PART I — FINANCIAL INFORMATION [Financial Statements](index=4&type=section&id=Item%201.%20Financial%20Statements) This section presents Adaptimmune Therapeutics plc's unaudited condensed consolidated financial statements for the three and six months ended June 30, 2025, detailing financial position, performance, cash flows, and significant subsequent events Condensed Consolidated Balance Sheet Highlights (in thousands) | Balance Sheet Item | June 30, 2025 | December 31, 2024 | | :--- | :--- | :--- | | **Assets** | | | | Cash and cash equivalents | $26,061 | $91,139 | | Marketable securities | $0 | $60,466 | | Total current assets | $78,115 | $188,169 | | Total assets | $130,633 | $245,963 | | **Liabilities & Equity** | | | | Total current liabilities | $51,513 | $64,527 | | Total liabilities | $201,591 | $234,114 | | Total stockholders' equity | $(70,958) | $11,849 | Condensed Consolidated Statements of Operations Highlights (in thousands, except per share data) | Income Statement Item | Six months ended June 30, 2025 | Six months ended June 30, 2024 | | :--- | :--- | :--- | | Product revenue, net | $15,126 | $0 | | Development revenue | $5,836 | $133,909 | | **Total revenue** | **$20,962** | **$133,909** | | Research and development | $(51,836) | $(75,655) | | Selling, general and administrative | $(41,767) | $(38,815) | | **(Loss)/profit from operations** | **$(76,021)** | **$19,439** | | **Net (loss)/profit** | **$(77,924)** | **$21,018** | | Net (loss)/profit per share, basic | $(0.05) | $0.01 | Condensed Consolidated Statements of Cash Flows Highlights (in thousands) | Cash Flow Item | Six months ended June 30, 2025 | Six months ended June 30, 2024 | | :--- | :--- | :--- | | Net cash (used in)/provided by operating activities | $(101,372) | $15,449 | | Net cash provided by/(used in) investing activities | $59,644 | $(1,101) | | Net cash (used in)/provided by financing activities | $(23,666) | $53,747 | | **Net (decrease)/increase in cash** | **$(65,428)** | **$67,659** | - The company has incurred a net loss of **$77.9 million** and used **$101.4 million** in cash from operating activities for the six months ended June 30, 2025 However, management believes that cash and cash equivalents will be sufficient for at least the next 12 months following the filing, primarily due to a significant asset sale and restructuring that occurred in July 2025[28](index=28&type=chunk)[31](index=31&type=chunk) - A significant subsequent event occurred on July 27, 2025, when the company entered into an Asset Purchase Agreement to sell its key cell therapy assets (TECELRA, letecel, afami-cel, uza-cel) to USWM CT, LLC for **$55.0 million** in cash upfront, plus potential future milestones up to **$30.0 million** The transaction closed on July 31, 2025[103](index=103&type=chunk)[104](index=104&type=chunk)[105](index=105&type=chunk) - In connection with the asset sale, the company announced a further restructuring on July 28, 2025, planning to reduce its remaining workforce by approximately **62%** This is expected to incur pre-tax costs of approximately **$7.0 million to $8.0 million**, primarily in the third quarter of 2025[109](index=109&type=chunk) [Management's Discussion and Analysis of Financial Condition and Results of Operations](index=26&type=section&id=Item%202.%20Management%27s%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operations) Management discusses the company's strategic shift, including the sale of key assets and restructuring, analyzing financial results impacted by decreased collaboration revenue and initial product sales, while affirming sufficient liquidity post-asset sale - On July 27, 2025, the company agreed to sell its key assets, including TECELRA, letecel, afami-cel, and uza-cel, to US WorldMeds This transaction marks a significant strategic shift, with the company now planning to explore options for its remaining preclinical assets like PRAME and ADP-520[115](index=115&type=chunk)[120](index=120&type=chunk)[121](index=121&type=chunk) Comparison of Operations for the Three Months Ended June 30 (in thousands) | Metric | Q2 2025 | Q2 2024 | Change ($) | Change (%) | | :--- | :--- | :--- | :--- | :--- | | **Revenue** | **$13,677** | **$128,231** | **$(114,554)** | **(89)%** | | Product revenue, net | $11,078 | $0 | $11,078 | N/A | | Development revenue | $2,599 | $128,231 | $(125,632) | (98)% | | R&D Expenses | $(22,979) | $(40,448) | $17,469 | (43)% | | SG&A Expenses | $(18,485) | $(19,083) | $598 | (3)% | | **Net (Loss)/Profit** | **$(30,340)** | **$69,521** | **$(99,861)** | **(144)%** | Comparison of Operations for the Six Months Ended June 30 (in thousands) | Metric | H1 2025 | H1 2024 | Change ($) | Change (%) | | :--- | :--- | :--- | :--- | :--- | | **Revenue** | **$20,962** | **$133,909** | **$(112,947)** | **(84)%** | | Product revenue, net | $15,126 | $0 | $15,126 | N/A | | Development revenue | $5,836 | $133,909 | $(128,073) | (96)% | | R&D Expenses | $(51,836) | $(75,655) | $23,819 | (31)% | | SG&A Expenses | $(41,767) | $(38,815) | $(2,952) | 8% | | **Net (Loss)/Profit** | **$(77,924)** | **$21,018** | **$(98,942)** | **(471)%** | - The significant decrease in development revenue in 2025 is primarily due to the termination of the Genentech collaboration in April 2024, which resulted in a one-time cumulative catch-up revenue recognition of **$101.3 million** in Q2 2024[163](index=163&type=chunk)[178](index=178&type=chunk) - Total Liquidity, a non-GAAP measure combining cash, cash equivalents, and marketable securities, was **$26.1 million** as of June 30, 2025, a sharp decline from **$151.6 million** at December 31, 2024 However, the company received a **$55.0 million** cash payment from the asset sale in July 2025[190](index=190&type=chunk)[199](index=199&type=chunk) - Net cash used in operating activities was **$101.4 million** for the first six months of 2025, a stark contrast to the **$15.4 million** provided by operating activities in the same period of 2024 The change was driven by the absence of large upfront collaboration payments received in 2024 and cash outflows for redundancy payments in 2025[192](index=192&type=chunk)[193](index=193&type=chunk)[195](index=195&type=chunk) [Quantitative and Qualitative Disclosures About Market Risk](index=40&type=section&id=Item%203.%20Quantitative%20and%20Qualitative%20Disclosures%20About%20Market%20Risk) The company reports no material changes to its market risk exposure during the three months ended June 30, 2025, referring to the 2024 Annual Report for detailed discussion - There were no material changes to the Company's market risk during the second quarter of 2025[202](index=202&type=chunk) [Controls and Procedures](index=40&type=section&id=Item%204.%20Controls%20and%20Procedures) Management concluded that disclosure controls and procedures were effective as of June 30, 2025, with no material changes to internal control over financial reporting during the quarter - Based on an evaluation as of June 30, 2025, the Chief Executive Officer and Chief Financial Officer concluded that the company's disclosure controls and procedures were effective[203](index=203&type=chunk)[204](index=204&type=chunk) - No material changes to the company's internal control over financial reporting were identified during the quarter ended June 30, 2025[205](index=205&type=chunk) PART II — OTHER INFORMATION [Legal Proceedings](index=40&type=section&id=Item%201.%20Legal%20Proceedings) The company settled litigation with The University of Texas M.D. Anderson Cancer Center on July 16, 2025, with the financial impact deemed immaterial to its operations - On July 16, 2025, the company settled litigation with The University of Texas M.D Anderson Cancer Center concerning a 2016 strategic alliance agreement[95](index=95&type=chunk)[206](index=206&type=chunk) - The company asserts that the financial obligations of the settlement are not material and are not expected to have a material adverse effect on its financial position[96](index=96&type=chunk)[207](index=207&type=chunk) [Risk Factors](index=41&type=section&id=Item%201A.%20Risk%20Factors) This section highlights the risk of non-compliance with Nasdaq's minimum bid price requirement, detailing the company's transfer to the Nasdaq Capital Market and the extended period to regain compliance - The company is not in compliance with Nasdaq's minimum bid price requirement, as its American Depositary Shares (ADSs) traded below **$1.00** for over 30 consecutive business days, receiving a notice on November 1, 2024[211](index=211&type=chunk) - On May 1, 2025, Nasdaq approved the company's application to transfer its listing to the Nasdaq Capital Market, granting an additional 180-day compliance period to regain the minimum **$1.00** bid price[212](index=212&type=chunk) - Failure to regain compliance with Nasdaq's listing rules could result in the delisting of the company's ADSs, which would adversely affect market price, liquidity, and the ability to raise capital[213](index=213&type=chunk) [Unregistered Sales of Equity Securities and Use of Proceeds](index=41&type=section&id=Item%202.%20Unregistered%20Sales%20of%20Equity%20Securities%20and%20Use%20of%20Proceeds) The company reported no unregistered sales of equity securities or use of proceeds from such sales during the period - None reported for the period[214](index=214&type=chunk) [Defaults Upon Senior Securities](index=41&type=section&id=Item%203.%20Defaults%20Upon%20Senior%20Securities) The company reported no defaults upon its senior securities during the period - None reported for the period[215](index=215&type=chunk) [Mine Safety Disclosures](index=42&type=section&id=Item%204.%20Mine%20Safety%20Disclosures) This item is not applicable to the company's business operations - Not applicable[216](index=216&type=chunk) [Other Information](index=42&type=section&id=Item%205.%20Other%20Information) The company states that during the three-month period ended June 30, 2025, none of its directors or officers adopted, modified, or terminated a Rule 10b5-1 trading arrangement or a non-Rule 10b5-1 trading arrangement - No directors or officers adopted, modified, or terminated a Rule 10b5-1 or non-Rule 10b5-1 trading arrangement during the second quarter of 2025[217](index=217&type=chunk) [Exhibits](index=42&type=section&id=Item%206.%20Exhibits) This section lists exhibits filed with the Quarterly Report on Form 10-Q, including the Asset Purchase Agreement and required officer certifications - The exhibits filed with this report include the Asset Purchase Agreement dated July 27, 2025, and required officer certifications under Sections 302 and 906 of the Sarbanes-Oxley Act[218](index=218&type=chunk)

[Business and Financial Highlights](index=1&type=section&id=Business%20and%20Financial%20Highlights) [Q2 2025 Business Update](index=1&type=section&id=Q2%202025%20Business%20Update) Adaptimmune reported strong commercial growth for TECELRA in Q2 2025, with sales increasing over 150% compared to Q1, and strategically agreed to sell its main cell therapy assets to US WorldMeds for $55 million upfront plus potential milestones, leading to debt repayment and restructuring to focus on remaining PRAME and CD70 programs - Entered into a definitive agreement to sell TECELRA, lete-cel, afami-cel, and uza-cel cell therapies to US WorldMeds[1](index=1&type=chunk) US WorldMeds Transaction Details | Term | Value | | :--- | :--- | | Upfront Payment | $55 million | | Future Milestone Payments | Up to $30 million | - Q2 TECELRA sales reached **$11.1 million** from 16 patients invoiced, representing over **150% growth** compared to Q1 2025[1](index=1&type=chunk)[2](index=2&type=chunk) - Following the asset sale, Adaptimmune repaid its debt facility with Hercules Capital and is restructuring to maximize value from remaining assets, including programs targeting PRAME and CD70[1](index=1&type=chunk)[2](index=2&type=chunk) - The company has maintained a **100% commercial manufacturing success rate** through the end of Q2, and the network of Authorized Treatment Centers (ATCs) is nearing completion with 30 centers accepting referrals[2](index=2&type=chunk) [Q2 2025 Financial Highlights](index=1&type=section&id=Q2%202025%20Financial%20Highlights) For the second quarter of 2025, Adaptimmune's revenue was $13.7 million, a significant decrease from $128.2 million in Q2 2024, primarily due to the termination of the Genentech collaboration, resulting in a net loss of $30.3 million compared to a prior-year profit, with operating expenses decreasing due to lower R&D costs, and cash and cash equivalents at $26.1 million as of June 30, 2025 Key Financial Metrics (Three Months Ended June 30) | Metric | 2025 | 2024 | Change | | :--- | :--- | :--- | :--- | | Revenue | $13.7M | $128.2M | -89.3% | | R&D Expenses | $23.0M | $40.4M | -43.1% | | SG&A Expenses | $18.5M | $19.1M | -3.1% | | Net (Loss)/Profit | $(30.3)M | $69.5M | N/A | | EPS (Diluted) | $(0.02) | $0.04 | N/A | Key Financial Metrics (Six Months Ended June 30) | Metric | 2025 | 2024 | Change | | :--- | :--- | :--- | :--- | | Revenue | $21.0M | $133.9M | -84.3% | | R&D Expenses | $51.8M | $75.7M | -31.6% | | SG&A Expenses | $41.8M | $38.8M | +7.7% | | Net (Loss)/Profit | $(77.9)M | $21.0M | N/A | | EPS (Diluted) | $(0.05) | $0.01 | N/A | - The significant decrease in revenue for the six months ended June 30, 2025, was primarily due to the termination of the Genentech collaboration in April 2024, which had resulted in a **$101.3 million cumulative catch-up adjustment** in the prior year period[3](index=3&type=chunk) - Cash and cash equivalents were **$26.1 million** as of June 30, 2025, down from **$91.1 million** at December 31, 2024[3](index=3&type=chunk) - The company believes its cash and cash equivalents are sufficient to fund planned operations for at least 12 months following the Q2 2025 filing, as a result of the US WorldMeds transaction and debt repayment[5](index=5&type=chunk) [Financial Statements](index=6&type=section&id=Financial%20Statements) [Condensed Consolidated Statement of Operations](index=6&type=section&id=Condensed%20Consolidated%20Statement%20of%20Operations) For the six months ended June 30, 2025, total revenue was $21.0 million, a sharp decline from $133.9 million in the same period of 2024, driven by a near-total drop in development revenue partially offset by new product revenue of $15.1 million, with total operating expenses decreasing to $97.0 million from $114.5 million, resulting in an operating loss of $76.0 million and a net loss of $77.9 million for the first half of 2025 Statement of Operations Summary (in thousands) | Line Item | Six Months Ended June 30, 2025 | Six Months Ended June 30, 2024 | | :--- | :--- | :--- | | Total Revenue | $20,962 | $133,909 | | Total Operating Expenses | $(96,983) | $(114,470) | | (Loss)/Profit from Operations | $(76,021) | $19,439 | | Net (Loss)/Profit | $(77,924) | $21,018 | | Net (Loss)/Profit per Share (Diluted) | $(0.05) | $0.01 | [Condensed Consolidated Balance Sheets](index=7&type=section&id=Condensed%20Consolidated%20Balance%20Sheets) As of June 30, 2025, Adaptimmune's total assets were $130.6 million, a significant decrease from $246.0 million at the end of 2024, primarily due to a reduction in cash and marketable securities, while total liabilities also decreased to $201.6 million from $234.1 million mainly from a reduction in borrowings, resulting in total stockholders' equity turning to a deficit of $71.0 million from a positive $11.8 million at year-end 2024 Balance Sheet Summary (in thousands) | Line Item | June 30, 2025 | December 31, 2024 | | :--- | :--- | :--- | | Cash and cash equivalents | $26,061 | $91,139 | | Total Current Assets | $78,115 | $188,169 | | **Total Assets** | **$130,633** | **$245,963** | | Total Current Liabilities | $51,513 | $64,527 | | **Total Liabilities** | **$201,591** | **$234,114** | | **Total Stockholders' Equity** | **$(70,958)** | **$11,849** | [Condensed Consolidated Cash Flow Statement](index=8&type=section&id=Condensed%20Consolidated%20Cash%20Flow%20Statement) For the first six months of 2025, net cash used in operating activities was $101.4 million, a significant outflow compared to a $15.4 million inflow in the prior year period, driven by the net loss and changes in working capital, with net cash provided by investing activities at $59.6 million primarily from marketable securities maturity, and net cash used in financing activities at $23.7 million mainly due to borrowings repayment, resulting in a net decrease in cash of $65.4 million for the period Cash Flow Summary (Six Months Ended June 30, in thousands) | Cash Flow Activity | 2025 | 2024 | | :--- | :--- | :--- | | Net cash (used in)/provided by operating activities | $(101,372) | $15,449 | | Net cash provided by/(used in) investing activities | $59,644 | $(1,101) | | Net cash (used in)/provided by financing activities | $(23,666) | $53,747 | | **Net (decrease)/increase in cash** | **$(65,428)** | **$67,659** | [Non-GAAP Financial Measures](index=5&type=section&id=Non-GAAP%20Financial%20Measures) [Reconciliation of Total Liquidity](index=5&type=section&id=Reconciliation%20of%20Total%20Liquidity) The company uses the non-GAAP measure 'Total Liquidity,' defined as the sum of cash, cash equivalents, and marketable securities, which as of June 30, 2025, was $26.1 million, a significant decrease from $151.6 million at the end of 2024, primarily due to the sale or maturity of all marketable securities - Total Liquidity is a non-GAAP financial measure defined as the total of cash and cash equivalents and marketable securities (available-for-sale debt securities)[8](index=8&type=chunk) Reconciliation of Total Liquidity (in thousands) | | June 30, 2025 | December 31, 2024 | | :--- | :--- | :--- | | Cash and cash equivalents | $26,061 | $91,139 | | Marketable securities | — | $60,466 | | **Total Liquidity** | **$26,061** | **$151,605** |

Core Viewpoint - Adaptimmune Therapeutics has entered into a definitive agreement to sell its cell therapy assets, including TECELRA, lete-cel, afami-cel, and uza-cel, to US WorldMeds for $55 million in cash, with potential future payments of up to $30 million based on milestone achievements [1][2][5] Group 1: Transaction Details - The sale includes all intellectual property rights related to the Assigned Assets, and Adaptimmune will retain rights to its preclinical assets such as PRAME and CD70 [1][2] - The transaction is expected to be completed before the end of the week, and Adaptimmune will provide transition services to US WorldMeds [1][4] - US WorldMeds plans to continue the development of lete-cel and other therapies, ensuring that patients have uninterrupted access to TECELRA [1][5] Group 2: Strategic Rationale - Adaptimmune's Board of Directors concluded that this transaction is in the best interest of all stakeholders after a comprehensive review of strategic alternatives [1][2] - The CEO of Adaptimmune emphasized the importance of securing the right strategic option to maximize value for stakeholders and ensure continued patient access to TECELRA [2][5] - US WorldMeds' CEO highlighted the acquisition as a significant step in their mission to innovate and provide hope to patients [2][5] Group 3: Financial Aspects - The transaction will be financed through debt led by Oaktree Capital Management and Athyrium Capital Management [6] - Adaptimmune will receive an initial payment of $55 million upon sale consummation, with additional milestone payments potentially reaching $30 million [1][2]

FDA Approval and Clinical Trials - TECELRA received FDA approval on August 1, 2024, and 28 Authorized Treatment Centers (ATCs) are available for patient treatment as of May 13, 2025[112]. - In Q1 2025, 13 patients were apheresed, and 6 patients were invoiced; in Q2 2025 to date, 8 patients have been apheresed and invoiced[112]. - The company plans to launch letetresgene autoleucel ("lete-cel") for synovial sarcoma and myxoid liposarcoma in 2026[110]. - The company anticipates filing a clinical trial authorization for a Phase 1 trial in head and neck cancer in collaboration with Galapagos during 2025[117]. Financial Performance - Product revenue for the three months ended March 31, 2025, was $4.0 million, with total revenue increasing by 28% to $7.3 million compared to $5.7 million in the same period of 2024[160][162]. - Research and development expenses decreased by 18% to $28.9 million for the three months ended March 31, 2025, down from $35.2 million in the same period of 2024[163]. - Selling, general and administrative expenses increased by 18% to $23.3 million for the three months ended March 31, 2025, compared to $19.7 million in the same period of 2024[167]. - The operating loss for the three months ended March 31, 2025, was $45.7 million, a decrease of 7% from the operating loss of $49.3 million in the same period of 2024[160]. - Interest income for the three months ended March 31, 2025, was $0.9 million, a decrease of 32% from $1.3 million in the same period of 2024[170]. - Development revenue for the three months ended March 31, 2025, was $3.2 million, a decrease of 43% from $5.7 million in the same period of 2024[160]. - The company reported a net loss of $47.6 million for the three months ended March 31, 2025[182]. Cash Flow and Liquidity - As of March 31, 2025, the company had cash and cash equivalents of $41.1 million and Total Liquidity of $59.6 million[174]. - Net cash used in operating activities increased to $66.6 million for the three months ended March 31, 2025, compared to $31.9 million for the same period in 2024[181]. - Net cash provided by investing activities was $41.2 million for the three months ended March 31, 2025, compared to a cash outflow of $0.4 million in the same period of 2024[183]. - The company incurred a net cash outflow of $25.3 million from financing activities for the three months ended March 31, 2025, compared to a net inflow of $29.2 million in the same period of 2024[184]. - Total Liquidity decreased from $151.6 million as of December 31, 2024, to $59.6 million as of March 31, 2025[185]. Strategic Decisions and Collaborations - The Galapagos Collaboration Agreement includes an upfront payment of $100 million, with $70 million received upfront and $30 million for research and development funding[132]. - The termination of the Genentech Collaboration Agreement resulted in a cumulative catch-up adjustment to revenue recognized of $101.3 million[125]. - The company is evaluating all strategic options for its programs and operations[111]. - The company is actively seeking additional funding and has engaged TD Cowen to evaluate strategic options, including potential mergers and acquisitions[177]. - The company has paused spending on preclinical programs targeting PRAME and CD70[118]. - The company has paused spending on its PRAME and CD70 programs as part of its cost-reduction strategy[177]. Tax and Regulatory Considerations - Research and development expenses are partially offset by reimbursable tax credits from the U.K. government, with a potential cash tax benefit of up to 27% for qualifying expenditures[139]. - The company is subject to a U.K. corporation tax rate of 25% for the year ended December 31, 2025[152]. - Substantial doubt exists regarding the company's ability to continue as a going concern within one year from the date of the financial statements[178].

Financial Data and Key Metrics Changes - The company reported net sales of $4 million for Q1 2025, with a revenue guidance for the full year of $35 million to $45 million from T Cellra sales [4][5][50] - The average turnaround time from apheresis to release was 27 days, beating the target of 30 days [6] - The company achieved a 100% manufacturing success rate from its U.S. T Cell manufacturing center [6][31] Business Line Data and Key Metrics Changes - A total of 21 patients have been treated with T Cellra in 2025, with 13 in Q1 and 8 in early Q2 [4] - The company invoiced 14 T Cellra treatments in 2025 to date, with 6 in Q1 [5] - The company expects to have approximately 30 authorized treatment centers (ATCs) operational by the end of 2025, which is a year earlier than initially anticipated [4][5] Market Data and Key Metrics Changes - The company has seen effective patient access to T Cellra with no patient denials to date [6] - The annual incidence rate for eligible patients diagnosed with synovial sarcoma is approximately 1,000, which aligns with the company's expectations [68] Company Strategy and Development Direction - The company is focused on the successful launch of T Cellra and is preparing for the launch of Letocell, anticipated in 2026 [8] - The company is reviewing strategic options with Cowen as advisors to explore opportunities that benefit patients and shareholders [9] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in achieving the revenue guidance based on the number of patients treated and the operational efficiency of ATCs [50] - The company has had three formal meetings with the FDA in the last six months, indicating a positive regulatory environment [28] Other Important Information - The company has implemented cost reduction actions and a restructuring plan that impacted Q1 spending [46] - The gross margin in Q1 was around 78%, with expectations of normalizing to about 70% in the long run [66] Q&A Session Summary Question: Clarification on apheresis patients invoiced - Management confirmed that most apheresis patients invoiced in Q1 were from the prior quarter, with expectations for invoicing the majority in the coming month [10][11] Question: Trends in patient referrals and screening - Management expects incremental growth quarter on quarter without specific seasonalization, driven by increased awareness and onboarding of ATCs [16][18] Question: Impact of regulatory changes - Management noted that the FDA remains engaged and has not indicated any issues with the regulatory process [28] Question: Key learnings from the early launch - The onboarding of treatment centers has occurred faster than anticipated, and the manufacturing success rate has been exceptional [29][31] Question: Financing and liquidity concerns - The company paid down $25 million of financing obligations to manage its balance sheet and leverage [42][45] - The company has less than twelve months of cash runway, and detailed cash guidance was deemed inappropriate due to various influencing factors [46][47]

Financial Data and Key Metrics Changes - The company reported net sales of $4 million for Q1 2025, with a revenue guidance for the full year of $35 million to $45 million from TESELRA sales [3][4][5] - The average turnaround time from apheresis to release was 27 days, beating the target of 30 days [5] - The company achieved a 100% manufacturing success rate from its U.S. T Cellular manufacturing center [5][6] Business Line Data and Key Metrics Changes - A total of 21 patients have been treated with TESELRA in 2025, with 13 in Q1 and 8 in early Q2 [3][4] - The company invoiced 14 T Cellular treatments in 2025 to date, with 6 in Q1 [4] - The company anticipates peak sales of $400 million from its combined T Cellra and Letocell sarcoma franchise [5] Market Data and Key Metrics Changes - The company has established 28 authorized treatment centers (ATCs) for TESELRA, with plans to reach approximately 30 by the end of 2025 [3][4] - The company expects to treat around 1,000 patients annually diagnosed with synovial sarcoma, aligning with initial forecasts [67][68] Company Strategy and Development Direction - The company is focused on the successful launch of TESELRA and preparing for the launch of Letocell, anticipated in 2026 [6] - Investments in infrastructure for T Cellra will also support the Letocell launch [6] - The company is exploring strategic options with Cowen as advisors to benefit patients and shareholders [7] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in achieving the revenue guidance based on patient treatment cycles and the number of treatment centers [3][5] - The management noted that the FDA is engaged and working diligently on regulatory matters, with no indications of delays [28] - The company has seen positive trends in patient referrals and screening, expecting incremental growth quarter over quarter [18][19] Other Important Information - The company has not experienced any patient denials to date, indicating effective patient access to TESELRA [5] - The company is managing its balance sheet and has paid down $25 million of financing obligations to improve leverage [44][45] Q&A Session Summary Question: Clarification on apheresis patients invoiced - Management indicated that most apheresis patients invoiced in Q1 were from the prior quarter, with expectations for invoicing to continue in the coming months [10] Question: Trends in patient referrals and screening - Management expects incremental growth quarter over quarter, driven by increased awareness and onboarding of ATCs [18] Question: Impact of regulatory changes - Management noted ongoing engagement with the FDA and no indications of delays in regulatory processes [28] Question: Key learnings from the early launch - Management highlighted faster-than-expected onboarding of treatment centers and a 100% manufacturing success rate as key positives [30][31] Question: Cash runway and sustainability of operations - Management acknowledged a substantial debt concern and indicated that cash runway guidance is inappropriate due to various impacting factors [45][46] Question: Drop-off rate from apheresis to infusion - Management confirmed that there have been no cancellations from the moment a patient is enrolled, indicating a high conversion rate [39] Question: Manufacturing maintenance plans - Management stated there are no significant maintenance plans that would impact capacity for the year [58] Question: COGS tracking and expectations - Management indicated that COGS for the first few quarters will be higher than expected due to pre-purchased products, with margins expected to normalize [63][66]

Financial Performance - Tecelra net sales for Q1 2025 reached $4.0 million, with a full-year sales guidance of $35-$45 million for 2025[1][2] - Total revenue for Q1 2025 was $7.3 million, an increase from $5.7 million in Q1 2024, primarily due to product sales from Tecelra[12] - The company reported a net loss of $47.6 million in Q1 2025, compared to a net loss of $48.5 million in Q1 2024[12] - Net loss for Q1 2025 was $47,584,000, slightly improved from a net loss of $48,503,000 in Q1 2024[18] Expenses - Research and development (R&D) expenses decreased to $28.9 million in Q1 2025 from $35.2 million in Q1 2024, attributed to a reduction in R&D personnel and subcontracted expenditures[12] - Selling, general and administrative (SG&A) expenses increased to $23.3 million in Q1 2025 from $19.7 million in Q1 2024, due to restructuring charges and increased professional fees[12] - Net cash used in operating activities increased to $66,592,000 in Q1 2025 from $31,950,000 in Q1 2024[18] - Share-based compensation expense decreased significantly to $669,000 in Q1 2025 from $3,102,000 in Q1 2024[18] Liquidity and Cash Flow - As of March 31, 2025, total liquidity was $59.6 million, down from $151.6 million as of December 31, 2024[15] - Cash, cash equivalents, and restricted cash decreased to $43,004,000 at the end of Q1 2025 from $143,528,000 at the end of Q1 2024[18] - Cash flows from investing activities provided $41,154,000 in Q1 2025, compared to a cash outflow of $358,000 in Q1 2024[18] Operational Highlights - The company achieved a 100% manufacturing success rate with no payer denials to date, supporting the ongoing Tecelra launch[6] - The pivotal trial for Tecelra met its primary endpoint with a 42% overall response rate, including 6 complete responses[6] - The number of Authorized Treatment Centers (ATCs) accepting referrals increased to 28, with plans to reach approximately 30 by the end of 2025[6] Future Outlook - The company is on track to initiate rolling BLA submission for lete-cel in late 2025, with approval anticipated in 2026[6] Inventory and Assets - The company reported an increase in inventories of $4,426,000 in Q1 2025, indicating potential growth in production or sales[18] - The company acquired property, plant, and equipment for $1,203,000 in Q1 2025, up from $102,000 in Q1 2024[18] Currency Impact - The effect of currency exchange rate changes resulted in a positive impact of $556,000 on cash in Q1 2025, compared to a negative impact of $416,000 in Q1 2024[18] Liabilities - The company experienced a decrease in payables and other current liabilities amounting to $13,011,000 in Q1 2025, compared to a decrease of $7,650,000 in Q1 2024[18] - The company reported a depreciation expense of $2,291,000 in Q1 2025, down from $2,771,000 in Q1 2024[18]

Core Insights - Adaptimmune Therapeutics plc is set to report its financial results and business updates for Q1 2025 on May 13, 2025, before US markets open [1] - A live webcast will follow the announcement at 8:00 a.m. EDT on the same day [1][2] Company Overview - Adaptimmune is a clinical-stage biopharmaceutical company focused on developing cell therapies aimed at treating solid tumor cancers [3] - The company utilizes a unique engineered T-cell receptor (TCR) platform to create T-cells that target and destroy various solid tumor types [3]

FDA Approvals and Product Launches - The company received FDA approval for TECELRA on August 1, 2024, marking it as the first engineered T-cell therapy for solid tumors approved in the U.S.[431] - The company plans to launch its second T-cell immunotherapy, lete-cel, in 2026, with an estimated peak combined U.S. sales of up to $400 million from TECELRA and lete-cel[428]. - Approximately 400 newly diagnosed patients per year are biomarker eligible for TECELRA, and an additional 600 for lete-cel in the U.S.[428]. - As of March 18, 2025, 20 ATCs are available for TECELRA treatment, with plans to have approximately 30 ATCs active by the end of 2025[431]. - The company anticipates filing an IND for ADP-5701 for a Phase 1 trial in head and neck cancer in 2025[434]. Financial Performance and Revenue - Total revenue increased by $117.8 million to $178.0 million for the year ended December 31, 2024, compared to $60.3 million in 2023, primarily due to the termination of the Genentech Collaboration Agreement and subsequent revenue recognition adjustments[483]. - Development revenue rose by 193% to $176.8 million in 2024 from $60.3 million in 2023, reflecting significant collaboration activities[482]. - The company recognized $101.3 million in cumulative catch-up revenue from the Genentech Collaboration Agreement in Q2 2024 and an additional $37.8 million in Q3 2024[483]. - The company incurred a net loss of $70.8 million in 2024, with total revenues of $178.0 million[511]. - The company has incurred losses since its inception in 2008 and expects to continue incurring losses for the foreseeable future[441]. Cost Management and Expenses - The company announced a 29% reduction in headcount and a 25% reduction in total operating expenses compared to 2024[430]. - Research and development expenses increased by 18% to $149.1 million in 2024 from $126.5 million in 2023, driven by ongoing clinical trials and development activities[482]. - Selling, general and administrative expenses rose by 19% to $87.3 million in 2024 compared to $73.5 million in 2023, reflecting increased operational costs[482]. - The operating loss improved by 51% to $68.8 million in 2024 from $139.7 million in 2023, indicating better financial performance despite ongoing expenses[482]. - The company plans to implement additional cost reductions for its preclinical PRAME and CD70 programs[440]. Collaboration Agreements and Payments - The company received an upfront payment of $150 million from Genentech in October 2021 as part of a collaboration agreement[445]. - The company received initial payments of $100 million under the Galapagos Collaboration Agreement, including $70 million upfront and $30 million for research and development funding[461]. - The company anticipates a significant increase in future revenues from milestone payments and royalties associated with the Galapagos Collaboration Agreement, with potential additional payments of up to $465 million[461]. Liquidity and Cash Flow - Total liquidity as of December 31, 2024, was $151.6 million, with cash and cash equivalents at $91.1 million[511]. - Net cash used in operating activities decreased to $73.2 million in 2024 from $140.9 million in 2023, driven by increased payments from collaboration agreements[517]. - Net cash provided by financing activities was $78.7 million in 2024, compared to $0.9 million in 2023, including proceeds from public offerings[529]. - Net cash used in investing activities was $59.0 million in 2024, a decrease from net cash provided of $176.5 million in 2023, due to lower cash received from the TCR2 acquisition[526]. Taxation and Deferred Tax Assets - Income tax expenses were $3.6 million for the year ended December 31, 2024, an increase of $2.2 million from $1.3 million in 2023 due to higher taxable profits in the U.S. subsidiary[494]. - Deferred tax assets amount to $313.1 million, offset by deferred tax liabilities of $3.6 million and a valuation allowance of $309.5 million as of December 31, 2024[561]. - The Company has maintained a full valuation allowance against the deferred tax asset of Adaptimmune LLC due to insufficient positive evidence of future taxable income[569]. Market and Economic Conditions - Inflation has increased operating expenses, but it has not materially affected the company's financial condition or results of operations for the year ended December 31, 2024[579]. - The company is exposed to interest rate fluctuations, but does not expect a one percentage point change in interest rates to materially affect the fair market value of its portfolio[573]. - The exchange rate as of December 31, 2024, was £1.00 to $1.25, exposing the company to foreign exchange rate risk[575]. - The company has not used forward exchange contracts or other currency hedging products to manage exchange rate exposure, although it may consider doing so in the future[575].

Financial Data and Key Metrics Changes - The company reported Q4 product revenue of $1.2 million from TECELRA, with expectations to invoice approximately six to eight patients in Q1 2025, significantly higher than the previous quarter [9][10][17] - The consensus analyst forecast for 2025 sales is approximately $25 million, which the company believes is achievable based on current performance metrics [17][30] Business Line Data and Key Metrics Changes - The launch of TECELRA has seen strong momentum, with 20 authorized treatment centers (ATCs) established, ahead of the planned 30 by the end of 2025 [6][8] - The company has a pipeline of around 20 biomarker-positive patients expected to be treated in Q2 and Q3 2025, with over 80 patients having completed MAGE-A4 testing [11][12] Market Data and Key Metrics Changes - Over 70% of commercial and Medicare lives have established reimbursement policies for TECELRA, with no denials reported to date [12] - The company anticipates that Lete-cel will expand the sarcoma franchise, potentially doubling the number of treatable patients annually in the US [25] Company Strategy and Development Direction - The company aims to achieve cash flow breakeven by 2027, with a focus on building a successful business around two FDA-approved products in sarcoma [26][30] - The company is exploring strategic options, including partnerships and collaborations, to optimize shareholder value and ensure financial stability [28][56] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the accelerating sales of TECELRA and the anticipated launch of Lete-cel, which is expected to leverage existing commercial infrastructure [17][30] - The company is focused on managing costs effectively while pushing towards profitability in 2027, with a commitment to exploring all financial opportunities [30][56] Other Important Information - The company has paused spending on preclinical programs targeting PRAME and CD70, which is expected to reduce cash flow demands by approximately $75 million to $100 million through 2028 [27][68] - The company is part of the PRIME scheme in Europe for TECELRA and plans to submit a marketing application based on comprehensive trial results [80] Q&A Session Summary Question: Can you comment on the pace of apheresis during Q1? - The pace of apheresis has been increasing, with more patients being treated as additional ATCs come online [35] Question: What are the assumptions for profitability in 2027? - The company has not provided specific revenue guidance but expects to achieve profitability through the combination of TECELRA and Lete-cel sales [36][50] Question: What is the status of the ex-US strategy? - The primary focus remains on establishing a commercially viable business in the US, with discussions ongoing for potential partnerships in ex-US markets [66] Question: Can you provide insights on the financials for the quarter? - The company is finalizing its 10-K filing and expects to publish it soon, with anticipated cost reductions from restructuring [68] Question: Are there any capacity constraints affecting patient infusions? - There are currently no capacity limitations reported, and the company is confident in meeting its goals [111][112]