described within Note 3 “ Assets held for sale and divestiture of commercial manufacturing facilities ”.

There have been no material changes in the Company’s significant accounting policies during the nine months ended September 30, 2024 except as described within Note 3 “ Divestiture of commercial manufacturing activities ” and Note 5 “ CSL Behring collaboration .”

2.5 Recent accounting pronouncements

There have been no new accounting pronouncements or changes to accounting pronouncements during the six months ended June 30, 2024, as compared to the recent accounting pronouncements described in Note 2.3.27 of the Annual Report , which could be expected to materially impact the Company’s unaudited consolidated financial statements.

Assets held for sale and divestiture of commercial manufacturing activities

There have been no new accounting pronouncements or changes to accounting pronouncements during the nine months ended September 30, 2024, as compared to the recent accounting pronouncements described in Note 2.3.27 of the Annual Report , which could be expected to materially impact the Company’s unaudited consolidated financial statements.

Divestiture of commercial manufacturing activities

Description of transaction

On June 29, 2024, the Company and its affiliates entered into various agreements with Genezen Holdings Inc.

On June 29, 2024, affiliates of the Company agreed with Genezen Holdings Inc.

and its affiliate Genezen MA, Inc.

(together “Genezen”) to sell its commercial manufacturing activities located in Lexington, MA (the “Lexington Facility”) (the “Lexington Transaction”).

The transaction closed on July 22, 2024 (the “Closing”).

(together “Genezen”) to sell the Company’s commercial manufacturing activities located in Lexington, MA (the “Lexington Transaction”).

The Lexington Transaction closed on July 22, 2024 (the “Closing”).

Genezen extended offers of employment to a significant majority of the Company’s employees located at the Lexington facility (the “Lexington Facility”), with the remaining employees terminated effective August 30, 2024.

and uniQure biopharma B.V., both wholly owned subsidiaries of the Company, entered into an Asset Purchase Agreement (“APA”) with Genezen on June 29, 2024.

Pursuant to the APA, Genezen agreed to acquire the manufacturing equipment with a carrying value of $ 5.7 million and related manufacturing operations, inventory with a carrying value of $ 8.8 million and certain other assets with a carrying value of $ 12.3 million associated with the Lexington Facility on Closing.

As consideration, the Company received (i) shares of newly issued Series C preferred stock of Genezen Holdings Inc.

valued at $ 12.5 million, which are convertible into common stock and will accrue an 8.0 % per annum cumulative dividend, and (ii) a convertible promissory note with a nominal amount of $ 12.5 million, bearing interest at 8.0 % per annum and maturing 63 months following the date of issuance.

and uniQure biopharma B.V.

(the “Sellers”), both wholly owned subsidiaries of the Company (together “Company”) entered into an asset purchase agreement (“APA”) with Genezen.

Pursuant to the APA, Genezen agreed to acquire the manufacturing equipment and related manufacturing operations along with certain other assets associated with the Lexington Facility.

uniQure Inc., Genezen and the landlord of the Lexington Facility entered into an agreement for uniQure to assign and Genezen to assume the existing lease agreement between uniQure and the landlord.

also amended its original July 2013 guarantee to continue guaranteeing rental payments owed by Genezen until the end of the current term on May 31, 2029.

which are convertible into Genezen common stock and will accrue an 8.0 % per annum cumulative dividend, (ii) a convertible promissory note with a nominal amount of $ 12.5 million, bearing interest at 8.0 % per annum and maturing 63 months following the date of issuance and (iii) a right to purchase HEMGENIX® at terms considered favorable to market terms.

The Company recorded the Series C preferred stock in Genezen Holdings Inc.

issued to the Company at Closing at its fair market value of $ 12.5 million.

The Company subsequently measures these non-marketable equity securities at cost less any impairment, adjusted to fair value if there are observable price changes in orderly transactions for an identical or similar investment of the Genezen Holdings Inc., in accordance with topic ASC 321, Investments – Equity Securities.

The value of the Series C preferred stock was $ 12.5 million as of September 30, 2024.

The convertible promissory note was recognized at its fair value of $ 13.3 million at Closing.

The convertible promissory note is classified as not held for sale and subsequently measured at amortized cost, net of allowance for credit losses in accordance with topic ASC 310, Receivables as it did not meet the definition of a debt security under topic ASC 320, Investments – Debt Securities.

The Company accrues interest income on its convertible promissory note using the effective interest method over the convertible promissory note’s contractual term.

The convertible promissory note had a balance of $ 13.4 million and nil as of September 30, 2024 and December 31, 2023, respectively.

During the three and nine months ended September 30, 2024, the Company recognized $ 0.1 million and $ 0.1 million, respectively, of interest income.

As of September 30, 2024, the Company has not recorded an allowance for credit losses related to the convertible promissory note.

uniQure Inc., Genezen and the landlord of the Lexington Facility entered into an agreement for uniQure to assign and Genezen to assume the existing lease agreement between uniQure and the landlord at Closing.

The Company also amended its original July 2013 guarantee to continue guaranteeing rental payments owed by Genezen until the end of the current term on May 31, 2029.

In the event of Genezen’s default related to rental payments owed to the landlord, uniQure is entitled to terminate the assignment agreement and step into the original lease agreement.

Genezen extended offers of employment to a significant majority of the Company’s employees located at the Lexington Facility, with the remaining employees terminated effective August 30, 2024.

Concurrent with entering into the APA, uniQure Inc.

On Closing, the Company de-recognized its right of use asset with a carrying amount of $ 11.8 million and related lease liability for the facility, of $ 17.9 million, which were classified as held-for-sale as at June 30, 2024.

Following the Closing, $ 1.7 million of deposits were released and reclassified from restricted cash into cash.

At Closing, uniQure Inc.

entered into a Commercial Supply Agreement (“CSA”) with Genezen.

Pursuant to the terms of the CSA, the Company subcontracted the manufacturing of HEMGENIX® to Genezen.

Pursuant to the terms of the CSA, the parties agreed to subcontract the manufacturing of HEMGENIX® to Genezen.

The CSA includes a minimum term of three years and minimum purchase commitments of HEMGENIX® commercial supplies of $ 43.3 million over the first three years , unless certain contractual provisions are triggered.

The Company will continue to sell these HEMGENIX® commercial supplies to CSL Behring in accordance with the Development and Commercial Supply Agreement between uniQure biopharma B.V.

and CSL Behring Inc.

The CSA provides the Company with rights to purchase HEMGENIX® at terms considered favorable to arms-length market terms.

In accordance with ASC 805 Business Combinations, the Company recorded an intangible asset valued at $ 16.7 million with respect to these favorable terms.

The intangible asset will be amortized on a straight-line basis over a three-year term, commencing at Closing.

Amortization expense of $ 1.2 million (presented within Other expense in the Consolidated Statement of Operations and Comprehensive Loss) was recorded during the three and nine-month periods ended September 30, 2024.

The Company’s obligations with respect to the supply of HEMGENIX® to CSL Behring pursuant to the Development and Commercial Supply Agreement between uniQure biopharma B.V.

and CSL Behring Inc (the “DCSA”) remain in effect notwithstanding the subcontracting to Genezen.

The Company expects to resell HEMGENIX® material purchased from Genezen via its minimum commitments to CSL Behring at a loss.

In accordance with ASC 330 Inventory, the Company, at Closing, recognized a liability of $ 8.8 million related to the net losses expected from the purchase of these minimum commitments.

The liability is accounted for as a reduction of the consideration received.

The Company will subsequently adjust the liability for any changes to the losses expected to be incurred.

Changes to the liability are recorded as Other expense within the Company’s Consolidated Statements of Operations and Comprehensive Loss.

As of September 30, 2024, the Company classified $ 2.4 million of the liability as accrued expenses and other current liabilities and $ 5.5 million within Other non-current liabilities in the Consolidated Balance Sheets.

The Lexington Transaction was accounted for as a divestment of the Company’s commercial manufacturing activities.

The net fair value of consideration received of $ 25.4 million, less costs associated with the sale of $ 3.3 million, exceeded the $ 20.9 million fair market value of the net assets transferred (including allocated goodwill) by $ 1.2 million.

The excess over the fair market value was recognized as a net gain in Other income on the Company’s Consolidated Statement of Operations and Comprehensive Loss.

At Closing, the Company paid a total of $ 8.3 million to Genezen and a third party related to adjustments of working capital and to obtain consent to proceed with the divestment.

Additionally, uniQure biopharma B.V.

entered into a development and other manufacturing services agreement (“DMSA”) with Genezen.

Pursuant to the terms of the DMSA, the Company has preferred customer status to receive manufacturing and development services to support the Company’s investigational gene therapy programs and other services related to the manufacture of HEMGENIX® under the CSA.

entered into a development and other manufacturing services agreement (“DMSA”) with Genezen at Closing.

Pursuant to the DMSA, the Company is entitled to receive, as a preferred customer, manufacturing and development services to support the Company’s investigational gene therapy programs and other services related to HEMGENIX® (other than its manufacturing and supply obligations under the CSA).

The DMSA has a minimum term of three years and requires the Company to purchase services for a total minimum of $ 14.0 million.

The CSA and DMSA became effective at Closing.

On July 19, 2024, in connection with the closing of the Lexington Transaction, the Company prepaid $ 50.0 million of the $ 100.0 million of principal outstanding under its amended and restated loan facility with Hercules Capital, Inc.

Accounting as of June 30, 2024

The Company classified the following assets and liabilities as held for sale as of June 30, 2024:

Restructuring

As part of the Lexington Transaction, the Company terminated certain employees that did not transfer to Genezen.

The Company incurred $ 1.4 million of expenses related to termination benefits offered to these employees, which were recorded as Research and Development Expense and Selling, General and Administrative Expense during the nine-month period ended September 30, 2024.

On August 1, 2024, the Company announced an organizational restructuring (the “Restructuring”).

As a result, the Company recorded $ 4.1 million of severance and other personnel-related expenses during the three-month period ended September 30, 2024.

A summary of the charges for the three and nine months ended September 30, 2024 by major activity type is as follows ( nil in prior periods) :

Three months ended September 30,

Nine months ended September 30,

Severance and other personnel costs

(in thousands)

Inventories, net

Prepaid expenses

Property, plant and equipment, net of accumulated depreciation

Operating lease right-of-use asset

Total assets held for sale

Operating lease liability

Total liabilities held for sale

The Company recorded the assets at the lower of cost or fair market value.

The Company accrued $ 1.4 million of other postemployment benefits, presented within both research and development expenses as well as general and administrative expenses, related to the Lexington Facility employees who were terminated effective August 30, 2024.

Subsequent accounting at Closing

As of the Closing, the Company will record the sale of the net assets associated with the Lexington Facility as of Closing.

The Company expects the fair market value of the consideration received less costs to sell to approximate the carrying amount of the net assets held for sale.

Research and development

General and administrative

In October 2023, the Company announced a reorganization and recorded a $ 1.0 million liability as of December 31, 2023 related to the termination of certain employees.

A summary of the changes in the severance and other personnel liabilities related to the workforce reduction, which are included within Accrued Expenses and Other Current Liabilities on the Consolidated Balance Sheets, are as follows:

Amount of liability

(in thousands)

Balance as of December 31, 2023

Severance and other personnel costs

Cash payments during the period

Balance as of September 30, 2024

CSL Behring collaboration

3 unchanged sentences

License revenue

The Company recognized $ 1.9 million and $ 3.1 million of royalty revenue in the three and six months ended June 30, 2024, respectively, compared to $ 0.8 million of royalty revenue in each of the three and six months ended June 30, 2023.

The Company recognized $ 2.1 million and $ 5.2 million of royalty revenue in the three and nine months ended September 30, 2024, respectively, compared to $ 0.5 million and $ 1.3 million of royalty revenue in the three and nine months ended September 30, 2023, respectively.

Royalties on the sale of HEMGENIX® are recorded once earned and are presented as license revenue.

Manufacturing revenue

The Company recognized nil and $ 6.1 million of manufacturing revenue in the three and nine months ended September 30, 2024, respectively, compared to $ 0.3 million and $ 6.6 million of manufacturing revenue recorded in the three and nine months ended September 30, 2023, respectively.

The Company recognized contract manufacturing revenue when ownership transferred to CSL Behring.

Following the Closing of the Lexington Transaction, title to HEMGENIX® supply directly passes from the contract manufacturer, Genezen, to CSL Behring.

The Company does not control HEMGENIX® before it is transferred to CSL Behring.

The Company arranges for HEMGENIX® to be provided by Genezen to CSL Behring.

The Company determined that it is an agent in the sale of HEMGENIX® to CSL Behring.

In accordance with ASC 330 Inventory , at Closing, the Company recognized a liability of $ 8.8 million related to the expected net losses from the resale of HEMGENIX® to be purchased pursuant to its contractual minimum commitments .

As a result of the Company being an agent, the Company recognizes corresponding costs related to the purchase of HEMGENIX® from Genezen net of income from the sales of HEMGENIX® to CSL Behring and income related to the release of liabilities associated with expected net losses in Other expense within the Company’s Consolidated Statements of Operations and Comprehensive Loss.

Collaboration revenue

The Company recognized $ 7.1 million and $ 10.4 million of collaboration revenue in the three and six months ended June 30, 2024, respectively, compared to $ 0.3 million and $ 0.7 million of collaboration revenue in each of the three and six months ended June 30, 2023.

In accordance with the CSL Behring Agreement, certain development and other services rendered by the Company are reimbursed by CSL.

Accounts receivable and contract asset

The Company recognized $ 0.2 million and $ 10.6 million of collaboration revenue in the three and nine months ended September 30, 2024, respectively, compared to $ 0.6 million and $ 1.3 million of collaboration revenue in each of the three and nine months ended September 30, 2023.

In accordance with the DCSA, certain development and other services rendered by the Company are reimbursed by CSL Behring.

Accounts receivable

As of September 30, 2024 , the Company had accounts receivable of $ 5.0 million from CSL Behring related to collaboration services and royalty revenue.

As of December 31, 2023, the Company recorded accounts receivable of $ 4.0 million from CSL Behring related to collaboration services, contract manufacturing revenue and royalty revenue.

As of June 30, 2024 , the Company had accounts receivable of $ 7.8 million from CSL Behring related to collaboration services, contract manufacturing revenue and royalty revenue.

Investment securities

The following tables summarize the Company’s investments in sovereign debt as of June 30, 2024 and December 31, 2023:

At June 30, 2024

The following tables summarize the Company’s investments in sovereign debt as of September 30, 2024 and December 31, 2023:

At September 30, 2024

Amortized cost

17 unchanged sentences

dollar and euro denominated, respectively.

Investment securities with original maturities of less than 90 days when purchased are presented within cash and cash equivalents and measured at amortized cost (June 30, 2024:

Investment securities with original maturities of 90 days or less when purchased are presented within cash and cash equivalents and measured at amortized cost (September 30, 2024:

$ 44.6 million, December 31, 2023:

1 unchanged sentence

Inventories, net

The following table summarizes the inventories, net balances as of June 30, 2024 and December 31, 2023:

The following table summarizes the inventories, net balances as of September 30, 2024 and December 31, 2023:

September 30,

(in thousands)

2 unchanged sentences

Finished goods

The Company recorded write downs to net realizable value of $ 4.1 million and $ 5.8 million in the three and six months ended June 30, 2024, respectively, compared to nil in the same periods in 2023.

The Company recorded write downs to net realizable value of $ 0.5 million and $ 6.3 million in the three and nine months ended September 30, 2024, respectively, compared to nil in the same periods in 2023.

The costs are recognized as Cost of Contract Manufacturing Revenues.

At June 30, 2024, and December 31, 2023, the Company recorded an allowance for inventory of $ 5.3 million and $ 1.6 million, respectively.

As of June 30, 2024, $ 8.0 million of inventory is presented as assets held for sale on the consolidated balance sheet (refer to Note 3 “ Assets held for sale and divestiture of commercial manufacturing activities ”).

At September 30, 2024, and December 31, 2023, the Company recorded an allowance for inventory of nil and $ 1.6 million, respectively.

The Company sold its inventories as part of the divestment of its commercial manufacturing activities (refer to Note 3 “ Divestiture of commercial manufacturing activities ” and Note 4 “Restructuring ”).

Fair value measurement

9 unchanged sentences

The carrying amount of cash and cash equivalents, accounts receivable from licensing and collaboration partners, 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 June 30, 2024 and December 31, 2023 :

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, 2024 and December 31, 2023 :

Quoted prices

12 unchanged sentences

Total liabilities

At June 30, 2024

At September 30, 2024

Cash and cash equivalents

8 unchanged sentences

Contingent consideration

The Company is required to pay up to EUR 178.8 million (or $ 191.6 million based on the foreign exchange rate on June 30, 2024) to the former shareholders of uniQure France SAS (formerly Corlieve Therapeutics SAS) upon the achievement of contractually defined milestones in connection with the Company’s July 2021 acquisition of uniQure France SAS.

The fair value of the contingent consideration as of June 30, 2024 was $ 40.1 million (December 31, 2023:

The Company is required to pay up to EUR 178.8 million (or $ 199.6 million based on the foreign exchange rate on September 30, 2024) to the former shareholders of uniQure France SAS (formerly Corlieve Therapeutics SAS) upon the achievement of contractually defined milestones in connection with the Company’s July 2021 acquisition of uniQure France SAS.

The fair value of the contingent consideration as of September 30, 2024 was $ 41.4 million (December 31, 2023:

$ 43.0 million) using discount rates of approximately 14.4 % to 15.4 % (December 31, 2023:

15.3 % to 15.6 %).

The Company assumes the probability of achieving a EUR 30.0 million (or $ 32.1 million based on the foreign exchange rate on June 30, 2024) milestone payment following the dosing of the first patient in Phase I/II clinical trial of AMT-260 to be 100 %.

If, as of June 30, 2024, the Company had assumed a 100 % likelihood of AMT-260 advancing into a Phase III clinical study, then the fair value of the contingent consideration would have increased to $ 67.0 million.

If as of June 30, 2024 the Company had assumed that it would discontinue development of the AMT-260 program, then the contingent consideration would have been released to income.

The following table presents the changes in fair value of contingent consideration between December 31, 2023 and June 30, 2024:

The Company assumes the probability of achieving a EUR 30.0 million (or $ 33.5 million based on the foreign exchange rate on September 30, 2024) milestone payment following the dosing of the first patient in Phase I/II clinical trial of AMT-260 to be 100 %.

If, as of September 30, 2024, the Company had assumed a 100 % likelihood of AMT-260 advancing into a Phase III clinical study, then the fair value of the contingent consideration would have increased to $ 68.5 million.

If as of September 30, 2024 the Company had assumed that it would discontinue development of the AMT-260 program, then the contingent consideration would have been released to income.

The following table presents the changes in fair value of contingent consideration between December 31, 2023 and September 30, 2024:

consideration

3 unchanged sentences

Currency translation effects

Balance at June 30, 2024

As of June 30, 2024, the Company classified $ 28.1 million (December 31, 2023:

Balance at September 30, 2024

As of September 30, 2024, the Company classified $ 29.2 million (December 31, 2023:

$ 28.2 million) of the total contingent consideration of $ 41.4 million (December 31, 2023:

2 unchanged sentences

Investment securities

Refer to Note 5 “ Investment securities ” for the fair value of the investment securities as of June 30, 2024 and December 31, 2023.

Refer to Note 6 “ Investment securities ” for the fair value of the investment securities as of September 30, 2024 and December 31, 2023.

Accrued expenses and other current liabilities

Accrued expenses and other current liabilities include the following items:

September 30,

(in thousands)

1 unchanged sentence

Accruals for goods received from and services provided by vendors-not yet billed

Current portion of firm purchase commitment liability

Liability owed to the Purchaser pursuant to the Royalty Financing Agreement

2 unchanged sentences

(formerly known as Hercules Technology Growth Capital, Inc.) (“Hercules”).

The facility was amended and restated in 2014, 2016, 2018, January 2021, December 2021 (the “2021 Restated Facility”), May 12, 2023 (the “2023 Amended Facility”) and June 28, 2024 (the “2024 Amended Facility”).

The facility was amended and restated in 2014, 2016, 2018, January 2021, December 2021 (the “2021 Restated Facility”), and on May 12, 2023 (the “2023 Amended Facility”) and July 22, 2024 (the “2024 Amended Facility”).

On July 19, 2024, in connection with the Closing of the Lexington Transaction and the amendment of the 2023 Amended Facility, the Company prepaid $ 50.0 million of the $ 100.0 million of principal outstanding as well as $ 3.1 million in end-of-term fees.

The 2023 Amended Facility extended the maturity date and interest-only period from December 1, 2025 to January 5, 2027 (the “Maturity Date”).

The total principal outstanding as of June 30, 2024 under the 2023 Amended Facility was $ 100.0 million.

On July 19, 2024, in connection with the closing of the Lexington Transaction and pursuant to the 2024 Amended Facility, the Company prepaid $ 50.0 million of the $ 100.0 million of principal outstanding under the 2024 Amended Facility as well as $ 3.1 million in end-of-term fees.

The total principal outstanding as of September 30, 2024 under the 2024 Amended Facility was $ 50.0 million.

The Company is required to repay the residual principal balance of $ 50.0 million on the Maturity Date.

1 unchanged sentence

Pursuant to the terms of the 2024 Amended Facility, the Company owes a back-end fee of $ 2.4 million on December 1, 2025 and a back-end fee of $ 0.6 million on the Maturity Date.

The amortized cost (including interest due presented as part of accrued expenses and other current liabilities) of the 2023 Amended Facility was $ 103.6 million as of June 30, 2024, compared to $ 102.9 million as of December 31, 2023, and is recorded net of discount and debt issuance costs.

The foreign currency loss on the facility in the three and six months ended June 30, 2024 was $ 0.7 million and $ 3.0 million, respectively, compared to a foreign currency gain $ 0.8 million and $ 1.6 million, respectively, during the same period in 2023.

Interest expense associated with the 2023 Amended Facility during the three and six months ended June 30, 2024 was $ 3.7 million and $ 7.4 million, respectively, compared to $ 3.7 million and $ 7.3 million during the same period in 2023.

The amortized cost (including interest due presented as part of accrued expenses and other current liabilities) was $ 51.7 million as of September 30, 2024, compared to $ 102.9 million as of December 31, 2023, and is recorded net of discount and debt issuance costs.

The foreign currency gain on the facility in the three months ended September 30, 2024 was $ 2.6 million and the foreign currency loss on the facility in the nine months ended September 30, 2024 was $ 0.4 million compared to a foreign currency loss of $ 3.0 million and $ 1.4 million, respectively, during the same periods in 2023.

Interest expense during the three and nine months ended September 30, 2024 was $ 3.7 million and $ 11.1 million, respectively, compared to $ 3.7 million and $ 10.9 million during the same periods in 2023.

Under the 2024 Amended Facility, the Company must remain current in its periodic reporting requirements and is required to keep a minimum cash balance deposited in bank accounts in the U.S.

5 unchanged sentences

Under the 2024 Amended Facility, the occurrence of a material adverse effect, as defined therein, would entitle Hercules to declare all principal, interest and other amounts owed by the Company immediately due and payable.

As of June 30, 2024, the Company was in material compliance with all covenants and provisions.

As of September 30, 2024, the Company was in material compliance with all covenants and provisions.

11 Royalty Financing Agreement

14 unchanged sentences

Based on the Company’s projections the effective interest rate is expected to be within a range of 12.0 % per annum to 13.5 % per annum.

The Company would have recorded between $ 24.5 million and $ 27.7 million of interest expense through the six months ended June 30, 2024 ($ 12.4 million and $ 14.0 million, respectively, for the three months ended June 30, 2024) if it had used 12.0 % or 13.5 %, instead of the $ 24.8 million recorded in the six months ended June 30, 2024 ($ 12.4 million for the three months ended June 30, 2024).

Interest expense during the three and nine months ended September 30, 2024 was $ 12.8 and $ 37.7 million, respectively, compared to $ 11.8 million and $ 14.9 million, during the same period in 2023.

The Company would have recorded between $ 37.4 million and $ 42.3 million of interest expense through the nine months ended September 30, 2024 ( $ 12.9 million and $ 14.6 million, respectively, for the three months ended September 30, 2024) if it had used 12.0 % or 13.5 % instead.

The Company will prospectively update the effective interest rate at each reporting date based on updated projections.

The liability was initially recognized at fair value and inputs were considered Level 3 inputs.

The following table presents the movement in the liability related to the Royalty Financing Agreement between the December 31, 2023 and June 30, 2024:

The following table presents the movement in the liability related to the Royalty Financing Agreement between the December 31, 2023 and September 30, 2024:

Amount of liability

14 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 and the ESPP for the periods indicated below was as follows:

Three months ended June 30,

Six months ended June 30,

Three months ended September 30,

Nine months ended September 30,

(in thousands)

3 unchanged sentences

Selling, general and administrative

Share-based compensation expense recognized by award type for the 2014 Plans as well as the ESPP was as follows:

Three months ended June 30,

Six months ended June 30,

Share-based compensation expense / (income) recognized by award type for the 2014 Plans as well as the ESPP was as follows:

Three months ended September 30,

Nine months ended September 30,

(in thousands)

5 unchanged sentences

Employee share purchase plan

As of June 30, 2024, the unrecognized share-based compensation expense related to unvested awards under the 2014 Plans were:

As of September 30, 2024, the unrecognized share-based compensation expense related to unvested awards under the 2014 Plans were:

Weighted average

4 unchanged sentences

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.

The Company will account for the forfeitures of awards to employees impacted by the divestment of the Lexington Facility as of the date employment with the Company ends, which are expected to occur in the third quarter of 2024.

The Company will account for the forfeitures of awards to employees impacted by the August 2024 restructuring as of the date employment with the Company ends, which is expected to occur between November 2024 and June 2025.

The Company expects this to reduce the unrecognized share-based compensation expense by approximately $ 3.2 million.

4 unchanged sentences

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

The following tables summarize option activity under the 2014 Plans for the six months ended June 30, 2024:

The following tables summarize option activity under the 2014 Plans for the nine months ended September 30, 2024:

Weighted average

2 unchanged sentences

Outstanding at December 31, 2023

Outstanding at June 30, 2024

Thereof, fully vested, and exercisable on June 30, 2024

Thereof, outstanding and expected to vest after June 30, 2024

Outstanding at September 30, 2024

Thereof, fully vested, and exercisable on September 30, 2024

Thereof, outstanding and expected to vest after September 30, 2024

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

As a result of the Lexington Transaction (refer to Note 3 “ Assets held for sale and divestiture of commercial manufacturing activities” ) 87,281 options are expected to be forfeited during the third quarter of 2024.

As a result of the August 2024 restructuring, 67,755 options are expected to be forfeited between November 2024 and June 2025.

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 June 30,

Six months ended June 30,

Three months ended September 30,

Nine months ended September 30,

Expected volatility

4 unchanged sentences

Expected dividend yield

The following table summarizes the RSU activity for the six months ended June 30, 2024:

The following table summarizes the RSU activity for the nine months ended September 30, 2024:

Weighted average

2 unchanged sentences

Non-vested at December 31, 2023

Non-vested at June 30, 2024

Non-vested at September 30, 2024

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

1 unchanged sentence

RSUs granted to non-executive directors vest one year from the date of grant.

As a result of the Lexington Transaction (refer to Note 3 “ Assets held for sale and divestiture of commercial manufacturing activities” ) 391,038 RSUs are expected to be forfeited during the third quarter of 2024.

The following table summarizes the PSU activity for the six months ended June 30, 2024:

As a result of the August 2024 restructuring, 229,113 RSUs are expected to be forfeited between November 2024 and June 2025.

The following table summarizes the PSU activity for the nine months ended September 30, 2024:

Weighted average

2 unchanged sentences

Non-vested at December 31, 2023

Non-vested at June 30, 2024

Non-vested at September 30, 2024

The Company granted ordinary shares to certain employees in December 2021 and at various dates during the year ended December 31, 2022 that will be earned upon achievement of defined milestones.

2 unchanged sentences

The Company recognizes the compensation cost related to these grants to the extent it considers achievement of the milestones to be probable.

As of June 30, 2024, two milestones had been achieved and vested in either 2022 or 2023.

Additionally, another two milestones are considered probable as of December 31, 2023 and June 30, 2024.

During the six months ended June 30, 2024, 10,150 ordinary shares were issued under the ESPP compared to 5,006 during the same period in 2023.

As of June 30, 2024, 86,712 ordinary shares remain available for issuance under the ESPP compared to a total of 111,054 as of June 30, 2023.

The Company recorded $ 0.9 million and $ 1.6 million deferred tax expense in relation to its operations in the U.S.

during the three and six months ended June 30, 2024, respectively.

The Company recorded $ 0.2 million deferred tax expense and $ 1.0 million deferred tax benefit in relation to its operations in the U.S.

and France during the three and six months ended June 30, 2023, respectively.

The effective income tax rate of 1.7 % and 1.3 % during the three and six months ended June 30, 2024 is substantially lower than the enacted rate of 25.8 % in the Netherlands as the Company records a valuation allowance against its net deferred tax assets in the Netherlands and a partial a valuation allowance against its net deferred tax assets in France.

The effective income tax rate during the three and six months ended June 30, 2023 was 0.2 % and ( 0.7 %), respectively, as the Company had recorded a valuation allowance against its net deferred tax assets in the Netherlands.

As of September 30, 2024, three milestones had been achieved.

Additionally, another milestone was achieved in October 2024.

During the nine months ended September 30, 2024, 10,150 ordinary shares were issued under the ESPP compared to 12,270 during the same period in 2023.

As of September 30, 2024, 86,712 ordinary shares remain available for issuance under the ESPP compared to a total of 103,790 as of September 30, 2023.

The Company recorded $ 0.0 million deferred tax benefit and $ 1.6 million deferred tax expense in relation to its operations in the U.S.

during the three and nine months ended September 30, 2024, respectively.

The Company recorded $ 0.1 million and $ 1.1 million deferred tax benefit in relation to its operations in the U.S.

and France during the three and nine months ended September 30, 2023, respectively.

The effective income tax rate of ( 0.1 %) and 1.0 % during the three and nine months ended September 30, 2024 is substantially lower than the enacted rate of 25.8 % in the Netherlands as the Company records a valuation allowance against its net deferred tax assets in the Netherlands and a partial a valuation allowance against its net deferred tax assets in France.

The effective income tax rate during the three and nine months ended September 30, 2023 was ( 0.1 %) and ( 0.5 %), respectively, as the Company had recorded a valuation allowance against its net deferred tax assets in the Netherlands.

14 Basic and diluted earnings per share

Diluted earnings per share are calculated by adjusting the weighted average number of ordinary shares outstanding, assuming conversion of all potentially dilutive ordinary shares.

As the Company has incurred a loss in the three and six months ended June 30, 2024, all potentially dilutive ordinary shares would have an antidilutive effect, if converted, and thus have been excluded from the computation of loss per share for the three and six months ended June 30, 2024.

The ordinary 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 June 30, 2024 and June 30, 2023, respectively.

As the Company has incurred a loss in the three and nine months ended September 30, 2024, all potentially dilutive ordinary shares would have an antidilutive effect, if converted, and thus have been excluded from the computation of loss per share for the three and nine months ended September 30, 2024.

The ordinary 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, 2024 and September 30, 2023, respectively.

The potentially dilutive ordinary shares are summarized below:

Three months ended June 30,

Six months ended June 30,

Three months ended September 30,

Nine months ended September 30,

Anti-dilutive ordinary share equivalents

3 unchanged sentences

15 Subsequent events

On June 29, 2024 the Company entered into a transaction with Genezen (refer to Note 3 “ Assets held for sale and divestiture of commercial manufacturing activities” ).

On July 23, 2024 the Company announced the closing of the sale of its Lexington Facility to Genezen and on August 1, 2024, the Company announced an organizational restructuring.

These actions were the outcome of a recently completed, comprehensive review of the Company’s operations with the goals of conserving capital and streamlining the organization.

As part of these changes, the Company expects to eliminate approximately 300 positions or 65 % of its workforce.

The Company estimates that it will incur costs in the range of $ 6.5 million to $ 7.5 million in connection with the restructuring, consisting primarily of cash expenditures related to employee severance costs.

These costs are subject to assumptions, including local law requirements, and actual expenses may differ materially from the estimates disclosed above.

The restructuring is subject to the review by the Company’s Amsterdam-based works council, which is expected to be completed in the third quarter of 2024.

The Company expects the restructuring to be substantially completed by the end of 2024.

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