Sales of Future Royalties

9 Months Ended

Sep. 30, 2024

Ultomiris Royalty Sale Agreement

The Company evaluated the arrangement and determined that the proceeds from the sale of future royalties should be classified as debt according to ASC 470 Debt. At September 30, 2024, the estimated effective interest rate remains at 21.1%. The Company continues to reassess the estimate of total future royalty payments and prospectively adjusts the imputed interest rate and related amortization if the estimate is materially different. For the three and nine months ended September 30, 2024, the Company recognized $15.7 million and $42.1 million of non-cash royalty revenue, respectively, and $8.2 million and $25.3 million of non-cash interest expense, respectively.

Monjuvi Royalty Sale Agreement

The Company evaluated the arrangement and determined that the proceeds from the sale of future royalties should be classified as debt pursuant to ASC 470 Debt. At June 30, 2024, the Company reassessed the estimate of total future royalty payments and updated the estimated effective interest rate to 17.5%. The Company continues to reassess the estimate of total future royalty payments and prospectively adjusts the imputed interest rate and related amortization if the estimate is materially different. For the three and nine months ended September 30, 2024, the Company recognized $2.1 million and $6.5 million of non-cash royalty revenue, respectively, and $0.8 million and $2.7 million of non-cash interest expense, respectively.

The following table shows the activity within debt for the nine months ended September 30, 2024 (in thousands):


	September 30, 2024
	(As Restated)
Beginning balance of debt related to sale of future royalties	$	189,483
Royalties owed to OMERS	834
Royalties paid to OMERS	(45,472)
Non-cash interest expense recognized	27,950
Ending balance of debt related to sale of future royalties	$	172,795

Debt - short-term	44,455
Debt - long-term	128,340
Total debt	$	172,795