Commitments and Contingencies

12 Months Ended

Dec. 31, 2024

Commitments and Contingencies Disclosure [Abstract]

In-License Agreements

The Company is party to a number of licensing agreements, these agreements serve to provide the Company with the right to develop and exploit the counterparties’ intellectual property for certain medical indications. As part of execution of these arrangements, the Company paid certain upfront fees, which have been expensed as incurred because the developing technology has not yet reached technical feasibility, the lack of alternative use, and the lack of proof of potential value. The agreements cover a variety of fields, including influenza, cancer, HPV, HBV and MERS. The Company’s obligations for future payments under these arrangements are dependent on its ability to develop promising drug candidates, the potential market for these candidates and potential competing products, and the payment mechanisms in place in countries where the Company retains the right to sell. Each agreement provides for specific milestone payments, typically triggered by achievement of certain testing phases in human candidates, and future royalties ranging from 1 to 5% for direct sales of a covered product to 3 to 7% of net payments received for allowable sublicenses of technology developed by the Company. The obligation to make these payments is contingent upon the Company’s ability to develop candidates for submission for phased testing and approvals, and for the development of markets for the products developed by the Company. The Company has not made any material payments under these license agreements during the years ended December 31, 2024, and 2023.

Leases

The Company leases certain laboratory and office space under operating leases, which are described below.

The Harwell Science and Innovation Campus, Oxfordshire

On September 3, 2021, the Company entered into a lease agreement for the lease of approximately 31,000 square feet of laboratory and office space in Harwell, Oxfordshire, which expires in September 2031. As the Company’s leases typically do not provide an implicit rate, the Company uses an estimate of its incremental borrowing rate based on the information available at the lease commencement date, being the rate incurred to borrow on a collateralized basis over a similar term at an amount equal to the lease payments in a similar economic environment. The Company has provided the lessor with a refundable security deposit of $0.7 million which is included in Other assets.

Germantown, Maryland

On June 14, 2022, the Company entered into a lease agreement for the lease of approximately 19,700 square feet in Germantown, Maryland. The site houses the Company’s state-of-the-art wet laboratory and office space in the United States of America. The lease expires on February 28, 2034, with the Company having a single right to extend for an additional five years on the same terms and conditions other than for the base rent. The Company had a rent-free period up to February 29, 2024 and is entitled to up to $3.5 million for leasehold improvements to the premises desired by the Company. The Company has provided the lessor with a refundable security deposit of $0.2 million which is included in Other assets.

The Company recorded a right-of-use asset and a lease liability on the effective date of the lease term. The Company’s right-of-use assets and lease liabilities are as follows (in thousands):


	December 31, 2024			December 31, 2023
Right-of-use asset	$	4,384		$	7,581
Lease liability, current	$	1,920		$	1,785
Lease liability, non-current	$	10,087		$	11,191

Other information
Operating cash flows from operating leases	$	1,789		$	639
Weighted average remaining lease term (years)	7.98			8.93
Weighted average discount rate	7.5		%	7.5		%

Lease Costs
Short-term lease costs	$	—		$	189
Operating leases	$	1,443		$	883
Total lease cost	$	1,443		$	1,072

The Company identified circumstances that could indicate that the carrying amount of the U.K. operating lease right-of-use asset and the property and equipment located in the U.K. may not be recoverable as of December 31, 2024, as it was more likely than not that the Company would cease the operating activities undertaken in the laboratory and office space in Harwell, Oxfordshire in 2025, significantly before the end of the previously estimated useful lives. The Company performed an impairment assessment of the U.K. operating lease right-of-use asset, which is part of the U.K. asset group, using the income approach and recorded an impairment charge within general and administrative expenses of $2.6 million to write down the asset to the estimated recoverable amount. The impairment charge is subject to a number of assumptions and actual results may differ. The Company will continue to refine these assumptions as additional information becomes available. The significant assumptions used in determining the estimated fair value of the U.K. operating lease right-of-use asset are the timing of successful termination of the Company's U.K. lease obligations and the value of any charges associated with terminating the Company's U.K. lease obligations. Significant changes in these inputs could have a material effect on the fair value measurement. See Note 6 Property and Equipment, Net for details of the impairment assessment performed over the property and equipment within the U.K. asset group.

Maturities of the Company’s minimum lease liabilities as of December 31, 2024 were as follows (in thousands):


Maturity of lease liabilities:
2025	$	1,920
2026	1,944
2027	1,969
2028	1,994
2029	2,020
Thereafter	5,934
Total minimum lease payments	15,781
Less: imputed interest	(3,774)
Total lease liability	$	12,007

Non-lease and other costs paid to the lessors are primarily related to services provided by the lessors in operating the premises that includes fees, operating costs, taxes, and insurance related to the leased premises.

Other contingencies

The Company is a party to various contractual disputes, litigation, and potential claims arising in the ordinary course of business. The Company does not believe that the resolution of these matters will have a material adverse effect on its financial position or results of operations.

The Company enters into contracts in the normal course of business with CROs and other third parties for clinical trials and preclinical research studies and testing. These contracts are generally cancellable by us upon prior notice. Payments due upon cancellation consist only of payments for services provided or expenses incurred, including noncancellable obligations of our service providers, up to the date of cancellation.