IMCR Immunocore Holdings PLC

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

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FORM 6-K

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REPORT OF FOREIGN PRIVATE ISSUER PURSUANT TO RULE 13a-16 OR 15d-16

UNDER THE SECURITIES EXCHANGE ACT OF 1934

For the Month of November 2023

Commission File Number: 001-39992

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Immunocore Holdings plc

(Translation of registrant’s name into English)

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92 Park Drive

Milton Park

Abingdon, Oxfordshire OX14 4RY

United Kingdom

(Address of principal executive office)

Indicate by check mark whether the registrant files or will file annual reports under cover of Form 20-F or Form 40-F:

☒  Form 20-F    ☐  Form 40-F

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INCORPORATION BY REFERENCE

 

Exhibits 99.1 and 99.2 to this Report on Form 6-K (the “Report”) shall be deemed to be incorporated by reference into the registration statement on Form S-8 (File Nos. 333-255182, 333-265000 and 333-271164) and the registration statement on Form F-3ASR (File No. 333-264105) of Immunocore Holdings plc (the “Company”) and to be a part thereof from the date on which this Report is furnished, to the extent not superseded by documents or reports subsequently filed or furnished.

 

Exhibit 99.3 to this Report is being furnished and shall not be deemed “filed” for purposes of Section 18 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), or otherwise subject to the liabilities of that section, nor shall it be deemed incorporated by reference in any filing under the Securities Act of 1933, as amended, or the Exchange Act.

 

CAUTIONARY NOTE ON FORWARD-LOOKING STATEMENTS

 

This Report contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Words such as “may”, “will”, “expect”, “plan”, “anticipate”, “estimate”, “believe”, “intend” and similar expressions (as well as other words or expressions referencing future events, conditions or circumstances) are intended to identify forward-looking statements. These forward-looking statements are based on the Company’s expectations and assumptions as of the date of this Report. Each of these forward-looking statements involves risks and uncertainties. Actual results may differ materially from those expressed or implied by these forward-looking statements. For a discussion of risks and other factors that may cause the Company’s actual results to differ from those expressed or implied in the forward-looking statements in this Report, you should refer to the Company’s filings with the U.S. Securities and Exchange Commission, including the “Risk Factors” and “Management’s Discussion and Analysis of Financial Condition and Results of Operations” sections contained therein. Except as required by law, the Company undertakes no obligation to publicly update any forward-looking statements, whether as a result of new information, future events or otherwise, except as required by law. You should, therefore, not rely on these forward-looking statements as representing the Company’s views as of any date subsequent to the date of this Report.

 

EXHIBIT INDEX

 

 

SIGNATURES

 

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

 

 

Exhibit 99.1

Immunocore Holdings plc

Unaudited Condensed Consolidated Interim Financial Statements

Unaudited Condensed Consolidated Statements of Profit / (Loss) and Comprehensive (Loss) / Income

The accompanying notes form part of these unaudited condensed consolidated interim financial statements.

Immunocore Holdings plc

Unaudited Condensed Consolidated Interim Financial Statements

Unaudited Condensed Consolidated Statements of Financial Position as at

 

The accompanying notes form part of these unaudited condensed consolidated interim financial statements.

Immunocore Holdings plc

Unaudited Condensed Consolidated Interim Financial Statements

Unaudited Condensed Consolidated Statements of Changes in Equity

 

The accompanying notes form part of these unaudited condensed consolidated interim financial statements.

Immunocore Holdings plc

Unaudited Condensed Consolidated Interim Financial Statements

Unaudited Condensed Consolidated Statements of Cash Flows

The accompanying notes form part of these unaudited condensed consolidated interim financial statements.

Immunocore Holdings plc

Unaudited Condensed Consolidated Interim Financial Statements

Notes to the Financial Statements

1. Organization and nature of business

General information

Immunocore Holdings plc (the “Company”) is a public limited company incorporated in England and Wales and has the following wholly owned subsidiaries: Immunocore Limited, Immunocore LLC, Immunocore Commercial LLC, Immunocore Ireland Limited, Immunocore GmbH, and Immunocore Nominees Limited (collectively referred to as the “Group”).

The Company’s American Depositary Shares (“ADSs”) began trading on the Nasdaq Global Select Market under the ticker symbol “IMCR” on February 5, 2021, following its initial public offering (“IPO”). The IPO and concurrent private placement generated net proceeds of £210,985,000 ($286,887,000) after underwriting discounts, commissions and directly attributable offering expenses. In July 2022, the Company raised net proceeds of £116,424,000 ($139,515,000) through the sale of its ordinary shares in the form of ADSs and non-voting ordinary shares in a private placement.

The principal activity of the Group is pioneering the development and sale of a novel class of TCR bispecific immunotherapies called ImmTAX – Immune mobilizing monoclonal TCRs Against X disease – designed to treat a broad range of diseases, including cancer, infectious and autoimmune diseases. Leveraging its proprietary, flexible, off-the-shelf ImmTAX platform, the Group is developing a deep pipeline in multiple therapeutic areas, including four clinical stage programs in oncology and infectious disease, advanced pre-clinical programs in autoimmune disease and multiple earlier pre-clinical programs.

In 2022, the Group received approval for its lead product, KIMMTRAK, for the treatment of unresectable metastatic uveal melanoma from the U.S. Food and Drug Administration the European Commission and other health authorities. KIMMTRAK is now approved in over 35 countries and the Group has commercially launched in the United States, Germany and France, among other territories, with further commercial launches underway in additional territories where it has received approval.

2. Significant accounting policies

Basis of preparation and statement of compliance

The unaudited condensed consolidated interim financial statements (“interim financial statements”) as at and for the three and nine months ended September 30, 2023 and 2022 have been prepared in accordance with International Accounting Standard 34, “Interim Financial Reporting” (“IAS 34”). The accounting policies, including the Group’s Critical accounting estimates, applied in these interim financial statements are the same as those applied in the Group’s consolidated financial statements as at and for the year ended December 31, 2022.

The unaudited condensed consolidated interim financial statements do not include all of the information required for the full annual financial statements and should be read in conjunction with the annual consolidated financial statements of the Group for the year ended December 31, 2022 included in the Company’s Annual Report on Form 20-F, filed with the Securities and Exchange Commission on March 1, 2023 (the “Annual Report”).

The unaudited condensed consolidated interim financial statements have been prepared under the historical cost basis, as modified by the recognition of certain financial instruments measured at fair value and are presented in pounds sterling which is the Company’s functional currency. All values are rounded to the nearest thousand, except where otherwise indicated.

Date of authorization

These unaudited condensed consolidated interim financial statements were approved by the Board of Directors (the “Board”) on November 7, 2023, and signed on its behalf by Dr. Bahija Jallal, Chief Executive Officer.

Adoption of new accounting standards

There have been no new accounting standards adopted by the Group in the three and nine months ended September 30, 2023 which have had a material impact on these unaudited condensed consolidated interim financial statements. There are no standards issued but not yet effective that the Group expects to have a material impact on its financial statements.

Going concern

The Group reported cash and cash equivalents of £363,955,000 and net current assets of £318,084,000 at September 30, 2023, with an operating loss for the three and nine months ended September 30, 2023 of £699,000 and £33,859,000 respectively, and net cash from operating activities for the nine months ended September 30, 2023 of £11,519,000. The positive operational cash inflow was largely due to R&D tax credits received, and generated net product revenue of £49,719,000 and £137,285,000 for the three and nine months ended September 30, 2023, respectively.

In assessing the going concern assumptions, management has undertaken an assessment of the current business and strategy forecasts covering a twelve month period, which includes anticipated KIMMTRAK revenue. In assessing the downside risks, the Board has also considered scenarios incorporating a range of revenue arising from KIMMTRAK sales. As part of considering the downside risks, the Board has considered the impact of the current macroeconomic environment, such as the effects of pandemics or epidemics and other potential economic impacts including the war in Ukraine and the conflict between Hamas and Israel, and related geopolitical tensions, as well as global inflation, liquidity concerns at banks and financial institutions, capital market instability, interest and exchange rate fluctuations, and increases in commodity, energy and fuel prices as well as supply chain disruptions. The Board has concluded that while these may have a future impact on the Group’s business and implementation of its strategy and plans, it anticipates that any such impact will be minimal on clinical trials or other business activities over the period assessed for going concern purposes. As of the date of these financial statements, the Group is not aware of any specific event or circumstance that would require the Group to update its estimates, assumptions and judgments or revise the carrying value of its assets or liabilities. Actual results could differ from these estimates, and any such differences may be material to the Group’s financial statements.

Given the current cash position and the assessment performed, the Board believes that the Group will have sufficient funds to continue to meet its liabilities as they fall due for a period of at least twelve months from the date of issue of these unaudited condensed consolidated interim financial statements and therefore, the Group has prepared the financial statements on a going concern basis. This scenario is based on the Group’s lower range of anticipated revenue levels. As the Group continues to incur significant expenses in the pursuit of its business strategy, including further commercialization and marketing plans for KIMMTRAK, additional funding will be needed before further existing clinical and preclinical programs may be expected to reach commercialization, which would potentially lead to additional operational cash inflows. Until the Group can generate revenue from product sales sufficient to fund its ongoing operations and further develop its pipeline, if ever, it expects to finance its operations through a combination of public or private equity offerings and debt financings or other sources, such as potential collaboration agreements, strategic alliances and licensing arrangements.

Estimates and judgments

The preparation of the unaudited condensed consolidated interim financial statements in conformity with IAS 34 requires management to make judgments, estimates and assumptions. These judgments, estimates and assumptions affect the reported assets and liabilities as well as contingent liabilities and income and expenses in the financial period. The estimates and associated assumptions are based on information available when the unaudited condensed consolidated interim financial statements are prepared, historical experience and various other factors which are believed to be reasonable under the circumstances the results of which form the basis of making judgments about the carrying values of assets and liabilities that are not readily apparent from other sources. Existing circumstances and assumptions about future developments, however, may change due to market changes or circumstances arising that are beyond the Group’s control. Hence, estimates may vary from the actual values. The estimates and underlying assumptions are reviewed on an ongoing basis. Revisions to accounting estimates are recognized in the period in which the estimate is revised if the revision affects only that period or the period of revision and future periods if this revision affects both current and future periods.

Judgments and estimates made, including Critical accounting estimates, together with the Group’s significant accounting policies, are disclosed in the consolidated financial statements of the Group for the year ended December 31, 2022, and are presented in the Group’s Annual Report. There have been no significant updates to the Group’s estimates and accounting policies for the three and nine months ended September 30, 2023.

Segmental reporting

The Group operates in one operating segment. The Group’s chief operating decision maker, its Chief Executive Officer, manages the Group’s operations on an integrated basis for the purposes of allocating resources.

3. Revenue

Revenue is presented by type, and net of deductions in the table below.

Eli Lilly and Genentech are based in the United States. Net product revenue from the sale of KIMMTRAK, and net pre-product revenue from the sale of tebentafusp as part of a compassionate use and early access program are presented by region based on the location of the customer below.

Product revenue, net

During the three and nine months ended September 30, 2023, the Group recognized £49,719,000 and £137,285,000 of net product revenue, respectively, relating to the sale of KIMMTRAK primarily in the United States and Europe following marketing approvals in 2022 and subsequent commercial launches. Revenue is presented after estimated deductions for rebates, chargebacks, other customer fees and returns.

Pre-product revenue, net

There was no pre-product revenue during the three and nine months ended September 30, 2023, following the transition to the commercial sale of KIMMTRAK in France in the second half of 2022. In the three and nine months ended September 30, 2022, the Group recognized £3,051,000 and £9,588,000 of net pre-product revenue, respectively, relating to the sale of tebentafusp under a compassionate use and early access program in France after estimated deductions for rebates and returns.

Genentech Collaboration

During the three and nine months ended September 30, 2023, the Group recognized £1,769,000 and £6,508,000 of revenue, respectively, relating to the 2018 Genentech agreement and IMC-C103C (for the three and nine months ended September 30, 2022: £4,896,000 and £13,800,000).

In February 2023, Genentech accepted our proposal to cease co-funding the development of MAGE-A4 HLA-A02 targeted programs, except for our equal share of the wind-down costs of the IMC-C103C Phase 1 clinical trial.

Eli Lilly Collaboration

During the three and nine months ended September 30, 2023, the Group recognized no revenue relating to the Eli Lilly Collaboration (for the three and nine months ended September 30, 2022: £nil and £7,361,000, respectively).

The Group released the remaining deferred revenue attributed to the third target under the Eli Lilly Collaboration after the parties agreed to terminate the agreement with Eli Lilly during the three months ended March 31, 2022.

Deferred revenue

Of the total revenue recognized during the three and nine months ended September 30, 2023, £1,602,000 and £4,806,000, respectively, was included in deferred revenue at January 1, 2023. No collaboration revenue was recognized in the three and nine months ended September 30, 2023 relating to performance obligations satisfied in previous years (for the three and nine months ended September 30, 2022: £nil). The remaining current deferred revenue as at September 30, 2023 relates to the Genentech agreement. The Group expects to recognize this remaining revenue within the next year.

Non-current deferred revenue in the unaudited condensed consolidated interim statement of financial position as at September 30, 2023 and December 31, 2022, respectively, relates to the Group’s non-refundable payment of £4,331,000 received from Medison Pharma Ltd (“Medison”) in the year ended December 31, 2022. The Group expects to recognize revenue for this combined performance obligation of supplying KIMMTRAK and granting Medison the exclusive right to distribute KIMMTRAK in South America with the sale of products following regulatory approval in South America. The Group estimates that Product revenue recognition of this Non-current deferred revenue will commence later than September 30, 2024.

4. Selling and administrative expenses

There were £9,298,000 of foreign exchange gains and £108,000 of foreign exchange losses, which the Group classifies within Selling and administrative expenses, for the three and nine months ended September 30, 2023, respectively, compared to gains of £15,184,000 and £24,343,000 in the three and nine months ended September 30, 2022, respectively. These gains and losses arise on a number of foreign currency items, including the translation of monetary foreign currency balances in the Group’s main operating subsidiary in the United Kingdom.

5. Finance income

Finance income increased in the three and nine months ended September 30, 2023 due to higher interest rates and higher levels of cash and cash equivalents held by the Group in the three and nine months ended September 30, 2023 compared to the three and nine months ended September 30, 2022.

6. Income tax

Income tax credit/ (charge) is recognized at an amount determined by multiplying the profit / (loss) before taxation for the interim reporting period by the Group’s best estimate of the weighted-average annual income tax rate expected for the full financial year, adjusted for the tax effect of certain items recognized in full in the interim period. As such, the effective tax rate in the interim financial statements may differ from the Group’s estimate of the effective tax rate for the annual financial statements.

The Group’s consolidated estimated effective tax credit rate for the three months ended September 30, 2023 and effective tax rate for the nine months ended September 30, 2023 was 8.2% and 0.8% (tax credit rate for the three and nine months ended September 30, 2022: 25.0% and 24.0%). During the three and nine months ended September 30, 2023, the Company recorded a tax credit of £144,000 and a tax charge of £243,000, respectively, compared to tax credits for the three and nine months ended September 30, 2022 of £1,244,000 and £5,050,000. Historically, the Group satisfied the definition of a Small and Medium-sized Enterprise (“SME”), and was able to surrender some of its U.K. tax losses for a cash rebate of up to 33.35% of expenditures related to eligible research and development projects. The Group exceeded the size limit thresholds and no longer qualifies for tax relief under the U.K. SME research and development regime in 2023. The Group will continue to benefit from the U.K. large company, Research & Development Expenditure Credit (“RDEC”) regime which can generate a cash rebate of up to 10.53% of qualifying research and development expenditures incurred prior to 1 April 2023 and 15% for expenditure incurred after this date. The Group records tax credits receivable under the SME research and development tax credit regime within income tax credit / (charge). Tax credits receivable under the large company RDEC regime are recorded ‘above the line’ as a reduction from research and development expenses.

A deferred tax asset of £4,135,000 has been recognized as of September 30, 2023 (December 31, 2022: £4,240,000) primarily representing unused tax credits carried forward for one of the Group’s U.S. subsidiaries, Immunocore LLC, following an annual assessment, or periodically as required, of all available and applicable information, including its forecasts of costs and future profitability and the resulting ability to reverse the recognized deferred tax assets over a short period of time.

During the nine months ended September 30, 2023, the Group received U.K. tax credits of £12,566,000 relating to research and development expenditure in the year ended December 31, 2021 and 2022 (for the nine months ended September 30, 2022, no tax credits were received). During the nine months ended September 30, 2023, the Group made tax payments of £180,000 in relation to estimated U.S. corporate income taxes for 2023.

7. Basic and diluted earnings / (loss) per share

 

Basic and diluted earnings / (loss) per share is calculated by dividing the profit or loss for the period attributable to the equity holders of the Group by the weighted average number of ordinary shares outstanding during the period, including ordinary shares represented by ADSs. For the nine months ended September 30, 2023 and 2022, the dilutive effect of potential shares through equity settled transactions is considered to be anti-dilutive as they would decrease the loss per share and are, therefore, excluded from the calculation of diluted loss per share. For the three months ended September 30, 2023 and 2022, there were 902,650 and 88,695, respectively, ordinary shares issuable upon the exercise of options granted under the Group’s option plans excluded from the calculation for diluted earnings per share, because they are considered to be anti-dilutive.

8. Property, plant and equipment

During the three and nine months ended September 30, 2023, the Group acquired assets at a cost of £787,000 and £4,025,000, respectively, relating primarily to laboratory equipment.

9. Trade and other receivables

Included within prepayments and accrued income are amounts paid in advance for clinical trials that are expected to be received in services or repaid within twelve months.

10. Share capital

11. Share-based payments

During the three and nine months ended September 30, 2023 the total charge for share-based payments was £6,719,000 and £20,370,000 respectively (for the three and nine months ended September 30, 2022, £6,093,000 and £20,181,000, respectively).

The Group granted 27,360 and 2,100 options to purchase ordinary shares under the Group’s 2021 Equity Incentive Plan in the three months ended September 30, 2023 and 2022 respectively, and 769,465 and 1,365,753 options in the nine months ended September 30, 2023 and 2022, respectively. The options in both periods were valued using the Black-Scholes model, with the majority vesting over a four-year period from the date of grant, and with 25% of the award vesting at the end of the first year and the remaining award vesting quarterly over the following three years. The weighted average fair value and exercise prices of options granted is set out below.

12. Trade and other payables

Accruals as at September 30, 2023 include estimates for rebates, chargebacks, other customer fees and returns of £46,515,000 in respect of Product revenue from the sale of KIMMTRAK and Pre-product revenue from the sale of tebentafusp, compared to £24,066,000 as at December 31, 2022. Combined with the Non-current accruals in the unaudited condensed consolidated interim statement of financial position, the Group’s total accruals for such deductions from revenue were £49,046,000 as at September 30, 2023, and £25,545,000 as at December 31, 2022. The increase in these accruals reflects revenue growth in major markets and ongoing sales in Europe prior to the completion of pricing negotiations and settlement of rebates payable.

13. Events after the reporting period

In October 2023, the Group entered into a lease agreement for approximately 19,000 square feet of additional office space in Maryland, United States. Under this agreement, the Group is required to make lease payments until 2035. The lease contains early termination and extension options.

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Exhibit 99.2

MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

You should read the following discussion and analysis of our financial condition and results of operations together with our unaudited condensed consolidated interim financial statements and the related notes to those statements included as Exhibit 99.1 to this Report on Form 6-K, or this Report, submitted to the Securities and Exchange Commission, or the SEC, on November 7, 2023.  We also recommend that you read our discussion and analysis of financial condition and results of operations together with our audited financial statements and notes thereto, and the section entitled “Risk Factors”, each of which appear in our Annual Report on Form 20-F for the year ended December 31, 2022 filed with the SEC on March 1, 2023, or our Annual Report.

We present our unaudited condensed consolidated interim financial statements in accordance with International Accounting Standard 34, “Interim Financial Reporting” or IAS 34, which may differ in material respects from generally accepted accounting principles in other jurisdictions, including generally accepted accounting principles in the United States, or U.S. GAAP.

We maintain our books and records in pounds sterling. For the convenience of the reader, we have translated pound sterling amounts as of and for the period ended September 30, 2023 into U.S. dollars at a rate of £1.00 to $1.2214. These translations should not be considered representations that any such amounts have been, could have been or could be converted into U.S. dollars at that or any other exchange rate as of that or any other date.

Unless otherwise indicated or the context otherwise requires, all references to “Immunocore,” the “Company,” “we,” “our,” “us” or similar terms refer to Immunocore Holdings plc and its consolidated subsidiaries.

The statements in this discussion regarding industry outlook, our expectations regarding our future performance, liquidity and capital resources and other non-historical statements are forward-looking statements. Forward-looking statements are based on the Company’s expectations and assumptions as of the date of this Report, and involve known and unknown risks, uncertainties and other factors that may cause our actual results, performance or achievements to be materially different from any future results, performance or achievements expressed or implied by the forward-looking statements. These risks and uncertainties include, but are not limited to, the risks and uncertainties set forth in the “Risk Factors” section of our Annual Report and any subsequent reports that we file with the SEC. Except as required by law, the Company undertakes no obligation to publicly update any forward-looking statements, whether as a result of new information, future events or otherwise, except as required by law. You should, therefore, not rely on these forward-looking statements as representing the Company’s views as of any date subsequent to the date of this Report.

Overview

We are a commercial stage biotechnology company pioneering the development of a novel class of TCR bispecific immunotherapies called ImmTAX – Immune mobilizing monoclonal TCRs Against X disease – designed to treat a broad range of diseases, including cancer, infectious and autoimmune diseases. Leveraging our proprietary, flexible, off-the-shelf ImmTAX platform, we are developing a deep pipeline in multiple therapeutic areas, including four clinical stage programs in oncology and infectious disease, advanced pre-clinical programs in autoimmune disease and multiple earlier pre-clinical programs.

In 2022, we received approval for our lead product, KIMMTRAK, for the treatment of unresectable metastatic uveal melanoma, or mUM, from the U.S. Food and Drug Administration, or FDA,, the European Commission, or EC, and other health authorities. KIMMTRAK is the lead product from our ImmTAX platform and is the first new therapy in uveal melanoma in four decades. To date, we have dosed over 1,000 cancer patients with KIMMTRAK, tebentafusp, and our other ImmTAX product candidates, which we believe is the largest clinical data set of any bispecific in a solid tumor and any TCR therapeutic. Our other clinical programs are being conducted with patients with a broad range of cancers including lung, bladder, gastric, head and neck and ovarian, among others. We believe that these other ImmTAX product candidates have the potential to address other tumor types with larger addressable patient populations and significant unmet need.

Our ImmTAC Platform (Oncology)

Our ImmTAV Platform (Infectious Diseases)

Significant Events in the Three Months Ended September 30, 2023

In August 2023, John Goll was appointed as our SVP, Finance and Chief Accounting Officer. Prior to joining us, John served as the Senior Vice President, Chief Accounting Officer at Insmed.

In the third quarter of 2023, we signed pricing agreements for KIMMTRAK (tebentafusp) with the Belgian and Canadian authorities.

Recent Developments since September 30, 2023

In October 2023, we published in the New England Journal of Medicine and presented at the ESMO 2023 Congress the long-term OS data from the KIMMTRAK (tebentafusp-tebn) Phase 3 trial in previously untreated HLA-A*02:01 positive patients with metastatic uveal melanoma. The longest of any randomized trial for metastatic uveal melanoma, the trial demonstrated a three-year OS rate of 27% in the tebentafusp arm, versus 18% in the control arm (investigator’s choice, predominantly [82%] single agent pembrolizumab).

In October 2023, Australia’s Pharmaceutical Benefits Advisory Committee recommended tebentafusp for the treatment of HLA-A*02:01 positive adult patients with advanced uveal melanoma.

Operating Results

Total net product revenue arising from the sale of KIMMTRAK was £49.7 million ($60.7 million) and £137.3 million ($167.7 million) in the three and nine months ended September 30, 2023, of which £34.5 million ($42.1 million) and £96.9 million ($118.3 million) was in the United States, £15.0 million ($18.3 million) and £39.5 million ($48.3 million) was in Europe, and £0.2 million ($0.3 million) and £0.9 million ($1.1 million) was in the rest of the world. For the three months and nine ended September 30, 2022, we recorded total net product and pre-product revenue of £36.3 million and £74.5 million, respectively.

For the three and nine months ended September 30, 2023, our research and development expenses were £31.7 million ($38.7 million) and £88.9 million ($108.6 million), respectively, as compared to £23.3 million and £62.0 million for the three and nine months ended September 30, 2022 respectively. For the three and nine months ended September 30, 2023, our selling and administrative expenses were £20.3 million ($24.8 million) and £87.5 million ($106.8 million), respectively, compared to £11.7 million and £50.6 million for the three and nine months ended September 30, 2022 respectively.

Basic and diluted profit per share for the three months ended September 30, 2023, was £0.04 (or $0.05 and $0.04, respectively) compared to a basic and diluted profit per share of £0.13 and £0.12 for the three months ended September 30, 2022. Basic and diluted loss per share for the nine months ended September 30, 2023, was £0.59 (or $0.72), compared to £0.36 for the nine months ended September 30, 2022.

Cash and cash equivalents were £364.0 million ($444.5 million) as of September 30, 2023, compared to £332.5 million as of December 31, 2022.

Components of Results of Operations

 

Revenue

Product revenue, Net

Product revenue, net, relates to the sale of KIMMTRAK following marketing approval. We recognize product revenue at the point in time that control transfers to a customer, which is typically on delivery to our distributors and healthcare providers. We also operate under consignment arrangements where control passes when our distributors take KIMMTRAK out of consignment inventory. The amount of revenue recognized reflects the consideration to which we expect to be entitled, net of estimated deductions for rebates, chargebacks, other customer fees and product returns. These estimates consider contractual and statutory requirements, the expected payer and patient mix, sell-through data, our customers’ inventory levels, anticipated demand and the volume of customer purchase orders, internal data, other information provided by our customers and third-party logistics providers, and, in certain countries, pricing negotiations.

Pre-Product Revenue, Net

Pre-product revenue, net, relates to the sale of tebentafusp under a compassionate use and an early access program. These programs provided patients with access to tebentafusp prior to KIMMTRAK becoming available as a marketed product in France. Pre-product revenue is recognized on delivery of tebentafusp to healthcare providers, which is the point in time when control is transferred. Such revenue is recognized net and represents the prices set by us that are expected to be retained after estimated deductions for product returns and government rebates, which are dependent on the outcome of French legislative processes and price negotiations. In September 2022, we began selling KIMMTRAK as a commercial product in France, and these sales are reflected in Product revenue, net.

Collaboration Revenue

Upfront payments and development milestones are initially recorded on our statement of financial position as deferred revenue and are subsequently recognized as revenue as the underlying programs progress through research and development using an estimate of the percentage completion of each program in accordance with our accounting policy.

Operating Expenses

Cost of Product Revenue

Cost of product revenue represents production costs including raw materials, external manufacturing costs, and other costs incurred in bringing inventories to their location and condition prior to sale. Overheads and internal costs of product revenue are minimal under our manufacturing arrangements. Due to the low costs involved in manufacturing KIMMTRAK, cost of product revenue is not material, and we do not expect such costs to be material for the foreseeable future.

Research and Development Expenses

Research and development expenses consist primarily of costs incurred for current or planned investigations undertaken with the prospect of gaining new scientific or technical knowledge and understanding and consist primarily of personnel-related costs, including salaries and share-based compensation expense, for the various research and development departments, costs associated with clinical trial activities undertaken by contract research organizations, or CROs, and external manufacturing costs related to research and development undertaken by contract manufacturing organizations, or CMOs, research and development laboratory consumables, internal clinical trial expenses, costs associated with maintaining laboratory equipment, and reductions from expenses for amounts under the U.K.’s Research & Development Expenditure Credit, or RDEC, scheme. All research and development expenses are expensed as incurred due to scientific uncertainty. Those research and development expenses incurred with external organizations to undertake research and development activities on our behalf typically relate to clinical programs and are assigned to the individual programs; however, for certain pre-clinical programs and other research spend incurred externally, such spend is not assigned to individual programs. Internal research and development expenses primarily relate to personnel-related costs and research and development laboratory consumables and due to the cross functional expertise of our people it is not possible to provide a breakdown of internal costs by program.

We expect our research and development expenses to increase in the future as we advance existing and future product candidates into and through clinical studies and pursue further regulatory approval. The process of conducting the necessary clinical studies to obtain regulatory approval is costly and time-consuming. We maintain our headcount at a level required to support our continued research activities and development of our product candidates. Clinical trials generally become larger and more costly to conduct as they advance into later stages. We cannot determine with certainty the timing of initiation, the duration or the completion costs of current or future preclinical studies and clinical trials of our product candidates due to the inherently unpredictable nature of preclinical and clinical development. Clinical and preclinical development timelines, the probability of success and development costs can differ materially from expectations. At this time, we cannot reasonably estimate or know the nature, timing and estimated costs of the efforts that will be necessary to complete the development of any product candidates that we develop from our programs. As a result, our research and development expenses may vary substantially from period to period based on the timing of our research and development activities. Several of our research and development programs are at an early stage. We must demonstrate the safety and efficacy of our product candidates in humans through extensive clinical testing. We may experience numerous unforeseen events during, or as a result of, the testing process that could delay or prevent commercialization of our products, including but not limited to the following:

Any changes in the outcome of any of these variables with respect to the development of our product candidates in preclinical and clinical development could mean a significant change in the costs and timing associated with the development of these product candidates. We may obtain unexpected results from our clinical trials. We may elect to discontinue, delay or modify clinical trials of some product candidates or focus on other product candidates. For example, if the FDA, EMA or another regulatory authority were to delay our planned start of clinical trials or require us to conduct clinical trials or other testing beyond those that we currently expect or if we experience significant delays in enrollment in any of our planned clinical trials, we could be required to expend significant additional financial resources and time on the completion of clinical development of that product candidate.

Selling and Administrative Expenses

Selling and administrative expenses consist primarily of personnel-related costs, including salaries and share-based compensation expense, for selling, corporate and other administrative and operational functions including finance, legal, human resources, commercial expenses, information technology, as well as facility-related costs and foreign currency movements.

Following our commercialization of KIMMTRAK and our substantial increase in planned research and development expenses, as explained above, we also expect that our selling and administrative expenses will increase. We expect that we will incur increased selling, distribution, commercial, accounting, audit, legal, regulatory, compliance, director, and officer insurance costs as well as investor and public relations expenses associated with being a public company operating in multiple territories. Additionally, if and as we receive further regulatory approvals of product candidates, we anticipate an increase in payroll and expenses in connection with our commercial operations. We have experienced, and may continue to experience, increased personnel costs attributable to offering and maintaining competitive salaries due to heightened global inflation. We anticipate that we will continue to experience these and other increased costs attributable to inflation, and may also experience increased selling and administrative costs as a result of further volatility in the impact of foreign exchange differences.

Finance Income

Finance income arises from interest income on cash and cash equivalents and short-term deposits.

Finance Costs

Finance costs consist of interest expenses related to our loan and lease liabilities.

Income Tax Credit / (Charge)

We are subject to corporate taxation in the United Kingdom, United States, Ireland and Switzerland. Due to the nature of our business, on a consolidated basis, we have generated losses in most periods since inception. Our income tax charge represents income tax payable in the United States, Ireland and Switzerland.

As a company that carries out extensive research and development activities, we benefit from the U.K. research and development tax regime. Historically, we satisfied the definition of a Small and Medium-sized Enterprise, or SME, and were able to surrender some of our U.K. tax losses for a cash rebate of up to 33.35% of expenditures related to eligible research and development projects. We exceeded the size limit thresholds and no longer qualify for tax relief under the U.K. SME research and development regime in 2023. We will continue to benefit from the U.K.’s RDEC regime which can generate a cash rebate of up to 10.53% of qualifying research and development expenditures incurred prior to 1 April 2023 and 15% for expenditure incurred after this date.

We record tax credits receivable under the SME research and development tax credit regime within Income tax (charge) / credit. Tax credits receivable under the large company RDEC regime are recorded ‘above the line’ as a reduction from Research and development expenses. Whilst we expect to continue to receive cash credits under the RDEC regime, we have moved from an overall tax credit position to recording a tax charge because no SME research and development tax credits have been generated and recorded within Income tax (charge) / credit since the start of 2023. Historically, SME research and development tax credits comprised the majority of our income tax credits.

Qualifying expenditures largely comprise clinical trial costs, employment costs for relevant staff and consumables incurred as part of research and development projects. A large portion of costs relating to our research and development and clinical trial activities are eligible for inclusion within these tax credit cash credit claims.

Amendments to the U.K. R&D tax credit regime have recently been enacted, proposed or are under consultation. These amendments (amongst other things) (i) will reduce the cash rebate that may be claimed under the SME Program to 18.6% of qualifying expenditure, and (ii) increase the cash rebate that can be claimed under the RDEC regime to 15% of qualifying expenditure.  These amendments took effect from 1 April 2023. In addition, the U.K. government has recently launched a consultation on its proposal to merge the SME Program and the RDEC Program into a single scheme with effect from April 2024 and may (unless limited exceptions apply) introduce restrictions on the tax relief that can be claimed for expenditure incurred on sub-contracted R&D activities or externally provided workers, where such sub-contracted activities are not carried out in the U.K. or such workers are not subject to U.K. payroll taxes. If such a proposal is implemented, it may be the case that different (and potentially lower) caps are imposed on the amount of tax relief or credits that we can claim. These and other potential future changes to the U.K. R&D tax relief programs may have a material impact on the extent to which we can benefit from U.K. research and development tax relief.

Un-surrendered U.K. tax losses are carried forward indefinitely to be offset against future taxable profits, subject to any relevant utilization criteria and restrictions (including the U.K. Corporate Loss Restriction rules which, broadly restrict the amount of carried forward losses that can be utilized to 50% of U.K. tax profits above £5 million per year). After accounting for tax credits receivable, there were accumulated tax losses for carry forward in the United Kingdom of £241 million as of December 31, 2022. No deferred tax asset is recognized in respect of accumulated tax losses in the United Kingdom because future profits are not sufficiently certain. A deferred tax asset is recognized primarily in respect of unused tax credits carried forward for one of the Group’s U.S. subsidiaries, Immunocore LLC.

As we continue to generate significant net product revenue, we may benefit from the U.K.’s. “patent box”, which allows profits attributable to revenues from patents or patented products to be taxed at a lower rate than other revenue. The rate of tax for relevant streams of qualifying revenue for companies receiving this relief will be 10%, where applicable.

Results of Operations

Comparison of the Three Months Ended September 30, 2023 and 2022

The following table summarizes our unaudited condensed consolidated statement of profit for each period presented:

 

Revenue

Product and pre-product revenue, net

Net product revenue from the sale of KIMMTRAK, and net pre-product revenue from the sale of tebentafusp as part of an early access program, are presented by region based on the location of the customer below.

For the three months ended September 30, 2023, we generated net product revenue of £49.7 million ($60.7 million) from the sale of KIMMTRAK, of which £34.5 million ($42.1 million) was in the United States, £15.0 million ($18.3 million) in Europe and £0.2 million ($0.3 million) in the rest of the world. Revenue in the United States and Europe increased in the three months ended September 30, 2023 due to continued execution of our sales strategy following commercial launch. There was an adjustment to our estimates following pricing agreement in Germany, which also contributed to the increase in European revenue in the three months ended September 30, 2023. There was no pre-product revenue in the three months ended September 30, 2023 following the transition to the commercial sale of KIMMTRAK in France in the second half of 2022. Total product and pre-product revenue of £36.3 million was lower in the three months ended September 30, 2022, as we continued to implement commercial launches in multiple territories following marketing approvals.

Collaboration revenue

Revenue from collaboration agreements decreased by £3.1 million to £1.8 million in the three months ended September 30, 2023, compared to £4.9 million for the three months ended September 30, 2022, following agreement with Genentech in February 2023 to wind down the Phase 1 clinical trial under the Genentech Collaboration.

Research and Development Expenses

For the three months ended September 30, 2023, our research and development expenses were £31.7 million, compared to £23.3 million for the three months ended September 30, 2022. This increase of £8.4 million was due to an increase in external research and development expenses of £6.7 million, and an increase in internal research and development expenses of £1.6 million.

The increase in our external research and development expenses of £6.7 million was primarily due to an additional £9.7 million in expenses associated with our PRAME program as we seek to advance our IMC-F106C product candidate through clinical trials and further develop our other PRAME candidates. Expenses associated with our other pre-IND programs also increased by £0.5 million in the three months ended September 30, 2023, whereas costs associated with our IMC-C103C and tebentafusp programs decreased by £3.4 million. The increase in our internal research and development expenses was largely attributable to higher employee costs as the number of staff engaged in research and development activities increased.

Selling and Administrative Expenses

For the three months ended September 30, 2023, our selling and administrative expenses were £20.3 million, compared to £11.7 million for the three months ended September 30, 2022, reflecting an increase of £8.6 million.

This increase primarily reflects foreign exchange gains of £9.3 million in the three months ended September 30, 2023, compared to gains of £15.2 million in the three months ended September 30, 2022. Such exchange differences arose primarily on the translation of monetary U.S. dollar balances held by our U.K. subsidiary. Selling and commercial costs increased by £2.1 million due to further costs associated with the distribution of KIMMTRAK in multiple territories.

We expect our selling and administrative expenses to increase as we continue to grow as a commercial organization and as we continue to pursue the approval and launch of KIMMTRAK in further countries. The impact of macroeconomic factors, volatility in foreign exchange differences, and global inflation may also significantly impact our selling and administrative expenses in the future.

Finance Income

Our finance income increased by £3.5 million to £4.1 million in the three months ended September 30, 2023 due to higher interest rates and our higher levels of cash and cash equivalents held in the three months ended September 30, 2023 compared to the three months ended September 30, 2022.

Income Tax Credit

For the three months ended September 30, 2023, the income tax credit amounted to £0.1 million compared to £1.2 million for the three months ended September 30, 2022. The reduction in our tax credit position is primarily a result of no longer being considered a Small and Medium-Sized Enterprise (“SME”) for U.K. R&D Tax Relief.

 

We continue to benefit from the U.K.’s RDEC regime which can generate a cash rebate of up to 10.53% of qualifying research and development expenditures incurred prior to April 1, 2023 and 15% for expenditure incurred after this date. Tax credits receivable under the large company RDEC regime are recorded ‘above the line’ as a reduction in research and development expenses.

Comparison of the Nine Months Ended September 30, 2023 and 2022

The following table summarizes our unaudited condensed consolidated statement of loss for each period presented:

 

Revenue

Product and pre-product revenue, net

Net product revenue from the sale of KIMMTRAK, and net pre-product revenue from the sale of tebentafusp as part of a compassionate use and early access program are presented by region based on the location of the customer below.

For the nine months ended September 30, 2023, we generated net product revenue of £137.3 million ($167.7 million) from the sale of KIMMTRAK, of which £96.8 million ($118.3 million) was in the United States, £39.5 million ($48.3 million) in Europe and £0.9 million ($1.1 million) in the rest of the world, following marketing approval for KIMMTRAK in the United States, Europe and other territories. There was no pre-product revenue in the nine months ended September 30, 2023 following the transition to the commercial sale of KIMMTRAK in France in the second half of 2022. Total product and pre-product revenue of £74.5 million was lower in the nine months ended September 30, 2022, as we had only recently commenced our commercial launch.

Collaboration revenue

For the nine months ended September 30, 2023, revenue from collaboration agreements decreased by £14.7 million to £6.5 million compared to £21.2 million for the nine months ended September 30, 2022 due to the termination of our collaboration with Eli Lilly in 2022 and our agreement with Genentech in February 2023 to close enrollment and for the parties to fulfil remaining obligations for the Phase 1 clinical trial under the Genentech Collaboration.

Research and Development Expenses

For the nine months ended September 30, 2023, our research and development expenses were £88.9 million, as compared to £62.0 million for the nine months ended September 30, 2022. This increase of £26.9 million was primarily attributable to an increase in external research and development expenses of £18.5 million. Internal research and development expenses also increased by £8.3 million.

The increase in our external research and development expenses of £18.5 million was driven by £21.1 million of additional costs in connection with our PRAME program in the nine months ended September 30, 2023 as we seek to advance our IMC-F106C product candidate through clinical trials and further develop our other PRAME candidates, and an increase of £4.2 million of costs associated with our preclinical and other research expenses, driven primarily by our other pre-IND programs. These increases were partially offset by a decrease of £3.7 million of costs related to our IMC-C103C program following agreement with Genentech in February 2023 to wind down the Phase 1 clinical trial, and a decrease of £3.0 million in costs associated with tebentafusp.

The increase in our internal research and development expenses of £8.3 million was mainly due to higher employee and share based payment expenses as the headcount engaged in research and development increased.

Selling and Administrative Expenses

For the nine months ended September 30, 2023, selling and administrative expenses were £87.5 million, compared to £50.6 million for the nine months ended September 30, 2022, an increase of £36.9 million.

The increase in our selling and administrative expenses of £36.9 million primarily reflects movements in foreign exchange differences. There were exchange losses of £0.1 million in the nine months ended September 30, 2023, compared to gains of £24.3 million in the nine months ended September 30, 2022. Such exchange differences arose primarily on the translation of monetary U.S. dollar balances held by our U.K. subsidiary. Other employee costs also increased by £4.8 million due to an increase in employees engaged in administrative activities, and selling and other commercial costs increased by £7.1 million due to further costs associated with the distribution of KIMMTRAK in multiple territories.

We expect our selling and administrative expenses to increase as we continue to grow as a commercial organization and as we seek the approval and launch of KIMMTRAK in further countries. The impact of macroeconomic factors, volatility in foreign exchange differences, and global inflation may also significantly impact our selling and administrative expenses in the future.

Income Tax (Charge) / Credit

For the nine months ended September 30, 2023, the income tax charge amounted to £0.2 million compared to a £5.1 million credit for the nine months ended September 30, 2022. The move from an overall tax credit position to recording a tax charge is a result of no longer being considered a Small and Medium-Sized Enterprise, or SME, for U.K. R&D Tax Relief. No SME research and development tax credits have been generated and recorded within Income tax (charge) / credit since the start of 2023. Historically, SME research and development tax credits represented the majority of our income tax credit.

 

We continue to benefit from the U.K.’s RDEC regime which can generate a cash rebate of up to 10.53% of qualifying research and development expenditures incurred prior to April 1, 2023 and 15% for expenditure incurred after this date. Tax credits receivable under the large company RDEC regime are recorded ‘above the line’ as a reduction in research and development expenses.

Our income tax charge represents income payable in the United States, Ireland and Switzerland. The income tax charge for the nine months ended September 30, 2023 is lower than the income tax charge for the six months to June 30, 2023 as a result of discrete adjustments made in the three months ended September 30, 2023 in relation to additional U.K. tax credits received and less U.S. income tax paid in relation to 2022 than had been initially estimated.

Liquidity and Capital Resources

Sources of Liquidity

While we have recorded net product revenue for the sale of KIMMTRAK, we have incurred and expect to continue to incur operating losses and negative cash flows from our operations in most periods. We expect to incur significant expenses and operating losses for the foreseeable future as we advance further product candidates through preclinical and clinical development, seek further regulatory approval and pursue commercialization of existing and any additional approved product candidates. We expect that our research and development and selling and administrative costs will increase in connection with our expanding operations and as a result of global and macroeconomic conditions as described elsewhere herein. See “—Operation and Funding Requirements” below for additional discussion of factors that we expect may increase our costs. As a result, we will need additional capital to fund our operations until such time as we can generate higher levels of revenue from product sales.

We have funded our operations to date primarily with proceeds from sales of equity securities, debt financing, product sales and collaboration agreements. In February 2021, we generated net proceeds of £211.0 million ($286.9 million) from the initial public offering of our American Depositary Shares, or ADSs, on the Nasdaq Global Select Market and a concurrent private placement after underwriting discounts, commissions and directly attributable offering expenses, and in July 2022, we generated net proceeds of £116.4 million ($139.5 million) through the sale of our ordinary shares in the form of ADSs and non-voting ordinary shares in a private placement.

On September 9, 2022, we entered into an Open Market Sale Agreement^SM, or the Sales Agreement, with Jefferies LLC, or Jefferies, pursuant to which we may issue and sell ADSs, each representing one ordinary share, having an aggregate offering price of up to $250,000,000, from time to time, in one or more at-the-market offerings, for which Jefferies will act as sales agent and/or principal. The ADSs to be issued and sold pursuant to the at-the-market facility has been registered under the Securities Act pursuant to our shelf registration statement on Form F-3. As of September 30, 2023, no issuances or sales had been made pursuant to the Sales Agreement.

As of September 30, 2023, and December 31, 2022, we had cash and cash equivalents of £364.0 million and £332.5 million, respectively.

Other than our loan facility entered into with Pharmakon Advisors, LP in November 2022, under which we have borrowed $50 million, which bears interest at a fixed rate of 9.75% and is due to mature in November 2028, we currently have no ongoing material financing commitments, such as lines of credit or guarantees, that are expected to affect our liquidity over the next five years, other than our lease obligations and supplier purchase commitments.

Cash Flows

 

The following table summarizes the primary sources and uses of cash for each period presented:

 

Operating Activities

Net cash from operating activities was £11.5 million for the nine months ended September 30, 2023 compared to net cash used in operating activities of £31.9 million for the nine months ended September 30, 2022. We generated cash from operating activities due to higher revenue receipts and R&D tax credit receipts of £12.6 million (relating to expenditure in 2021 and 2022) in the nine months ended September 30, 2023. In the nine months ended September 30, 2022, revenue receipts were lower in the period of our initial KIMMTRAK launch.

Investing Activities

Net cash from investing activities during the nine months ended September 30, 2023 was £4.5 million compared to net cash used in investing activities of £0.1 million for the nine months ended September 30, 2022. This is attributable to an increase in interest income receipts of £8.7 million due to increased cash balances and interest rates, partially offset by an increase in the purchase of plant, property and equipment of £2.9 million.

Financing Activities

Net cash from financing activities during the nine months ended September 30, 2023 was £16.3 million compared to £115.6 million for the nine months ended September 30, 2022. Our decrease in cash from financing activities was primarily due to £116.4 million of net proceeds from issue of share capital in a private placement during the nine months ended September 30, 2022, whereas we have not received such proceeds in the nine months ended September 30, 2023. This decrease is offset by the effect of £22.5 million of share option exercise receipts in the nine months ended September 30, 2023 compared to £4.5 million for the nine months ended September 30, 2022, respectively.

Operation and Funding Requirements

We have incurred significant losses due to our substantial research and development expenses, and our ongoing selling and administrative expenses. We have an accumulated deficit of £290.1 million as of September 30, 2023. We expect to incur significant losses in the future and expect our expenses to increase in connection with our ongoing activities, particularly as we continue our commercialization of KIMMTRAK as well as research and development and clinical activities for our product candidates. In addition, we expect to continue to incur additional costs associated with operating as both a public company and a commercial-stage company. Our expenses will also increase if, and as, we:

We held cash and cash equivalents of £364.0 million and net current assets of £318.1 million as at September 30, 2023, with an operating loss for the nine months ended September 30, 2023 of £33.9 million and net cash from operating activities of £11.5 million. The positive operational cash inflow was largely due to R&D tax credits received, and receipts from our net product revenue during the nine months ended September 30, 2023.

In assessing the going concern assumptions, we have undertaken an assessment of the current business and strategy forecasts covering a twelve month period, which includes our anticipated commercial revenue for KIMMTRAK. In assessing the downside risks, we have also considered scenarios incorporating a range of revenue from sales of KIMMTRAK. As part of considering the downside risks, we have also considered the impact of the current macroeconomic environment, such as the effects of pandemics or epidemics and other potential economic impacts including the war in Ukraine and the conflict between Hamas and Israel, and related geopolitical tension, as well as global inflation, liquidity concerns at banks and financial institutions, capital market instability, interest and exchange rate fluctuations, and increases in commodity, energy and fuel prices as well as supply chain disruptions. We have concluded that these may have a future impact on our business and implementation of our strategy and plans; however, we anticipate that any such impact will be minimal on clinical trials or other business activities over the period assessed for going concern purposes. As of the date of these financial statements, we are not aware of any specific event or circumstance that would require us to update estimates, assumptions and judgments or revise the carrying value of its assets or liabilities. Actual results could differ from these estimates, and any such differences may be material to our financial statements.

Given the current cash position and the assessment performed, we believe that we will have sufficient funds to continue to meet liabilities as they fall due for a period of at least twelve months from the date of issue of these financial statements and therefore, we have prepared the financial statements on a going concern basis. This scenario is based on our lower range of anticipated revenue levels. As we continue to incur significant expenses in the pursuit of our business strategy described herein, additional funding will be needed before further existing clinical and preclinical programs may be expected to reach commercialization, which would potentially lead to further operational cash inflows. Until we can generate revenue from product sales sufficient to fund our ongoing operations and further develop our pipeline, if ever, we expect to finance our operations in part through a combination of public or private equity offerings and debt financings or other sources, such as potential collaboration agreements, strategic alliances and licensing arrangements.

Our need and ability to raise additional capital on favorable terms or at all may be adversely impacted by global and macroeconomic conditions as described elsewhere herein. These include recent and potential future disruptions to, and volatility in, financial markets and the financial services sector in the United States and worldwide, including liquidity concerns at, and failures of, banks and other financial institutions.

Critical Accounting Policies and Significant Judgments and Estimates

Our unaudited condensed consolidated interim financial statements for the nine months ended September 30, 2023 and 2022, respectively, have been prepared in accordance with International Accounting Standard 34, “Interim Financial Reporting,” or IAS 34. The preparation of the unaudited condensed consolidated interim financial statements requires us to make judgments, estimates and assumptions that affect the value of assets and liabilities—as well as contingent assets and liabilities—as reported on the statement of financial position date, and revenues and expenses arising during the fiscal period.

The estimates and associated assumptions are based on information available when the unaudited condensed consolidated interim financial statements are prepared, historical experience and various other factors which are believed to be reasonable under the circumstances. Existing circumstances and assumptions about future developments, however, may change due to market changes or circumstances arising that are beyond our control. Hence, estimates may vary from the actual values.

The estimates and underlying assumptions are reviewed on an ongoing basis. Revisions to accounting estimates are recognized in the period in which they become known and are applied prospectively.

Those judgments and estimates made, together with our significant accounting policies, are set out in our consolidated financial statements for the year ended December 31, 2022.

Recently Issued and Adopted Accounting Pronouncements

There are no recently issued accounting pronouncements that are expected to materially impact our financial position and results of operations.

U.S. Domestic Filer Status

We have determined that, as of June 30, 2023, the last business day of our second quarter, we no longer meet the requirements for being a “foreign private issuer” as defined under the Securities Exchange Act of 1934, as amended, or the Exchange Act. As a result, effective January 1, 2024, we will be subject to SEC reporting and other rules and regulations applicable to U.S. domestic issuers under the Exchange Act, including the requirement to file an annual report on Form 10-K, to file periodic reports (including current reports on Form 8-K and quarterly reports on Form 10-Q) and to file registration statements on U.S. domestic issuer forms as well as complying with the sections of the Exchange Act regulating the solicitation of proxies, requiring insiders to file public reports of their share ownership and trading activities and insiders being liable for profit from trades made in a short period of time. Pursuant to SEC rules, beginning January 1, 2024, we will be required to report our financial results in U.S. dollars and under U.S. generally accepted accounting principles, including our historical financial results, which have previously been prepared in accordance with IFRS. We will also be required to comply with the rules of Nasdaq applicable to U.S. domestic issuers, including that our articles of association specify a quorum of no less than one-third of our outstanding voting ADSs for meetings of our shareholders, the solicitation of proxies and the approval by our shareholders in connection with certain events such as the acquisition of stock or assets of another company, the establishment of or amendments to equity-based compensation plans for employees, a change of control and certain private placements. We expect to incur significant legal, accounting, insurance and other expenses and to expend greater time and resources, as we prepare for compliance, and comply, with these requirements.

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Immunocore Reports Third Quarter 2023 Financial Results and Provides Business Update

KIMMTRAK net revenues of £49.7 million ($60.7 million) in Q3 2023, maintaining strong momentum in major markets with continued reimbursement expansion globally

New Phase 3 clinical trial of KIMMTRAK adjuvant therapy for uveal (or ocular) melanoma (ATOM) in collaboration with the European Organisation for Research and Treatment of Cancer (EORTC)

Long-term survival for KIMMTRAK in metastatic uveal melanoma demonstrated – published in the New England Journal of Medicine and presented as a mini oral at ESMO Congress 2023

 IMC-F106C (PRAME-A02) progressing; data in multiple tumors expected in 1H 2024

and first patient randomized in Phase 3 cutaneous melanoma trial (PRISM-MEL301) in 1Q 2024

Cash and cash equivalents increased to £364 million ($445 million) as of September 30, 2023

(OXFORDSHIRE, England & CONSHOHOCKEN, Penn. & ROCKVILLE, Md., US, 07 November 2023) Immunocore Holdings plc (Nasdaq: IMCR), a commercial-stage biotechnology company pioneering the development of a novel class of T cell receptor (TCR) bispecific immunotherapies designed to treat a broad range of diseases, including cancer, infectious diseases and autoimmune conditions, today announced its financial results for the third quarter ended September 30, 2023, and provided a business update.

 

“We are proud to have simultaneously published in the New England Journal of Medicine and presented at ESMO 2023 the unprecedented three-year survival follow-up from our pivotal trial of KIMMTRAK in metastatic uveal melanoma,” said Bahija Jallal, Immunocore’s Chief Executive Officer. “We continue to pioneer TCRs by exploring KIMMTRAK in the adjuvant setting with the EORTC-sponsored ATOM Phase 3 clinical trial and progressing the PRAME franchise in multiple solid tumors.”

 

KIMMTRAK is approved in over 35 countries globally. Total net product revenue arising from the sale of KIMMTRAK (or “net sales”) was £49.7 million (or $60.7 million) in the third quarter of 2023, an increase of 9% (or 5% in USD*) compared to the second quarter of 2023, of which £34.5 million (or $42.1 million) was in the United States, £15.0 million (or $18.3 million) in Europe, and £0.2 million (or $0.3 million) in Rest of World.

 

In October, the Company published in the New England Journal of Medicine and presented at the European Society for Medical Oncology (ESMO) 2023 Congress long-term overall survival (OS) data from the KIMMTRAK (tebentafusp-tebn) Phase 3 clinical trial in previously untreated HLA-A*02:01 positive patients with metastatic uveal melanoma. The longest of any randomized trial for metastatic uveal melanoma, the trial demonstrated a three-year OS rate of 27% in the tebentafusp arm, versus 18% in the control arm (investigator’s choice, predominantly [82%] single agent pembrolizumab).

 

In October, the Company signed an agreement for a European Organisation for Research and Treatment of Cancer (EORTC)-sponsored trial to study tebentafusp as adjuvant therapy of uveal (or ocular) melanoma (ATOM). The Phase 3 trial will randomize HLA-A*02:01 positive patients after definitive treatment of high-risk primary uveal melanoma and no evidence of metastatic disease on imaging. Patients will be randomized to one of two arms: KIMMTRAK as monotherapy or observation. The primary endpoint of the trial is relapse-free survival (RFS). The Company anticipates that the EORTC will randomize the first patient in the trial in 2024. The EORTC is a non-profit cancer research organization with a mission to coordinate and conduct international translational and clinical research to improve the standard of cancer treatment for patients.

In October, the Company won the prestigious Galenus von Pergamon Prize (the German Prix Galien) for best ‘Orphan Drug’ for KIMMTRAK, adding to the French award for best ‘Medicine in Innovative Therapeutics’ received in 2022.

TEBE-AM - Phase 2/3 trial with KIMMTRAK in second-line or later cutaneous melanoma

 

Randomization continues in the Phase 2/3 clinical trial of KIMMTRAK in HLA-A*02:01 positive patients with second-line or later cutaneous melanoma. The trial is randomizing patients with advanced melanoma who have progressed on an anti-PD1, received prior ipilimumab and, if applicable, received a BRAF inhibitor. Patients are being randomized to one of three arms, including KIMMTRAK as monotherapy or in combination with an anti-PD1, and a control arm. The trial has a dual primary endpoint of OS and circulating tumor DNA (ctDNA) reduction. The Company expects to complete randomization of the Phase 2 portion of the trial in the second half of 2024.

 

 

PRISM-MEL301 – First PRAME Phase 3 trial with IMC-F106C in first-line cutaneous melanoma

 

In August, the Company announced the planned start of a registrational Phase 3 trial with IMC-F106C in cutaneous melanoma. The trial will randomize patients with HLA-A*02:01 positive, first-line cutaneous melanoma to IMC-F106C + nivolumab versus a control arm of either nivolumab or nivolumab + relatlimab, depending on the country where the patient is enrolled. The Company plans to randomize the first patient in this trial in the first quarter of 2024.

 

Phase 1/2 IMC-F106C targeting PRAME-A02 in multiple solid tumors

 

In addition to progressing IMC-F106C into a registrational trial in cutaneous melanoma, the Company is continuing to enroll patients in the monotherapy and combination arms of the Phase 1/2 clinical trial across multiple tumor types, including expansion arms for patients with advanced ovarian, non-small cell lung, endometrial, and melanoma cancers. In August, the Company provided an updated analysis of the original 18 melanoma patients (initially presented at ESMO in September 2022), which continues to show promising durability of the clinical activity (range of duration of partial response from 6 months to 17 months). The Company expects to report data from the trial in the first half of 2024.

 

IMC-P115C (PRAME-A02 HLE), IMC-T119C (PRAME-A24)

 

The Company continues to work on expanding the PRAME franchise, with pre-clinical work ongoing for two new PRAME ImmTAC candidates, IMC-P115C (PRAME-A02 HLE) and IMC-T119C (PRAME-A24) for solid tumors, with both on-track for investigational new drug (IND) or clinical trial application (CTA) submission in 2024.

 

 

IMC-R117C (PIWIL1)

 

The Company remains on-track to submit an IND/CTA in the fourth quarter of 2023 for IMC-R117C, an ImmTAC targeting the PIWIL1 protein for colorectal and other gastrointestinal cancers. The Company believes this is the first PIWIL1-targeted immunotherapy in development.

 

 

IMC-M113V and IMC-I109V: aiming for functional cure in HIV and HBV

 

The Company continues to enroll people living with HIV in the multiple ascending dose (MAD) part of a Phase 1 clinical trial with IMC-M113V, to identify a safe and tolerable dosing schedule. This study will also test whether IMC-M113V could lead to reduction in the viral load and, after stopping all therapies (antiretroviral therapies and ImmTAV), delay or prevent HIV rebound (known as functional cure). The MAD part of the trial will enroll up to 28 participants. The Company expects to present a data update in 2024.

 

A Phase 1 clinical trial with IMC-I109V, enrolling people living with HBV, is ongoing and continues to enroll patients in the single ascending dose portion of the trial. In August, the Company announced that the multiple dose portion of the trial has been amended to include patients with HBV-positive hepatocellular carcinoma.

 

Corporate Updates

 

The Company appointed John Goll as Senior Vice President (SVP), Finance and Chief Accounting Officer. Prior to joining Immunocore, he served as the SVP, Chief Accounting Officer at Insmed. Additionally, the Company appointed John Trainer as SVP, Chief Operating Officer. Prior to joining the Company, John served as the Chief Financial Officer at NexImmune.

Financial Results

 

Total net product revenue arising from the sale of KIMMTRAK was £49.7 million ($60.7 million) and £137.3 million ($167.7 million) in the three and nine months ended September 30, 2023, respectively, of which £34.5 million ($42.1 million) and £96.9 million ($118.3 million) was in the United States, £15.0 million ($18.3 million) and £39.5 million ($48.3 million) was in Europe, and £0.2 million ($0.3 million) and £0.9 million ($1.1 million) was in Rest of World. For the three and nine months ended September 30, 2022, the Company recorded total net product and pre-product revenue of £36.3 million and £74.5 million, respectively.

 

For the three and nine months ended September 30, 2023, the Company’s research and development expenses were £31.7 million ($38.7 million) and £88.9 million ($108.6 million), respectively, as compared to £23.3 million and £62.0 million for the three and nine months ended September 30, 2022, respectively. For the three and nine months ended September 30, 2023, the selling and administrative expenses were £20.3 million ($24.8 million) and £87.5 million ($106.8 million), respectively, compared to £11.7 million and £50.6 million for the three and nine months ended September 30, 2022, respectively.

 

Basic and diluted profit per share for the three months ended September 30, 2023 was £0.04 (or $0.05 and $0.04, respectively), as compared to basic profit per share of £0.13 and diluted profit per share of £0.12 for the three months ended September 30, 2022. Basic and diluted loss per share for the nine months ended September 30, 2023 was £0.59 (or $0.72), compared to a basic and diluted loss per share of £0.36 for the nine months ended September 30, 2022.

 

Cash and cash equivalents were £364.0 million ($444.5 million) as of September 30, 2023, compared to £332.5 million as of December 31, 2022.

 

* The Company maintains its books and records in pounds sterling. For the convenience of the reader, the Company has translated pound sterling amounts as of and for the period ended September 30, 2023 into U.S. dollars at a rate of £1.00 to $1.2214. Comparisons to the three months ended June 30, 2023 are based on previously reported U.S. dollar amounts, which applied a convenience rate of £1.00 to $1.2709.

About the ATOM Phase 3 trial

 

About TEBE-AM - Phase 2/3 trial with tebentafusp (gp100xCD3) in second-line or later cutaneous melanoma

 

The trial is randomizing patients with second-line or later cutaneous melanoma who have progressed on an anti-PD1, received prior ipilimumab and, if applicable, received a BRAF kinase inhibitor. Patients will be randomized to one of three arms including tebentafusp, as monotherapy or in combination with an anti-PD1, and a control arm. The Phase 2 portion of the trial will include 40 patients per arm.

 

About PRISM-MEL301 – Phase 3 trial with IMC-F106C (PRAMExCD3) in 1L advanced cutaneous melanoma

 

The Phase 3 registrational trial will randomize patients with previously untreated, HLA-A*02:01 positive, advanced melanoma to IMC-F106C + nivolumab versus nivolumab or nivolumab + relatlimab, depending on the country where the patient is enrolled. The study will initially randomize to three arms: two F106C dose regimens (40 mcg and 160 mcg) and control arm and will discontinue one of the F106C dose regimens after an initial review of the first 60 patients randomized to the two experimental arms (90 patients randomized total). The primary endpoint of the trial is progression free survival (PFS) by blinded independent central review (BICR), with secondary endpoints of overall survival (OS) and overall response rate (ORR).

 

About ImmTAV molecules and infectious diseases

 

ImmTAV (Immune mobilizing monoclonal TCRs Against Virus) molecules are novel bispecific molecules that, like ImmTAC (Immune mobilizing monoclonal TCRs Against Cancer) molecules, are designed to enable the immune system to recognize and eliminate virally infected cells.

 

Immunocore is advancing clinical candidates to cure patients with HIV and HBV. The Company aims to achieve a reduction in viral reservoirs to enable sustained control of HIV after stopping antiretroviral therapy (ART), without the risk of virological relapse or onward transmission. This is known as ‘functional cure’. For the treatment of HBV, the Company aims to achieve sustained loss of circulating viral antigens and markers of viral replication after stopping medication for people living with chronic hepatitis B.

 

About Uveal Melanoma

 

Uveal melanoma is a rare and aggressive form of melanoma, which affects the eye. Although it is the most common primary intraocular malignancy in adults, the diagnosis is rare, and up to 50% of people with uveal melanoma will eventually develop metastatic disease. Unresectable or metastatic uveal melanoma typically has a poor prognosis and had no approved treatment until KIMMTRAK.

 

About KIMMTRAK^®

 

KIMMTRAK is a novel bispecific protein comprised of a soluble T cell receptor fused to an anti-CD3 immune-effector function. KIMMTRAK specifically targets gp100, a lineage antigen expressed in melanocytes and melanoma. This is the first molecule developed using Immunocore’s ImmTAC technology platform designed to redirect and activate T cells to recognize and kill tumor cells. KIMMTRAK has been approved for the treatment of HLA-A*02:01-positive adult patients with unresectable or metastatic uveal melanoma in the United States, European Union, Canada, Australia, and the United Kingdom.

 

IMPORTANT SAFETY INFORMATION

 

Cytokine Release Syndrome (CRS), which may be serious or life-threatening, occurred in patients receiving KIMMTRAK. Monitor for at least 16 hours following first three infusions and then as clinically indicated. Manifestations of CRS may include fever, hypotension, hypoxia, chills, nausea, vomiting, rash, elevated transaminases, fatigue, and headache. CRS occurred in 89% of patients who received KIMMTRAK with 0.8% being grade 3 or 4. Ensure immediate access to medications and resuscitative equipment to manage CRS. Ensure patients are euvolemic prior to initiating the infusions. Closely monitor patients for signs or symptoms of CRS following infusions of KIMMTRAK. Monitor fluid status, vital signs, and oxygenation level and provide appropriate therapy. Withhold or discontinue KIMMTRAK depending on persistence and severity of CRS.

 

Skin Reactions

 

Skin reactions, including rash, pruritus, and cutaneous edema occurred in 91% of patients treated with KIMMTRAK. Monitor patients for skin reactions. If skin reactions occur, treat with antihistamine and topical or systemic steroids based on persistence and severity of symptoms. Withhold or permanently discontinue KIMMTRAK depending on the severity of skin reactions.

 

Elevated Liver Enzymes

 

Elevations in liver enzymes occurred in 65% of patients treated with KIMMTRAK. Monitor alanine aminotransferase (ALT), aspartate aminotransferase (AST), and total blood bilirubin prior to the start of and during treatment with KIMMTRAK. Withhold KIMMTRAK according to severity.

 

Embryo-Fetal Toxicity

 

KIMMTRAK may cause fetal harm. Advise pregnant patients of potential risk to the fetus and patients of reproductive potential to use effective contraception during treatment with KIMMTRAK and 1 week after the last dose.

 

The most common adverse reactions (≥30%) in patients who received KIMMTRAK were cytokine release syndrome, rash, pyrexia, pruritus, fatigue, nausea, chills, abdominal pain, edema, hypotension, dry skin, headache, and vomiting. The most common (≥50%) laboratory abnormalities were decreased lymphocyte count, increased creatinine, increased glucose, increased AST, increased ALT, decreased hemoglobin, and decreased phosphate.

 

For more information, please see full Summary of Product Characteristics (SmPC) or full U.S. Prescribing Information (including BOXED WARNING for CRS).

 

About KIMMTRAKConnect

 

Immunocore is committed to helping patients who need KIMMTRAK obtain access via our KIMMTRAKConnect program. The program provides services with dedicated nurse case managers who provide personalized support, including educational resources, financial assistance, and site of care coordination. To learn more, visit KIMMTRAKConnect.com or call 844-775-2273.

 

About Immunocore

 

Immunocore is a commercial-stage biotechnology company pioneering the development of a novel class of TCR bispecific immunotherapies called ImmTAX – Immune mobilizing monoclonal TCRs Against X disease – designed to treat a broad range of diseases, including cancer, autoimmune, and infectious disease. Leveraging its proprietary, flexible, off-the-shelf ImmTAX platform, Immunocore is developing a deep pipeline in multiple therapeutic areas, including five clinical stage programs in oncology and infectious disease, advanced pre-clinical programs in autoimmune disease and multiple earlier pre-clinical programs. The Company’s most advanced oncology TCR therapeutic, KIMMTRAK has been approved for the treatment of HLA-A*02:01-positive adult patients with unresectable or metastatic uveal melanoma in the United States, European Union, Canada, Australia, and the United Kingdom.

 

Forward Looking Statements

 

This press release contains “forward-looking statements” within the meaning of the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. Words such as “may”, “will”, “believe”, “expect”, “plan”, “anticipate” and similar expressions (as well as other words or expressions referencing future events or circumstances) are intended to identify forward-looking statements. All statements, other than statements of historical facts, included in this press release are forward-looking statements. These statements include, but are not limited to, statements regarding the commercial performance of KIMMTRAK including planned launches in additional countries including Canada; the ability to translate a pricing agreement into a success launch; the potential benefits and advantages KIMMTRAK will provide for patients; the estimated market share of KIMMTRAK; the benefits of the Company’s collaboration with EORTC; the risk that the Company may not realize the anticipated benefits of its collaboration with EORTC; uncertainties relating to regulatory applications and related filing and approval timelines for tebentafusp as a treatment for positive high-risk primary uveal melanoma or other programs subject of the collaboration, including the risk that FDA may not approve any such programs on the currently anticipated timelines or at all, and any marketing approvals, if granted, may have significant limitations on its use; the estimated market size and patient population for KIMMTRAK and the Company’s other product candidates; expectations regarding the design, progress, timing, enrollment, scope, expansion, and results of the Company’s existing and planned clinical trials, those of the Company’s collaboration partners or the combined clinical trials with the Company’s collaboration partners; the timing and sufficiency of clinical trial outcomes to support potential approval of any of the Company’s product candidates or those of, or combined with, its collaboration partners, the Company’s goals to develop and commercialize product candidates based on its KIMMTRAK platform alone or with collaboration partners; the expected submission of investigational new drug applications or clinical trial applications; the potential regulatory approval, expected clinical benefits and availability of Immunocore’s product candidates; market competition; sales, marketing, manufacturing and distribution requirements; and potential growth opportunities and trends, including in connection with product launches in future quarters. Any forward-looking statements are based on management’s current expectations and beliefs of future events and are subject to a number of risks and uncertainties that could cause actual events or results to differ materially and adversely from those set forth in or implied by such forward-looking statements, many of which are beyond the Company’s control. These risks and uncertainties include, but are not limited to, the impact of worsening macroeconomic conditions on the Company’s business, financial position, strategy and anticipated milestones, including Immunocore’s ability to conduct ongoing and planned clinical trials; Immunocore’s ability to obtain a clinical supply of current or future product candidates or commercial supply of KIMMTRAK or any future approved products, including as a result of health epidemics or pandemics, war in Ukraine, the conflict between Hamas and Israel, or global geopolitical tension; Immunocore’s ability to obtain and maintain regulatory approval of its product candidates, including KIMMTRAK; Immunocore’s ability and plans in continuing to establish and expand a commercial infrastructure and to successfully launch, market and sell KIMMTRAK and any future approved products; Immunocore’s ability to successfully expand the approved indications for KIMMTRAK or obtain marketing approval for KIMMTRAK in additional geographies in the future; the delay of any current or planned clinical trials, whether due to patient enrollment delays or otherwise; Immunocore’s ability to successfully demonstrate the safety and efficacy of its product candidates and gain approval of its product candidates on a timely basis, if at all; competition with respect to market opportunities; unexpected safety or efficacy data observed during preclinical studies or clinical trials; actions of regulatory agencies, which may affect the initiation, timing and progress of clinical trials or future regulatory approval; Immunocore’s need for and ability to obtain additional funding, on favorable terms or at all, including as a result of worsening macroeconomic conditions, including changes inflation and interest rates and unfavorable general market conditions, and the impacts thereon of the war in Ukraine, the conflict between Hamas and Israel, and global geopolitical tension; Immunocore’s ability to obtain, maintain and enforce intellectual property protection for KIMMTRAK or any of its product candidates it or its collaborators are developing; and the success of Immunocore’s current and future collaborations, partnerships or licensing arrangements. These and other risks and uncertainties are described in greater detail in the section titled "Risk Factors" in Immunocore’s filings with the Securities and Exchange Commission, including Immunocore’s most recent Annual Report on Form 20-F for the year ended December 31, 2022 filed with the Securities and Exchange Commission on March 1, 2023, as well as discussions of potential risks, uncertainties, and other important factors in the Company’s subsequent filings with the Securities and Exchange Commission. All information in this press release is as of the date of the release, and the Company undertakes no duty to update this information, except as required by law.

 

CONTACT:

 

Immunocore

Sébastien Desprez, Head of Communications

T: +44 (0) 7458030732

E:  sebastien.desprez@immunocore.com

Follow on Twitter: @Immunocore

 

Investor Relations

Clayton Robertson / Morgan Warenius

T: +1 215-384-4781

E: ir@immunocore.com

 

Unaudited Condensed Consolidated Statements of Profit / (Loss)

 

Comparison of the Three Months Ended September 30, 2023 and 2022