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Adaptimmune(ADAP) - 2024 Q4 - Annual Report
ADAPAdaptimmune(ADAP)2025-03-24 20:44
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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 400millionfromTECELRAandlete−cel[428].−Approximately400newlydiagnosedpatientsperyeararebiomarkereligibleforTECELRA,andanadditional600forlete−celintheU.S.[428].−AsofMarch18,2025,20ATCsareavailableforTECELRAtreatment,withplanstohaveapproximately30ATCsactivebytheendof2025[431].−ThecompanyanticipatesfilinganINDforADP−5701foraPhase1trialinheadandneckcancerin2025[434].FinancialPerformanceandRevenue−Totalrevenueincreasedby400 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 178.0millionfortheyearendedDecember31,2024,comparedto178.0 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 176.8millionin2024from176.8 million in 2024 from 60.3 million in 2023, reflecting significant collaboration activities[482]. - The company recognized 101.3millionincumulativecatch−uprevenuefromtheGenentechCollaborationAgreementinQ22024andanadditional101.3 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 70.8millionin2024,withtotalrevenuesof70.8 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 149.1millionin2024from149.1 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 87.3millionin2024comparedto87.3 million in 2024 compared to 73.5 million in 2023, reflecting increased operational costs[482]. - The operating loss improved by 51% to 68.8millionin2024from68.8 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 150millionfromGenentechinOctober2021aspartofacollaborationagreement[445].−Thecompanyreceivedinitialpaymentsof150 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 70millionupfrontand70 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 465million[461].LiquidityandCashFlow−TotalliquidityasofDecember31,2024,was465 million[461]. Liquidity and Cash Flow - Total liquidity as of December 31, 2024, was 151.6 million, with cash and cash equivalents at 91.1million[511].−Netcashusedinoperatingactivitiesdecreasedto91.1 million[511]. - Net cash used in operating activities decreased to 73.2 million in 2024 from 140.9millionin2023,drivenbyincreasedpaymentsfromcollaborationagreements[517].−Netcashprovidedbyfinancingactivitieswas140.9 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 0.9millionin2023,includingproceedsfrompublicofferings[529].−Netcashusedininvestingactivitieswas0.9 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 176.5millionin2023,duetolowercashreceivedfromtheTCR2acquisition[526].TaxationandDeferredTaxAssets−Incometaxexpenseswere176.5 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 2.2millionfrom2.2 million from 1.3 million in 2023 due to higher taxable profits in the U.S. subsidiary[494]. - Deferred tax assets amount to 313.1million,offsetbydeferredtaxliabilitiesof313.1 million, offset by deferred tax liabilities of 3.6 million and a valuation allowance of 309.5millionasofDecember31,2024[561].−TheCompanyhasmaintainedafullvaluationallowanceagainstthedeferredtaxassetofAdaptimmuneLLCduetoinsufficientpositiveevidenceoffuturetaxableincome[569].MarketandEconomicConditions−Inflationhasincreasedoperatingexpenses,butithasnotmateriallyaffectedthecompany′sfinancialconditionorresultsofoperationsfortheyearendedDecember31,2024[579].−Thecompanyisexposedtointerestratefluctuations,butdoesnotexpectaonepercentagepointchangeininterestratestomateriallyaffectthefairmarketvalueofitsportfolio[573].−TheexchangerateasofDecember31,2024,was£1.00to309.5 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].