What changed in this filing

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Item 8. Financial Statements and Supplementary Data

2026-02-23 compared with 2025-02-27 · 299 added, 302 removed, 823 unchanged (42% of the section changed)

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Consolidated Statements of Operations for the years ended December 31, 2025, 2024 and 2023

Consolidated Statements of Comprehensive (Loss) Income for the years ended December 31, 2024, 2023 and 2022

Consolidated Statements of Comprehensive Loss for the years ended December 31, 2025, 2024 and 2023

Consolidated Statements of Stockholders’ Equity for the years ended December 31, 2025, 2024 and 2023

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We have audited the accompanying consolidated balance sheets of Vir Biotechnology, Inc.

(the Company) as of December 31, 2024 and 2023, the related consolidated statements of operations, comprehensive (loss) income, stockholders’ equity and cash flows for each of the three years in the period ended December 31, 2024, and the related notes (collectively referred to as the “consolidated financial statements”).

(the Company) as of December 31, 2025 and 2024, the related consolidated statements of operations, comprehensive loss, stockholders’ equity and cash flows for each of the three years in the period ended December 31, 2025, and the related notes (collectively referred to as the “consolidated financial statements”).

In our opinion, the consolidated financial statements present fairly, in all material respects, the financial position of the Company at December 31, 2025 and 2024, and the results of its operations and its cash flows for each of the three years in the period ended December 31, 2025, in conformity with U.S.

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Accrued and other liabilities 83,012 98,521

Deferred revenue, current 12,648 64,853

Contingent consideration obligation, current — 16,060

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2025 2024 2023

Collaboration revenue $ 8,379 $ 37,266 $ 1,505,469

Contract revenue 55,333 2,228 52,714

License revenue from a related party — — 22,289

License and collaboration revenue $ 63,130 $ 61,370 $ 37,382

Grant revenue 2,036 10,493 46,686

Other revenue 3,390 2,342 2,112

Total revenues 68,556 74,205 86,180

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Selling, general and administrative 92,074 119,031 174,441

Restructuring, long-lived assets impairment and related charges 34,995 13,559 —

Restructuring, long-lived assets impairment and related charges, net ( 182 ) 34,995 13,559

Total operating expenses 547,884 661,370 770,485

(Loss) income from operations ( 587,165 ) ( 684,305 ) 833,068

Other income (loss):

Loss from operations ( 479,328 ) ( 587,165 ) ( 684,305 )

Other income:

Change in fair value of equity investments 1,729 ( 5,528 ) ( 21,888 )

Interest income 40,238 71,809 86,990

Other (expense) income, net ( 2,221 ) ( 8,991 ) 4,260

Total other income (loss) 64,060 56,111 ( 78,788 )

(Loss) income before benefit from (provision for) income taxes ( 523,105 ) ( 628,194 ) 754,280

Benefit from (provision for) income taxes 1,145 13,077 ( 238,443 )

Net (loss) income ( 521,960 ) ( 615,117 ) 515,837

Other expense, net ( 409 ) ( 2,221 ) ( 8,991 )

Total other income 41,558 64,060 56,111

Loss before (provision for) benefit from income taxes ( 437,770 ) ( 523,105 ) ( 628,194 )

(Provision for) benefit from income taxes ( 217 ) 1,145 13,077

Net loss ( 437,987 ) ( 521,960 ) ( 615,117 )

Net loss attributable to noncontrolling interest — — ( 56 )

Net (loss) income attributable to VirBio $ ( 521,960 ) $ ( 615,061 ) $ 515,837

Net (loss) income per share attributable to VirBio, basic $ ( 3.83 ) $ ( 4.59 ) $ 3.89

Net (loss) income per share attributable to VirBio, diluted $ ( 3.83 ) $ ( 4.59 ) $ 3.83

Weighted-average shares outstanding, basic 136,246,865 134,130,924 132,606,767

Weighted-average shares outstanding, diluted 136,246,865 134,130,924 134,810,908

Net loss attributable to Vir Bio $ ( 437,987 ) $ ( 521,960 ) $ ( 615,061 )

Net loss per share attributable to Vir Bio, basic and diluted $ ( 3.16 ) $ ( 3.83 ) $ ( 4.59 )

Weighted-average shares outstanding, basic and diluted 138,520,419 136,246,865 134,130,924

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

VIR BIOTECHNOLOGY, INC.

Consolidated Statements of Comprehensive (Loss) Income

Consolidated Statements of Comprehensive loss

(in thousands)

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2025 2024 2023

Net (loss) income $ ( 521,960 ) $ ( 615,117 ) $ 515,837

Net loss $ ( 437,987 ) $ ( 521,960 ) $ ( 615,117 )

Other comprehensive (loss) income:

Unrealized gain (loss) on investments 503 9,310 ( 7,524 )

Unrealized (loss) gain on investments ( 314 ) 503 9,310

Pension actuarial loss ( 26 ) ( 1,405 ) ( 1,003 )

Total other comprehensive (loss) income ( 340 ) ( 902 ) 8,307

Comprehensive (loss) income ( 522,862 ) ( 606,810 ) 507,814

Comprehensive loss ( 438,327 ) ( 522,862 ) ( 606,810 )

Comprehensive loss attributable to noncontrolling interest — — ( 56 )

Comprehensive (loss) income attributable to VirBio $ ( 522,862 ) $ ( 606,754 ) $ 507,814

Comprehensive loss attributable to Vir Bio $ ( 438,327 ) $ ( 522,862 ) $ ( 606,754 )

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

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(in thousands, except share data)

VirBio Stockholders’ Equity

Vir Bio Stockholders’ Equity

Common Stock Additional

Paid-in Capital Accumulated Other

Comprehensive Loss (Accumulated Deficit)

Retained Earnings Noncontrolling

Comprehensive Loss Retained Earnings

(Accumulated Deficit) Noncontrolling

interest Total

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Balance at December 31, 2022 133,236,687 $ 13 $ 1,709,835 $ ( 9,122 ) $ 377,237 $ — $ 2,077,963

Issuance of common stock in connection with a grant agreement 881,365 — 28,462 — — — 28,462

Vesting of restricted common stock 734,662 — — — — — —

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Stock-based compensation — — 111,316 — — — 111,316

Other comprehensive loss — — — ( 8,023 ) — — ( 8,023 )

Net income — — — — 515,837 — 515,837

Other comprehensive income — — — 8,307 — — 8,307

Contributions from noncontrolling owners — — — — — 100 100

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

Net loss — — — — ( 615,061 ) ( 56 ) ( 615,117 )

Balance at December 31, 2023 134,781,286 13 1,828,862 ( 815 ) ( 237,824 ) — 1,590,236

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Stock-based compensation — — 78,457 — — — 78,457

Other comprehensive income — — — 8,307 — — 8,307

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

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

Other comprehensive loss — — — ( 902 ) — — ( 902 )

Net loss — — — — ( 521,960 ) — ( 521,960 )

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CASH FLOWS FROM OPERATING ACTIVITIES:

Net (loss) income $ ( 521,960 ) $ ( 615,117 ) $ 515,837

Adjustments to reconcile net (loss) income to net cash (used in) provided by operating activities:

Changes in estimated constraint on profit-sharing amount 685 ( 28,118 ) 369,535

Net loss $ ( 437,987 ) $ ( 521,960 ) $ ( 615,117 )

Adjustments to reconcile net loss to net cash used in operating activities:

Depreciation and amortization 11,680 14,559 19,451

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Change in estimated fair value of contingent consideration 11,490 14,149 1,024

Payment of contingent consideration in excess of acquisition date fair value ( 17,140 ) — —

Stock-based compensation 49,072 78,457 111,316

Change in deferred income taxes ( 2,949 ) ( 1,063 ) ( 15,186 )

In-process research and development impairment — 14,550 9,658

Non-cash restructuring, long-lived assets impairment and related charges 654 24,173 7,662

Payment of contingent consideration in excess of acquisition date fair value — — ( 93,803 )

Other non-cash items, net 172 ( 3,131 ) ( 910 )

Changes in operating assets and liabilities:

Receivable from collaboration ( 6,513 ) ( 565 ) 770,038

Prepaid expenses and other current assets 2,075 4,358 36,287

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Operating lease liabilities ( 7,368 ) ( 23,027 ) ( 13,046 )

Deferred revenue ( 53,731 ) ( 2,345 ) ( 33,300 )

Net cash (used in) provided by operating activities ( 446,352 ) ( 778,785 ) 1,663,253

Net cash used in operating activities ( 391,781 ) ( 446,352 ) ( 778,785 )

CASH FLOWS FROM INVESTING ACTIVITIES:

Proceeds from sale of property and equipment 3,372 — —

Purchases of property, equipment and intangible assets ( 7,301 ) ( 21,573 ) ( 68,006 )

Proceeds from sale of equipment 253 3,372 —

Purchases of long-lived assets ( 4,832 ) ( 7,301 ) ( 21,573 )

Purchases of investments ( 886,334 ) ( 1,235,339 ) ( 2,016,189 )

Maturities and sales of investments 1,201,284 1,738,635 2,202,391

Net cash provided by (used in) investing activities 499,367 164,629 ( 1,193,461 )

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

VIR BIOTECHNOLOGY, INC.

Consolidated Statements of Cash Flows

(in thousands)

Years Ended December 31,

2024 2023 2022

Net cash provided by investing activities 310,371 499,367 164,629

CASH FLOWS FROM FINANCING ACTIVITIES:

Proceeds from issuance of common stock under ESPP 3,763 4,283 3,222

Proceeds from exercise of stock options 1,349 790 3,484

Proceeds from issuance of common stock in connection with a grant agreement — — 28,462

Payment of contingent consideration — — ( 1,197 )

Proceeds from issuance of common stock under ESPP 2,797 3,763 4,283

Other financing activities ( 361 ) ( 165 ) ( 287 )

Net cash provided by financing activities 3,785 4,388 7,480

Net increase (decrease) in cash, cash equivalents and restricted cash and cash equivalents 57,403 ( 606,676 ) 504,553

Net (decrease) increase in cash, cash equivalents and restricted cash and cash equivalents ( 77,625 ) 57,403 ( 606,676 )

Cash, cash equivalents and restricted cash and cash equivalents at beginning of period 318,695 261,292 867,968

Cash, cash equivalents and restricted cash and cash equivalents at end of period $ 241,070 $ 318,695 $ 261,292

SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION:

Net refund received (cash paid) for income tax $ 786 $ 2,676 $ ( 252,030 )

NONCASH INVESTING AND FINANCING ACTIVITIES:

Operating lease liabilities obtained in exchange of right-of-use asset $ 7,329 $ — $ —

RECONCILIATION OF CASH, CASH EQUIVALENTS AND RESTRICTED CASH AND CASH EQUIVALENTS TO THE CONSOLIDATED BALANCE SHEETS:

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Vir Biotechnology, Inc.

(“VirBio” 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 (“HDV”) and chronic hepatitis B infections (“HBV”) and multiple dual-masked T-cell engagers (“TCEs”) across validated targets in solid tumor indications.

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

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

(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 programs for chronic hepatitis delta and multiple dual-masked T-cell engagers (TCEs) across validated targets in solid tumor indications.

Vir Bio also has a portfolio of preclinical 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.

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’ outstanding voting shares to 100 %.

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

Sales Agreement

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As of December 31, 2025, no shares have been issued under the Sales Agreement.

The Sales Agreement will expire in November 2026.

Need for Additional Capital

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The Company expects to continue to incur net losses over the next several years and may need to raise additional capital to fully implement its business plan.

As of December 31, 2024, the Company had accumulated deficit of $ 759.8 million.

The Company had $ 1.1 billion in cash, cash equivalents, and investments as of December 31, 2024.

Based on the Company’s current operating plan, management believes that the $ 1.1 billion as of December 31, 2024 will be sufficient to fund its operations through at least the next 12 months from the issuance date of these consolidated financial statements.

The Company also had $ 95.7 million in restricted cash and cash equivalents as of December 31, 2024.

As of December 31, 2025, the Company had accumulated deficit of $ 1.2 billion.

The Company had $ 781.6 million in cash, cash equivalents, and investments as of December 31, 2025.

Based on the Company’s current operating plan, management believes that the $ 781.6 million as of December 31, 2025 will be sufficient to fund its operations through at least the next 12 months from the issuance date of these consolidated financial statements.

Summary of Significant Accounting Policies

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The Company’s consolidated financial statements have been prepared in conformity with accounting principles generally accepted in the United States of America (GAAP) and include all adjustments necessary for the fair presentation of the Company’s financial position for the periods presented.

The consolidated financial statements include the accounts of VirBio and its wholly-owned subsidiaries.

The consolidated financial statements include the accounts of Vir Bio and its wholly-owned subsidiaries.

All intercompany balances and transactions have been eliminated upon consolidation.

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Revenue and expenses are translated at average exchange rates throughout the respective periods.

Transaction gains and losses are included in other (expense) income, net on the consolidated statements of operations.

VIR BIOTECHNOLOGY, INC.

Notes to Consolidated Financial Statements

Transaction gains and losses are included in other expense, net on the consolidated statements of operations.

Use of Estimates

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Actual results could materially differ from those estimates.

VIR BIOTECHNOLOGY, INC.

Notes to 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.

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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.

VIR BIOTECHNOLOGY, INC.

Notes to Consolidated Financial Statements

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

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The cost of securities sold is based on the specific identification method.

VIR BIOTECHNOLOGY, INC.

Notes to Consolidated Financial Statements

Equity Investments

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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 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 consolidated statements of operations.

Restricted Cash and Cash Equivalents

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.

Restricted cash and cash equivalents primarily includes funds to secure standby letters of credit and security deposits with financial institutions under lease agreements and funds restricted as to withdrawal or usage under grant agreements and collaboration agreements.

Property and Equipment, Net

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Alternatively, if a product candidate is abandoned, the carrying value of the intangible asset will be charged to research and development expenses.

VIR BIOTECHNOLOGY, INC.

Notes to Consolidated Financial Statements

Finite-lived intangible assets acquired in a business combination are initially recognized at their fair value at the acquisition date.

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Finite-lived intangible 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 Consolidated Financial Statements

Goodwill represents the excess of the purchase price over the estimated fair value of the net tangible and intangible assets acquired in a business combination.

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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.

License and Collaboration Revenue

The Company analyzes its license and collaboration arrangements to assess whether they are within the scope of Accounting Standards Codification 808, Collaborative Arrangements (“ASC 808”) to determine whether such arrangements involve joint operating activities performed by parties that are both active participants in the activities and exposed to significant risks and rewards dependent on the commercial success of such activities.

For elements of collaboration arrangements that are accounted for pursuant to 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, Revenue from Contracts with Customers (ASC 606) .

The accounting policy pursuant to ASC 606 is outlined below.

For elements of collaboration arrangements that are not subject to the guidance in ASC 606, an appropriate recognition method is determined and applied consistently.

The Company’s license and collaboration revenue is accounted for under ASC 606.

The Company may receive reimbursement or make payments to a collaboration partner to satisfy cost sharing requirements.

These payments are generally recorded as an offset or increase to research and development expenses, respectively.

Under 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:

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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.

The Company is considered an agent in elements of collaboration arrangements within the scope of ASC 808 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 recorded in the period in which such sales occur and 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.

VIR BIOTECHNOLOGY, INC.

Notes to Consolidated Financial Statements

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

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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.

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.

The Company recognizes revenue as it fulfills its obligations under each of its agreements.

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.

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

VIR BIOTECHNOLOGY, INC.

Notes to Consolidated Financial Statements

In these instances, license and collaboration revenue is recorded in the period in which such sales occur and 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.

The Company evaluates 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.

Grant Revenue

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If the screen test is not met, further assessment is required to determine whether the Company has acquired inputs and a substantive process 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.

If determined to be an acquisition of asset(s), the Company accounts for 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.

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

VIR BIOTECHNOLOGY, INC.

Notes to Consolidated Financial Statements

Business combinations are accounted for using the acquisition method of accounting.

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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.

VIR BIOTECHNOLOGY, INC.

Notes to Consolidated Financial Statements

Research and Development Expenses

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The fair value of restricted stock awards (RSAs) and restricted stock units (RSUs) is based on the market value of the Company’s common stock on the date of grant.

The Company will adjust the fair value if any are determined to be spring-loaded.

Stock-based compensation is recognized using the straight-line method for awards that vest only upon the employee’s or non-employee’s continued service to the Company.

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Forfeitures are recognized as they occur.

VIR BIOTECHNOLOGY, INC.

Notes to Consolidated Financial Statements

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.

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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.

VIR BIOTECHNOLOGY, INC.

Notes to Consolidated Financial Statements

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.

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The provision for income taxes includes the effects of any accruals that the Company believes are appropriate, as well as any related net interest and penalties.

Net (Loss) Income Per Share

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

Diluted net (loss) income per common share is computed by dividing the net (loss) income attributable to VirBio 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.

VIR BIOTECHNOLOGY, INC.

Notes to Consolidated Financial Statements

New Accounting Pronouncement Not Yet Adopted

The Tax Cuts and Jobs Act of 2017 subjects a U.S.

shareholder to current tax on global intangible low-taxed income (GILTI) earned by certain foreign subsidiaries.

The Company has elected to recognize the tax on GILTI as a period expense in the period the tax is incurred.

Net Loss Per Share

Basic net loss per common share is computed by dividing the net loss attributable to Vir Bio 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 Bio 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.

New Accounting Pronouncement

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

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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 consolidated financial statements and related disclosures.

The Company adopted ASU 2023-06 in this Annual Report on Form 10-K on a prospective basis.

VIR BIOTECHNOLOGY, INC.

Notes to Consolidated Financial Statements

In November 2024, the FASB issued ASU No.

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

In September 2025, the FASB issued ASU No.

2025-06, Targeted Improvements to the Accounting for Internal-Use Software (ASU 2025-06) , which clarifies and modernizes the accounting for costs related to internal-use software in ASC Topic 350-40, Intangibles —Goodwill and Other — Internal-Use Software (ASC 350-40) .

ASU 2025-06 removed all references to project stages throughout ASC 350-40, and requires entities to begin capitalizing software costs when both of the following occur:

(1) management, with the relevant authority, implicitly or explicitly authorizes and commits to funding a computer software project;

and (2) it is probable that the project will be completed and the software will be used to perform the function intended (referred to as the probable-to-complete recognition threshold).

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

Early adoption is permitted.

ASU 2025-06 should be either applied on a prospective basis, retrospective or modified prospective basis based on the status of the project and whether software costs were capitalized before the date of adoption.

The Company is currently evaluating the impact the adoption of ASU 2025-06 may have on its consolidated financial statements and related disclosures.

In September 2025, the FASB issued ASU No.

2025-07, Derivatives and Hedging (Topic 815) and Revenue from Contracts with Customers (Topic 606):

Derivative Scope Refinements and Scope Clarification for Share-Based Noncash Consideration from a Customer in a Revenue Contract (ASU 2025-07) , which refines the scope of Topic 815 by clarifying which contracts are subject to derivative accounting and expands the scope exception for certain contracts not traded on an exchange to include contracts for which settlement is based on operations or activities specific to one of the parties to the contract.

The guidance also provides clarification under Topic 606 for share-based payments from a customer in a revenue contract.

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

Early adoption permitted.

The Company early adopted ASU 2025-07 on a prospective basis in 2025.

Reclassification

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

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

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

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

As a result, certain amounts related to deferred revenue, previously reflected in deferred revenue, current , were reclassified to accrued and other liabilities .

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

As a result, the Company changed its presentation of collaboration revenue to license and collaboration revenue and its presentation of contract revenue to other revenue .

In conjunction with these changes, certain license revenue, primarily related the Company’s collaboration with Glaxo Wellcome UK Limited and GlaxoSmithKline Biologicals S.A.

(GSK), which were presented as part of contract revenue in prior years, are now presented as part of license and collaboration revenue .

Certain reclassifications have been made to prior period amounts on the Company’s 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 .

Additionally, certain amounts related to deferred revenue, previously reflected in changes in operating assets and liabilities – deferred revenue, were reclassified to changes in operating assets and liabilities – accrued liabilities and other long-term liabilities .

Fair Value Measurements

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

VIR BIOTECHNOLOGY, INC.

Notes to Consolidated Financial Statements

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

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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 Consolidated Financial Statements

Cash Equivalents and Available-for-Sale Securities

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government agency bonds and discount rates 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

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The Company did not write off any accrued interest receivable during the years ended December 31, 2025, 2024 and 2023.

VIR BIOTECHNOLOGY, INC.

Notes to Consolidated Financial Statements

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

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

VIR BIOTECHNOLOGY, INC.

Notes to Consolidated Financial Statements

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

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As of December 31, 2025, the Company remeasured the equity investment at a fair value of $ 6.1 million.

For the years ended December 31, 2024, 2023 and 2022, the Company recognized unrealized losses of $ 5.5 million, $ 21.9 million and $ 111.1 million, respectively, as other income (loss) in the consolidated statements of operations.

For the years ended December 31, 2024, 2023 and 2022, the unrealized loss related to foreign currency translation were immaterial.

For the year ended December 31, 2025, the Company recognized unrealized gain of $ 1.7 million as other income in the consolidated statements of operations.

For the years ended December 31, 2024 and 2023, the Company recognized unrealized losses of $ 5.5 million and $ 21.9 million, respectively, as other income in the consolidated statements of operations.

For the years ended December 31, 2025, 2024 and 2023, the unrealized gains or loss related to foreign currency translation were immaterial.

Contingent Consideration

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The Company classifies the contingent consideration as Level 3 financial liabilities within the fair value hierarchy as of December 31, 2025 and 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 December 31, 2024, the Company calculated the estimated fair value of the remaining clinical and regulatory milestones related to tobevibart using the following significant unobservable inputs:

Unobservable input Range

(Weighted-Average) (1)

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

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

As of December 31, 2025, the Company calculated the estimated fair value of the remaining regulatory approval milestone related to tobevibart using the following significant unobservable inputs:

Unobservable input Value

Discount rates 11.4 %

Probability of achievement 85.5 %

____________________________________________

(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 because of the availability of discrete revenue forecasts.

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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 Consolidated Financial Statements

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

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Changes in fair value 11,490

Payment ( 17,500 )

Balance at December 31, 2025 $ 34,100

VIR BIOTECHNOLOGY, INC.

Notes to Consolidated Financial Statements

Goodwill and Intangible assets

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Indefinite-Lived Intangible Assets

As of December 31, 2024 and 2023, the Company had indefinite-lived intangible assets of $ 6.5 million and $ 21.1 million, respectively, related to the IPR&D from the Humabs acquisition.

For the years ended December 31, 2024 and 2023, $ 14.6 million and $ 9.7 million impairment losses were recorded as part of research and development expenses for IPR&D assets related to non-prioritized or abandoned research programs, respectively.

As of December 31, 2025 and 2024, the Company had indefinite-lived intangible assets of $ 6.5 million related to the IPR&D from the Humabs acquisition.

No impairment losses were recorded for the year ended December 31, 2025.

Grant Agreements

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 earlier terminated 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 project.

VIR BIOTECHNOLOGY, INC.

Notes to Consolidated Financial Statements

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.

Grant Agreements

Gates Foundation Grants

The Company previously entered into various grant agreements with the Gates Foundation (formerly known as the Bill & Melinda Gates Foundation), under which it was awarded grants to support its HIV vaccine program, tuberculosis vaccine program, HIV vaccinal antibody program and malaria vaccinal antibody program.

During 2025 all of the grant agreements expired except for the HIV vaccine program.

Upon the expiration of the vaccinal antibody program grant the Company returned $ 9.5 million of unused grant funds to the Gates Foundation.

The term of the HIV vaccine program grant agreement will expire mid 2027, unless earlier terminated 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 project.

In 2022, 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, which is used in furtherance of Gates Foundation’s charitable purposes to develop the Company’s vaccinal antibody program, in each case for use in specified developing countries.

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 include the HIV vaccine program and the tuberculosis vaccine program currently 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 accounted for the common stock issued to the Gates Foundation based on its fair market value on the closing date.

The stock purchase premium is recognized over time as required research and development activities are performed to advance the Company’s vaccinal antibody program.

As of December 31, 2025, the Company had unrecognized premium balance of $ 9.3 million, including $ 1.9 million as part of accrued and other liabilities and $ 7.4 million as part of other long-term liabilities.

Grant payments received in advance that are related to future research activities are deferred and recognized as grant revenue as the research and development activities are performed.

The Company recognized grant revenue of $ 2.0 million, $ 4.6 million, and $ 13.3 million for the years ended December 31, 2025 , 2024, and 2023, respectively.

As of December 31, 2024 and 2023, the Company had deferred revenue of $ 11.1 million and $ 13.1 million, respectively.

As of December 31, 2024 and 2023, the Company had $ 11.6 million and $ 9.2 million, respectively, within accrued and other liabilities, which may need to be refunded to the Gates Foundation.

As of December 31, 2024, the Company had deferred revenue of $ 11.1 million, within accrued and other liabilities.

No deferred revenue was recorded as of December 31, 2025.

As of December 31, 2025 and 2024, the Company had $ 1.8 million and $ 11.6 million, respectively, within accrued and other liabilities, related to funds expected to be refunded to the Gates Foundation.

The funds related to the $ 1.8 million liability as of December 31, 2025 is classified within restricted cash and cash equivalents, current.

Biomedical Advanced Research and Development Authority

In September 2022, the Company entered into a multi-year agreement (the “BARDA Agreement”) under Other Transaction Authority (OTA) 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, with the potential for up to $ 1.0 billion to advance the development of a full portfolio of innovative solutions to address influenza and potentially other infectious disease threats.

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

Under the BARDA Agreement, the Company was initially awarded $ 55.0 million for the development of VIR-2482, an investigational prophylactic monoclonal antibody designed with the aim to protect against seasonal and pandemic influenza.

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

$ 40.0 million was used 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.

which was used to support the development of novel mAb candidates and delivery solutions to widen the applicability of mAbs in COVID-19 and in pandemic preparedness and response.

Additionally, the Company was awarded up to $ 11.2 million of additional funding to wind down activities related to VIR-2482.

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

P00003 to the BARDA Agreement, pursuant to which the parties agreed to partially de-obligate certain funds previously awarded to the development of VIR-7229.

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

In October 2024, the Company notified BARDA of intent to terminate the OTA on December 31, 2024.

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The Company receives BARDA funding as it incurs eligible costs.

The Company recognized grant revenue related to BARDA of $ 5.9 million, $ 33.4 million.

and $ 26.4 million for the years ended December 31, 2024, 2023, and 2022, respectively, and other receivables in prepaid expenses and other current assets of $ 0.1 million and $ 7.6 million as of December 31, 2024 and 2023, respectively.

The Company recognized grant revenue related to BARDA of $ 5.9 million and $ 33.4 million for the years ended December 31, 2024 and 2023, respectively.

VIR BIOTECHNOLOGY, INC.

Notes to Consolidated Financial Statements

Collaboration and License Agreements

License Agreement with Norgine Pharma UK Limited

On December 15, 2025, the Company and Norgine Pharma UK Limited (together with its affiliates in the Norgine group of companies, Norgine) entered into a License Agreement (the Norgine Agreement) under which the Company granted Norgine an exclusive license with respect to commercial rights and certain development rights to the combination of tobevibart, an investigational monoclonal antibody, and elebsiran, an investigational small interfering ribonucleic acid (Licensed Product), for the treatment of people living with chronic hepatitis delta (CHD) in Europe, Australia, and New Zealand (collectively, the Norgine Territory), while Vir Bio will retain commercial rights for the Licensed Product in the United States and all other international markets outside of the People’s Republic of China and Taiwan.

The Company and Norgine will collaborate on the development and commercialization of Licensed Product in Norgine Territory under the oversight of various joint committees, with the Company primarily responsible for development activities for the ongoing trials in Vir Bio’s ECLIPSE registrational program (ECLIPSE 1, 2 and 3) and Norgine primarily responsible for regulatory, medical affairs and commercialization activities.

Vir Bio will also provide future commercial supply to Norgine.

In exchange, Vir Bio received an initial reimbursement of historical development costs from Norgine in the amount of € 55 million or $ 64.3 million in December 2025 and is eligible to receive up to an additional € 495 million in clinical, regulatory and sales milestones, along with tiered, mid-teen to high-twenties percent royalties on net sales in the Norgine Territory.

In addition, clinical development costs for the ongoing ECLIPSE registrational program will be shared, with Norgine contributing approximately 25 % of external costs starting from January 1, 2026.

The Company determined that the Norgine Agreement is a collaborative arrangement given that both parties are (i) active participants in the development and commercialization of Licensed Product in Norgine Territory and (ii) exposed to significant risks and rewards dependent on the commercial success of Licensed Product.

The Company further evaluated whether the Norgine Agreement is partially within the scope of ASC 606 and identified two performance obligations, the delivery of Norgine License and the promise to conduct development activities for the ongoing ECLIPSE registrational program.

The Norgine License was considered distinct from the development activities as those activities will not significantly modify or customize the Norgine License, in-part due to the late clinical stage of development at contract inception.

With respect to the promise to deliver commercial supplies in the future, it is at Norgine’s option and will be provided at fair value, and therefore, it is not considered a material right or a performance obligation under the Norgine Agreement.

For each of the two units of account, the Company then assessed whether each unit was associated with a customer.

The Company determined that Norgine is a customer with respect to the delivery of Norgine License and that Norgine is not a customer with respect to the development activities.

With respect to the delivery of Norgine License, the transaction price include the initial payment of € 55 million, clinical, regulatory and sales milestones of up to € 495 million and sales royalties.

The clinical and regulatory milestones are variable considerations and are fully constrained at contract inception.

Sales milestones and royalties are variable considerations and will be recognized when future sales occur.

The Company will reassess revenue constraints each period.

The performance obligation to deliver Norgine License was satisfied upon transfer of the license to Norgine in December 2025.

With respect to the promise to conduct development activities and related cost share, the Company will account for the costs shared with Norgine as reduction of research and development expenses in the period when those costs are shared under the Norgine Agreement.

As a result, the Company recognized the € 55 million or $ 64.3 million as license and collaboration revenue in year ended December 31, 2025.

License Agreement with Sanofi

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 (the “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 cancer indications.

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-stage clinical dual-masked TCEs that all leverage the PRO-XTEN ® universal masking platform within a range of oncology indications.

VIR BIOTECHNOLOGY, INC.

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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 consolidated balance sheets.

In July 2025, the first patient was dosed in phase 1 study evaluating VIR-5525.

During the third quarter of 2025, the Company paid the $ 75.0 million milestone, which was recorded as part of research and development expenses in the Company’s consolidated statement of operations for the year ended December 31, 2025.

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 VirBio receiving certain sublicense income related to the licenses obtained from the Sanofi Agreement, Sanofi may be eligible to receive a portion of such income.

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.

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

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 expenses as they had no alternative future use.

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.

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 expenses as they had no alternative future use.

Contingent milestone payments will be recognized when the contingency is resolved and the consideration is paid or becomes payable.

Any milestone payments made in the future will either be expensed as research and development or capitalized as a developed asset based on when regulatory approval is obtained.

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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 two amendments to the 2020 GSK Agreement.

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

In 2020, the Company, GSK entered into a collaboration agreement (the 2020 GSK Agreement), pursuant to which 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.

On February 8, 2023, the Company and GSK entered into two amendments to the 2020 GSK Agreement, pursuant to which the Company and GSK agreed to reduce the scope of the collaboration to include only sotrovimab and VIR-7832, and certain variants thereof.

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.

In addition, 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, which remain subject to the terms of the 2020 GSK Agreement.

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 sotrovimab, except that GSK has the sole right to develop (including to seek, obtain or maintain regulatory approvals), manufacture and commercialize sotrovimab in and for People’s Republic of 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 sotrovimab for as long as it is being commercialized by the lead party.

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 parties share all development costs, manufacturing costs, and costs and expenses for the commercialization of sotrovimab, with the Company bearing 72.5 % of such costs, except that GSK has the sole right to develop (including to seek, obtain or maintain regulatory approvals), manufacture and commercialize sotrovimab in and for People’s Republic of China and Taiwan at GSK’s sole cost and expense, and equal sharing of such costs for the functional genomics products.

In May 2021, the U.S.

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As the agent, the Company recognizes its contractual share of the profit-sharing amounts 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.

In periods when allowable expenses exceed amounts recognized for net product sales of sotrovimab, negative revenue is 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.

VIR BIOTECHNOLOGY, INC.

Notes to Consolidated Financial Statements

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 a constraint on its cumulative profit-sharing amounts.

For the year ended December 31, 2024 and 2023, the Company paid GSK $ 0.7 million and $ 341.3 million relating to these manufacturing expenses.

GSK may continue to adjust the allowable manufacturing expenses.

As of December 31, 2024, the accrued liability balance for the Company’s share of the remaining estimated manufacturing expenses related to excess sotrovimab supply and binding reserved manufacturing capacity not utilized is immaterial.

The Company re-assesses these estimates each reporting period.

During the years ended December 31, 2024, 2023, and 2022, the Company recorded profit-sharing amounts, profit-sharing amounts constrained, and profit-sharing amounts previously constrained, released as components of collaboration revenue in the consolidated statements of operations, as follows (in thousands):

For the year ended December 31, 2023, the Company released $ 35.7 million profit-sharing amount previously constrained for certain allowable manufacturing expenses related to excess sotrovimab supply and binding reserved manufacturing capacity not utilized.

During the years ended December 31, 2025, 2024, and 2023, the Company recorded profit-sharing amounts, profit-sharing amounts constrained, and profit-sharing amounts previously constrained, released as components of license and collaboration revenue in the consolidated statements of operations, as follows (in thousands):

Years Ended December 31,

2025 2024 2023

Collaboration revenue, net

License and collaboration revenue under GSK 2020 Agreement

Profit-sharing amount $ ( 1,138 ) $ 9,078 $ 1,536

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Profit-sharing amount previously constrained, released — — 35,730

Total collaboration revenue, net $ 8,379 $ 37,266 $ 1,505,469

Royalties earned by third-party licensors on net sales of sotrovimab are reported as cost of revenue on the consolidated statement of operations, which the Company recognized $ 0.8 million, $ 2.8 million, $ 146.3 million for the years ended December 31, 2024, 2023, and 2022, respectively.

Total license and collaboration revenue under GSK 2020 Agreement $ ( 1,138 ) $ 8,379 $ 37,266

Costs associated with co-development activities performed under the 2020 GSK Agreement are included in research and development expenses on the 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 $ 5.5 million, $ 7.7 million, and $ 23.4 million during the years ended December 31, 2025, 2024, and 2023, respectively.

VIR BIOTECHNOLOGY, INC.

Notes to 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 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 selected by GSK (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 remove the Influenza Program 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.

As of the effective date of the Letter Agreement, the VIR-2482 Option was terminated.

As it relates to the Expanded Functional Genomics Program, the Company and GSK mutually rejected all targets selected in the first quarter of 2024, with remaining exclusivity to such targets expiring in mid-2025.

Regarding the Additional Programs, GSK selected respiratory syncytial virus (“RSV”) as its first pathogen in 2022, and as a result the Company recognized the $ 39.8 million as contract revenue.

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

One of three programs granted GSK the option to select up to three non-influenza target pathogens.

GSK selected respiratory syncytial virus (RSV) as its first pathogen in 2022.

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 reduce the scope of collaboration to include only the RSV program.

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

During the fourth quarter of 2024, the Company opted-out of the RSV program.

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If the RSV program is commercialized, GSK will pay to the Company a royalty on net sales at the low single digits.

VIR BIOTECHNOLOGY, INC.

Notes to Consolidated Financial Statements

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

During the year ended December 31, 2024, the Company recognized reimbursement of research and development expenses of $ 0.8 million.

During the years ended December 31, 2023, and 2022, the Company recognized additional net research and development expenses of $ 2.2 million and $ 2.3 million, respectively.

Brii Biosciences

In 2018, the Company entered into a collaboration, option and license agreement (the “Brii Agreement”) with Brii Bio Parent and Brii Biosciences Offshore Limited (“Brii Bio”), pursuant to which the Company granted to Brii Bio, with respect to up to four of the Company’s programs, an exclusive option to obtain exclusive rights to develop and commercialize compounds and products arising from such programs in People’s Republic of China, Taiwan, Hong Kong and Macau (collectively, the “China Territory”) for the treatment, palliation, diagnosis, prevention or cure of acute and chronic diseases of infectious pathogen origin or hosted by pathogen infection (the “Field of Use”).

To date, Brii Bio has opted in for elebsiran and tobevibart to develop and commercialize in the China Territory under the Brii Agreement.

In partial consideration for the options granted by the Company to Brii Bio, Brii Bio Parent and Brii Bio granted the Company, with respect to up to four of Brii Bio Parent’s or Brii Bio’s programs, an exclusive option to be granted exclusive rights to develop and commercialize compounds and products arising from such Brii Bio programs in the United States for the Field of Use.

To date, the Company has not exercised any of its options.

In July 2022, Brii Bio exercised its option to obtain exclusive rights to develop and commercialize compounds and products arising from tobevibart in the China Territory.

In consideration of the Company’s grant to Brii Bio of an exclusive license related to tobevibart in the China Territory, the Company received a $ 20.0 million option exercise fee in connection with the option exercise.

The Company evaluated the tobevibart transaction under ASC 606 and identified one performance obligation consisting of the license granted to Brii Bio.

Under the Brii Agreement, Brii Bio is responsible for performing all research and development activities, and the Company does not have any other performance obligations within the context of ASC 606 under the arrangement after the option exercise.

The transaction price was determined to be $ 22.3 million, which consists of the $ 20.0 million option exercise fee and $ 2.3 million of the deferred revenue allocated to the tobevibart option at the inception of the Brii Agreement.

The Company determined that the license is considered a functional intellectual property that is a distinct performance obligation.

Specifically, the Company believes the license is capable of being distinct, as Brii Bio has the capabilities to develop the license either on its own or by contracting with other third parties.

Brii Bio can benefit from the license at the time of grant and, therefore, the related performance obligation is satisfied at a point in time.

The Company holds a minority equity interest in Brii Bio through Brii Bio Parent (refer to Note 3 Fair Value Measurements ).

Through the second quarter of 2024, one member of the Company’s board of directors had served on Brii Bio Parent’s board of directors, and thus Brii Bio Parent and Brii Bio were considered the Company’s related parties.

For the year ended December 31, 2024 and 2023, the Company recognized no license revenue from a related party.

For the years ended December 31, 2022, the Company recognized $ 22.3 million license revenue from a related party.

As of December 31, 2024, the Company recorded $ 1.5 million deferred revenue, which represents Brii Bio’s option to opt in up to two of the Company’s programs that will expire in May 2025.

During the years ended December 31, 2025 and 2024, the reimbursement of research and development expenses by GSK is not material.

During the year ended December 31, 2023, the Company recognized additional net research and development expenses of $ 2.2 million.

Alnylam Pharmaceuticals, Inc.

1 unchanged sentence

(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 directed to HBV, including elebsiran, for all uses and purposes including the treatment of HBV and HDV.

In addition, Alnylam granted the Company an exclusive option, for each of the infectious disease siRNA programs directed to the Company’s four selected targets, to obtain a worldwide, exclusive license to develop, manufacture and commercialize siRNA products directed to the target of each such program for all uses and purposes other than certain excluded fields.

Following the Company’s exercise of an option for a program and payment of the program option exercise fee and any outstanding program costs due to Alnylam, the Company is solely responsible, at the Company’s expense (subject to Alnylam’s exercise of a profit-sharing option), for conducting all development, manufacture and commercialization activities for products arising from each such program.

If Alnylam exercises its profit-sharing option, the parties will negotiate and enter into a profit-sharing agreement for such product.

VIR BIOTECHNOLOGY, INC.

Notes to Consolidated Financial Statements

The Company is required to pay Alnylam up to $ 190.0 million in the aggregate for the achievement of specified development and regulatory milestones for the first siRNA product directed to HBV, whether for the treatment of HBV or HDV.

The Company achieved a specified development milestone relating to elebsiran and paid Alnylam $ 15.0 million in 2020, thereby reducing the $ 190.0 million initial amount to $ 175.0 million of potential development and regulatory milestones remaining to be paid related to elebsiran.

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 siRNA products directed to HBV, whether for the treatment of HBV or HDV related to elebsiran.

The Company may 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.

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 licensed 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 paid Alnylam $ 30.0 million, which was recorded as part of research and development expenses in the Company’s statement of operations for the year ended December 31, 2025.

After this payment, the remaining amount of the development and regulatory milestones is up to $ 145.0 million for elebsiran.

Any development and regulatory milestones for elebsiran 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.

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

If the Company does not exercise its option for an infectious disease program directed to one of its selected targets, the Alnylam Agreement will expire upon the expiration of the applicable option period with respect to such program.

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 Alnylam Agreement on 30 days’ notice.

The Company did not incur any expenses under the Alnylam Agreement during the year ended December 31, 2024 and incurred expenses of $ 1.7 million and $ 1.4 million during the years ended December 31, 2023 and 2022, respectively.

In August 2019, the Company entered into a patent license agreement, which was amended in February 2021, with Xencor (the “2019 Xencor Agreement”).

In 2020, the Company entered into a patent license agreement (the “2020 Xencor Agreement”).

Under these agreements, the Company obtained non-exclusive, sublicensable (only to its affiliates and subcontractors) licenses to incorporate Xencor’s licensed technologies into, and to evaluate, antibodies that target influenza A, HBV, and any component of a coronavirus, including SARS-CoV-2, SARS-CoV and MERS-CoV, and worldwide, non-exclusive, sublicensable licenses to develop and commercialize products containing such antibodies incorporating such technologies for all uses.

These technologies are used in tobevibart and sotrovimab, incorporating Xencor’s Xtend technology.

In consideration for the grant of the license, the Company is obligated to pay regulatory and commercial milestones along with tiered royalties based on net sales of licensed products ranging from the low- to mid-single-digits.

The royalties are payable, on a product-by-product and country-by-country basis, until the later of the expiration of the last to expire valid claim in the licensed patents covering such product in such country or 12 years.

During the years ended December 31, 2024, 2023, and 2022, the Company recognized $ 0.6 million, $ 2.2 million, and $ 114.5 million, respectively, as cost of revenue for royalties due to Xencor from the sales of sotrovimab.

The 2019 Xencor Agreement and 2020 Xencor Agreement will remain in force, on a product-by-product and country-by-country basis, until the expiration of all royalty payment obligations under each of the respective agreements.

The Company may terminate each agreement in its entirety, or on a target-by-target basis, for convenience upon 60 days’ written notice.

Either party may terminate each agreement for the other party’s uncured material breach upon 60 days’ written notice (or 30 days in the case of non-payment) or in the event of bankruptcy of the other party immediately upon written notice.

Xencor may terminate each agreement immediately upon written notice if the Company challenges, or upon 30 days’ written notice if any of the Company’s sublicensees challenge, the validity or enforceability of any patent licensed to the Company under each respective agreement.

Alnylam is 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 Company did not incur any expenses under the Alnylam Agreement during the year ended December 31, 2025 and 2024, respectively, and incurred expenses of $ 1.7 million during the year ended December 31, 2023.

VIR BIOTECHNOLOGY, INC.

Notes to Consolidated Financial Statements

In August 2019, the Company entered into a patent license agreement, which was amended in February 2021, with Xencor.

The Company obtained non-exclusive, sublicensable (only to its affiliates and subcontractors) licenses to incorporate Xencor’s licensed technologies into, and to evaluate, antibodies that target influenza A and HBV, and worldwide, non-exclusive, sublicensable licenses to develop and commercialize products containing such antibodies incorporating such technologies for all uses.

These technologies are used in tobevibart, incorporating Xencor’s Xtend technology.

Balance Sheet Components

1 unchanged sentence

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

Depreciation and amortization expenses were $ 14.2 million, $ 18.9 million, and $ 6.3 million for the years ended December 31, 2024, 2023 and 2022, respectively.

Depreciation expenses were $ 11.4 million, $ 14.2 million, and $ 18.9 million for the years ended December 31, 2025, 2024 and 2023, respectively.

(in years) 2025 2024

2 unchanged sentences

Laboratory equipment 5 40,961 39,428

Computer equipment 3 2,778 2,783

Furniture and fixtures 5 2,836 2,696

Computer equipment 3 2,689 2,778

Construction in progress NA 114 1,074

4 unchanged sentences

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

Payroll and related expenses $ 31,165 $ 41,322

Research and development expenses $ 35,299 $ 29,225

Excess funds payable under grant agreements 11,589 9,202

Payroll and related expenses 28,724 31,165

Operating lease liabilities, current 8,798 7,752

Excess funds payable under grant agreements 1,825 11,589

Other professional and consulting expenses 3,327 2,268

Deferred revenue, current — 12,648

Other accrued expenses 5,039 3,874

Total accrued and other liabilities $ 83,012 $ 98,521

VIR BIOTECHNOLOGY, INC.

Notes to Consolidated Financial Statements

Restructuring, Impairment and Related Costs

5 unchanged sentences

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 actions related to 2023 Restructuring Plan and 2024 Restructuring Plan were substantially completed by the end of 2024.

VIR BIOTECHNOLOGY, INC.

Notes to Consolidated Financial Statements

The following table is a summary of restructuring charges incurred under both the 2023 and 2024 Restructuring Plans and a roll forward of accrued restructuring costs (in thousands).

The actions related to 2023 Restructuring Plan and 2024 Restructuring Plan were substantially completed by the end of 2024.

Severance and other employee-related expenses Long-lived assets impairment and disposal losses Lease termination gain Total

9 unchanged sentences

Accrued restructuring charges at December 31, 2024 $ 1,612 $ — $ — $ 1,612

Reconciliation of accrued restructuring charges to the consolidated balance sheets

Accrued and other liabilities $ 1,612 $ — $ — $ 1,612

(1) Disclosed amount primarily consists of $ 5.4 million impairment charges recorded upon the Company ceasing to use the leased space at 499 Illinois Street, San Francisco, California, former corporate headquarter in 2023.

41 unchanged sentences

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 December 31, 2024, the Company had unaccrued unpaid commitments of approximately $ 23 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 December 31, 2024, the Company had unaccrued unpaid commitments of approximately $ 9 million under the Elebsiran Agreements.

The Company has entered into various scopes of work with third-party contract development and manufacturing organizations (CDMOs) to support the advancement of its pipeline programs.

As of December 31, 2025, the Company had unaccrued unpaid commitments of approximately $ 24 million under manufacturing agreements related to tobevibart and elebsiran and unaccrued unpaid commitments of approximately $ 20 million under manufacturing agreements related to its TCE programs.

VIR BIOTECHNOLOGY, INC.

13 unchanged sentences

For ISO and NSO, the option price generally shall not be less than 100 % of the estimated fair value on the date of grant.

Options granted typically vest over a four-year period but may be granted with different vesting terms.

Awards granted typically vest over a four-year period but may be granted with different vesting terms.

As of December 31, 2025, there are 27,326,711 shares available for the Company to grant under the 2019 Plan.

3 unchanged sentences

For ISO and NSO, the option price shall not be less than 100 % of the estimated fair value on the date of grant.

Options granted typically vest over a four-year period but may be granted with different vesting terms.

Awards granted typically vest over a four-year period but may be granted with different vesting terms.

In conjunction with adopting the 2019 Plan, the Company discontinued the 2016 Plan with respect to the new equity awards.

87 unchanged sentences

Notes to Consolidated Financial Statements

Net (Loss) Income Per Share

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

Diluted net (loss) income per common share is computed by dividing the net (loss) income 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.

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

Net Loss Per Share

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

Years ended December 31,

2025 2024 2023

Net (loss) income attributable to VirBio $ ( 521,960 ) $ ( 615,061 ) $ 515,837

Weighted-average shares outstanding, basic 136,246,865 134,130,924 132,606,767

Weighted-average effect of dilutive securities:

Options to purchase common stock — — 2,130,212

Restricted shares subject to future vesting — — 73,851

Shares to purchase under Employee Stock Purchase Plan — — 78

Weighted-average shares outstanding, diluted 136,246,865 134,130,924 134,810,908

Net (loss) income per share attributable to VirBio, basic $ ( 3.83 ) $ ( 4.59 ) $ 3.89

Net (loss) income per share attributable to VirBio, diluted $ ( 3.83 ) $ ( 4.59 ) $ 3.83

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

Net loss attributable to Vir Bio $ ( 437,987 ) $ ( 521,960 ) $ ( 615,061 )

Weighted-average shares outstanding, basic and diluted 138,520,419 136,246,865 134,130,924

Net loss per share attributable to Vir Bio, basic and diluted $ ( 3.16 ) $ ( 3.83 ) $ ( 4.59 )

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 years presented were as follows:

Years ended December 31,

9 unchanged sentences

Notes to Consolidated Financial Statements

(Loss) income before benefit from (provision for) income taxes consists of the following (in thousands):

Loss before (provision for) benefit from income taxes consists of the following (in thousands):

Years Ended December 31,

2 unchanged sentences

Foreign 10,600 ( 23,425 ) ( 20,060 )

Total (loss) income before benefit from (provision for) income taxes $ ( 523,105 ) $ ( 628,194 ) $ 754,280

The components of benefit from (provision for) income taxes consist of the following (in thousands):

Total loss before (provision for) benefit from income taxes $ ( 437,770 ) $ ( 523,105 ) $ ( 628,194 )

The components of (provision for) benefit from income taxes consist of the following (in thousands):

Years Ended December 31,

8 unchanged sentences

( 304 ) 2,949 1,063

Benefit from (provision for) income taxes $ 1,145 $ 13,077 $ ( 238,443 )

(Provision for) benefit from income taxes $ ( 217 ) $ 1,145 $ 13,077

Income taxes paid consists of following (in thousands):

Year Ended December 31 2025

Foreign (Switzerland) 2,347

Total $ 2,420

A reconciliation between the U.S.

federal statutory income tax rate and the reported effective income tax rate is as follows:

federal statutory income tax provision and rate and the reported effective income tax provision and rate for the year ended December 31, 2025 is as follows (in thousands, except for percentages).

The Company's effective tax rate of ( 0.03 )% for the year ended December 31, 2025 is primarily due to the movement of valuation allowance and nondeductible stock compensation expense.

Year Ended December 31 2025

Provision at US federal statutory rate $ ( 91,933 ) 21.00 %

State and local income taxes, net of federal income tax effect 9 —

Foreign tax effects ( 2,224 ) 0.51

Effect of cross-border tax laws:

GILTI 3,559 ( 0.81 )

research and development credit ( 3,904 ) 0.89

Change in valuation allowance 76,305 ( 17.43 )

Nontaxable or nondeductible items

Stock-based compensation 15,335 ( 3.50 )

Other permanent items 3,169 ( 0.72 )

Changes in unrecognized tax benefits 1,025 ( 0.23 )

Other adjustments ( 1,124 ) 0.26

Income tax provision and effective tax rate $ 217 ( 0.03 %)

VIR BIOTECHNOLOGY, INC.

Notes to Consolidated Financial Statements

As previously disclosed for the years ended December 31, 2024 and 2023, prior to the adoption of ASU 2023-09, the effective income tax rate differs from the statutory federal income tax rate as follows.

Years Ended December 31,

2024 2023 2022

federal statutory income tax rate 21.0 % 21.0 %

4 unchanged sentences

Changes in valuation allowance ( 18.5 ) ( 24.2 )

Other ( 1.5 ) ( 0.8 ) ( 0.9 )

Other adjustments ( 1.5 ) ( 0.8 )

Effective income tax rate 0.2 % 2.1 %

VIR BIOTECHNOLOGY, INC.

Notes to Consolidated Financial Statements

The tax effects of temporary differences that give rise to significant portions of the Company’s deferred tax assets and liabilities as of December 31, 2025, and 2024, are related to the following (in thousands):

12 unchanged sentences

Property and equipment ( 9,004 ) ( 10,628 )

Unrealized gain on investments — ( 1,190 )

IPR&D ( 1,928 ) ( 1,928 )

Other ( 257 ) —

Deferred tax liabilities ( 22,105 ) ( 24,775 )

Net deferred tax assets (liabilities) $ 759 $ ( 2,190 )

Net deferred tax assets $ 454 $ 759

Although the Company has taxable income for the years ended December 31, 2022, and 2021, it has otherwise incurred accumulated tax losses since inception.

2 unchanged sentences

For the year ended December 31, 2025, the Company recorded a valuation allowance increase of $ 73.7 million.

As of December 31, 2024, the Company has net operating loss carryforwards of $ 645.3 million for federal purposes and $ 450.2 million for state tax purposes.

As of December 31, 2025, the Company has net operating loss carryforwards of $ 1.2 billion for federal purposes and $ 446.4 million for state tax purposes.

If not utilized, these carryforwards will begin to expire in 2036 for federal and in 2037 for state tax purposes.

As of December 31, 2025, the Company also has net operating loss carryforwards of $ 34.2 million for Australian tax purposes, which have an indefinite carryforward period, and $ 16.0 million net operating loss carryforwards for Swiss tax purposes, which have a seven-year carryforward period.

VIR BIOTECHNOLOGY, INC.

Notes to Consolidated Financial Statements

Under the Tax Reform Act of 1986, the amounts of and benefits from net operating loss carryforwards may be impaired or limited in certain circumstances.

4 unchanged sentences

The California credits can be carried forward indefinitely.

The Tax Cuts and Jobs Act of 2017 subjects a U.S.

shareholder to current tax on global intangible low-taxed income (“GILTI”) earned by certain foreign subsidiaries.

The FASB Staff Q&A, Topic 740 No.

5, Accounting for Global Intangible Low-Taxed Income, states that an entity can make an accounting policy election to either recognize deferred taxes for temporary differences expected to reverse as GILTI in future years or provide for the tax expense related to GILTI in the year the tax is incurred.

The Company has elected to recognize the tax on GILTI as a period expense in the period the tax is incurred.

VIR BIOTECHNOLOGY, INC.

Notes to Consolidated Financial Statements

On July 4, 2025, legislation formally titled An Act to Provide for Reconciliation Pursuant to Title II of H.

14, commonly referred to as the One Big Beautiful Bill Act (OBBBA), was signed into law by President Trump.

The application of the OBBBA did not have a material impact on the Company's financial statements during the year ended December 31, 2025.

Uncertain Tax Positions

2 unchanged sentences

Other unrecognized tax benefits as of December 31, 2025, if recognized, would be in the form of net operating loss and tax credit carryforwards, which attract a full valuation allowance offset, and would not impact the Company’s effective tax rate.

There are no provisions for which it is reasonably possible that the total amounts of unrecognized tax benefits will significantly increase or decrease within 12 months of the reporting date.

Because the statute of limitations does not expire until after the net operating loss and credit carryforwards are actually used, the statutes are still open on calendar years ending December 31, 2017 and forward for federal and state purposes.

16 unchanged sentences

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) income that also is reported on the consolidated statements of operations as consolidated net (loss) income.

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) income 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 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.

VIR BIOTECHNOLOGY, INC.

5 unchanged sentences

Segment expenses (1)

Cost of sales 845 2,765 146,319

Cost of revenue 26 845 2,765

Research and development

Contract manufacturing 40,081 114,262 47,960

Clinical costs 57,624 121,422 118,849

Personnel (2)

1 unchanged sentence

Licenses, collaborations and contingent consideration 125,058 129,846 30,215

129,846 30,215 54,087

Clinical costs 87,173 57,624 121,422

Contract manufacturing 47,622 40,081 114,262

Other R&D (3)

2 unchanged sentences

92,074 119,031 174,441

Restructuring, long-lived assets impairment and related charges 34,995 13,559 —

Restructuring, long-lived assets impairment and related charges, net ( 182 ) 34,995 13,559

Other segment items (4)

41,341 65,205 69,188

Segment and consolidated net (loss) income $ ( 521,960 ) $ ( 615,117 ) $ 515,837

(1) Refer to Note 7 Balance Sheet Components for depreciation and amortization expenses included in segment expenses.

Segment and consolidated net loss $ ( 437,987 ) $ ( 521,960 ) $ ( 615,117 )

(1) Refer to Note 7 Balance Sheet Components for depreciation expenses included in segment expenses.

(2) Refer to Note 11 Stock-Based Awards for stock-based compensation expenses included in segment expenses.

(3) 2024 license collaboration and contingent consideration expenses include $ 102.8 million expenses related to the portion of the upfront payment under the Sanofi license agreement that was allocated to IPR&D and expensed.

Refer to Note 6 Collaboration and License Agreements for more details.

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

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

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

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 (refer to Note 6 Collaboration and License Agreements for further details), contract revenue generated from clinical supplies provided to foreign companies, and license revenue from the Company’s collaboration with Brii Bio.

The revenues attributed to foreign customers primarily include license and collaboration revenues recognized under the Company’s license agreement with Norgine and collaboration agreements with GSK (refer to Note 6 Collaboration and License Agreements for further details), revenue generated from clinical supplies provided to foreign companies, and license revenue from the Company’s collaboration with Brii Bio.

Years Ended December 31,

3 unchanged sentences

Foreign customers

Norgine 64,268 — —

GSK ( 1,138 ) 60,309 37,265

1 unchanged sentence

Total segment and consolidated revenue $ 68,556 $ 74,205 $ 86,180

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

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

16 Subsequent Event

On February 19, 2026, the Company and Astellas US LLC (together with its subsidiaries and affiliates (including its indirect parent, Astellas Pharma Inc.), Astellas) entered into a Collaboration and License Agreement (the Astellas Agreement).

Upon closing of the transaction contemplated by the Astellas Agreement, the Company and Astellas will enter into a global strategic collaboration to co-develop and co-commercialize VIR-5500, an investigational PRO-XTEN ® dual-masked CD3 TCE targeting PSMA (Prostate-Specific Membrane Antigen) for the treatment of prostate cancer that is currently in Phase 1 development, through a sharing of expenses and revenues.

The Company has agreed to grant to Astellas, subject to certain intellectual property rights of Sanofi, an exclusive license to develop, manufacture, commercialize and otherwise exploit VIR-5500 and certain related derivative compounds throughout the world for therapeutic, prophylactic, palliative and diagnostic uses.

VIR BIOTECHNOLOGY, INC.

Notes to Consolidated Financial Statements

Under the terms of the Astellas Agreement, in the U.S., the Company will share profits and losses from future sales of VIR-5500 equally with Astellas, should VIR-5500 receive regulatory approval, and the Company will have the option to co-promote VIR-5500.

Outside of the U.S., Astellas will obtain exclusive rights to commercialize VIR-5500 and be responsible for all commercialization costs.

The Company and Astellas will jointly develop VIR-5500, with global clinical development costs shared 40 % by the Company and 60 % by Astellas, while costs of U.S.-specific studies will be shared equally, and Astellas will be solely responsible for costs of ex-U.S.-specific studies.

In addition, the Company has the option to opt out of development cost sharing responsibilities and U.S.

profit sharing, and in such case, Astellas will pay the Company royalties on net sales made in the U.S., as described below.

The Company will receive $ 335 million in upfront and near-term milestone payments, including $ 240 million in cash, a $ 75 million equity investment pursuant to a separate Stock Purchase Agreement (the Astellas SPA, described further below), and a near-term $ 20 million milestone payment upon completion of manufacturing technology transfer, anticipated in the second quarter or third quarter of 2027.

The Company will also be eligible to receive up to $ 1.37 billion in future development, regulatory and ex-U.S.

sales milestones, along with tiered, double-digit royalties on ex-U.S.

net sales, which royalties are subject to reduction under certain specified circumstances.

If the Company elects to opt out of development cost sharing responsibilities and U.S.

profit sharing, it would be eligible to receive up to $ 1.37 billion (or $ 1.60 billion if the Company has met a pre-defined limited funding threshold at the time of the opt-out) in future development, regulatory and global sales milestones, along with tiered, double-digit royalties on global net sales, which royalties are subject to reduction under certain specified circumstances.

Further, certain opt-out milestones, if met, will include reimbursement of a portion of the Company’s previously expensed development and commercialization spend.

The closing of the transaction is subject to the expiration or termination of the applicable waiting period under the Hart-Scott-Rodino Antitrust Improvements Act of 1976, as amended.

Under the terms of the Sanofi Agreement, the Company will share with Sanofi 20% of certain future collaboration proceeds, including the upfront payment, equity premium and the portion of milestones, profit-share and royalties that exceed amounts already owed to Sanofi.

Concurrently with the execution of the Astellas Agreement, the Company also entered into the Astellas SPA, pursuant to which Astellas has agreed to purchase 7,239,382 shares of the Company’s common stock for an aggregate purchase price of approximately $ 75 million, subject to customary closing conditions and the closing of the Astellas Agreement.

The purchase price per share of the Company’s common stock of $ 10.36 is equal to a 50 % premium of the 30-day volume weighted average price of a share of the Company’s common stock as of February 17, 2026.

The Astellas SPA includes standstill, voting and lockup provisions, with customary exceptions, that expire one year after the date of the anticipated closing of the Astellas SPA.

One year after the anticipated closing of the Astellas SPA, Astellas will have, under certain circumstances, a customary right to require the Company to register the resale of the shares purchased pursuant to the Astellas SPA.

Changes in and Disagreements With Accountants on Accounting and Financial Disclosure.

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

What changed 10-K

Item 8. Financial Statements and Supplementary Data