Revenue

12 Months Ended

Dec. 31, 2023

Revenue [Abstract]

Revenue

3. Revenue

Revenue from sale of therapies (in thousands)	2023		2022		2021
Product revenue	$	238,735	$	130,013	$	—
Pre-product revenue		—		10,674		4,078
Total revenue from sale of therapies		238,735		140,687		4,078
Collaboration revenue
GSK		—		—		8,385
Eli Lilly		—		9,205		—
Genentech		10,693		24,469		24,021
Total collaboration revenue		10,693		33,674		32,406
Total revenue	$	249,428	$	174,361	$	36,484

Product revenue, net

During the year ended December 31, 2023, the Company recognized $238.7 million (2022: $130 million) of net product revenue relating to the sale of KIMMTRAK primarily in the United States and Europe after estimated deductions for rebates, chargebacks, other customer fees and returns, which are recognized in Accrued expenses and other current liabilities as set out in the Company’s accounting policies.

Pre-product revenue, net

There was no pre-product revenue during the year ended December 31, 2023, following the transition to the commercial sale of KIMMTRAK in France in the second half of 2022. During the year ended December 31, 2022 and 2021, the Company recognized $10.7 million and $4.1 million of net pre-product revenue, respectively, relating to the sale of tebentafusp under compassionate use and early access programs in France after estimated deductions for rebates and returns, which are recognized in Accrued expenses and other current liabilities as set out in the Company’s accounting policies.

The Company recognized revenues from four customers accounting for 29%, 26%, 17% and 16% of the Company’s total revenue from the sale of therapies for the year ended December 31, 2023, five customers accounting for 26%, 25%, 17%, 17% and 12% of the Company’s total revenue from the sale of therapies for the year ended December 31, 2022, and one customer accounted for all revenue from the sale of therapies for the year ended December 31, 2021.

Net product revenue from the sale of KIMMTRAK, and net pre-product revenue are presented by country / region based on the location of the end customer below (in thousands).

	2023		2022		2021
United States	$	169,791	$	96,893	$	—
Europe		67,628		42,745		4,078
International		1,316		1,049		—
Total revenue from sale of therapies	$	238,735	$	140,687	$	4,078

Net product revenue for the year ended December 31, 2023 includes $3.6 million (2022: $1.9 million, 2021: none) of partnered revenue under our agreement with Medison, split between our European and international markets.

Of the Company’s collaboration customers, Eli Lilly and Genentech are based in the United States. GSK is based in the United Kingdom. The revenue for Genentech represented more than 10% of the Company’s total revenue during 2022. During 2021, the revenue for GSK and Genentech represented more than 10% of the Company’s total revenue.

Accounts receivable from contracts with customers

Accounts receivable, net as of December 31, 2023 and 2022 were as follows (in thousands):

	2023			2022
Beginning balance	$	33,584		$	7,334
Additions		307,255			206,442
Payments received		(288,211	)		(180,192	)
Provision		(535	)		—
Ending balance	$	52,093		$	33,584

As of December 31, 2023, four customers individually accounted for approximately 31%, 26%, 19% and 16% of accounts receivable associated with the Company’s revenue from the sale of therapies, as compared to 27%, 25%, 23% and 20% as of December 31,2022. As of December 31, 2023 and 2022, the amount of expected credit losses on accounts receivable was not material.

Accruals for rebates and chargebacks

Current and non-current accruals for rebates, chargebacks and returns as of December 31, 2023 and 2022 were as follows (in thousands):

	Rebates			Chargebacks			Returns			Total
As of January 1, 2022	$	3,391		$	—		$	—		$	3,391
Provisions related to sales in the period		24,141			16,597			969			41,707
Credits and payments made		(1,115	)		(12,944	)		(121	)		(14,180	)
As of December 31, 2022	$	26,417		$	3,653		$	848		$	30,918
Provisions related to sales in the period		59,160			25,467			1,937			86,564
Adjustments related to prior period sales		(1,861	)		(734	)		(237	)		(2,832	)
Credits and payments made		(19,759	)		(26,355	)		(1,810	)		(47,924	)
As of December 31, 2023	$	63,957		$	2,031		$	738		$	66,726

The adjustments related to prior period sales in the year ended December 31, 2023 was due to changes in estimates primarily related to the pricing agreement signed for Germany in August 2023.

Deferred revenue

For the year ended December 31, 2023, a total of $7.8 million of revenue recognized was included in Deferred revenue as of January 1, 2023 (2022: $33.0 million ; 2021: $29.1 million).

Deferred revenue in the Consolidated Balance Sheets is primarily in respect of the upfront fee and development milestone consideration received from the various collaboration agreements in advance of services performed by the Company.

Non-current deferred revenue in the Consolidated Balance Sheet as of December 31, 2023, relates to a revised distribution agreement with Medison entered into in November 2022. Under the revised agreement, the Company received a non-refundable payment of $5.0 million in exchange for granting Medison exclusive distribution rights in South America. The Company has determined that the deferred revenue relates to the Company’s single, combined performance obligation to supply KIMMTRAK to Medison and to grant Medison the exclusive right to distribute KIMMTRAK in South America. The Company expects to recognize this revenue with the sale of products following regulatory approval in the territory. The Company estimates that Product revenue recognition of this non-current deferred revenue will commence after one year or later.

Revenue recognized relating to performance obligations satisfied in previous years was zero for all years presented.

Genentech Collaboration

Under the Genentech agreement signed in November 2018, the Company received aggregate non-refundable payments totaling $100 million consisting of an initial upfront payment of $50 million and $50 million paid upon an investigational new drug filing for the first clinical trial of the product candidate compound, in exchange for granting Genentech rights to co- develop/co-promote the Company’s IMC-C103C program and the co-exclusive worldwide license to the Company’s intellectual property rights in MAGE A4 soluble TCR bispecific therapeutic candidate compounds. The Company was responsible for development of the IMC-C103C program over the period of time to estimated completion of the Phase 1 clinical trial, with costs being shared equally with Genentech.

In February 2023, as the Company elected to withdraw from co-funding with Genentech the MAGE-A4 HLA-A02 program, IMC-C103C, Genentech acquired an exclusive worldwide license to the MAGE-A4 HLA-A02 soluble TCR bispecific therapeutic candidate compounds and shall be fully responsible for all further development and commercialization of such candidate compounds, at its expense.

The transaction price was recorded as deferred revenue on receipt in November 2018 and allocated to a single combined performance obligation covering the granting of the co-exclusive worldwide license, the provision of development services and participation on a joint steering committee. This deferred revenue is recognized as the Company satisfies the combined performance obligation over the estimated period of time to when the Company has completed substantially all of its responsibilities associated with its withdrawal from the co-funding and the Phase I clinical trial. R&D costs reimbursed under the 2018 Genentech Agreement are considered variable consideration and not recognized in the transaction price until it is probable that the recognition of such revenue will not be reversed.

During the year ended December 31, 2023, the Company recognized $10.7 million of revenue relating to the 2018 Genentech Agreement (2022: $24.5 million; 2021: $24.0 million). The revenue recognized represents both deductions from deferred revenue and R&D costs reimbursed, predominantly for clinical trial costs. Such reimbursements arise in order to ensure that R&D costs are shared equally in accordance with the 2018 Genentech agreement. The revenue recognized in 2023 represents the remaining transaction price relating to the unsatisfied performance obligation as of December 31, 2022, and the unsatisfied performance obligation was expected to be fully recognized within one year. As of December 31, 2023, the Company determined its performance obligation under its collaboration with Genentech was complete. The Company determined achieving commercialization milestones and royalties to be unlikely and were excluded from the transaction price as of December 31, 2023, 2022 and 2021, therefore any future milestones will be recorded when they become probable of being achieved.

Lilly Collaboration

In July 2014, the Company entered into a development and license agreement with Eli Lilly, or the Lilly Agreement, pursuant to which the Company and Eli Lilly agreed to collaborate in the development, manufacture and commercialization of soluble TCR bispecific therapeutic compounds. Under the Lilly Agreement, Eli Lilly paid an initial non-refundable upfront fee payment of $45 million in exchange for options to three targets. Following termination of the agreement, Eli Lilly no longer has any rights to the targets or the ability to nominate any further targets under the initial agreement.

The transaction price, equal to the $45.0 million upfront payment was recorded as deferred revenue on receipt and was allocated to each target based on the relative standalone selling price. Each target had a single combined performance obligation covering the provision of R&D services and participation on a joint steering committee. This deferred revenue was recognized as the Company satisfied the combined performance obligations over the estimated period of time to when Eli Lilly could exercise the option to obtain exclusive co-development/co-promotion rights to the target and the Company could opt-out of the co-development of the target.

The Company released the remaining deferred revenue attributed to the third target under the Lilly Collaboration after the parties agreed to terminate the agreement in March 2022. No further revenue under the collaboration has been recognized.

During the year ended December 31, 2023, the Company recognized no revenue relating to the Lilly Agreement (2022: $9.2 million; 2021: no revenue).

GSK Collaboration

In June 2013, the Company entered into a collaboration and license agreement with GSK pursuant to which the Company and GSK agreed to collaborate in the development of soluble TCR bispecific therapeutic compounds (the “GSK Agreement”). Under the GSK Agreement, the Company granted GSK the right to nominate up to four exclusive targets. The first target, GSK01/NY-ESO, was nominated at the time of execution of the GSK Agreement. A second target was nominated in July 2017. GSK subsequently had no further ability to nominate additional targets under the terms of the agreement. Following a review of the targets in the year ended December 31, 2021, the parties elected not to proceed further with the second target and the GSK Agreement was terminated in January 2022. The transaction price at the time the agreement was entered was equal to the total payments received of $27.8 million.

The total payments were recorded as deferred revenue on receipt and were allocated to each target based on the relative standalone selling price. Each target had a single combined performance obligation covering the provision of R&D services and participation on a joint steering committee. This deferred revenue was recognized as the Company satisfied the combined performance obligation over the estimated period that GSK could exercise the option to obtain an exclusive worldwide license for the therapeutic candidate compounds. R&D costs reimbursed under the GSK Agreement were considered variable consideration and assessed at contract inception and each subsequent reporting period and not recognized in the transaction price until it was probable that the recognition of such revenue would not be reversed.

During the year ended December 31, 2023, the Company recognized no revenue relating to the GSK Agreement (2022: no revenue; 2021: $8.4 million) following termination of the agreement in 2021.

Other information

Substantially all of the Company’s assets are held in the United Kingdom.

The total of non-current assets other than financial instruments and deferred tax assets located in the United Kingdom as of December 31, 2023 is $55.4 million (2022: $43.7 million). The total located in the United States is $1.8 million (2022: $2.7 million).