What changed in this filing

/stocks — the workspaceLOADING

Item 1. Financial Statements

2025-05-08 compared with 2024-11-04 · 220 added, 453 removed, 312 unchanged (68% of the section changed)

3 unchanged sentences

(in thousands, except share and per share data)

September 30,

2025 December 31,

19 unchanged sentences

Deferred revenue, current 11,935 12,648

Contingent consideration obligation, current 17,500 16,060

Total current liabilities 137,286 119,662

Operating lease liabilities, noncurrent 88,170 90,139

Contingent consideration, noncurrent 33,170 25,960

Contingent consideration obligation, noncurrent 23,640 24,050

Other long-term liabilities 14,812 14,577

3 unchanged sentences

Preferred stock, $ 0.0001 par value;

10,000,000 shares authorized as of September 30, 2024 and December 31, 2023;

no shares issued and outstanding as of September 30, 2024 and December 31, 2023

10,000,000 shares authorized as of March 31, 2025 and December 31, 2024;

no shares issued and outstanding as of March 31, 2025 and December 31, 2024

Common stock, $ 0.0001 par value;

300,000,000 shares authorized as of September 30, 2024 and December 31, 2023;

136,706,350 and 134,781,286 shares issued and outstanding as of September 30, 2024 and December 31, 2023, respectively

300,000,000 shares authorized as of March 31, 2025 and December 31, 2024;

138,063,698 and 136,959,446 shares issued and outstanding as of March 31, 2025 and December 31, 2024, respectively

Additional paid-in capital 1,926,529 1,911,872

Accumulated other comprehensive gain (loss) 1,127 ( 815 )

Accumulated other comprehensive loss ( 1,975 ) ( 1,717 )

Accumulated deficit ( 880,749 ) ( 759,784 )

6 unchanged sentences

Three Months Ended

September 30, Nine Months Ended

September 30,

2024 2023 2024 2023

Collaboration revenue $ ( 70 ) $ ( 987 )

6 unchanged sentences

Selling, general and administrative 23,944 36,321

Restructuring, long-lived assets impairment and related charges 12,712 3,372 38,939 8,738

Restructuring, long-lived assets impairment and related charges, net ( 10 ) ( 48 )

Total operating expenses 142,579 136,457

3 unchanged sentences

Interest income 12,288 21,283

Other (expense) income, net ( 893 ) 882 ( 1,715 ) ( 7,506 )

Other expense, net ( 72 ) ( 287 )

Total other income 18,598 15,081

Loss before (provision for) benefit from income taxes ( 213,540 ) ( 166,626 ) ( 418,430 ) ( 507,437 )

(Provision for) benefit from income taxes ( 177 ) 3,213 1,059 8,293

Loss before provision for income taxes ( 120,949 ) ( 65,000 )

Provision for income taxes ( 16 ) ( 276 )

Net loss $ ( 120,965 ) $ ( 65,276 )

Net loss attributable to noncontrolling interest — — — ( 56 )

Net loss attributable to Vir $ ( 213,717 ) $ ( 163,413 ) $ ( 417,371 ) $ ( 499,088 )

Net loss per share attributable to Vir, basic and diluted $ ( 1.56 ) $ ( 1.22 ) $ ( 3.07 ) $ ( 3.73 )

Net loss per share, basic and diluted $ ( 0.88 ) $ ( 0.48 )

Weighted-average shares outstanding, basic and diluted 137,468,900 135,280,648

4 unchanged sentences

Three Months Ended

September 30, Nine Months Ended

September 30,

2024 2023 2024 2023

Net loss $ ( 120,965 ) $ ( 65,276 )

Other comprehensive income:

Unrealized gain on investments 3,996 994 2,094 7,194

Amortization of actuarial gain (loss) 10 9 ( 152 ) 28

Total other comprehensive income 4,006 1,003 1,942 7,222

Other comprehensive loss:

Unrealized loss on investments ( 303 ) ( 1,411 )

Pension actuarial gain (loss) 45 ( 171 )

Total other comprehensive loss ( 258 ) ( 1,582 )

Comprehensive loss $ ( 121,223 ) $ ( 66,858 )

Comprehensive loss attributable to noncontrolling interest — — — ( 56 )

Comprehensive loss attributable to Vir $ ( 209,711 ) $ ( 162,410 ) $ ( 415,429 ) $ ( 491,866 )

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

2 unchanged sentences

(in thousands, except share amounts)

Vir Stockholders’ Equity

Common Stock Additional

Capital Accumulated

Comprehensive

(Loss) Gain Accumulated

Deficit Noncontrolling

Interest Total

Stockholders’

Shares Amount

Balance at June 30, 2024 136,590,097 $ 14 $ 1,878,013 $ ( 2,879 ) $ ( 441,478 ) $ — $ 1,433,670

Vesting of restricted common stock 81,415 — — — — — —

Exercise of stock options 34,838 — 71 — — — 71

Stock-based compensation — — 16,697 — — — 16,697

Other comprehensive income — — — 4,006 — — 4,006

Net loss — — — — ( 213,717 ) — ( 213,717 )

Balance at September 30, 2024 136,706,350 $ 14 $ 1,894,781 $ 1,127 $ ( 655,195 ) $ — $ 1,240,727

Vir Stockholders’ Equity

Common Stock Additional

Capital Accumulated

Comprehensive

Loss Retained

Deficit) Noncontrolling

Interest Total

Stockholders’

Shares Amount

Balance at June 30, 2023 134,230,494 $ 13 $ 1,771,536 $ ( 2,903 ) $ 41,562 $ — $ 1,810,208

Vesting of restricted common stock 73,351 — — — — — —

Exercise of stock options 194,041 — 343 — — — 343

Stock-based compensation — — 26,944 — — — 26,944

Other comprehensive income — — — 1,003 — — 1,003

Net loss — — — — ( 163,413 ) — ( 163,413 )

Balance at September 30, 2023 134,497,886 $ 13 $ 1,798,823 $ ( 1,900 ) $ ( 121,851 ) $ — $ 1,675,085

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

VIR BIOTECHNOLOGY, INC.

Condensed Consolidated Statements of Stockholders’ Equity

(in thousands, except shares amounts)

Vir Stockholders’ Equity

Common Stock Additional

Capital Accumulated

Comprehensive

(Loss) Gain Accumulated Deficit Noncontrolling

Interest Total

Comprehensive Loss Accumulated

Deficit Total

Stockholders’

3 unchanged sentences

Exercise of stock options 92,624 — 598 — — 598

Issuance of common stock under employee stock purchase plan 315,831 — 2,602 — — — 2,602

Stock-based compensation — — 14,059 — — 14,059

Other comprehensive income — — — 1,942 — — 1,942

Other comprehensive loss — — — ( 258 ) — ( 258 )

Net loss — — — — ( 120,965 ) ( 120,965 )

Balance at September 30, 2024 136,706,350 $ 14 $ 1,894,781 $ 1,127 $ ( 655,195 ) $ — $ 1,240,727

Vir Stockholders’ Equity

Balance at March 31, 2025 138,063,698 $ 14 $ 1,926,529 $ ( 1,975 ) $ ( 880,749 ) $ 1,043,819

Common Stock Additional

1 unchanged sentence

Comprehensive

Loss Retained

Deficit) Noncontrolling

Interest Total

Loss Accumulated

Deficit Total

Stockholders’

3 unchanged sentences

Exercise of stock options 112,020 — 220 — — 220

Issuance of common stock under employee stock purchase plan 114,903 — 2,605 — — — 2,605

Stock-based compensation — — 23,757 — — 23,757

Other comprehensive income — — — 7,222 — — 7,222

Contributions from noncontrolling interest owners — — — — — 100 100

Increase in ownership interest in a subsidiary — — ( 56 ) ( 44 ) ( 100 )

Other comprehensive loss — — — ( 1,582 ) — ( 1,582 )

Net loss — — — — ( 65,276 ) ( 65,276 )

Balance at September 30, 2023 134,497,886 $ 13 $ 1,798,823 $ ( 1,900 ) $ ( 121,851 ) $ — $ 1,675,085

Balance at March 31, 2024 135,843,560 $ 14 $ 1,852,839 $ ( 2,397 ) $ ( 303,100 ) $ 1,547,356

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

2 unchanged sentences

(in thousands)

Nine Months Ended September 30,

Three Months Ended March 31,

CASH FLOWS FROM OPERATING ACTIVITIES:

3 unchanged sentences

Depreciation and amortization 2,867 4,517

Amortization of premiums (accretion of discounts) on investments, net 3,229 ( 10,057 )

Amortization of premiums on investments, net 4,089 238

Noncash lease expense 1,121 1,447

2 unchanged sentences

Stock-based compensation 14,059 23,757

In-process research and development impairment 3,512 6,899

Long-lived assets impairment and disposal loss 28,557 7,474

Change in deferred income taxes ( 306 ) —

Other non-cash items, net 6 ( 176 )

Changes in operating assets and liabilities:

Receivable from collaboration 2,234 3,041

Prepaid expenses and other current assets 5,058 1,433

10 unchanged sentences

Maturities and sales of investments 301,860 592,698

Other ( 412 ) —

Net cash provided by investing activities 126,818 28,420

2 unchanged sentences

Proceeds from exercise of stock options 598 221

Issuance of common stock under ESPP 2,602 2,605

Contributions from noncontrolling interest owners — 100

Increase in ownership interest in a subsidiary — ( 100 )

Net cash provided by financing activities 598 152

12 unchanged sentences

Vir Biotechnology, Inc.

(“Vir” or the “Company”) is a clinical-stage biopharmaceutical company focused on powering the immune system to transform lives by discovering and developing medicines for serious infectious diseases and cancer.

Its current clinical development pipeline consists of product candidates targeting hepatitis delta virus (“HDV”) and hepatitis B virus (“HBV”), in addition to multiple oncology programs.

Vir also has a preclinical portfolio of programs across a range of other infectious diseases, including respiratory syncytial virus and human metapneumovirus (“RSV” and “MPV”, respectively).

In January 2023, a majority-owned subsidiary, Encentrio Therapeutics, Inc.

(“Encentrio”), was incorporated in the State of Delaware.

The Company initially owned 80 % of Encentrio’s outstanding voting shares.

During the three months ended June 30, 2023, the Company increased its ownership of Encentrio’s outstanding voting shares to 100 %.

The primary purpose of Encentrio is to conduct research and development of oncology therapeutics.

(Vir Bio or the Company) is a clinical-stage biopharmaceutical company focused on powering the immune system to transform lives by discovering and developing medicines for serious infectious diseases and cancer.

Its clinical-stage portfolio includes infectious disease programs for chronic hepatitis delta and chronic hepatitis B infections and multiple dual-masked T-cell engagers (TCEs) across validated targets in solid tumor indications.

Vir Bio also has a preclinical portfolio of programs across a range of infectious diseases and oncologic malignancies.

Vir Bio has exclusive rights to the PRO-XTEN™ masking platform for oncology and infectious disease.

PRO-XTEN™ is a trademark of Amunix Pharmaceuticals, Inc., a Sanofi company.

Liquidity and Capital Resources

In November 2023, the Company entered into a sales agreement (Sales Agreement) with Cowen and Company, LLC, as sales agent (TD Cowen), pursuant to which the Company may from time to time offer and sell shares of its common stock for an aggregate offering price of up to $ 300.0 million, through or to TD Cowen, acting as sales agent or principal.

The shares will be offered and sold under the Company’s shelf registration statement on Form S-3 and a related prospectus filed with the Securities and Exchange Commission (“SEC”) on November 3, 2023.

The shares will be offered and sold under the Company’s shelf registration statement on Form S-3 and a related prospectus filed with the U.S.

Securities and Exchange Commission (SEC) on November 3, 2023.

The Company will pay TD Cowen a commission of up to 3.0 % of the aggregate gross proceeds from each sale of shares, reimburse legal fees and disbursements and provide TD Cowen with customary indemnification and contribution rights.

As of September 30, 2024, no shares have been sold under the Sales Agreement.

As of September 30, 2024, the Company had $ 1.19 billion in cash, cash equivalents, and investments, which the Company believes will be sufficient to fund its operations for a period through at least twelve months from the issuance date of these unaudited condensed consolidated financial statements.

As of March 31, 2025, no shares have been sold under the Sales Agreement.

As of March 31, 2025, the Company had $ 1.02 billion in cash, cash equivalents, and investments, which the Company believes will be sufficient to fund its operations for a period through at least twelve months from the issuance date of these unaudited condensed consolidated financial statements.

The Company also had $ 94.4 million in restricted cash and cash equivalents as of March 31, 2025.

Summary of Significant Accounting Policies

1 unchanged sentence

The Company’s unaudited condensed consolidated financial statements have been prepared in conformity with accounting principles generally accepted in the United States of America (GAAP) and applicable rules and regulations of the SEC regarding interim financial reporting.

The unaudited condensed consolidated financial statements include the accounts of Vir and its majority-owned subsidiaries.

For consolidated entities where Vir owns or is exposed to less than 100.0% of the economics, the Company records net income (loss) attributable to noncontrolling interests, net of tax in its unaudited condensed consolidated statements of operations equal to the percentage of the economic or ownership interest retained in such entities by the respective noncontrolling parties.

All intercompany balances and transactions have been eliminated upon consolidation.

The unaudited interim condensed consolidated financial statements have been prepared on the same basis as the annual consolidated financial statements and reflect, in the opinion of management, all adjustments of a normal and recurring nature that are necessary for the fair presentation of the Company’s financial information.

The unaudited condensed consolidated 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 year ending December 31, 2024, or for any other future annual or interim period.

The unaudited condensed consolidated results of operations for the three months ended March 31, 2025 are not necessarily indicative of the results to be expected for the year ending December 31, 2025, or for any other future annual or interim period.

Certain information and footnote disclosures typically included in the Company’s annual consolidated financial statements have been condensed or omitted.

As such, these unaudited interim condensed consolidated financial statements should be read in conjunction with the Company’s audited consolidated financial statements and related notes included in the Annual Report on Form 10-K for the year ended December 31, 2023, filed with the SEC on February 26, 2024.

VIR BIOTECHNOLOGY, INC.

Notes to Unaudited Condensed Consolidated Financial Statements

Use of Estimates

2 unchanged sentences

Actual results could materially differ from those estimates.

VIR BIOTECHNOLOGY, INC.

Notes to Unaudited Condensed Consolidated Financial Statements

Operating segments are defined as components of an entity about which separate discrete information is available for evaluation by the chief operating decision maker (CODM) in deciding how to allocate resources and in assessing performance.

The Company manages the business activities on a consolidated basis and operates as one reportable segment that constitutes all of the consolidated entity, which is the business of powering the immune system to transform lives by discovering and developing medicines for serious infectious diseases and cancer.

Factors used in determining the reportable segment include the nature of the Company’s operating activities, the organizational and reporting structure, and the type of information regularly provided to the CODM to allocate resources and evaluate financial performance.

The Company’s CODM is its Chief Executive Officer.

Cash Equivalents

The Company considers all highly liquid investments with original maturities of three months or less at the date of purchase to be cash equivalents, which consist of amounts invested primarily in money market funds and are stated at fair value.

Investments include available-for-sale debt securities and equity investments carried at estimated fair value.

Investments include available-for-sale debt securities and equity investments, which are carried at fair value.

Available-for-Sale Debt Securities

1 unchanged sentence

Generally, investments with original maturities beyond three months at the date of purchase and that mature at, or less than 12 months from, the unaudited condensed consolidated balance sheet date are considered short-term investments, with all others considered to be long-term investments.

Unrealized gains and losses deemed temporary in nature are reported as a component of accumulated other comprehensive gain (loss).

Unrealized gains and losses deemed temporary in nature are reported as a component of accumulated other comprehensive loss.

The amortized cost of debt securities is adjusted for amortization of premiums and accretion of discounts to maturity, which is included in interest income on the unaudited condensed consolidated statements of operations.

3 unchanged sentences

Otherwise, the investments in equity securities are measured at cost less impairment, adjusted for observable price changes for identical or similar investments of the same issuer unless the Company has significant influence or control over the investee.

Changes in fair value resulting from observable price changes are presented as change in fair value of equity investments, and changes in fair value resulting from foreign currency translation are included in other (expense) income, net on the unaudited condensed consolidated statements of operations.

Changes in fair value resulting from observable price changes are presented as change in fair value of equity investments, and changes in fair value resulting from foreign currency translation are included in other expense, net on the unaudited condensed consolidated statements of operations.

Restricted Cash and Cash Equivalents

Restricted cash and cash equivalents, current and noncurrent, primarily consist of funds placed in an escrow account under the Company's license agreement with Amunix Pharmaceuticals, Inc., funds received from certain grants that are restricted as to their use, and money market funds to secure standby letters of credit and security deposits with financial institutions under office and laboratory space lease agreements.

Property and Equipment, Net

Property and equipment are stated at cost, net of accumulated depreciation and amortization and, if applicable, impairment charges.

Depreciation and amortization are computed using the straight-line method over the estimated useful lives of the respective assets, generally three to five years .

Leasehold improvements are amortized over the lesser of their useful lives or the remaining life of the lease.

When assets are retired or otherwise disposed of, the cost and related accumulated depreciation and amortization are removed from the balance sheet, and the resulting gain or loss is reflected in operations in the period realized.

Maintenance and repairs are charged to operations as incurred.

The Company reviews property and equipment for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset (group) may not be recoverable.

Recoverability is measured by comparing the carrying amount to the future net undiscounted cash flows that the asset (group) is expected to generate.

If such asset (group) is considered to be impaired, the impairment to be recognized is measured by the amount by which the carrying amount of the asset (group) exceeds its fair value.

VIR BIOTECHNOLOGY, INC.

Notes to Unaudited Condensed Consolidated Financial Statements

Revenue Recognition

Collaboration, License and Contract Revenue

Under Accounting Standards Codification (“ASC”) Topic 606, Revenue from Contracts with Customers (“ASC 606”), the Company recognizes revenue when the Company’s customer obtains control of promised goods or services in an amount that reflects the consideration which the Company expects to receive in exchange for those goods and services.

To determine revenue recognition for arrangements within the scope of ASC 606, the Company performs the following five steps:

(i) identify the contract with a customer;

(ii) identify the performance obligations in the contract;

(iii) determine the transaction price;

(iv) allocate the transaction price to the performance obligations in the contract;

and (v) recognize revenue when or as the Company satisfies a performance obligation.

For collaborative arrangements that fall within the scope of ASC 808, Collaborative Arrangements (“ASC 808”), the Company first determines which elements of the collaboration are deemed to be a performance obligation with a customer within the scope of ASC 606.

For elements of collaboration arrangements that are accounted for pursuant to ASC 808 and are not subject to the guidance in ASC 606, the Company applies the revenue recognition model under ASC 606, including the royalty exception guidance and variable consideration guidance under ASC 606 as described below, or other guidance, as deemed appropriate.

When the Company is considered an agent in elements of collaboration arrangements within the scope of ASC 808, it records its share of collaboration revenue in the period in which such sales occur.

The Company is considered an agent when the collaboration partner controls the product before transfer to the customers and has the ability to direct the use of and obtain substantially all of the remaining benefits from the product.

In these instances, collaboration revenue is based upon the net sales reported by the Company’s collaboration partners, net of cost of goods sold and allowable expenses (e.g., manufacturing, distribution, medical affairs, selling, and marketing expenses) in the period.

In order to record collaboration revenue, the Company utilizes certain information from its collaboration partner, including actual net product sales and costs incurred for sales activities, and makes key judgments based on business updates related to commercial and clinical activities such as expected commercial demand, commercial supply plan, manufacturing commitments, risks related to expired or obsolete inventories, and risks related to potential product returns or contract terminations.

The Company uses these estimates to determine whether payments due to it under its collaboration arrangements, such as profit-share payments, should be recognized as revenue in the period that they become due or whether any portion of the payments due should be constrained from revenue recognition because it is not probable that recognizing such amounts will not result in a significant reversal of cumulative revenues recognized in future reporting periods.

The Company has entered into a number of license and collaboration agreements that fall within the scope of ASC 606.

The Company evaluates the promised goods or services in these agreements to determine which ones represent distinct performance obligations.

Prior to recognizing revenue, the Company estimates the transaction price, including variable consideration that is subject to a constraint.

Amounts of variable consideration are included in the transaction price to the extent that it is probable that a significant reversal in the amount of cumulative revenue recognized will not occur when the uncertainty associated with the variable consideration is subsequently resolved.

These estimates are re-assessed each reporting period as required.

These agreements may include the following types of consideration:

non-refundable upfront payments, reimbursement for research and development services, research, development or regulatory milestone payments, profit-sharing arrangements, and royalty and commercial sales milestone payments.

If there are multiple distinct performance obligations, the Company allocates the transaction price to each distinct performance obligation based on their estimated standalone selling prices (“SSP”).

The Company estimates the SSP for each distinct performance obligation by considering information such as market conditions, entity-specific factors, and information about its customer that is reasonably available.

The Company considers estimation approaches that allow it to maximize the use of observable inputs.

These estimation approaches may include the adjusted market assessment approach, the expected cost plus a margin approach or the residual approach.

The Company also considers whether to use a different estimation approach or a combination of approaches to estimate the SSP for each distinct performance obligation.

Developing certain assumptions (e.g., treatable patient population, expected market share, probability of success and product profitability, and discount rate based on weighted-average cost of capital) to estimate the SSP of a distinct performance obligation requires significant judgment.

For performance obligations satisfied over time, the Company estimates the efforts needed to complete the performance obligation and recognizes revenue by measuring the progress towards complete satisfaction of the performance obligation using an input measure.

VIR BIOTECHNOLOGY, INC.

Notes to Unaudited Condensed Consolidated Financial Statements

For arrangements that include sales-based royalties, including commercial milestone payments based on pre-specified levels of sales, the Company recognizes revenue at the later of (i) when the related sales occur, or (ii) when the performance obligation to which some or all of the royalty has been allocated has been satisfied (or partially satisfied).

Achievement of these royalties and commercial milestones may solely depend upon the performance of the licensee.

Grant Revenue

Grants received, including cost reimbursement agreements, are assessed to determine if the agreement should be accounted for as an exchange transaction or a contribution.

An agreement is accounted for as a contribution if the resource provider does not receive commensurate value in return for the assets transferred.

Contributions are recognized as grant revenue when all donor-imposed conditions have been met.

Asset Acquisitions

The Company evaluates acquisitions and other similar transactions using the guidance in ASC Topic 805, Business Combinations (“ASC 805”), to determine whether the transaction should be accounted for as a business combination or an acquisition of asset(s) by first applying a screen test to assess if substantially all of the fair value of the gross assets acquired is concentrated in a single identifiable asset or a group of similar identifiable assets.

If the screen test is met, the transaction is accounted for as an acquisition of asset(s).

If the screen test is not met, further assessment is required to determine whether the Company has acquired inputs and a substantive processes that together significantly contribute to the ability to create outputs, which would meet the definition of a business.

If determined to be an acquisition of asset(s), the Company accounts the transaction using the cost accumulation and allocation method under ASC 805-50.

Under this method, the cost of the acquisition, including direct acquisition-related costs, is allocated to the assets acquired or liabilities assumed on a relative fair value basis.

Goodwill is not recognized in an asset acquisition and any difference between consideration transferred and the fair value of the net assets acquired is allocated to the identifiable assets acquired based on their relative fair values.

Contingent consideration payments in asset acquisitions are recognized when the contingency is resolved and the consideration is paid or becomes payable (unless the contingent consideration payments are subject to guidance in ASC 480, Distinguishing Liabilities from Equity, or ASC 815, Derivatives and Hedging).

Upon recognition of the contingent consideration payments, the amount is included in the cost of the acquired asset or group of assets.

Restricted cash and cash equivalents primarily includes the $ 75.0 million milestone payment due upon VIR-5525 achieving “first in human dosing” by 2026, amounts that may need to be refunded to the Gates Foundation and money market funds to secure standby letters of credit and security deposits with financial institutions under lease agreements.

Research and Development Expenses

7 unchanged sentences

and other allocated expenses, including expenses for rent, facilities maintenance, and depreciation and amortization.

The Company has acquired and may continue to acquire the rights to develop and commercialize new product candidates from third parties.

Upfront payments and research and development milestone payments made in connection with acquired licenses or product rights are expensed as incurred, provided that they do not relate to a regulatory approval milestone or assets acquired in a business combination.

VIR BIOTECHNOLOGY, INC.

Notes to Unaudited Condensed Consolidated Financial Statements

The Company has acquired and may continue to acquire the rights to develop and commercialize new product candidates from third parties.

The Company’s expense accruals for clinical trials and manufacturing are based on estimates of contracted services provided by third-party vendors not yet billed.

3 unchanged sentences

However, the Company may also be required to estimate these services based on information available to its internal clinical and manufacturing administrative staff if such information is not able to be obtained timely from its service providers .

Contingent Consideration Obligations in connection with Business Combinations

Contingent consideration obligations incurred in connection with a business combination are recorded at their fair values on the acquisition date, are remeasured each subsequent reporting period until the related contingencies are resolved, and are classified as contingent consideration on the unaudited condensed consolidated balance sheets.

The changes in fair values of contingent consideration related to the achievement of various milestones are recorded within research and development expenses or selling, general and administrative expenses based on the nature of the relevant underlying activities.

In accordance with ASC 842, Leases, the Company determines if an arrangement is or contains a lease at inception by assessing whether the arrangement contains an identified asset and whether it has the right to control the identified asset.

Right-of-use (“ROU”) assets represent the Company’s right to use an underlying asset for the lease term, and lease liabilities represent the Company’s obligation to make lease payments arising from the lease.

Lease liabilities are recognized at the lease commencement date based on the present value of future lease payments over the lease term.

ROU assets are based on the measurement of the lease liability, include any lease payments made prior to or on lease commencement, and exclude lease incentives and initial direct costs incurred, as applicable.

On the lease commencement date, the Company estimates and includes in its lease payments any lease incentive amounts based on future events when (1) the events are within the Company’s control and (2) the event triggering the right to receive the incentive is deemed reasonably certain to occur.

If the lease incentive received is greater or less than the amount recognized at lease commencement, the Company recognizes the difference as an adjustment to ROU asset and/or lease liability, as applicable.

As the implicit rate in the Company’s leases is generally unknown, the Company uses an incremental borrowing rate estimated based on the information available at the lease commencement date in determining the present value of future lease payments.

When calculating its estimated incremental borrowing rates, the Company considers its credit risk, the lease term, the total lease payments and the impact of collateral, as necessary.

The lease terms may include options to extend or terminate the lease when the Company is reasonably certain it will exercise such options.

ROU assets and lease liabilities are remeasured upon certain modifications to leases using the present value of remaining lease payments and estimated incremental borrowing rate upon lease modification.

Rent expense for the Company’s operating leases is recognized on a straight-line basis within operating expenses over the reasonably assured lease term.

The Company elected to not separate lease and non-lease components for any leases within its existing classes of assets and, as a result, accounts for the lease and non-lease components as a single lease component.

The Company also elected to not apply the recognition requirement to any leases within its existing classes of assets with a term of 12 months or less.

ROU assets are reviewed for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset (group) may not be recoverable, like that of property and equipment.

VIR BIOTECHNOLOGY, INC.

Notes to Unaudited Condensed Consolidated Financial Statements

New Accounting Pronouncement Not Yet Adopted

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

Improvements to Reportable Segment Disclosures, which requires, among other things, the following:

(i) enhanced disclosures about significant segment expenses that are regularly provided to the Chief Operating Decision Maker and included within a segment’s reported measure of profit or loss;

(ii) disclosure of the amount and description of the composition of other segment items, as defined in ASU 2023-07, by reportable segment;

and (iii) reporting the disclosures about each reportable segment’s profit or loss and assets on an annual and interim basis.

ASU 2023-07 clarifies that public entities with a single reportable segment are also required to provide the new disclosures and all existing disclosures required by ASC 280 Segment Reporting.

The guidance is effective for fiscal years beginning after December 15, 2023, and interim periods within fiscal years beginning after December 15, 2024.

Early adoption is permitted.

ASU 2023-07 is required to be applied retrospectively to all prior periods presented in the financial statements.

The Company is currently evaluating the impact the adoption of ASU 2023-07 may have on its consolidated financial statements and related disclosures.

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

In December 2023, the Financial Accounting Standards Board (FASB) issued Accounting Standards Updates (ASU) No.

2023-09, Income Taxes (Topic 740):

Improvements to Income Tax Disclosures , which modifies the rules on income tax disclosures to require entities to disclose (1) specific categories in the rate reconciliation, (2) the income or loss from continuing operations before income tax expense or benefit (separated between domestic and foreign) and (3) income tax expense or benefit from continuing operations (separated by federal, state and foreign).

3 unchanged sentences

ASU 2023-09 should be applied on a prospective basis, but retrospective application is permitted.

The Company is currently evaluating the impact the adoption of ASU 2023-09 may have on its annual consolidated financial statements and related disclosures.

In November 2024, the FASB issued ASU No.

2024-03, Income Statement—Reporting Comprehensive Income—Expense Disaggregation Disclosures (ASU 2024-03) , which requires entities to disclose specific information on the types of expenses included in the expense captions presented on the face of the income statement as well as disclosures about selling expenses.

The guidance is effective for annual periods beginning after December 15, 2026 and interim periods within annual reporting periods beginning after December 15, 2027.

Early adoption is permitted.

ASU 2024-03 should be applied on a prospective basis, but retrospective application is permitted.

The Company is currently evaluating the impact the adoption of ASU 2024-03 may have on its consolidated financial statements and related disclosures.

Reclassification

Certain reclassifications have been made to prior period amounts on the Company’s condensed consolidated balance sheets to conform to the current period presentation and enhance comparability.

As a result, the prior period amounts from deferred revenue, noncurrent were reclassified to other long-term liabilities .

These reclassifications had no impact on previously reported total assets, total liabilities, or total stockholders' equity.

Certain reclassifications have been made to prior period amounts on the Company’s condensed consolidated statements of operations to conform to the current period presentation and enhance comparability.

As a result, certain amounts related to long-lived assets impairment, previously reflected in research and development and selling, general and administrative , were reclassified to restructuring, long-lived assets impairment and related charges .

As a result, certain amounts related to restructuring activities and long-lived assets impairment and disposal gains or losses, previously reflected in selling, general and administrative , were reclassified to restructuring, long-lived assets impairment and related charges, net .

These reclassifications had no impact on previously reported total revenues, total operating expenses, or net loss.

There were no reclassifications made to the condensed consolidated statements of comprehensive loss, condensed consolidated statements of stockholders’ equity or condensed consolidated statements of cash flows.

Certain reclassifications have been made to prior period amounts on the Company’s condensed consolidated statements of cash flows to conform to the current period presentation and enhance comparability.

As a result, certain amounts related to collaboration receivables, previously reflected in changes in operating assets and liabilities – receivable from collaboration , were reclassified to changes in operating assets and liabilities – prepaid assets and other current assets .

Fair Value Measurements

1 unchanged sentence

Inputs that include quoted prices in active markets for identical assets and liabilities.

VIR BIOTECHNOLOGY, INC.

Notes to Unaudited Condensed Consolidated Financial Statements

Inputs other than Level 1 that are observable, either directly or indirectly, such as quoted prices for similar assets or liabilities;

2 unchanged sentences

Unobservable inputs that are supported by little or no market activity and that are significant to the fair value of the assets or liabilities.

The carrying amounts of the Company’s financial instruments, including accounts payable and accrued liabilities, approximate fair value due to their relatively short maturities.

VIR BIOTECHNOLOGY, INC.

Notes to Unaudited Condensed Consolidated Financial Statements

The carrying amounts of certain financial instruments, including accounts payable and accrued liabilities, approximate fair value due to their relatively short maturities.

Cash Equivalents and Available-for-Sale Securities

The following tables summarize the Company’s Level 1 and Level 2 financial assets measured at fair value on a recurring basis within the fair value hierarchy as of September 30, 2024 and December 31, 2023 (in thousands):

September 30, 2024

The following tables summarize the Company’s Level 1 and Level 2 financial assets measured at fair value on a recurring basis by level within the fair value hierarchy as of March 31, 2025 and December 31, 2024 (in thousands):

March 31, 2025

Hierarchy Amortized

Losses Aggregate

Money market funds (1)

Level 1 $ 118,278 $ — $ — $ 118,278

Money market funds Level 1 $ 168,828 $ — $ — $ 168,828

government treasuries Level 2 450,270 406 ( 10 ) 450,666

4 unchanged sentences

Total financial assets $ 989,092 $ 1,157 $ ( 43 ) $ 1,000,930

___________________________________________________

(1) Includes $ 21.0 million of restricted cash equivalents.

Reconciliation to cash, cash equivalents and investments on condensed consolidated balance sheet

Restricted cash equivalents invested in money market funds ( 18,957 )

Cash deposits 37,829

Total cash, cash equivalents and investments $ 1,019,802

December 31, 2024

1 unchanged sentence

Losses Aggregate

Money market funds (1)

Level 1 $ 278,187 $ — $ — $ 278,187

Money market funds Level 1 $ 146,505 $ — $ — $ 146,505

government treasuries Level 2 588,794 722 ( 33 ) 589,483

government agency bonds and discount notes Level 2 38,081 17 ( 19 ) 38,079

Asset-back securities Level 2 51,038 220 ( 10 ) 51,248

Corporate bonds Level 2 252,935 529 ( 9 ) 253,455

Equity securities Level 1 N/A N/A N/A 4,350

Total financial assets $ 1,077,353 $ 1,488 $ ( 71 ) $ 1,083,120

___________________________________________________

(1) Includes $ 19.7 million of restricted cash equivalents.

Accrued interest receivable excluded from both the fair value and amortized cost basis of the available-for-sale debt securities are presented within prepaid expenses and other current assets in the unaudited condensed consolidated balance sheets.

Accrued interest receivable amounted to $ 5.3 million and $ 4.0 million as of September 30, 2024 and December 31, 2023, respectively.

The Company did not write off any accrued interest receivable during the nine months ended September 30, 2024 and 2023.

The Company recognized total net unrealized gains of $ 3.0 million and $ 0.9 million in accumulated other comprehensive gain (loss) as of September 30, 2024 and December 31, 2023, respectively.

The gross unrealized losses related to U.S.

government treasuries, U.S.

government agency bonds and discount notes, and securities issued by institutions with investment-grade credit ratings as of September 30, 2024 and December 31, 2023 were nominal.

The Company determined that the gross unrealized losses on the investments as of September 30, 2024 were temporary in nature.

The Company currently does not intend, and it is highly unlikely that it will be required, to sell these securities before recovery of their amortized cost basis.

As of September 30, 2024, no securities have contractual maturities (or weighted average life for asset-backed securities) of longer than two years .

Reconciliation to cash, cash equivalents and investments on condensed consolidated balance sheet

Restricted cash equivalents invested in money market funds ( 20,281 )

Cash deposits 32,524

Total cash, cash equivalents and investments $ 1,095,363

VIR BIOTECHNOLOGY, INC.

Notes to Unaudited Condensed Consolidated Financial Statements

As of September 30, 2024, the Company’s equity investment consisted solely of ordinary shares of Brii Biosciences Limited (“Brii Bio Parent”).

The equity securities of Brii Bio Parent are listed on the The Stock Exchange of Hong Kong Limited, are considered to be marketable equity securities, and measured at fair value at each reporting date.

As of September 30, 2024, the Company remeasured the equity investment at a fair value of $ 5.5 million.

The Company recognized an unrealized gain of $ 1.1 million for the three months ended September 30, 2024, and an unrealized loss of $ 4.4 million for the nine months ended September 30, 2024, respectively, and unrealized losses of $ 2.7 million and $ 20.9 million for the three and nine months ended September 30, 2023, respectively, as other income in the unaudited condensed consolidated statement of operations.

For the three and nine months ended September 30, 2024 and 2023, the unrealized gains or losses related to foreign currency translation were not material.

Contingent Consideration Obligations in connection with Business Combinations

Contingent consideration obligations in connection with business combinations include potential milestone payments in connection with the acquisition of Humabs Biomed SA (“Humabs”).

The Company classifies the contingent consideration as Level 3 financial liabilities within the fair value hierarchy as of September 30, 2024 and December 31, 2023.

Accrued interest receivables excluded from both the fair value and amortized cost basis of the available-for-sale debt securities are presented within prepaid expenses and other current assets in the unaudited condensed consolidated balance sheets.

Accrued interest receivables amounted to $ 5.4 million and $ 5.0 million as of March 31, 2025 and December 31, 2024, respectively.

The Company did not write off any accrued interest receivables during the three months ended March 31, 2025 and 2024.

The Company recognized total net unrealized gains of $ 1.1 million and $ 1.4 million in accumulated other comprehensive loss as of March 31, 2025 and December 31, 2024, respectively.

The gross unrealized losses as of March 31, 2025 were due to changes in interest rates and temporary in nature.

The Company currently does not intend, and it is highly unlikely that it will be required, to sell these securities before recovery of their amortized cost basis.

As of March 31, 2025, no securities have contractual maturities (or weighted average life for asset-backed securities) of longer than two years .

As of March 31, 2025, the Company’s equity investment consisted solely of ordinary shares of Brii Biosciences Limited (Brii Bio Parent).

The equity securities of Brii Bio Parent are listed on the Stock Exchange of Hong Kong Limited and are considered to be marketable equity securities measured at fair value at each reporting date.

As of March 31, 2025, the Company remeasured the equity investment at a fair value of $ 10.7 million.

The Company recognized an unrealized gain of $ 6.4 million and an unrealized loss of $ 5.9 million for the three months ended March 31, 2025 and 2024, respectively, as part of other income in the unaudited condensed consolidated statement of operations.

For the three months ended March 31, 2025 and 2024, the unrealized gains or losses related to foreign currency translation were not material.

Contingent Consideration

Contingent consideration primarily includes potential milestone payments in connection with the acquisitions of Humabs BioMed SA (Humabs) in 2017.

The Company classifies the contingent consideration as Level 3 financial liabilities within the fair value hierarchy as of March 31, 2025 and December 31, 2024.

The estimated fair value of the contingent consideration related to the Humabs acquisition was determined by calculating the probability-weighted clinical, regulatory and commercial milestone payments based on the assessment of the likelihood and estimated timing that certain milestones would be achieved.

As of September 30, 2024, the Company calculated the estimated fair value of the remaining clinical and regulatory milestones related to tobevibart (formerly as VIR-3434), an investigational subcutaneously administered HBV-neutralizing monoclonal antibody, or mAb, using the following significant unobservable inputs:

Unobservable input Range

(Weighted-Average) 1

During the three months ended March 31, 2025, the Company achieved $ 17.5 million clinical milestone upon the enrollment of the first patient in phase 3 ECLIPSE registrational program for chronic hepatitis delta.

As of March 31, 2025, the Company recorded this $ 17.5 million as contingent consideration obligation, current on its unaudited condensed balance sheets and calculated the estimated fair value of the remaining clinical and regulatory milestones related to tobevibart using the following significant unobservable inputs:

Unobservable input Value

Discount rates 12.1 %

Probability of achievement 67.5 %

______________________________________________

(1) Unobservable inputs were weighted based on the relative fair value of the clinical and regulatory milestone payments.

For the commercial milestones, the Company used a Monte Carlo simulation.

As of September 30, 2024, the Monte Carlo simulation assumed a commercial product launch and associated discrete revenue forecasts, as well as the following significant unobservable inputs for the remaining commercial milestones related to tobevibart:

For the commercial milestones, the Company used a Monte Carlo simulation because of the availability of discrete revenue forecasts.

As of March 31, 2025, the Monte Carlo simulation assumed a commercial product launch and associated discrete revenue forecasts, as well as the following significant unobservable inputs for the remaining commercial milestones related to tobevibart:

Unobservable input Value

3 unchanged sentences

The discount rate captures the credit risk associated with the payment of the contingent consideration when earned and due.

As of September 30, 2024 and December 31, 2023, the estimated fair value of the contingent consideration related to the Humabs acquisition was $ 33.2 million and $ 26.0 million, respectively, with changes in the estimated fair value recorded in research and development expenses in the unaudited condensed consolidated statements of operations.

The estimated fair value of the contingent consideration related to the Humabs acquisition involves significant estimates and assumptions that give rise to measurement uncertainty.

As of March 31, 2025 and December 31, 2024, the estimated fair value of the contingent consideration related to the Humabs acquisition was $ 41.1 million and $ 40.1 million, respectively, with changes in the estimated fair value recorded in research and development expenses in the unaudited condensed consolidated statements of operations.

The estimated fair value of the contingent consideration related to the Humabs acquisition involves significant estimates and assumptions, which give rise to measurement uncertainty.

VIR BIOTECHNOLOGY, INC.

Notes to Unaudited Condensed Consolidated Financial Statements

The following table sets forth the changes in the estimated fair value of the Company’s contingent consideration obligations (in thousands):

Consideration

Consideration Obligation

Balance at December 31, 2024 $ 40,110

Changes in fair value 1,030

Balance at September 30, 2024 $ 33,170

VIR BIOTECHNOLOGY, INC.

Notes to Unaudited Condensed Consolidated Financial Statements

Balance at March 31, 2025 $ 41,140

Grant Agreements

Bill & Melinda Gates Foundation Grants

The Company has entered into various grant agreements with the Bill & Melinda Gates Foundation (“BMGF”), under which it is currently awarded grants totaling up to $ 49.9 million to support its HIV vaccine program, tuberculosis vaccine program, HIV vaccinal antibody program and malaria vaccinal antibody program.

The term of the grant agreements will expire at various dates through June 2027, unless terminated earlier by the BMGF for the Company’s breach, failure to progress the funded project, in the event of the Company’s change of control, change in the Company’s tax status, or significant changes in the Company’s leadership that the BMGF reasonably believes may threaten the success of the projects.

Concurrently with the execution of the grant agreement for the vaccinal antibody program, the Company entered into a stock purchase agreement with the BMGF, under which the BMGF purchased 881,365 shares of the Company’s common stock on January 13, 2022, at a price per share of $ 45.38 , for an aggregate purchase price of approximately $ 40.0 million.

The fair market value of the common stock issued to the BMGF was $ 28.5 million, based on the closing stock price of $ 37.65 per share on the closing date and taking into account a discount for the lack of marketability due to the restrictions in place on the underlying shares, resulting in a $ 11.3 million premium received by the Company.

The Company accounted for the common stock issued to the BMGF based on its fair market value on the closing date and determined that the premium paid by the BMGF should be included in the deferred revenue from the vaccinal antibody grant.

Gates Foundation Grants

The Company has entered into various grant agreements with the Gates Foundation (formerly known as the Bill & Melinda Gates Foundation), under which it is currently awarded grants totaling up to $ 49.9 million to support its HIV vaccine program, tuberculosis vaccine program, HIV vaccinal antibody program and malaria vaccinal antibody program.

The term of the grant agreements will expire at various dates through June 2027, unless terminated earlier by the Gates Foundation for the Company’s breach, failure to progress the funded project, in the event of the Company’s change of control, change in the Company’s tax status, or significant changes in the Company’s leadership that the Gates Foundation reasonably believes may threaten the success of the projects.

Concurrently with the execution of the grant agreement for the vaccinal antibody program, the Company entered into a stock purchase agreement with the Gates Foundation, under which the Gates Foundation purchased 881,365 shares of the Company’s common stock on January 13, 2022, at a price per share of $ 45.38 , for an aggregate purchase price of approximately $ 40.0 million.

The fair market value of the common stock issued to the Gates Foundation was $ 28.5 million, based on the closing stock price of $ 37.65 per share on the closing date and taking into account a discount for the lack of marketability due to the restrictions in place on the underlying shares, resulting in a $ 11.3 million premium received by the Company.

The Company accounted for the common stock issued to the Gates Foundation based on its fair market value on the closing date and determined that the premium paid by the Gates Foundation should be included in the deferred revenue from the vaccinal antibody grant.

In August 2024, the Company announced a strategic realignment that included phasing out certain research programs, which included the HIV vaccine program and the tuberculosis vaccine program funded by Gates Foundation grants.

The Company continues to pursue a cure for HIV in collaboration with the Gates Foundation.

Payments received in advance that are related to future research activities along with the aforementioned premium received are deferred and recognized as revenue when the donor-imposed conditions are met, which is as the research and development activities are performed.

The premium received by the Company is deferred and recognized over the same period as the grant proportionally.

The Company recognized grant revenue of $ 1.6 million and $ 3.8 million for the three months ended September 30, 2024 and 2023, respectively, and $ 3.8 million and $ 10.5 million for the nine months ended September 30, 2024 and 2023, respectively.

As of September 30, 2024 and December 31, 2023, the Company had deferred revenue of $ 13.7 million and $ 13.1 million, respectively.

As of September 30, 2024 and December 31, 2023, the Company had $ 9.7 million and $ 9.2 million, respectively, within accrued and other liabilities, which may need to be refunded to the BMGF.

Biomedical Advanced Research and Development Authority

In September 2022, the Company entered into a multi-year agreement (the “BARDA Agreement”) under Other Transaction Authority with the Biomedical Advanced Research and Development Authority (“BARDA”), part of the U.S.

Department of Health and Human Services’ Administration for Strategic Preparedness and Response.

Under the BARDA Agreement, the Company may receive up to an estimated $ 1.0 billion to advance the development of a full portfolio of innovative solutions to address influenza and potentially other infectious disease threats.

The Base Period for the BARDA Agreement includes government funding of approximately $ 55.0 million to reimburse a portion of expenses incurred by the Company to support the development of VIR-2482, an investigational prophylactic monoclonal antibody designed with the aim to protect against seasonal and pandemic influenza, including expenses related to the Phase 2 pre-exposure prophylaxis trial of VIR-2482.

The BARDA Agreement also provides for additional funding after the exercise by BARDA of up to twelve options to further support the development of pre-exposure prophylactic antibodies including and beyond VIR-2482 for the prevention of influenza illness and supporting medical countermeasures for other pathogens of pandemic potential.

In September 2023, the Company and BARDA entered into Amendment No.

P00001 to the BARDA Agreement (the “Amended BARDA Agreement”), pursuant to which BARDA awarded the Company $ 50.1 million in new funding upon the exercise of an additional option.

The Company will use $ 40.0 million to support the development of VIR-7229 through a Phase 1 clinical trial and $ 10.1 million to support the discovery of new monoclonal antibody against a second pathogen of pandemic potential.

The Company may also receive up to $ 11.2 million additional funding for the Base Period under the Amended BARDA Agreement to wind down activities related to the Phase 2 pre-exposure prophylaxis trial of VIR-2482.

The Amended BARDA Agreement will expire in July 2027 and may be extended by mutual written agreement of the Company and BARDA, if funding is available and research opportunities within scope reasonably warrant, or, if any of the options are exercised (as described above), to cover the period of such exercised option set forth in the Amended BARDA Agreement.

The Amended BARDA Agreement is terminable by the Company and BARDA at any time under specified circumstances, including for convenience.

VIR BIOTECHNOLOGY, INC.

Notes to Unaudited Condensed Consolidated Financial Statements

In September 2024, the Company and BARDA entered into Amendment No.

P00003 to the BARDA Agreement (the “Third Amended BARDA Agreement”), pursuant to which the parties agree to partially de-obligate certain funds from two of the exercised options related to the development of VIR-7229.

Under this Amendment the current BARDA commitment was decreased by $ 42.1 million.

The Company recognized grant revenue related to BARDA of $ 0.5 million and $ 2.9 million for the three months ended September 30, 2024 and 2023, respectively, and $ 5.6 million and $ 29.0 million for the nine months ended September 30, 2024 and 2023, respectively.

As of September 30, 2024, receivable from BARDA was no t material.

As of December 31, 2023, the Company had receivable from BARDA of $ 7.6 million, as part of prepaid expenses and other current assets.

As of September 30, 2024, $ 8.9 million of potential future reimbursement remains available under the Amended BARDA Agreement.

The Company recognized grant revenue of $ 1.2 million and $ 1.9 million for the three months ended March 31, 2025 and 2024, respectively.

As of March 31, 2025 and December 31, 2024, the Company had deferred revenue of $ 10.4 million and $ 11.1 million, respectively.

As of March 31, 2025 and December 31, 2024, the Company had $ 11.2 million and $ 11.6 million, respectively, within accrued and other liabilities, which may need to be refunded to the Gates Foundation.

Collaboration and License Agreements

License Agreement with Sanofi

On September 9, 2024, the Company closed the license agreement (the “Sanofi Agreement”) with Amunix Pharmaceuticals, Inc., a Sanofi company (“Sanofi”) previously announced on August 1, 2024.

The Sanofi Agreement provides the Company with an exclusive worldwide license to use of the proprietary PRO-XTEN™ universal masking technology for oncology and infectious disease,excluding the ophthalmological field, and to three early clinical-stage dual-masked T-cell engagers (TCEs) that all leverage the PRO-XTEN TM universal masking platform within a range of cancer indications.

Under the Sanofi Agreement the Company made an upfront payment to Sanofi in the amount of $ 100.0 million and placed into escrow a $ 75.0 million milestone payment that is subject to VIR-5525 achieving “first in human dosing” by 2026.

On September 9, 2024 (Acquisition Date), the Company closed the license agreement with Amunix Pharmaceuticals, Inc., a Sanofi company, previously announced on August 1, 2024 (Sanofi Agreement).

The Sanofi Agreement provides the Company with an exclusive worldwide license to use of the proprietary PRO-XTEN™ universal masking technology for oncology and infectious disease,excluding the ophthalmological field, and to three early clinical-stage dual-masked TCEs that all leverage the PRO-XTEN™ universal masking platform within a range of oncology indications.

VIR BIOTECHNOLOGY, INC.

Notes to Unaudited Condensed Consolidated Financial Statements

Under the Sanofi Agreement the Company made an upfront payment to Sanofi in the amount of $ 100.0 million and placed into escrow a $ 75.0 million milestone payment due to former shareholders of Amunix Pharmaceuticals, Inc., which is subject to VIR-5525 achieving “first in human dosing” by 2026.

The cash paid into escrow is under the control of the Company and is classified as restricted cash and cash equivalents, current in the unaudited condensed consolidated balance sheets.

Sanofi will also be eligible to receive up to an additional $ 323.0 million in future development and regulatory milestone payments, up to an additional $ 1.49 billion in commercial net sales-based milestone payments, and low single-digit to low double-digit tiered royalties on worldwide net sales.

In addition, if, within a two-year period from the execution of the Sanofi Agreement, the Company executes a transaction that gives rise to Vir Bio receiving certain sublicense income related to the licenses obtained from the Sanofi Agreement, Sanofi may be eligible to receive a portion of such income.

Additionally, as part of the Sanofi Agreement, the Company paid $ 3.7 million to acquire certain lab equipment and cash deposits primarily related to contract manufacturing agreements.

Shortly after the closing of the transactions, the Company hired certain former Sanofi personnel.

The Company incurred approximately $ 4.6 million of transaction costs associated with the closing of Sanofi Agreement.

The following table summarizes the aggregate amount paid for the assets acquired by the Company in connection with the Sanofi Agreement (in thousands):

Shortly after the closing of the Sanofi Agreement, the Company hired certain former Sanofi personnel.

The Company incurred approximately $ 4.6 million of transaction costs associated with the closing of the Sanofi Agreement.

The following table summarizes the aggregate amount paid for the assets acquired by the Company in connection with the Sanofi Agreement as of the Acquisition Date (in thousands):

Upfront $ 100,000

3 unchanged sentences

Total purchase consideration $ 108,342

The Company accounted for the transaction as an asset acquisition in accordance ASC 805-50 as substantially all of the fair value of the assets acquired is concentrated in a group of similar identifiable assets.

The three early clinical stage oncology TCEs use the same universal PRO-XTEN TM masking technology and have similar development timelines, probabilities of risk, and loss of patent exclusivity among other characteristics.

The Company accounted for the Sanofi Agreement as an asset acquisition in accordance ASC 805-50 as substantially all of the fair value of the assets acquired is concentrated in a group of similar identifiable assets.

The three early clinical stage oncology TCEs use the same universal PRO-XTEN™ masking technology and have similar development timelines, probabilities of risk, and loss of patent exclusivity among other characteristics.

ASC 805-50 requires the acquiring entity in an asset acquisition to recognize assets acquired and liabilities assumed based on the cost to the acquiring entity on a relative fair value basis, which includes consideration given.

The total purchase price was allocated to the acquired assets based on their relative fair values, as follows (in thousands):

In-process research and development ("IPR&D") $ 102,836

The total purchase price was allocated to the acquired assets based on their relative fair values, as of the Acquisition Date as follows (in thousands):

In-process research and development $ 102,836

Property and equipment 1,119

4 unchanged sentences

(1) Includes acquired cash deposits primarily related to contract manufacturing agreements.

VIR BIOTECHNOLOGY, INC.

Notes to Unaudited Condensed Consolidated Financial Statements

The fair value of the IPR&D was estimated using a multi-period excess earnings income approach that discounts expected cash flows to present value by applying a discount rate that represents the estimated rate that market participants would require for the intangible asset.

In accordance with ASC 730, as the three early clinical stage oncology TCEs have not achieved regulatory approval when acquired, the portion of the purchase price allocated to the IPR&D was immediately expensed to research and development as they had no alternative future use.

The expected cash flows and related discount rate are significant unobservable inputs categorized within Level 3 of the fair value hierarchy.

Contingent milestone payments were determined to be within the scope of ASC 450 and will be recognized when the contingency is resolved and the consideration is paid or becomes payable.

2 unchanged sentences

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

The assembled workforce is classified as intangible assets, net and is amortized over an expected useful life of 5 years as research and development expense.

Collaboration Agreements with GSK

2020 GSK Agreement

In 2020, the Company, Glaxo Wellcome UK Limited and Beecham S.A.

entered into a collaboration agreement (the “2020 GSK Agreement”).

Subsequently, Beecham S.A.

assigned and transferred all its rights, title, interest, and benefit in the 2020 GSK Agreement to GlaxoSmithKline Biologicals S.A.

(Glaxo Wellcome UK Limited and GlaxoSmithKline Biologicals S.A., referred to, individually and together, as “GSK”).

Under the terms of the 2020 GSK Agreement, the Company and GSK agreed to collaborate to research, develop and commercialize products for the prevention, treatment and prophylaxis of diseases caused by SARS-CoV-2, the virus that causes COVID-19, and potentially other coronaviruses.

The collaboration initially focused on the development and commercialization of three programs:

(1) antibodies targeting SARS-CoV-2 and potentially other coronaviruses (the “Antibody Program”);

(2) vaccines targeting SARS-CoV-2 and potentially other coronaviruses (the “Vaccine Program”), and (3) products based on genome-wide CRISPR screening of host targets expressed in connection with exposure to SARS-CoV-2 and potentially other coronaviruses (the “Functional Genomics Program”).

On February 8, 2023, the Company and GSK entered into Amendment No.

2 and Amendment No.

3 to the 2020 GSK Agreement.

Pursuant to Amendment No.

2, the Company and GSK agreed to remove the Vaccine Program from the 2020 GSK Agreement, and to wind down and terminate the cost-sharing arrangements and all ongoing activities in relation to the Vaccine Program.

As of the effective date of Amendment No.

2, the Vaccine Program had not yet advanced to its predefined development candidate stage.

The Company retains the right to progress development of vaccine products directed to SARS-CoV-2 and other coronaviruses independently (including with or for third parties) outside the scope of the 2020 GSK Agreement, subject to the payment of tiered royalties to GSK on net sales of any vaccine products covered by certain GSK intellectual property rights in the low single digits.

Pursuant to Amendment No.

3, the Company and GSK agreed to modify the Antibody Program to remove from the collaboration all coronavirus antibodies other than sotrovimab and VIR-7832, and certain variants thereof.

Sotrovimab and VIR-7832, and certain variants thereof, remain subject to the terms of the 2020 GSK Agreement, and the Company retains the sole right to progress the development and commercialization of the terminated antibody products independently (including with or for third parties), subject to the payment of tiered royalties to GSK on net sales of such terminated antibody products at percentages ranging from the very low single digits to the mid-single digits, depending on the nature of the antibody product being commercialized.

Subject to an opt-out mechanism, the parties share all development costs, manufacturing costs, and costs and expenses for the commercialization of the collaboration products, with the Company bearing 72.5 % of such costs for the antibody products, except that GSK has the sole right to develop (including to seek, obtain or maintain regulatory approvals), manufacture and commercialize sotrovimab in and for mainland China, Hong Kong, Macau and Taiwan at GSK’s sole cost and expense, and equal sharing of such costs for the functional genomics products.

The 2020 GSK Agreement will remain in effect with respect to each collaboration program for as long as there is a collaboration product being developed or commercialized by the lead party, or the non-opt-out party, in such program.

Either party has the right to terminate the 2020 GSK Agreement in the case of the insolvency of the other party, an uncured material breach of the other party with respect to a collaboration program or collaboration product, or as mutually agreed by the parties.

The assembled workforce is classified as intangible assets, net and is amortized over an expected useful life of five years .

VIR BIOTECHNOLOGY, INC.

Notes to Unaudited Condensed Consolidated Financial Statements

In May 2021, the U.S.

Food and Drug Administration (“FDA”) granted an EUA in the United States for sotrovimab, the first collaboration product under the Antibody Program.

In April 2022, the FDA excluded the use of sotrovimab in all U.S.

regions due to the continued proportion of COVID-19 cases caused by certain variants.

As the lead party for all manufacturing and commercialization activities, GSK incurs all of the manufacturing, sales and marketing expenses and is the principal on sales transactions with third parties.

As described in Note 2—Summary of Significant Accounting Policies, the Company’s accounting policy related to the profit-share is to consider the agreed-upon share of the profit-sharing amounts each quarter and evaluate whether those amounts are subject to potential future adjustments based on the latest available facts and circumstances.

As the Company is the agent, the Company recognizes its contractual share of the profit-sharing amounts or royalties (in case of an opt-out) as revenue, based on sales net of various estimated deductions such as rebates, discounts, chargebacks, credits and returns, less cost of sales and allowable expenses (including manufacturing, distribution, medical affairs, selling, and marketing expenses) in the period the sale occurs.

Manufacturing costs include inventory revaluation adjustments, lower of cost or market inventory adjustments, inventory write-downs and write-offs, and binding purchase commitments with a third-party manufacturer among other manufacturing costs.

In periods when allowable expenses exceed amounts recognized for net product sales of sotrovimab, negative revenue will be reported in our consolidated statements of operations.

The Company’s contractual share of the profit-sharing amounts is subject to potential future adjustments to allowable expenses, which represents a form of variable consideration.

At each reporting period, the Company evaluates the latest available facts and circumstances to determine whether any portion of profit-sharing amounts should be constrained.

In 2023, GSK reported to the Company certain allowable manufacturing expenses related to excess sotrovimab supply and binding reserved manufacturing capacity not utilized, which the Company had previously reserved as constraint on its cumulative profit-sharing amounts.

For the year ended December 31, 2023, the Company paid GSK $ 341.4 million relating to these manufacturing expenses.

GSK may continue to adjust allowable manufacturing expenses for the Company’s share of the excess supply write-offs and unused binding manufacturing capacity and report to the Company as cost-sharing amounts in future periods.

The Company evaluated the latest available facts and circumstances to update its evaluation of profit-sharing amounts to be constrained.

As of September 30, 2024, the Company’s share of the remaining estimated manufacturing expenses related to excess sotrovimab supply and binding reserved manufacturing capacity not utilized is not material.

The Company re-assesses these estimates each reporting period.

During the three and nine months ended September 30, 2024 and 2023, the Company recorded profit-sharing amount, profit-sharing amount constrained, and profit-sharing amount previously constrained, released as components of collaboration revenue in the unaudited condensed consolidated statements of operations, as follows (in thousands):

Three Months Ended

September 30, Nine Months Ended

September 30,

2024 2023 2024 2023

Profit-sharing amount $ ( 1,102 ) $ ( 6,038 ) $ ( 1,334 ) $ ( 7,198 )

Profit-sharing amount constrained — — ( 700 ) —

Profit-sharing amount previously constrained, released — 1,651 — 35,606

Total collaboration revenue, net $ ( 1,102 ) $ ( 4,387 ) $ ( 2,034 ) $ 28,408

Costs associated with co-development activities performed under the 2020 GSK Agreement are included in research and development expenses on the unaudited condensed consolidated statements of operations, with any reimbursement of costs by GSK reflected as a reduction of such expenses.

Under the 2020 GSK Agreement, the Company recognized additional net research and development expenses of $ 1.0 million and $ 6.1 million during the three months ended September 30, 2024 and 2023, respectively, and $ 6.5 million and $ 18.6 million during the nine months ended September 30, 2024 and 2023, respectively.

Alnylam Pharmaceuticals, Inc.

In October 2017, the Company and Alnylam Pharmaceuticals, Inc.

(Alnylam) entered into a collaboration and license agreement (the Alnylam Agreement).

Under the Alnylam Agreement, the Company obtained a worldwide, exclusive license to develop, manufacture and commercialize siRNA product candidates, including elebsiran, for all uses and purposes including the treatment of hepatitis B virus (HBV) and hepatitis delta virus (HDV).

Under the Alnylam Agreement, the Company also held options to obtain similar licenses to siRNA product candidates for up to four other infectious disease targets selected by Vir Bio, but following an amendment and restatement of the Alnylam Agreement in March 2025 (the Restated Alnylam Agreement), those options (and all rights and obligations related to those infectious disease targets) were terminated.

At the same time Alnylam elected to not opt-in to the profit-sharing arrangement with respect to any approved siRNA product candidates, including elebsiran, directed to HBV or HDV.

The Company remains solely responsible, at its expense, for conducting all development, manufacture and commercialization activities for elebsiran in HBV and HDV indications, and the Company is required to use commercially reasonable efforts to develop and commercialize elebsiran for the treatment of HBV or HDV in the United States and specified major markets.

In connection with the Restated Alnylam Agreement and Alnylam’s election to not opt-in to the profit-sharing arrangement, the Company agreed to pay Alnylam $ 30.0 million, which was recorded as part of research and development expenses in the Company’s unaudited condensed statement of operations for the three months ended March 31, 2025 and as part of accrued and other liabilities on its unaudited condensed balance sheets as of March 31, 2025.

After this payment, the remaining amount of the development and regulatory milestones is up to $ 145.0 million, down from the $ 175.0 million as previously disclosed in the audited consolidated financial statements included in the Annual Report on Form 10-K for the year ended December 31, 2024.

Any development and regulatory milestones for an elebsiran product will be payable to Alnylam only once, irrespective of dosage, formulation forms, route of administration or indication.

Following commercialization, the Company will be required to pay to Alnylam up to $ 250.0 million in the aggregate for the first achievement of specified levels of net sales by elebsiran products directed to HBV, whether for the treatment of HBV or HDV.

The Company will also be required to pay Alnylam tiered royalties at percentages ranging from the low double-digits to mid-teens on annual net sales of siRNA products directed to HBV, such as elebsiran, whether for the treatment of HBV or HDV, subject to specified reductions and offsets.

The royalties are payable on a product-by-product and country-by-country basis until the later of the expiration of all valid claims of specified patents covering such product in such country and 10 years after the first commercial sale of such product in such country.

Alnylam is also entitled to receive a portion of any consideration the Company receives as a result of granting a sublicense under the licenses granted to Vir Bio by Alnylam under the Alnylam Agreement.

The term of the Restated Alnylam Agreement will continue, on a product-by-product and country-by-country basis, until expiration of all royalty payment obligations under the Restated Alnylam Agreement.

The Company may terminate the Alnylam Agreement on a program-by-program basis or in its entirety for any reason on 90 days’ written notice.

Either party may terminate the agreement for cause for the other party’s uncured material breach on 60 days’ written notice (or 30 days’ notice for payment breach), or if the other party challenges the validity or enforceability of any patent licensed to it under the Restated Alnylam Agreement on 30 days’ notice.

The Company did no t incur material expenses during the three months ended March 31, 2024 related to collaboration with Alnylam.

VIR BIOTECHNOLOGY, INC.

Notes to Unaudited Condensed Consolidated Financial Statements

2021 Expanded GSK Collaboration

In 2021, the Company and GSK entered into a collaboration agreement (the “2021 GSK Agreement”) under which the parties agreed to expand the 2020 GSK Agreement to collaborate on three separate programs:

(1) a program to research, develop and commercialize certain mAbs for the prevention, treatment or prophylaxis of the influenza virus (the “Influenza Program”), excluding VIR-2482 unless GSK exercises its exclusive option to co-develop and commercialize after the Company completes a Phase 2 clinical trial (“VIR-2482 Option”);

(2) an expansion of the parties’ current Functional Genomics Program to focus on functional genomics screens directed to targets associated with respiratory viruses (the “Expanded Functional Genomics Program”);

and (3) additional programs to develop neutralizing mAbs directed to up to three non-influenza target pathogens if selected by GSK prior to March 25, 2024 (the “Selected Pathogens” and such programs, the “Additional Programs”).

On February 21, 2024, the Company and GSK entered into a letter agreement (the “Letter Agreement”) pursuant to which the Company and GSK agreed to terminate the Influenza Program and GSK’s VIR-2482 Option from the 2021 GSK Agreement and to wind down and terminate the cost-sharing arrangements and all ongoing activities in relation to the Influenza Program.

The parties mutually agree upon the allocation of responsibility for the development of products under the Expanded Functional Genomics Program, and for the development and early-stage manufacturing of products under the Additional Programs if and when GSK decides which Selected Pathogens to pursue.

GSK is primarily responsible for commercial manufacturing and commercialization activities for products under the Expanded Functional Genomics Program and Additional Programs, if and when selected by GSK.

For each collaboration program, the Company granted or will grant GSK certain license rights related to the development, manufacturing and commercialization of products arising from the program.

GSK selected RSV as its first pathogen under the Additional Programs in 2022.

During the first quarter of 2024, the Company recognized contract revenue of $ 51.7 million as GSK’s rights to select the remaining two additional non-influenza target pathogens expired on March 25, 2024.

The Company had no other remaining performance obligations under the 2021 GSK Agreement.

The parties share 50 % of all development costs in accordance with the budget for each of the collaboration programs.

The parties also share 50 % of all profits and losses arising from any collaboration product.

Costs associated with co-development activities performed under the 2021 GSK Agreement are included in research and development expenses in the unaudited condensed consolidated statements of operations, with any reimbursement of costs by GSK reflected as a reduction of such expenses.

Under the 2021 GSK Agreement, the Company recognized net reimbursement of research and development expenses of $ 0.2 million and $ 0.7 million, respectively, during the three and nine months ended September 30, 2024 and additional net research and development expenses of $ 0.6 million and $ 1.9 million, respectively, during the three and nine months ended September 30, 2023.

Balance Sheet Components

1 unchanged sentence

Property and equipment, net consists of the following (in thousands).

(in years) September 30,

Depreciation expenses were $ 2.8 million and $ 4.4 million for the three months ended March 31, 2025 and 2024, respectively.

(in years) March 31,

2025 December 31,

Laboratory equipment 5 $ 40,963 $ 43,728

Computer equipment 3 2,615 2,783

Furniture and fixtures 5 2,553 2,887

Leasehold improvements 8 - 12

$ 53,981 $ 53,992

Laboratory equipment 5 39,426 39,428

Furniture and fixtures 5 2,715 2,696

Computer equipment 3 2,621 2,778

Construction in progress N/A 1,808 1,074

Property and equipment, gross 100,551 99,968

Less accumulated depreciation ( 35,193 ) ( 33,896 )

accumulated depreciation ( 38,870 ) ( 36,785 )

Total property and equipment, net $ 61,681 $ 63,183

Depreciation expenses were $ 2.9 million and $ 4.5 million for the three months ended September 30, 2024 and 2023, respectively, and $ 11.5 million and $ 14.6 million for the nine months ended September 30, 2024 and 2023, respectively.

VIR BIOTECHNOLOGY, INC.

Notes to Unaudited Condensed Consolidated Financial Statements

Accrued and Other Liabilities

Accrued and other liabilities consist of the following (in thousands):

September 30,

2025 December 31,

Payroll and related expenses 31,369 41,322

Research and development expenses $ 67,893 $ 29,225

Operating lease liabilities, current 19,408 12,867

Payroll and related expenses 11,611 31,165

Excess funds payable under grant agreements 11,177 11,589

Operating lease liabilities, current 7,925 7,752

Other professional and consulting expenses 2,068 2,268

Net profit-sharing amount 1,100 —

Other accrued expenses 3,452 3,874

Total accrued and other liabilities $ 104,126 $ 85,873

Restructuring, Asset Impairment and Related Charges

2024 Restructuring Plan

In August 2024, the Company initiated a strategic restructuring to advance the development of its hepatitis programs and focus on the highest near-term value opportunities (“2024 Restructuring Plan”).

The organizational realignment and optimization included phasing out programs in influenza, COVID-19, and the Company's T cell-based viral vector platform, as well as a workforce reduction of approximately 25 % or approximately 140 employees.

The Company expects to recognize restructuring expenses of approximately $ 11 million to $ 13 million, primarily related to employee severance cash payouts, mostly in the second half of 2024.

During the three months ended September 30, 2024, the Company incurred severance and other employee-related expenses of $ 10.4 million, of which $ 8.2 million and $ 2.2 million is classified as research and development and selling, general and administrative expenses, respectively.

2023 Restructuring Plan

In December 2023, the Company initiated strategic steps to reduce operating expenses and focus its capital allocation on programs with the highest potential for patient impact and value creation (“2023 Restructuring Plan”).

As part of the steps, the R&D facilities in St.

Louis, Missouri and Portland, Oregon were closed in 2024.

In addition, approximately 75 net positions, or 12 % of the workforce, were eliminated, which included reductions from the Company’s discontinuation of its innate immunity small molecule group that was initiated in the third quarter of 2023.

In the second quarter of 2024, due to the completion of R&D activities at the St.

Louis, Missouri site, the Company recorded non-cash impairment charges of $ 24.2 million primarily related to the write-off of the remaining balance of the ROU asset and related leasehold improvements along with non-cash disposal losses of $ 2.3 million related to certain lab equipment held for sale.

In the third quarter 2024, the Company recognized restructuring charges of $ 2.3 million for long-lived assets primarily driven by a write-off of $ 1.4 million representing the remaining balance of ROU asset for Portland, Oregon site due to the cessation of R&D activities.

For the nine months ended September 30, 2024, total restructuring charges for long-lived assets amounted to $ 28.8 million.

All actions related to the 2023 Restructuring Plan have been substantially completed by the third quarter of 2024.

VIR BIOTECHNOLOGY, INC.

Notes to Unaudited Condensed Consolidated Financial Statements

The following table is a summary of restructuring charges incurred under both the 2023 and 2024 Restructuring Plans during the three and nine months ended September 30, 2024 and a roll forward of accrued restructuring costs from December 31, 2023 to September 30, 2024 (in thousands).

Severance and other employee-related expenses Long-lived assets impairment charges and disposal losses Total

Accrued restructuring charges at December 31, 2023 $ 4,454 $ — $ 4,454

Restructuring charges, net ( 48 ) — ( 48 )

Cash payment ( 2,592 ) — ( 2,592 )

Accrued restructuring charges at March 31, 2024 $ 1,814 $ — $ 1,814

Restructuring charges, net ( 200 ) 26,475 26,275

Cash payment ( 710 ) — ( 710 )

Non-cash activity — ( 26,475 ) ( 26,475 )

Accrued restructuring charges at June 30, 2024 $ 904 $ — $ 904

Restructuring charges, net 10,379 2,333 12,712

Cash payment ( 301 ) — ( 301 )

Non-cash activity — ( 2,333 ) ( 2,333 )

Accrued restructuring charges at September 30, 2024 $ 10,982 $ — $ 10,982

Reconciliation of accrued restructuring charges to the condensed consolidated balance sheets

Accrued and other liabilities $ 10,982 $ — $ 10,982

During the three months ended June 30, 2023, the Company ceased to use the leased space at 499 Illinois Street, San Francisco, California, former corporate headquarter.

As a result, the Company assessed the related long-lived assets at the site for impairment and recognized $ 5.4 million impairment charges, primarily related to the write-off of the remaining balance of ROU asset and leasehold improvements.

Commitments and Contingencies

Manufacturing and Supply Agreements

In the first quarter of 2024, the Company and a third-party contract development manufacturing organization entered into various scopes of work with respect to the manufacturing of tobevibart (the “Tobevibart Agreements”).

As of September 30, 2024, the Company had unaccrued unpaid commitments of approximately $ 15 million under the Tobevibart Agreements.

In the third quarter of 2024, the Company and a third-party contract development manufacturing organization entered into various scopes of work with respect to the manufacturing of elebsiran (the “Elebsiran Agreements”).

As of September 30, 2024, the Company had unaccrued unpaid commitments of approximately $ 7 million under the Elebsiran Agreements.

As of March 31, 2025, the Company had unaccrued unpaid commitments of approximately $ 22 million under the Tobevibart Agreements.

As of March 31, 2025, the Company had unaccrued unpaid commitments of approximately $ 8 million under the Elebsiran Agreements.

Legal Proceedings

14 unchanged sentences

The fair value of stock options granted to employees was estimated on the date of grant using the Black-Scholes option-pricing model with the following assumptions:

Three Months Ended

September 30, Nine Months Ended

September 30,

2024 2023 2024 2023

Three Months Ended March 31,

Expected term of options (in years) 6.1 6.1

1 unchanged sentence

89.2 % – 89.3 %

89.2 % - 91.8 %

99.6 % - 101.5 %

Risk-free interest rate 4.1 % – 4.5 %

4.0 % - 4.4 %

3.5 % - 4.6 %

3.4 % - 4.4 %

Expected dividend yield — —

The valuation assumptions for stock options were determined as follows:

• Expected Term — The expected term represents the period that the stock options granted are expected to be outstanding and is determined using the simplified method (based on the mid-point between the vesting date and the end of the contractual term).

• Expected Volatility — Expected volatility is determined by using a blended approach of the Company and certain industry peers’ historical volatilities.

• Risk-Free Interest Rate — The Company based the risk-free interest rate over the expected term of the stock options based on the constant maturity rate of U.S.

Expected Term — The expected term represents the period that the stock options granted are expected to be outstanding and is determined using the simplified method (based on the mid-point between the vesting date and the end of the contractual term) as the Company has limited historical information to develop reasonable expectations about future exercise patterns and post-vesting employment termination behavior for its stock option grants.

Expected Volatility — The expected volatility is determined by using a blended approach of the Company and its industry peers’ historical volatilities.

Risk-Free Interest Rate — The Company determines the risk-free interest rate over the expected term of the stock options based on the constant maturity rate of U.S.

Treasury securities with similar maturities as of the date of the grant.

5 unchanged sentences

The following table sets forth the total stock-based compensation expense for all awards granted to employees and non-employees and the ESPP in the unaudited condensed consolidated statements of operations (in thousands):

Three Months Ended

September 30, Nine Months Ended

September 30,

2024 2023 2024 2023

Three Months Ended March 31,

Research and development $ 7,005 $ 13,606

2 unchanged sentences

Net Loss Per Share

Basic net loss per common share is computed by dividing the net loss attributable to Vir by the weighted-average number of common shares outstanding during the period, without consideration of common stock equivalents.

Diluted net loss per common share is computed by dividing the net loss attributable to Vir by the sum of the weighted-average number of common shares outstanding during the period plus any potential dilutive effects of common stock equivalents outstanding during the period calculated in accordance with the treasury stock method.

Basic net loss per common share is computed by dividing the net loss by the weighted-average number of common shares outstanding during the period, without consideration of common stock equivalents.

Diluted net loss per common share is computed by dividing the net loss by the sum of the weighted-average number of common shares outstanding during the period plus any potential dilutive effects of common stock equivalents outstanding during the period calculated in accordance with the treasury stock method.

For periods that the Company was in a net loss position, basic net loss per share is the same as diluted net loss per share as the inclusion of all potential common securities outstanding would have been anti-dilutive.

The following is a calculation of the basic and diluted net loss per share (in thousands, except share and per share data):

Three Months Ended

September 30, Nine Months Ended

September 30,

2024 2023 2024 2023

Net loss attributable to Vir $ ( 213,717 ) $ ( 163,413 ) $ ( 417,371 ) $ ( 499,088 )

Three Months Ended March 31,

Net loss $ ( 120,965 ) $ ( 65,276 )

Weighted-average shares outstanding, basic and diluted 137,468,900 135,280,648

Net loss attributable to Vir per share, basic and diluted $ ( 1.56 ) $ ( 1.22 ) $ ( 3.07 ) $ ( 3.73 )

Potentially dilutive securities that were not included in the diluted per share calculations because they would be anti-dilutive were as follows:

Three Months Ended

September 30, Nine Months Ended

September 30,

2024 2023 2024 2023

Net loss per share, basic and diluted $ ( 0.88 ) $ ( 0.48 )

Securities that could potentially dilute basic net loss per common share in the future that were not included in the computation of diluted net loss per common share because to do so would have been antidilutive for the periods presented were as follows:

Three Months Ended March 31,

Options issued and outstanding 11,080,159 12,018,822

1 unchanged sentence

Total 17,968,621 16,540,696

The table below presents our loss before (provision for) benefit from income taxes, (provision for) benefit from income taxes and effective tax rate for the three and nine months ended September 30, 2024 and 2023 (in thousands):

Three Months Ended

September 30, Nine Months Ended

September 30,

2024 2023 2024 2023

Loss before (provision for) benefit from income taxes $ ( 213,540 ) $ ( 166,626 ) $ ( 418,430 ) $ ( 507,437 )

(Provision for) benefit from income taxes $ ( 177 ) $ 3,213 $ 1,059 $ 8,293

The table below presents our loss before provision for income taxes, provision for income taxes and effective tax rate for the three months ended March 31, 2025 and 2024(in thousands):

Three Months Ended March 31,

Loss before provision for income taxes $ ( 120,949 ) $ ( 65,000 )

Provision for income taxes $ ( 16 ) $ ( 276 )

Effective tax rate — % ( 0.4 %)

4 unchanged sentences

Accordingly, the Company’s effective tax rates will vary depending on the relative proportion of foreign to United States income/loss, the utilization of net operating loss and tax credit carry forwards and carrybacks, changes in jurisdictional mix of income and expense, changes in management’s assessment of matters such as the ability to realize deferred tax assets, and changes in tax laws.

The provision for income taxes for the three months ended September 30, 2024 was not material.

The benefit from income taxes for the nine months ended September 30, 2024 was primarily due to a favorable adjustment to estimated tax payable.

The benefit from income taxes for the three and nine months ended September 30, 2023 was primarily due to a pre-tax loss and the Company’s ability to carry back the research and development credit to 2022.

Unrecognized tax benefits were $ 14.8 million and $ 13.6 million as of September 30, 2024 and December 31, 2023, respectively, and if recognized, would favorably affect the effective tax rate in future periods.

Unrecognized tax benefits were $ 18.5 million and $ 17.9 million as of March 31, 2025 and December 31, 2024, respectively, and if recognized, would favorably affect the effective tax rate in future periods.

Segment Reporting

The Company’s CODM is its Chief Executive Officer.

The accounting policies of the segment are the same as those described in the summary of significant accounting policies.

The measure of segment profit or loss is segment net loss that also is reported on the consolidated statements of operations as consolidated net loss.

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

The CODM uses segment net loss to monitor spending, assess performance for the Company and management, evaluate the progress of completing corporate goals, decide how to allocate resources among the Company’s clinical and pre-clinical portfolios, and make strategic decisions about business development opportunities.

The segment revenue, segment profit or loss, and significant segment expenses regularly provided to CODM are summarized as follows (in thousands).

Three Months Ended

Segment revenue $ 3,032 $ 56,376

Segment expenses (1)

Cost of revenue — 59

Research and development

Contract manufacturing 9,336 9,669

Clinical costs 20,606 11,607

Personnel (2)

33,718 46,190

Licenses, collaborations and contingent consideration 36,591 5,696

Other R&D (3)

18,394 26,963

Selling, general and administrative (2)

23,944 36,321

Restructuring, long-lived assets impairment and related charges, net ( 10 ) ( 48 )

Other segment items (4)

18,582 14,805

Segment and consolidated net loss $ ( 120,965 ) $ ( 65,276 )

(1) Refer to Note 6 Balance Sheet Components for depreciation and amortization expenses included in segment expenses.

(2) Refer to Note 8 Stock-Based Awards for stock-based compensation expenses included in segment expenses.

(3) Other research and development expenses primarily includes non-personnel research expenses, allocated facility and IT expenses, IPR&D impairment, and depreciation expenses.

(4) Other segment items include change in fair value of equity investments, interest income, other expense, net, and provision for income taxes, all of which were presented on the condensed consolidated statements of operations.

VIR BIOTECHNOLOGY, INC.

Notes to Unaudited Condensed Consolidated Financial Statements

The following table summarizes segment revenues by geographic area (in thousands).

The revenues attributed to foreign customers primarily include collaboration and contract revenues recognized under the Company’s collaboration agreements with GSK, contract revenue generated from clinical supplies provided to foreign companies, and license revenue from the Company’s collaboration with Brii Bio.

Three Months Ended

Segment revenues attributed to:

customers $ 1,238 $ 5,172

Foreign customers

GSK ( 70 ) 50,694

Other 1,864 510

Total segment and consolidated revenue $ 3,032 $ 56,376

The Company’s long-lived assets are primarily located in the U.S.

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