0001558370-23-013988 | 10-Q | XBRL Viewer | Iovance Biotherapeutics INC

STOCKHOLDERS' EQUITY (Tables)

6 Months Ended

Jun. 30, 2023


				Weighted
		Weighted		Average	Aggregate
	Number	Average		Remaining	Intrinsic
	of	Exercise		Contract	Value
	Options	Price		Life
Outstanding at December 31, 2022	15,240,197	$	22.45
Issued	4,873,795		7.19
Exercised	(7,860)		6.97
Expired/Cancelled	(667,826)		18.43
Outstanding at June 30, 2023	19,438,306	$	18.77	7.39	$	646,711
Ending vested and expected to vest at June 30, 2023	19,438,306	$	18.77	7.39	$	646,711
Options exercisable at June 30, 2023	11,255,242	$	23.09	6.10	$	428,090

Schedule of summary of RSU activity including PRSUs


		Weighted
	Number	Average
	of	Grant Date
	RSUs and PRSUs	Fair Value
Outstanding as of December 31, 2022	2,436,764	$	14.74
Granted	2,729,348		7.19
Vested/Released	(917,621)		16.89
Canceled/Forfeited	(94,922)		11.28
Outstanding as of June 30, 2023	4,153,569	$	9.38
Ending vested and expected to vest at June 30, 2023	4,153,569	$	9.38

Schedule of stock-based compensation


	Three Months Ended				Six Months Ended
	June 30,				June 30,
	2023		2022		2023		2022
Research and development	$	9,390	$	13,940	$	18,249	$	27,591
Selling, general and administrative		7,350		8,528		14,156		17,142
Total stock-based compensation expense	$	16,740	$	22,468	$	32,405	$	44,733

Schedule of stock-based compensation by type of award


	Three Months Ended				Six Months Ended
	June 30,				June 30,
	2023		2022		2023		2022
Stock option expense	$	11,893	$	15,130	$	23,595	$	29,997
Restricted stock expense		4,543		7,084		8,203		14,246
ESPP expense		304		254		607		490
Total stock-based compensation expense	$	16,740	$	22,468	$	32,405	$	44,733

REVENUE	6 Months Ended
Jun. 30, 2023
REVENUE
REVENUE	NOTE 7. REVENUE Product sales for the three and six months ended June 30, 2023 was $0.2 million and represented sales of Proleukin® made in licensed markets outside of the U.S. To date, there have been no product sales from Proleukin® in the U.S. market.

REVENUE

6 Months Ended

Jun. 30, 2023

REVENUE

REVENUE

NOTE 7. REVENUE

Product sales for the three and six months ended June 30, 2023 was $0.2 million and represented sales of Proleukin® made in licensed markets outside of the U.S. To date, there have been no product sales from Proleukin® in the U.S. market.

- Definition

The entire disclosure of revenue from contract with customer to transfer good or service and to transfer nonfinancial asset. Includes, but is not limited to, disaggregation of revenue, credit loss recognized from contract with customer, judgment and change in judgment related to contract with customer, and asset recognized from cost incurred to obtain or fulfill contract with customer. Excludes insurance and lease contracts.

+ References

Reference 1: http://www.xbrl.org/2003/role/disclosureRef
-Topic 606
-SubTopic 10
-Name Accounting Standards Codification
-Section 50
-Paragraph 9
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147479806/606-10-50-9

Reference 2: http://www.xbrl.org/2003/role/disclosureRef
-Topic 606
-SubTopic 10
-Name Accounting Standards Codification
-Section 50
-Paragraph 10
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147479806/606-10-50-10

Reference 3: http://www.xbrl.org/2003/role/disclosureRef
-Topic 606
-SubTopic 10
-Name Accounting Standards Codification
-Section 50
-Paragraph 15
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147479806/606-10-50-15

Reference 4: http://www.xbrl.org/2003/role/disclosureRef
-Topic 606
-SubTopic 10
-Name Accounting Standards Codification
-Section 50
-Paragraph 12
-Subparagraph (a)
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147479806/606-10-50-12

Reference 5: http://www.xbrl.org/2003/role/disclosureRef
-Topic 606
-SubTopic 10
-Name Accounting Standards Codification
-Section 50
-Paragraph 12
-Subparagraph (b)
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147479806/606-10-50-12

Reference 6: http://www.xbrl.org/2003/role/disclosureRef
-Topic 606
-SubTopic 10
-Name Accounting Standards Codification
-Section 50
-Paragraph 12
-Subparagraph (c)
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147479806/606-10-50-12

Reference 7: http://www.xbrl.org/2003/role/disclosureRef
-Topic 606
-SubTopic 10
-Name Accounting Standards Codification
-Section 50
-Paragraph 12
-Subparagraph (d)
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147479806/606-10-50-12

Reference 8: http://www.xbrl.org/2003/role/disclosureRef
-Topic 606
-SubTopic 10
-Name Accounting Standards Codification
-Section 50
-Paragraph 12
-Subparagraph (e)
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147479806/606-10-50-12

Reference 9: http://www.xbrl.org/2003/role/disclosureRef
-Topic 606
-SubTopic 10
-Name Accounting Standards Codification
-Section 50
-Paragraph 13
-Subparagraph (b)(2)
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147479806/606-10-50-13

Reference 10: http://www.xbrl.org/2003/role/disclosureRef
-Name Accounting Standards Codification
-Topic 606
-Publisher FASB
-URI https://asc.fasb.org//606/tableOfContent

+ Details

Condensed Consolidated Statements of Cash Flows - USD ($) $ in Thousands	6 Months Ended
	Jun. 30, 2023	Jun. 30, 2022
Cash Flows from Operating Activities
Net Loss	$ (213,898)	$ (190,956)
Adjustments to reconcile net loss to net cash used in operating activities:
Stock-based compensation expense	32,405	44,733
Unrealized exchange gains	(181)	0
Amortization of intangible assets	1,933	0
Amortization of right-of-use assets	5,910	6,184
Depreciation and amortization of property and equipment	5,695	4,042
Deferred tax benefit	(477)	0
Accretion of discounts and premiums on investments	(855)	995
Loss on write-off of fixed assets	0	314
Changes in assets and liabilities:
Prepaid expenses, other assets and long-term assets	(7,065)	(2,661)
Trade accounts receivable	(33)	0
Inventories	(9,549)	0
Operating lease liabilities	(5,261)	902
Accounts payable	3,171	65
Accrued expenses and other liabilities	(5,562)	(15,055)
Net cash used in operating activities	(193,767)	(151,437)
Cash Flows from Investing Activities
Maturities of investments	226,633	284,136
Purchase of investments	(5,323)	(85,841)
Cash paid for acquisition, net of cash acquired	(209,509)	0
Purchase of property and equipment	(15,184)	(16,016)
Net cash (used in) provided by investing activities	(3,383)	182,279
Cash Flows from Financing Activities
Tax payments related to shares withheld for vested restricted stock units	(2,230)	(2,649)
Proceeds from the issuance of common stock under employee stock purchase plan	1,271	582
Proceeds from the issuance of common stock upon exercise of options	55	1,417
Proceeds from the issuance of common stock, net	260,101	0
Net cash provided by (used in) financing activities	259,197	(650)
Effect of exchange rate changes	(3,768)	0
Net increase in cash, cash equivalents and restricted cash	58,279	30,192
Cash, Cash Equivalents and Restricted Cash Beginning of Period	238,161	84,313
Cash, Cash Equivalents and Restricted Cash End of Period	296,440	114,505
Supplemental disclosure of non-cash investing and financing activities:
Fair value of net assets acquired	222,637	0
Net unrealized gain (loss) on investments	894	(2,096)
Acquisition of property and equipment included in accounts payable and accrued expenses	3,813	967
Accrued capitalized acquisition costs	3,440	0
Lease liabilities arising from obtaining right-of-use asset from new leases	177	553
Lease liabilities arising from obtaining right-of-use asset from lease modifications	$ 349	$ 7,493

STOCKHOLDERS' EQUITY - Stock-based compensation by instrument (Details) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2023	Jun. 30, 2022	Jun. 30, 2023	Jun. 30, 2022
Total stock-based compensation expenses	$ 16,740	$ 22,468	$ 32,405	$ 44,733
Employee Stock Option [Member]
Total stock-based compensation expenses	11,893	15,130	23,595	29,997
Restricted stock units
Total stock-based compensation expenses	4,543	7,084	8,203	14,246
2020 ESPP
Total stock-based compensation expenses	$ 304	$ 254	$ 607	$ 490

PROLEUKIN ACQUISITION - Narrative (Details) - PROLEUKIN £ in Millions, $ in Millions	Jun. 30, 2023 USD ($)	May 18, 2023 USD ($)	May 18, 2023 GBP (£)
PROLEUKIN ACQUISITION
Upfront payment	$ 210.2	$ 207.2	£ 166.9
Payment for certain inventory		$ 3.0	£ 2.4

Insider Trading Arrangements	3 Months Ended
Insider Trading Arrangements	Jun. 30, 2023
Trading Arrangements, by Individual
Rule 10b5-1 Arrangement Adopted	false
Non-Rule 10b5-1 Arrangement Adopted	false
Rule 10b5-1 Arrangement Terminated	false
Non-Rule 10b5-1 Arrangement Terminated	false

LEASES - Right-of-use asset and lease liabilities (Details) - USD ($) $ in Thousands	Jun. 30, 2023	Dec. 31, 2022
LEASES
Operating lease right-of-use assets	$ 67,631	$ 73,015
Operating lease liabilities
Current portion included in current liabilities	10,866	12,587
Long-term portion included in non-current liabilities	68,844	71,859
Total operating lease liabilities	$ 79,710	$ 84,446

LEASES (Tables)

6 Months Ended

Jun. 30, 2023

LEASES

Schedule of balance sheet classification of the Company's right-of-use asset and lease liabilities

The balance sheet classification of the Company’s right-of-use asset and lease liabilities was as follows (in thousands):


	June 30,		December 31,
	2023		2022
Operating lease right-of-use assets	$	67,631	$	73,015
Operating lease liabilities
Current portion included in current liabilities		10,866		12,587
Long-term portion included in non-current liabilities		68,844		71,859
Total operating lease liabilities	$	79,710	$	84,446

Schedule of components of lease expenses

The following table summarizes components of lease expenses, which were included in Total costs and expenses in the Company’s Condensed Consolidated Statements of Operations, and other information related to its operating leases as follows (in thousands except weighted-average remaining lease terms and discount rates):


	Three Months Ended				Six Months Ended
	June 30,				June 30,
	2023		2022		2023			2022
Operating lease cost	$	4,521	$	4,399	$	9,044		$	8,954
Variable lease cost		2,307		1,236		4,001			2,216
Short-term lease cost		109		35		154			77
Total lease cost	$	6,937	$	5,670	$	13,199		$	11,247

Other information
Cash paid for amounts included in the measurement of lease liabilities included in cash flows from operations	$	4,235	$	3,262	$	8,396		$	7,073
Tenant improvement allowance received for amounts included in the measurement of lease liabilities included in cash flows from operations	$	—	$	2,085		—			5,200
Right-of-use assets obtained from entering new leases	$	177	$	553	$	177		$	553
Increase in right-of-use assets from lease modifications	$	—	$	(180)	$	349		$	7,493
Weighted-average remaining lease terms (years)						12.95			14.01
Weighted-average discount rates						7.5	%		7.3	%

Schedule of minimum lease commitments

As of June 30, 2023, the maturities of the Company’s operating lease liabilities were as follows (in thousands):


			CMO
	Facility		embedded
Year Ending December 31,	leases		leases		Total
Remainder of 2023	$	4,167	$	5,730	$	9,897
2024		8,510		2,180		10,690
2025		8,284		—		8,284
2026		7,989		—		7,989
2027		8,186		—		8,186
Thereafter		83,827		—		83,827
Total lease payments	$	120,963	$	7,910	$	128,873
Less: Present value adjustment		(48,839)		(324)		(49,163)
Operating lease liabilities	$	72,124	$	7,586	$	79,710

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - Additional information (Details)	6 Months Ended
	Jun. 30, 2023 segment
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
Number of operating segments	1

ACCRUED EXPENSES

6 Months Ended

Jun. 30, 2023

ACCRUED EXPENSES

ACCRUED EXPENSES

NOTE 9. ACCRUED EXPENSES

Accrued expenses consist of the following (in thousands):


	June 30,		December 31,
	2023		2022
Accrued payroll and employee related expenses	$	18,359	$	19,407
Clinical related		10,135		14,812
Manufacturing related		7,350		4,652
Facilities related		3,537		6,510
Legal and related services		1,416		3,015
Proleukin® acquisition related		1,249		—
Other accrued expenses		4,574		3,899
Total accrued expenses	$	46,620	$	52,295

LICENSES AND AGREEMENTS - Estimated purchase obligations (Details) - Manufacturing and Supply Agreement With Boehringer Ingelheim Biopharmaceuticals GmbH $ in Millions	Jun. 30, 2023 USD ($)
Remaining six months ending December 31, 2023	$ 6.8
Years ending December 31, 2024	9.5
Years ending December 31, 2025	6.1
Years ending December 31, 2026	6.1
Years ending December 31, 2027	$ 6.1

SUBSEQUENT EVENTS

6 Months Ended

Jun. 30, 2023

SUBSEQUENT EVENTS

SUBSEQUENT EVENTS

NOTE 15. SUBSEQUENT EVENTS

On July 13, 2023, the Company announced the closing of the sale of an aggregate of 23,000,000 shares of its common stock, pursuant to an underwriting agreement (the “Underwriting Agreement”) with Goldman Sachs & Co. LLC and Jefferies LLC (collectively, the “Underwriters”), including 3,000,000 shares issued pursuant to the exercise of the option granted to the Underwriters, at a public offering price of $7.50 per share before underwriting discounts and commissions. The total estimated net proceeds to the Company from the offering, including the exercise of the option by the Underwriters, were approximately $161.4 million after deducting underwriting discounts and commissions and estimated offering expenses payable by the Company.

PROLEUKIN ACQUISITION

6 Months Ended

Jun. 30, 2023

PROLEUKIN ACQUISITION

PROLEUKIN ACQUISITION

NOTE 4. PROLEUKIN® ACQUISITION

On January 23, 2023, the Company and its newly formed, wholly owned subsidiary, Iovance Biotherapeutics UK Ltd (the “Purchaser”) entered into an Option Agreement (the “Option Agreement”) with Clinigen Holdings Limited, Clinigen Healthcare Limited, and Clinigen, Inc. (collectively “Clinigen”), a global pharmaceutical services company, pursuant to which the Purchaser would acquire the worldwide rights for the manufacturing, supply, commercialization and sale of Proleukin® (aldesleukin) (the “Acquisition”).

On May 18, 2023, the Company completed the Acquisition and specifically acquired (i) all issued and outstanding shares of Clinigen SP Limited (the “Target”), (ii) the business of the Target and Clinigen (the “Proleukin® Business”) comprising the manufacturing, supply, commercialization and the generation of income from the Product rights and the undertaking of an active role in the development, maintenance and exploitation of those rights, and (iii) certain specified assets identified in the Option Agreement. Pursuant to the Option Agreement, the Company paid to Clinigen (i) an upfront payment of £166.9 million (or approximately $207.2 million), including the applicable stamp-tax payment, and (ii) a payment for certain inventory of £2.4 million (or approximately $3.0 million) using existing cash on hand. The Option Agreement includes potential future contingent payments, as discussed below.

The Acquisition was accounted for as an asset acquisition because substantially all of the fair value of the acquired assets was concentrated in the acquired developed technology related to the intellectual property rights of Proleukin® and therefore the Acquisition does not meet the definition of a business in accordance with ASC 805. The Proleukin® Business operations have been included in the Company’s Condensed Consolidated Financial Statements commencing from the acquisition date.

The following table summarizes the total cash consideration and allocated acquisition date fair values of assets acquired and liabilities assumed (in thousands):


		Amounts
Cash	$	35
Inventory		9,688
Developed technology		232,665
Assembled workforce		636
Deferred tax liability		(20,352)
Total Cost of Acquisition	$	222,672

The $222.7 million of total cost of the Acquisition consisted of (i) a $210.2 million of cash payment to Clinigen and (ii) $12.5 million of direct transaction costs incurred by the Company. The Option Agreement additionally provides for contingent cash payments consisting of (i) a milestone payment of £41.7 million, or approximately $50.0 million, upon first approval of lifileucel in advanced melanoma, (ii) deferred consideration based on double digit rates on global net sales (as defined in the Option Agreement) payable from the Company to the sellers following the completion of the Acquisition over a deferred consideration term of twelve years, and (iii) after the deferred consideration term, earnout payments payable from the Company to sellers following the completion of the transaction if deferred consideration payments are equal or greater than the deferred consideration amount provided for in the Option Agreement. These contingent payments were determined to be within the scope of ASC 450 and will be recognized when they are both probable and estimable. The recognition criteria have not been met as of the acquisition date or as of June 30, 2023.

The net assets acquired in the Acquisition were recorded by allocating the total cost of the Acquisition to the assets acquired on a relative fair value basis based on their estimated fair values as of May 18, 2023, which is the date that the Acquisition was completed.

The fair value of the developed technology was estimated using a multi-period excess earnings income approach that discounts expected cash flows to present value by applying a discount rate that represents the estimated rate that market participants would use to value the intangible assets. The fair value of the developed technology is being amortized over an expected useful life of 15 years and is recorded as Cost of Sales in the Company’s Condensed Consolidated Statement of Operations.

The fair value of the assembled workforce was estimated using a replacement cost less depreciation method. The fair value of the assembled workforce is being amortized over an expected useful life of 3 years and is recorded as Selling, General and Administrative expense in the Company’s Condensed Consolidated Statement of Operations.

The fair value of the acquired inventory was determined using the comparative sales method of the market approach, which uses historical and expected average selling prices of inventory as the base amount to which adjustment for costs to complete for work-in-process, cost of disposal and reasonable profit allowance are applied. The inventory fair value adjustment is being amortized as cost of sales as the acquired inventories are sold.

A deferred tax liability was recognized on the temporary differences related to the book and tax basis of the acquired intangible assets. The deferred tax liability and resulting adjustment to the carrying amount of the acquired intangibles was calculated using the simultaneous equations method under ASC 740. The tax rate used is based on the estimated statutory rates in the United Kingdom as this is where the intangible assets are domiciled.

PROPERTY AND EQUIPMENT, NET - Other information (Details) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2023	Jun. 30, 2022	Jun. 30, 2023	Jun. 30, 2022
PROPERTY AND EQUIPMENT, NET
Depreciation and amortization expense	$ 2,900	$ 2,200	$ 5,695	$ 4,042
Depreciation			$ 5,700	$ 4,000

INCOME TAXES (Details) - USD ($) $ in Thousands	3 Months Ended	6 Months Ended
INCOME TAXES (Details) - USD ($) $ in Thousands	Jun. 30, 2023	Jun. 30, 2023	May 18, 2023
INCOME TAXES
Deferred tax liability			$ 20,400
Tax benefit	$ (477)	$ (477)
Effective tax rates	0.40%	0.20%
US statutory rate		21.00%

- Definition

Amount of current income tax expense (benefit) and deferred income tax expense (benefit) pertaining to continuing operations.

+ References + Details

INVENTORY (Details) $ in Thousands	Jun. 30, 2023 USD ($)
Inventories
Work in process	$ 8,587
Finished goods	1,133
Total inventory	$ 9,720

CASH EQUIVALENTS, INVESTMENTS AND RECURRING FAIR VALUE MEASUREMENTS

6 Months Ended

Jun. 30, 2023

CASH EQUIVALENTS, INVESTMENTS AND RECURRING FAIR VALUE MEASUREMENTS

CASH EQUIVALENTS, INVESTMENTS AND RECURRING FAIR VALUE MEASUREMENTS

NOTE 3. CASH EQUIVALENTS, INVESTMENTS AND RECURRING FAIR VALUE MEASUREMENTS

The amortized cost and fair value of cash equivalents and investments as of June 30, 2023 and December 31, 2022 were as follows (in thousands):


			Gross		Gross
	Amortized		Unrealized		Unrealized
As of June 30, 2023	Cost		Gains		Losses		Fair Value
U.S. treasury securities	$	15,471	$	—	$	(7)	$	15,464
Commercial paper		5,421		—		(1)		5,420
Money market funds		175,977		—		—		175,977
Total investments	$	196,869	$	—	$	(8)	$	196,861


			Gross		Gross
	Amortized		Unrealized		Unrealized
As of December 31, 2022	Cost		Gains		Losses		Fair Value
U.S. treasury securities	$	118,570	$	—	$	(850)	$	117,720
U.S. government agency securities		11,272		—		(7)		11,265
Corporate securities		7,230		—		—		7,230
Commercial paper		148,299		8		(53)		148,254
Money market funds		88,001		—		—		88,001
Total investments	$	373,372	$	8	$	(910)	$	372,470

The fair value of cash equivalents and investments as of June 30, 2023 and December 31, 2022 are classified as follows in the Company’s Consolidated Balance Sheets (in thousands):


	June 30,		December 31,
Classified as:	2023		2022
Cash equivalents	$	175,977	$	132,356
Short-term investments		20,884		240,114
Total investments	$	196,861	$	372,470

Cash equivalents in the tables above exclude cash demand deposits of $54.0 million and $99.4 million as of June 30, 2023 and December 31, 2022, respectively. Unrealized gains and losses are included in Accumulated Other Comprehensive Income (Loss), and as of June 30, 2023 and December 31, 2022 no unrealized losses on available-for-sale securities have resulted from credit risk. All available-for-sale securities held as of June 30, 2023 and December 31, 2022 had contractual maturities of less than one year. No unrealized losses on available-for-sale securities have been in a continuous unrealized loss position for more than 12 months, as of the periods presented. To date, the Company has not recorded any impairment charges on its marketable securities.

Recurring Fair Value Measurements

As of June 30, 2023 and December 31, 2022, the fair value of the Company’s financial assets that are measured at fair value on a recurring basis, which consist of cash equivalents and short-term and long-term investments classified as available-for-sale securities, are categorized in the table below based upon the lowest level of significant input to the valuations (in thousands):


	Assets at Fair Value as of June 30, 2023
	Level 1		Level 2		Level 3		Total
U.S. treasury securities	$	15,464	$	—	$	—	$	15,464
Commercial paper		—		5,420		—		5,420
Money market funds		175,977		—		—		175,977
Total	$	191,441	$	5,420	$	—	$	196,861


	Assets at Fair Value as of December 31, 2022
	Level 1		Level 2		Level 3		Total
U.S. treasury securities	$	117,720	$	—	$	—	$	117,720
U.S. government agency securities		—		11,265		—		11,265
Corporate securities		—		7,230		—		7,230
Commercial paper		—		148,254		—		148,254
Money market funds		88,001		—		—		88,001
Total	$	205,721	$	166,749	$	—	$	372,470

Level 2 assets consist of commercial paper and government agency securities. Level 2 inputs for the valuations are limited to quoted prices for similar assets or liabilities in active markets and inputs other than quoted prices that are observable for the asset.

STOCKHOLDERS' EQUITY - Stock Options (Details) - Employee Stock Option [Member] - USD ($) $ / shares in Units, $ in Thousands	6 Months Ended
	Jun. 30, 2023
Number of Options
Outstanding, beginning balance	15,240,197
Issued	4,873,795
Exercised	(7,860)
Expired/Cancelled	(667,826)
Outstanding, ending balance	19,438,306
Ending vested and expected to vest	19,438,306
Options exercisable	11,255,242
Weighted Average Exercise Price
Outstanding, beginning balance	$ 22.45
Issued	7.19
Exercised	6.97
Expired/Cancelled	18.43
Outstanding, ending balance	18.77
Ending vested and expected to vest	18.77
Options exercisable	$ 23.09
Weighted Average Remaining Contractual Life
Options outstanding, remaining term	7 years 4 months 20 days
Ending vested and expected to vest, remaining term	7 years 4 months 20 days
Options exercisable, remaining term	6 years 1 month 6 days
Aggregate Intrinsic Value
Option at ending balance	$ 646,711
Ending vested and expected to vest	646,711
Option exercisable	$ 428,090

PROPERTY AND EQUIPMENT, NET (Tables)

6 Months Ended

Jun. 30, 2023

PROPERTY AND EQUIPMENT, NET

Schedule of Property and equipment

Property and equipment, net consists of the following (in thousands):


	June 30,		December 31,
	2023		2022
Leasehold improvements	$	76,724	$	74,305
Lab, process, and validation equipment		22,524		22,136
Utility equipment		5,990		5,951
Office furniture and equipment		3,404		2,927
Computer software		6,736		6,736
Computer equipment		695		695
Machinery and equipment		251		82
Construction in progress		18,529		9,118
Total property and equipment, cost		134,853		121,950
Less: Accumulated depreciation and amortization		(22,304)		(16,718)
Property and equipment, net	$	112,549	$	105,232

LEASES - Components of lease expenses (Details) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2023	Jun. 30, 2022	Jun. 30, 2023	Jun. 30, 2022
LEASES
Operating lease cost	$ 4,521	$ 4,399	$ 9,044	$ 8,954
Variable lease cost	2,307	1,236	4,001	2,216
Short-term lease cost	109	35	154	77
Total lease cost	6,937	5,670	13,199	11,247
Cash paid for amounts included in the measurement of lease liabilities included in cash flows from operations	4,235	3,262	8,396	7,073
Tenant improvement allowance received for amounts included in the measurement of lease liabilities included in cash flows from operations		2,085		5,200
Right-of-use assets obtained from entering new leases	$ 177	553	177	553
Increase in right-of-use assets from lease modifications		$ (180)	$ 349	$ 7,493
Weighted-average remaining lease terms (years)	12 years 11 months 12 days	14 years 3 days	12 years 11 months 12 days	14 years 3 days
Weighted-average discount rates	7.50%	7.30%	7.50%	7.30%

GENERAL ORGANIZATION, BUSINESS AND LIQUIDITY

6 Months Ended

Jun. 30, 2023

GENERAL ORGANIZATION, BUSINESS AND LIQUIDITY

GENERAL ORGANIZATION, BUSINESS AND LIQUIDITY

NOTE 1. GENERAL ORGANIZATION, BUSINESS AND LIQUIDITY

General Organization and Business

Iovance Biotherapeutics, Inc. (the “Company”) is a biopharmaceutical company pioneering a transformational approach to treating cancer by harnessing the human immune system’s ability to recognize and destroy diverse cancer cells using therapies personalized for each patient. The Company’s mission is to be the global leader in innovating, developing and delivering tumor infiltrating lymphocyte (“TIL”) therapies for patients with solid tumor cancers. The Company’s autologous TIL therapy platform uses a centralized, scalable, and proprietary 22-day manufacturing process to grow polyclonal T-cells unique to each patient and yields a cryopreserved, individualized therapy. In May 2023, the Company acquired the worldwide rights to Proleukin® (aldesleukin), a commercialized interleukin-2 (“IL-2”) product used to promote T-cell activity following TIL infusion. The acquisition of Proleukin® provides a new revenue source, secures the IL-2 supply chain and logistics surrounding TIL therapy administration, and lowers cost of goods and clinical trial expenses for Proleukin® used with TIL therapies.

The Company is currently conducting clinical trials to investigate multiple TIL therapies for multiple indications, including its lead product candidate, lifileucel, for advanced, or metastatic or unresectable, melanoma. The Company completed a rolling Biologics License Application (“BLA”) submission to the U.S. Food and Drug Administration (the “FDA”) for lifileucel for patients with advanced melanoma in March 2023, and the FDA accepted its BLA and granted lifileucel Priority Review in May 2023. The FDA assigned November 25, 2023 as the target action date for a decision under the Prescription Drug User Free Act (“PDUFA”). The Company is also pursuing registrational strategies for lifileucel in advanced cervical cancer and for its TIL therapy LN-145 in metastatic non-small cell lung cancer (“NSCLC”). In addition, the Company is investigating next generation approaches to optimize TIL products, manufacturing processes and treatment regimens, including a first-in-human clinical trial of its lead genetically modified TIL therapy, IOV-4001. The Company is also exploring a shorter manufacturing process, tumor tissue procurement via core biopsy, additional genetically modified TIL therapies including multiple immune checkpoint gene edits, and cytokine-tethered TIL therapies, as well as a novel IL-2 analog, designated IOV-3001, as potential avenues to improve efficacy, manufacturing timelines, sample collection and supportive treatments involved in the overall TIL therapy process and treatment regimen.

Basis of Presentation of Unaudited Condensed Consolidated Financial Information

The accompanying unaudited Condensed Consolidated Financial Statements of the Company for the three and six months ended June 30, 2023 and 2022 have been prepared in accordance with accounting principles generally accepted in the United States of America (“GAAP”) for interim financial information and pursuant to the requirements for reporting on Form 10-Q and Regulation S-X. Accordingly, they do not include all the information and footnotes required by GAAP for audited financial statements. However, such information reflects all adjustments (consisting solely of normal recurring adjustments), which are, in the opinion of management, necessary for the fair presentation of the Company's financial position and results of operations. Results shown for interim periods are not necessarily indicative of the results that may be expected for the year ended December 31, 2023 or for any other period. The Condensed Consolidated Balance Sheet as of December 31, 2022 was derived from the audited consolidated financial statements included in the Company's Annual Report on Form 10-K filed with the Securities and Exchange Commission (the “SEC”) on February 28, 2023. These interim financial statements should be read in conjunction with that report. The reporting currency of the Company is U.S. dollars. The functional currency for most of its foreign subsidiaries is their local currency.

Liquidity

The Company is currently engaged in the development of therapeutics to fight solid tumor cancers. With the completion of the rolling BLA submission for lifileucel for advanced melanoma in March 2023, the Company expects to generate revenue from the sale of its product lifileucel, if the BLA is approved. Furthermore, upon the completion of the closing of the acquisition of the worldwide rights to Proleukin®(as discussed below in Note 4 - Proleukin® Acquisition) in the second quarter of 2023, the Company began to generate revenue from the sales of Proleukin® during the three months ended June 30, 2023. However, such revenues for Proleukin® and lifileucel may not be material during the 12 months from the date these Condensed Consolidated Financial Statements are issued. The Company has incurred a net loss of $213.9 million for the six months ended June 30, 2023 and used $193.8 million of cash in its operating activities during the six months ended June 30, 2023. As of June 30, 2023, the Company had $317.3 million in cash, cash

equivalents, investments, and restricted cash ($230.0 million of cash and cash equivalents, $20.9 million in short-term investments and $66.4 million in restricted cash).

The Company expects to continue to incur significant expenses to support its preparations for the commercialization and launch of lifileucel (if approved), including continuing to prepare the Iovance Cell Therapy Center (the “iCTC”), its manufacturing facility in Philadelphia, to support the Company’s ongoing and planned clinical programs, including its NSCLC registration directed study and its frontline advanced melanoma Phase 3 confirmatory trial, TILVANCE-301, to expand the combination of TIL and immune checkpoint inhibitors (“ICI’s”) in ICI naïve patient cohorts, and to support Proleukin® integration activities during 2023 and beyond. Based on the funds the Company has available as of the date these consolidated financial statements are issued, which include estimated net proceeds (after deducting underwriting and other offering expenses) of $161.4 million from the public offering of its common stock completed on July 13, 2023, the Company believes that it has sufficient capital to fund its anticipated operating expenses and capital expenditures as planned for at least the next twelve months from the date these Condensed Consolidated Financial Statements are issued.

Concentrations of Risk

The Company is subject to credit risk from its portfolio of cash, cash equivalents, trade accounts receivable and investments. Under its investment policy, the Company limits amounts invested in securities by credit rating, maturity, industry group, investment type and issuer, except for securities issued by the U.S. government. The Company does not believe it is exposed to any significant concentrations of credit risk from these financial instruments. The goals of its investment policy are safety and preservation of principal, diversification of risk, and liquidity of investments sufficient to meet cash flow requirements.

Condensed Consolidated Statements of Stockholders' Equity - USD ($) $ in Thousands	Series A Convertible Preferred Stock Preferred Stock	Series B Convertible Preferred Stock Preferred Stock	Common Stock	Additional Paid-In Capital	Accumulated Other Comprehensive Income (Loss)	Accumulated Deficit	Total
Beginning Balance at Dec. 31, 2021		$ 3	$ 7	$ 1,794,695	$ (601)	$ (1,172,445)	$ 621,659
Beginning Balance (in Shares) at Dec. 31, 2021	194	2,842,158	157,004,742
Stock-based compensation expense				44,733			44,733
Common stock issued upon purchase of employee stock purchase plan				582			582
Common stock issued upon purchase of employee stock purchase plan (in shares)			80,203
Vesting of restricted shares issued for services (in shares)			898,392
Tax payments related to shares retired for vested restricted stock units				(2,649)			(2,649)
Tax payments related to shares retired for vested restricted stock units (in shares)			(346,335)
Common stock issued upon exercise of stock options				1,417			1,417
Common stock issued upon exercise of stock options (in shares)			163,579
Unrealized gain/(loss) on investments					(2,096)		(2,096)
Net Loss						(190,956)	(190,956)
Ending Balance at Jun. 30, 2022		$ 3	$ 7	1,838,778	(2,697)	(1,363,401)	472,690
Ending Balance (in Shares) at Jun. 30, 2022	194	2,842,158	157,800,581
Beginning Balance at Mar. 31, 2022		$ 3	$ 7	1,818,377	(2,343)	(1,264,052)	551,992
Beginning Balance (in Shares) at Mar. 31, 2022	194	2,842,158	157,168,321
Stock-based compensation expense				22,468			22,468
Common stock issued upon purchase of employee stock purchase plan				582			582
Common stock issued upon purchase of employee stock purchase plan (in shares)			80,203
Vesting of restricted shares issued for services (in shares)			898,392
Tax payments related to shares retired for vested restricted stock units				(2,649)			(2,649)
Tax payments related to shares retired for vested restricted stock units (in shares)			(346,335)
Unrealized gain/(loss) on investments					(354)		(354)
Net Loss						(99,349)	(99,349)
Ending Balance at Jun. 30, 2022		$ 3	$ 7	1,838,778	(2,697)	(1,363,401)	472,690
Ending Balance (in Shares) at Jun. 30, 2022	194	2,842,158	157,800,581
Beginning Balance at Dec. 31, 2022		$ 3	$ 8	2,068,867	(902)	(1,568,338)	499,638
Beginning Balance (in Shares) at Dec. 31, 2022	194	2,842,158	187,812,072
Stock-based compensation expense				32,405			32,405
Common stock issued upon purchase of employee stock purchase plan				1,271			1,271
Common stock issued upon purchase of employee stock purchase plan (in shares)			226,196
Vesting of restricted shares issued for services (in shares)			917,621
Tax payments related to shares retired for vested restricted stock units				(2,230)			(2,230)
Tax payments related to shares retired for vested restricted stock units (in shares)			(355,541)
Common stock issued upon exercise of stock options				55			55
Common stock issued upon exercise of stock options (in shares)			7,860
Common stock sold in private placement, net of offering costs			$ 1	260,100			260,101
Common stock sold in private placement, net of offering costs (in shares)			36,080,226
Unrealized gain/(loss) on investments					894		894
Foreign currency cumulative translation adjustment					333		333
Net Loss						(213,898)	(213,898)
Ending Balance at Jun. 30, 2023		$ 3	$ 9	2,360,468	325	(1,782,236)	578,569
Ending Balance (in Shares) at Jun. 30, 2023	194	2,842,158	224,688,434
Beginning Balance at Mar. 31, 2023		$ 3	$ 9	2,342,703	(126)	(1,675,708)	666,881
Beginning Balance (in Shares) at Mar. 31, 2023	194	2,842,158	224,358,979
Stock-based compensation expense				16,740			16,740
Common stock issued upon purchase of employee stock purchase plan				1,271			1,271
Common stock issued upon purchase of employee stock purchase plan (in shares)			226,196
Vesting of restricted shares issued for services (in shares)			147,364
Tax payments related to shares retired for vested restricted stock units				(301)			(301)
Tax payments related to shares retired for vested restricted stock units (in shares)			(51,965)
Common stock issued upon exercise of stock options				55			55
Common stock issued upon exercise of stock options (in shares)			7,860
Unrealized gain/(loss) on investments					118		118
Foreign currency cumulative translation adjustment					333		333
Net Loss						(106,528)	(106,528)
Ending Balance at Jun. 30, 2023		$ 3	$ 9	$ 2,360,468	$ 325	$ (1,782,236)	$ 578,569
Ending Balance (in Shares) at Jun. 30, 2023	194	2,842,158	224,688,434

STOCKHOLDERS' EQUITY (Details) - USD ($) $ / shares in Units, $ in Thousands				3 Months Ended		6 Months Ended		18 Months Ended
	Jul. 13, 2023	Nov. 18, 2022	Jun. 08, 2020	Jun. 30, 2023	Jun. 30, 2022	Jun. 30, 2023	Jun. 30, 2022	Jun. 30, 2023	Jun. 16, 2023	Jun. 06, 2023	Jun. 05, 2023	Mar. 13, 2023	Mar. 12, 2023	Dec. 31, 2022	Jun. 10, 2022	Jan. 12, 2022	Jan. 11, 2022	Sep. 22, 2021	Apr. 22, 2018
Common Stock
Common stock, shares authorized				500,000,000		500,000,000		500,000,000						500,000,000
Common stock, par or stated value per share				$ 0.000041666		$ 0.000041666		$ 0.000041666						$ 0.000041666
Common stock, shares issued				224,688,434		224,688,434		224,688,434						187,812,072
Common stock, shares outstanding				224,688,434		224,688,434		224,688,434						187,812,072
Proceeds from the issuance of common stock, net						$ 260,101	$ 0
Weighted average grant date fair value, options granted						$ 5.01	$ 8.89
Subsequent Event [Member]
Common Stock
Common stock issued, net of offering costs (in shares)	23,000,000
Share price (in dollars per share)	$ 7.50
At the Market Offering Program
Common Stock
Maximum percentage of commission		3.00%
Common stock issued, net of offering costs (in shares)				0	0	36,080,226	0
Proceeds from the issuance of common stock, net						$ 260,100
Weighted average price						$ 7.35
Second Sales Agreement
Common Stock
Maximum amount of shares to be issued		$ 500,000
2023 Sales Agreement
Common Stock
Maximum amount of shares to be issued									$ 450,000
Series A Convertible Preferred Stock
Common Stock
Preferred stock, shares authorized				17,000		17,000		17,000						17,000
Preferred stock, par or stated value per share				$ 0.001		$ 0.001		$ 0.001						$ 0.001
Conversion of Stock, shares converted								0
Conversion of stock, shares issued						500
Preferred stock, shares outstanding				194		194		194						194
Series A Convertible Preferred Stock \| Common Stock
Common Stock
Common stock available in conversion, shares				97,000		97,000		97,000						97,000
Series A Convertible Preferred Stock \| Private Placement
Common Stock
Preferred stock, par or stated value per share				$ 1,000		$ 1,000		$ 1,000
Convertible price per share						$ 2.00
Series B Convertible Preferred Stock
Common Stock
Preferred stock, shares authorized				11,500,000		11,500,000		11,500,000						11,500,000
Preferred stock, par or stated value per share				$ 0.001		$ 0.001		$ 0.001						$ 0.001
Conversion of stock, shares issued						1
Preferred stock, shares outstanding				2,842,158		2,842,158		2,842,158						2,842,158
Series B Convertible Preferred Stock \| Issuance Of Common Stock Upon Conversion Of Preferred Stock
Common Stock
Conversion of stock, shares issued				0	0	0	0
Series B Convertible Preferred Stock \| Common Stock
Common Stock
Preferred stock, shares outstanding				2,842,158		2,842,158		2,842,158						2,842,158
Series B Convertible Preferred Stock \| IPO
Common Stock
Preferred stock, par or stated value per share				$ 4.75		$ 4.75		$ 4.75
Convertible price per share						$ 4.75
Blank check
Common Stock
Preferred stock, shares authorized				50,000,000		50,000,000		50,000,000
Employee Stock Option [Member]
Common Stock
Unrecognized compensation cost				$ 55,900		$ 55,900		$ 55,900
Unrecognized compensation cost recognition period						2 years 29 days
RSUs and PRSUs
Common Stock
Unrecognized compensation cost recognition period						2 years 1 month 17 days
Unrecognized compensation cost				30,900		$ 30,900		30,900
Aggregate intrinsic value of outstanding non-vested RSUs & PRSUs				$ 29,200		$ 29,200		$ 29,200
Vested						917,621
Granted						2,729,348
2014 Equity Incentive Plan
Common Stock
Number of shares available				77,086		77,086		77,086
The 2018 Plan
Common Stock
Number of shares available				8,879,043		8,879,043		8,879,043
Shares authorized			14,000,000												20,700,000				6,000,000
Common Stock, Capital Shares Reserved for Future Issuance										29,700,000					20,700,000
2020 ESPP
Common Stock
Common stock issued, net of offering costs (in shares)						583,045
Shares authorized			500,000							1,400,000	500,000
Percentage of purchase price			85.00%
Stock-based compensation expense				$ 300	$ 300	$ 600	$ 500
Unrecognized compensation cost				$ 600		$ 600		$ 600
Unrecognized compensation cost recognition period						5 months 12 days
2021 Inducement Plan
Common Stock
Number of shares available				691,851		691,851		691,851
Shares authorized												2,250,000	1,750,000			1,750,000	1,000,000	1,000,000

LICENSES AND AGREEMENTS

6 Months Ended

Jun. 30, 2023

LICENSES AND AGREEMENTS

LICENSES AND AGREEMENTS

NOTE 11. LICENSES AND AGREEMENTS

National Institutes of Health (the “NIH”) and the National Cancer Institute (the “NCI”)

Cooperative Research and Development Agreement (the “CRADA”)

In August 2011, the Company signed a five-year CRADA with the NCI to work on the development of adoptive cell immunotherapies that are designed to destroy advanced melanoma cells. The CRADA was amended in 2015 and 2016 to, among other things, extend the term of the CRADA through August 2021, include new indications such as the development of TIL therapy for the treatment of patients with bladder, lung, triple-negative breast, and Human Papilloma Virus (“HPV”)-associated cancers, and modify

the focus on the development of unmodified TIL as a stand-alone therapy or in combination. The parties have continued the development of improved methods for the generation and selection of TIL with anti-tumor reactivity in metastatic melanoma, bladder, lung, breast, and HPV-associated cancers.

In August 2021, the NCI and the Company entered into a third amendment to the CRADA. The third amendment, among other things, extended the term of the CRADA by three years to August 2024. The research plan in this amendment includes the evaluation in clinical trials of strategies for development of more potent TILs, such as selection of CD39/69 double negative cells and the use of certain inhibitors or other reagents in TIL expansion cultures.

Pursuant to the terms of the CRADA, as amended, the Company is required to make quarterly payments of $0.5 million to the NCI for support of research activities. To the extent the Company licenses patent rights relating to a TIL-based product candidate, the Company will be responsible for all patent-related expenses and fees, past and future, relating to the TIL-based product candidate. In addition, the Company may be required to supply certain test articles, including TIL, grown and processed under Current Good Manufacturing Practice (“cGMP”) conditions, suitable for use in clinical trials. The extended CRADA has a three-year term expiring in August 2024. The Company or the NCI may unilaterally terminate the CRADA for any reason or for no reason at any time by providing written notice at least 60 days before the desired termination date. The Company recorded costs associated with the CRADA of $0.5 million for each of the three months ended June 30, 2023 and 2022, respectively, and $1.0 million for each of the six months ended June 30, 2023 and 2022, as research and development expenses.

Patent License Agreement Related to the Development and Manufacture of TIL Therapies

The Company entered into an Exclusive Patent License Agreement (the “Patent License Agreement”) with the NIH, an agency of the U.S. Public Health Service within the Department of Health and Human Services, in 2011, as amended in 2015. Pursuant to the Patent License Agreement, as amended, the NIH granted the Company licenses, including exclusive, co-exclusive, and non-exclusive licenses, to certain technologies relating to autologous tumor infiltrating lymphocyte adoptive cell therapy products for the treatment of metastatic melanoma, lung, breast, bladder and HPV-positive cancers.

Effective May 6, 2021, the Company entered into an Amended and Restated Patent License Agreement with NIH, which included the grant of additional exclusive, worldwide patent rights in the indications to interleukin-15 and interleukin-21cytokine-tethered TIL technology, and expanded the non-exclusive, worldwide field of use to all cancers. Effective August 1, 2022, the Company entered into a Second Amended and Restated Patent License Agreement with NIH to include additional exclusive, worldwide patent rights to TIL products expressing interleukin-12, expanded rights to TIL selection technologies previously licensed under the Exclusive Patent License Agreement below, and additional non-exclusive, worldwide patent rights to certain technologies for enhancing TIL products.

The Second Amended and Restated Patent License Agreement requires the Company to pay royalties based on a percentage of net sales in jurisdictions where patent rights exist, which percentage can fall into a tier that may be less than one percent to mid-single digits depending upon certain factors, including the exclusivity of the rights, and the Company expects lower overall royalty payments as a result. The Company also agreed to potential milestone payments on the achievement of certain clinical, regulatory, and commercial sales milestones for each of the indications and other direct costs incurred by the NIH pursuant to the Second Amended and Restated Patent License Agreement. The Company anticipates making payments that could range from several hundred thousand dollars to the mid-single-digit millions of dollars in conjunction with certain development milestones, the approval of a BLA or its foreign equivalent, or the first U.S. and foreign commercial sales of any of its product candidates covered by the Second Amended and Restated Patent License Agreement. The term of the Second Amended and Restated Patent License Agreement continues until the expiry of the last-to-expire patent rights licensed thereunder, and the agreement contains standard termination provisions.

Exclusive Patent License Agreement Related to TIL Selection

On February 10, 2015, the Company entered into an exclusive patent license agreement (the “Exclusive Patent License Agreement”) with the NIH under which the Company received an exclusive, worldwide license under a patent related to selected TILs. This license was superseded and replaced by the Second Amended and Restated Patent License Agreement.

H. Lee Moffitt Cancer Center

Research Collaboration and Clinical Grant Agreements with Moffitt

In June 2020, the Company entered into a Sponsored Research Agreement with the H. Lee Moffitt Cancer Center (“Moffitt”), with a term that ends either upon completion of the research thereunder or on July 1, 2022, whichever is sooner. In June 2022, this agreement was extended until June 2023, extendable until completion of the research plan thereunder. The Company recorded costs associated with this agreement of $0.1 million and $0.2 million for the three months ended June 30, 2023 and 2022, respectively, and $0.2 million and $0.3 million for each of the six months ended June 30, 2023 and 2022, as research and development costs.

In December 2016, the Company entered into a clinical grant agreement with Moffitt to support an ongoing clinical trial at Moffitt that combines TIL therapy with nivolumab for the treatment of patients with metastatic melanoma. In June 2017, the Company entered into a second clinical grant agreement with Moffitt to support a new clinical trial at Moffitt that combines TIL therapy with nivolumab for the treatment of patients with non-small cell lung cancer, under which the Company obtained a non-exclusive, royalty-free license to any new Moffitt inventions made in the performance of the agreement. Under both clinical grant agreements with Moffit, the Company has non-exclusive rights to clinical data arising from the respective clinical trials. No expenses were recorded for the three and six months ended June 30, 2023 and nil and $0.1 million of expenses were recorded for the three and six months ended June 30, 2022, respectively, in connection with the research collaboration and clinical grant agreements with Moffitt.

Exclusive License Agreements with Moffitt

The Company entered into a license agreement with Moffitt (the “First Moffitt License”), effective as of June 28, 2014, under which the Company received a world-wide license to Moffitt’s rights to patent-pending technologies related to methods for improving TIL for adoptive cell therapy using toll-like receptor agonists. Unless earlier terminated, the term of the license extends until the earlier of the expiration of the last issued patent related to the licensed technology or 20 years after the effective date of the license agreement.

Pursuant to the First Moffitt License, the Company paid an upfront licensing fee in the amount of $0.1 million which was recorded as research and development expense. In 2022, the Company paid a patent issuance fee that was payable under the First Moffitt License upon the issuance of the first U.S. patent covering the subject technology. In addition, the Company agreed to pay milestone license fees upon completion of specified milestones, customary royalties based on a specified percentage of net sales (which percentage is in the low single digits) and sublicensing payments, as applicable, and annual minimum royalties beginning with the first sale of products based on the licensed technologies, which minimum royalties will be credited against the percentage royalty payments otherwise payable in that year. The Company will also be responsible for all costs associated with the preparation, filing, maintenance and prosecution of the patent applications and patents covered by the First Moffitt License related to the treatment of any cancers in the U.S., Europe, and Japan and in other countries designated by the Company in agreement with Moffitt. No expenses were recorded for the First Moffitt License for the three and six months ended June 30, 2023 and 2022.

The Company entered into a second license agreement with Moffitt effective as of May 7, 2018 (the “Second Moffitt License”), under which the Company received a license to Moffitt’s rights to patent-pending technologies related to the use of 4-1BB agonists in conjunction with TIL manufacturing processes and therapies. Pursuant to the Second Moffitt License, the Company paid an upfront licensing fee in the amount of $0.1 million in 2018. An annual license maintenance fee is also payable commencing on the first anniversary of the effective date. The Company agreed to pay an annual commercial use payment for each indication for which a first sale has occurred, which in the aggregate amounts to up to $0.4 million a year. The Company recorded expense of a de minimis amount and $0.1 million for the three months ended June 30, 2023 and 2022, respectively, and $0.1 million for each of the six months ended June 30, 2023 and 2022, respectively, as research and development expenses in connection with this agreement.

The Company subsequently exercised an option to exclusively license Moffitt’s rights to patent pending technologies related to the use of tumor digests in conjunction with TIL manufacturing processes and therapies and entered into an amended and restated Second Moffitt License in October 2021 (the “Amended & Restated Second Moffit License”), to include these rights. Pursuant to the Amended & Restated Second Moffitt License, the Company paid an upfront licensing fee in the amount of $0.2 million in 2021, which was recorded as research and development expense. In addition, the Company agreed to pay an annual commercial use payment for each indication for which a first sale has occurred for products relating to the use of 4-1BB antagonists covered by the license and an additional annual commercial use payment for each indication for which a first sale has occurred for products relating to the use of tumor digests covered by the license. No expenses were recorded for the six months ended June 30, 2023 and 2022, respectively, associated with this agreement.

The University of Texas M.D. Anderson Cancer Center

Strategic Alliance Agreement

On April 17, 2017, the Company entered into a Strategic Alliance Agreement (the “SAA”) with The University of Texas M.D. Anderson Cancer Center (“MDACC”) under which the Company and MDACC agreed to conduct clinical and preclinical research studies. The Company agreed in the SAA to provide total funding not to exceed approximately $14.2 million for the performance of the multi-year studies under the SAA, of which approximately $5.3 million has been funded cumulatively through June 30, 2023, and has been recorded as research and development expense. In return, the Company acquired all rights to inventions resulting from the studies and has been granted a non-exclusive, sub-licensable, royalty-free, and perpetual license to specified background intellectual property of MDACC reasonably necessary to exploit, including the commercialization thereof. The Company has also been granted certain rights in clinical data generated by MDACC outside of the clinical trials to be performed under the SAA. The SAA’s term shall continue in effect until the later of the fourth anniversary of the SAA or the completion or termination of the research and receipt by the Company of all deliverables due from MDACC thereunder. No expenses were recorded for the three months ended June 30, 2023 and 2022, respectively. No expenses and $0.1 million were recorded for the six months ended June 30, 2023 and 2022, respectively, as research and development expenses associated with this agreement.

WuXi Advanced Therapies, Inc.

First WuXi Manufacturing and Services Agreement

In November 2016, the Company entered into a three-year manufacturing and services agreement (the “First WuXi MSA”) with WuXi Advanced Therapies, Inc. (“WuXi”) pursuant to which WuXi agreed to provide manufacturing and other services, which has since been amended and assigned to its subsidiary Iovance Biotherapeutics Manufacturing LLC. Under the First WuXi MSA, the Company entered into multiple statements of work for two cGMP manufacturing suites to be operated by WuXi for the Company. The terms of one of these statements of work expired in December 2022.

Second WuXi Manufacturing and Services Agreement

In October 2022, the Company’s subsidiary Iovance Biotherapeutics Manufacturing LLC entered into an additional three-year manufacturing and services agreement (the “Second WuXi MSA”) with WuXi and its parent company WuXi Apptec, Co, Ltd pursuant to which WuXi agreed to provide commercial and clinical manufacturing services and related testing services. Under the Second WuXi MSA, the Company entered into a statement of work for the two cGMP manufacturing suites to be operated by WuXi for the Company. Both suites are expected to be capable of being used for the commercial and clinical manufacture of the Company’s products. The Second WuXi MSA and its related statement of work will supersede the statements of work under the First WuXi MSA with respect to commercial and clinical manufacturing and the two manufacturing suites. Certain other statements of work for related services will also be covered by the Second WuXi MSA. The First WuXi MSA will continue to address development services provided by WuXi to the Company. Prior to regulatory approval, or if the Company experiences a material adverse event, the Company may unilaterally terminate the statement of work for commercial and clinical manufacturing under the Second WuXi MSA at any time by providing written notice of at least 120 days. Post regulatory approval, the Company may unilaterally terminate the statement of work for commercial and clinical manufacturing with written notice of 15 month in year 1 of the term, written notice of 9 months in year 2 of the term, and written notice of 6 months in year 3 of the term. If WuXi fails a Pre-Licensing Inspection and does not address any related issues within 90 days of receipt of the FDA response letter, the Company may either terminate the statement of work for commercial and clinical manufacturing under the Second WuXi MSA immediately or shorten the term of this statement of work to June 30, 2024. The Company recorded costs associated with agreements with WuXi of $4.8 million and $3.2 million for the three months ended June 30, 2023 and 2022, respectively, and $8.7 million and $7.1 million for the six months ended June 30, 2023 and 2022, respectively, as research and development expenses.

Cellectis S.A.

On December 31, 2019, the Company entered into a research collaboration and exclusive worldwide license agreement whereby the Company will license gene-editing technology from Cellectis S.A. (“Cellectis”), a clinical-stage biopharmaceutical company, to develop TIL therapies that have been genetically edited using TALEN ® technology, including a PD-1 inactivated product that the Company refers to as IOV-4001. Financial terms of the license include annual license payments and development, regulatory and sales milestone payments from the Company to Cellectis, as well as royalty payments based on net sales of TALEN®-modified TIL products. The Company recorded costs associated with the license agreement with Cellectis of $0.1 million for each of

the three months ended June 30, 2023 and 2022, and $0.2 million for each of the six months ended June 30, 2023 and 2022, respectively, as research and development expense.

Novartis Pharma AG and Related Entities

On January 9, 2020, the Company obtained a license from Novartis Pharma AG (“Novartis”) to develop and commercialize an antibody cytokine engrafted protein, which the Company refers to as IOV-3001. Under the agreement, the Company has paid an upfront payment to Novartis and may pay future milestones related to initiation of patient dosing in various phases of clinical development for IOV-3001 and approval of the product in the U.S, EU, and Japan. Novartis is also entitled to low-to-mid single digit percentage royalties from commercial sales of the product. The Company recorded costs associated with the license agreement from Novartis of $10.0 million as research and development expense during for the year ended December 31, 2020. No expenses were recorded for both the three and six months ended June 30, 2023 and 2022.

On May 18, 2023, as part of the completion of the Acquisition, the Company inherited two historical asset purchase agreements, one historical master cell bank license and working cell bank transfer agreement and one historical license agreement from Clinigen with Novartis AG, Novartis Pharma AG and Novartis Vaccines and Diagnostics, Inc. pursuant to which, among other things, the Company may be required to make future milestone payments based on net sales (as defined in the relevant underlying agreements) in the United States and the rest of world, which includes any and all sales outside of the United States. The maximum amount of these milestone payments payable under these agreements is $30.0 million upon reaching several certain net sales amounts in the United States and $15.0 million upon reaching several certain net sales amounts in the rest of the world, of which 25% of each milestone payment will be reimbursed by Clinigen by deduction from the deferred consideration due under the Option Agreement in the period such milestone payment is made. To date, the net sales milestones have not been achieved, and, therefore, no payments were made under these agreements for both the three and six months ended June 30, 2023 and 2022.

Boehringer Ingelheim Biopharmaceuticals GmbH

On May 18, 2023 as part of the completion of the Acquisition, the Company inherited a manufacturing and supply agreement from Clinigen with Boehringer Ingelheim Biopharmaceuticals GmbH (“BI”) pursuant to which BI will carry out the processing, manufacturing and supply of Proleukin® in unlabeled vials. The term of this agreement is through October 2025, with automatic renewals for a period of two years unless terminated as permitted by the contract. Under this agreement, the Company must purchase a minimum number of vials each year at fixed prices determined by vial batch size. No inventory was purchased or material expense was recorded under this agreement for both the three and six months ended June 30, 2023 and 2022. The total estimated purchase obligations under this agreement for the remaining six months ending December 31, 2023, and the years ending December 31, 2024, 2025, 2026 and 2027, are $6.8 million, $9.5 million, $6.1 million, $6.1 million, and $6.1 million, respectively.

STOCKHOLDERS' EQUITY - Stock based expense (Details) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2023	Jun. 30, 2022	Jun. 30, 2023	Jun. 30, 2022
Total stock-based compensation expenses	$ 16,740	$ 22,468	$ 32,405	$ 44,733
Research and development
Total stock-based compensation expenses	9,390	13,940	18,249	27,591
Selling, general and administrative
Total stock-based compensation expenses	$ 7,350	$ 8,528	$ 14,156	$ 17,142

LEASES - Additional information (Details)	6 Months Ended
LEASES - Additional information (Details)	Jun. 30, 2023 ft²
Option to extend	true
Minimum
Term of contract in years	1 year
Maximum
Term of contract in years	20 years
Office Space \| Minimum
Term of contract in years	12 months
Office Space \| Philadelphia, Pennsylvania
Area of land	136,000
Furniture and equipment \| Maximum
Term of contract in years	12 months
New Headquarters Lease \| Office Space \| San Carlos, California
Area of land	49,918

CASH EQUIVALENTS, INVESTMENTS AND RECURRING FAIR VALUE MEASUREMENTS - Narrative (Details) $ in Thousands	6 Months Ended	12 Months Ended
	Jun. 30, 2023 USD ($)	Dec. 31, 2022 USD ($)
Unrealized losses on available-for-sale	$ 0	$ 0
Number of investments in debt securities in continuous unrealized loss position for more than 12 months	0
Demand Deposits
Cash equivalents total	$ 54,000	$ 99,400

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Policies)

6 Months Ended

Jun. 30, 2023

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Cash, Cash Equivalents, and Investments

The Company’s cash and cash equivalents include short-term investments with original maturities of three months or less when purchased. The Company's investments are classified as “available-for-sale.” The Company includes these investments in current assets or non-current assets in the Condensed Consolidated Balance Sheets based on the length of maturity from the reporting date and carries them at fair value. Unrealized gains and losses on available-for-sale securities are recorded in the Condensed Consolidated Statements of Comprehensive Loss. Impairment losses related to credit losses (if any) are recorded as an allowance for credit losses with an offsetting entry to Interest income, net. No impairment losses related to credit losses were recognized for the three and six months ended June 30, 2023 and 2022. The cost of debt securities is adjusted for the amortization of premiums and accretion of discounts to maturity. Such amortization and accretion are included in Interest income, net in the Condensed Consolidated Statements of Operations. Gains and losses on securities sold are recorded based on the specific identification method and are included in Interest income, net in the Condensed Consolidated Statements of Operations. The Company has not incurred any realized gains or losses from sales of securities to date. The Company’s investment policy limits investments to certain types of instruments such as certificates of deposit, money market instruments, obligations issued by the U.S. government and U.S. government agencies as well as corporate debt securities and commercial paper, and places restrictions on maturities and concentration by type and issuer, except for securities issued by the U.S. government.

Restricted Cash

The Company maintains a required minimum balance in a segregated bank account in connection with its letters of credit for which amounts are restricted as to their use by the Company. Currently, the Company’s letters of credit are primarily comprised of one for the benefit of the landlord for the iCTC used as a security deposit for the lease in the amount $5.45 million and one for $0.6 million for the benefit of the landlord for the Company’s current headquarters’ lease (See Note 12 - Leases), as well as one for $60.0 million, for the future milestone payment as required by the terms of the Option Agreement for the Proleukin® acquisition (See Note 4 – Proleukin® Acquisition). The letter of credit for $5.45 million originally expired on May 28, 2020, however, it automatically extends for additional one-year periods, without written agreement, to May 28 in each succeeding calendar year, through at least 60 days after the lease expiration date. Further, on the expiration of the seventh year of the lease, and each anniversary date thereafter, the letter of credit may be decreased by $1.0 million with a minimum security deposit of $1.5 million maintained through the end of the lease term. The letter of credit with the landlord for the Company’s current headquarters’ lease expires on February 1, 2032, however, it will be automatically extended, without written agreement, for one-year periods to February in each succeeding calendar year. The letter of credit for the $60.0 million expires on May 5, 2024, however, it will be automatically extended, without written agreement,

for one-year periods to May in each succeeding calendar year and the final expiration date will be July 20, 2026. Furthermore, the letter of credit will not be automatically extended if a thirty-day written notice is provided prior to the annual extension. As of June 30, 2023 and December 31, 2022, Restricted cash totaled $66.4 million and $6.4 million, respectively, in the Company’s Condensed Consolidated Balance Sheets.

The following table provides a reconciliation of cash, cash equivalents, and restricted cash, reported within the Condensed Consolidated Balance Sheets that sum to the total of the same such amounts shown in the Condensed Consolidated Statements of Cash Flows (in thousands):


	June 30,
	2023		2022
Cash and cash equivalents	$	230,010	$	108,075
Restricted cash		66,430		6,430
Total cash, cash equivalents and restricted cash	$	296,440	$	114,505

Asset Acquisitions

The Company evaluates acquisitions of assets using the guidance in Accounting Standard Codification (“ASC”) Topic 805, Business Combinations (“ASC 805”), to determine whether the transaction should be accounted for as a business combination or asset acquisition by first applying a screen test to assess if substantially all of the fair value of the gross assets acquired is concentrated in a single identifiable asset or group of assets. If the screen test is met, the transaction is accounted for as an asset acquisition. If the screen test is not met, further assessment is required to determine whether the Company has acquired inputs and processes that have the ability to create outputs, which would meet the requirements of a business.

If the assets acquired do not constitute a business, the Company accounts for asset acquisitions using the cost accumulation and allocation method. Under this method the cost of the acquisition, including direct acquisition-related costs, is allocated to the assets acquired on a relative fair value basis. Goodwill is not recognized in an asset acquisition and any difference between consideration transferred and the fair value of the net assets acquired is allocated to the identifiable assets acquired based on their relative fair values.

Deferred tax liabilities arising from basis differences in assets acquired are calculated using the simultaneous equations method under ASC 740, Income Taxes (“ASC 740”), and based on the effective tax rate. The resulting deferred tax liability is recorded in the Condensed Consolidated Balance Sheet as of June 30, 2023.

Contingent consideration in the scope of ASC Topic 815, Derivatives and Hedging (“ASC 815”), is included in the cost of the asset acquisition at its acquisition date fair value. Contingent consideration in the scope of ASC Topic 450, Contingencies (ASC “450”), is recognized when it is both probable and reasonably estimable.

Inventory and Cost of Sales

Inventory is stated at the lower of cost or net realizable value. Cost includes amounts related to materials, labor and overhead. Net realizable value is the estimated selling price in the ordinary course of business less reasonably predictable costs of completion, disposal and transportation. Inventories presented in the Condensed Consolidated Balance Sheet as of June 30, 2023 pertain solely to Proleukin® and include a step-up of the fair value of inventories as a result of the acquisition of the worldwide rights to Proleukin®. Inventoriable costs incurred such as manufacturing costs for the Company’s product candidates, including lifileucel, are expensed as incurred as research and development expenses prior to regulatory approval. If and when regulatory approval of a product is obtained and the approved product is commercially launched, the Company will begin capitalizing manufacturing costs related to the approved product into inventory.

Cost of sales includes the cost of Proleukin® inventories and other costs that are directly associated with the purchase and sales of Proleukin®. In addition, amortization expense for the fair value step up of Proleukin® inventories and the acquired intangible assets related to the developed technology are included in Cost of Sales.

Trade Accounts Receivable

Trade accounts receivable are recorded net of allowances for product returns and estimated credit losses. The estimate of allowance for credit losses considers factors, including existing contractual payment and the aging of receivable from its customers. To date, the Company has determined that an allowance for doubtful accounts is not required.

Intangible Assets

The Company’s intangible assets are initially measured based on an allocation of the cost of the acquisition to the assets acquired on a relative fair value basis and are recorded net of accumulated amortization. The Company amortizes the intangible assets on a straight-line basis over their estimated useful lives.

When contingent consideration is a component of the cost of an asset acquisition, the Company capitalizes the amount of incremental cost from the contingent consideration related to the intangible asset acquired in the period the underlying contingency is resolved. When this occurs, the Company will recognize amortization expense on the incremental cost prospectively from the date the incremental costs are capitalized.

The Company reviews intangible assets for impairment at least annually and whenever events or changes in circumstances have occurred which could indicate that the carrying value of the assets are not recoverable. If such indicators are present, the Company assesses the recoverability of affected assets by determining if the carrying value of the assets is less than the sum of the undiscounted future cash flows of the assets. If the assets are found to not be recoverable, the Company measures the amount of impairment by comparing the carrying value of the assets to their fair values. The Company determined that no indicators of impairment existed as of June 30, 2023.

Leases

The Company determines if an arrangement includes a lease at inception and thereafter, if modified. Operating leases are included in its Condensed Consolidated Balance Sheets as Operating lease right-of-use assets and Operating lease liabilities as of June 30, 2023 and December 31, 2022. Operating lease right-of-use assets represent the Company’s right to use an underlying asset for the lease term and operating lease liabilities represent the Company’s obligation to make lease payments arising from the lease. Operating lease right-of-use assets and liabilities are recognized at the lease commencement date or modification date based on the present value of lease payments over the lease term. In determining the net present value of lease payments, the Company uses an estimated incremental borrowing rate that is applicable to the Company based on the information available at the later of the lease commencement or modification date.

The operating lease right-of-use assets also include any lease payments made less lease incentives. The Company’s leases may include options to extend or terminate the lease, which is considered in the lease term when it is reasonably certain that the Company will exercise any such options. Lease expense is recognized on a straight-line basis over the expected lease term and recorded in costs and expenses in the Condensed Consolidated Statements of Operations. The Company has elected not to apply the recognition requirements of Accounting Standards Update (“ASU”) No. 2016-02 and No. 2018-10 (together “Topic 842”) for short-term leases.

For lease agreements entered into by the Company that include lease and non-lease components, such components are generally accounted for separately.

Revenue Recognition

The Company recognizes revenue from product sales in accordance with ASC 606, Revenue from Contracts with Customers. Under ASC 606, revenue is recognized when a customer obtains control of promised goods or services, in an amount that reflects the consideration which the entity expects to receive in exchange for those goods or services. To the extent the transaction price includes variable consideration, the Company estimates the amount of variable consideration that should be included in the transaction price using the most likely method based on historical experience as well as applicable information currently available.

Indirect taxes collected from customers and remitted to government authorities that are related to sales of the Company’s products, primarily in Europe, are excluded from revenues.

Subsequent to the closing of the acquisition of Proleukin® in May 2023, the Company began to sell Proleukin® in licensed markets outside of the U.S. To date, there have been no product sales from Proleukin®in the U.S. market. Product sales for the three and six months ended June 30, 2023 were $0.2 million. Reserves for variable consideration for the market outside of the U.S. were immaterial.

Stock-Based Compensation

The Company periodically grants stock options to employees and non-employees as compensation for services rendered. The Company accounts for all stock-based payment awards made to employees, including the employee stock purchase plans, and non-employees in accordance with the authoritative guidance provided by the Financial Accounting Standards Board (“FASB”) where the value of the award is measured on the date of grant and recognized over the vesting period. Forfeitures are recognized in the period in which they occur. The Company accounts for stock option grants to non-employees in a similar manner as stock option grants to employees except for the term used in the grant date fair value, therefore no longer requiring a re-measurement at the then-current fair values at each reporting date until the shares underlying the options have vested. The non-employee awards that contain a performance condition that affects the quantity or other terms of the award are measured based on the outcome that is probable.

The fair value of the Company's common stock option grants is estimated using a Black-Scholes option pricing model, which uses certain assumptions related to risk-free interest rates, expected volatility, expected term of the common stock options, and future dividends. The stock-based compensation expense is recorded based upon the value derived from the Black-Scholes option pricing model. The assumptions used in the Black-Scholes option pricing model could affect compensation expense recorded in future periods.

The Company issues restricted stock units (“RSUs”) from time to time as part of its equity incentive plans. The Company measures the compensation cost with respect to RSUs issued to employees based upon the estimated fair value of the equity instruments at the date of the grant, which is recognized as an expense over the period during which an employee is required to provide services in exchange for the awards. The fair value of RSUs is based on the closing price of the Company’s common stock on the grant date. In addition to RSUs that have time-based vesting requirements, from time to time the Company may issue RSUs that include certain performance vesting criteria based upon the satisfaction of stated objectives (“PRSUs”). The Company measures the compensation cost with respect to PRSUs issued to employees based upon the estimated fair value of the equity instruments at the date of grant, which is recognized as an expense over the period that achievement is determined to be probable through the stated service period associated with the award.

Accrued Research and Development Costs

Research and development costs are expensed as incurred. Clinical development costs compose a significant component of research and development costs. The Company has a history of contracting with third parties, including contract research organizations (“CROs”), independent clinical investigators, and contract manufacturing organizations (“CMOs”) that perform various clinical trial activities on the Company’s behalf in connection with the ongoing development of the Company’s product candidates. The financial terms of these contracts are subject to negotiations and may vary from contract to contract and may result in an uneven payment flow. The Company accrues and expenses costs for clinical trial activities performed by third parties based upon estimates of work completed to date for each clinical trial in accordance with agreements established with CROs, hospitals, and clinical investigators. Accruals for CROs and CMOs are recorded based on estimates of services received and efforts expended pursuant to agreements established with CROs, CMOs and other outside service providers. The Company determines its estimates through discussions with internal clinical stakeholders and outside service providers as to the progress or stage of completion of clinical trials or services and the contracted fee to be paid for such services.

Included in the Company’s clinical development costs are investigator costs, which are costs associated with treatments administered at clinical sites as required under each clinical study protocol. The Company’s estimates for clinical investigator costs and timing of expense recognition will depend on a number of factors that include, but are not limited to, (i) the overall number of patients that enroll in the trial at each individual site, (ii) the length of study enrollment period, (iii) discontinuation and completion rates of patients, (iv) duration of patient safety follow-ups, (v) the number of sites included in the clinical trial, and (vi) the contracted fee of each participating site for patient treatment while on study, which can vary greatly for several reasons including, but not limited to, geographic region, medical center or physician costs, and overhead costs. In addition, the Company’s estimates for per patient trial costs will vary based on a number of factors that include, but are not limited to, the extent of additional treatments that may be administered by investigators as a result of patient health status, recoverability of patient costs through insurance carriers of patients, and unanticipated cost of injuries incurred as a result of the study treatment. The Company accrues for estimated expenses resulting from obligations under investigator site agreements as the timing of payments does not always timely align with the periods over which the treatments are administered by the clinical investigators. These estimates are typically based on contracted amounts, patient visit data, discussions with internal clinical stakeholders and outside service providers, and historical look-back analysis of actual payments made to date.

The Company makes judgements and estimates in determining the accrual balance in each reporting period.

In the event advance payments are made to a CRO, CMO or other outside service provider, the payments are recorded within prepaid expenses and other current assets in the Condensed Consolidated Balance Sheets and subsequently recognized as research and development expense in the Condensed Consolidated Statements of Operations when the associated services have been performed. As actual costs become known, the Company adjusts its estimates, liabilities and assets. Inputs used in the determination of estimates discussed above may vary from actual, which will result in adjustments to research and development expense in future periods. Changes in these estimates that result in material changes to the Company’s accruals could materially affect its results of operations. The Company’s historical estimates have not been materially different from actual amounts recorded.

Selling, general and administrative expense

Selling, general and administrative expenses consist primarily of salaries and other related costs, including stock-based compensation, for personnel in executive, finance, procurement, legal, investor relations, facilities, business development, marketing, commercial, information technology and human resources functions. Other significant costs include facility costs not otherwise included in research and development expenses and amortization expense for the acquired assembled workforce intangible asset. Selling, general and administrative costs are expensed as incurred, and the Company accrues for services provided by third parties related to such expenses by monitoring the status of services provided and receiving estimates from its service providers and adjusting its accruals as actual costs become known.

Net Loss per Share

Basic net loss per share is computed by dividing the net loss by the weighted average number of common shares outstanding during the period.

Diluted net loss per share is computed by dividing the net loss by the sum of the weighted average number of shares of common stock outstanding and the dilutive common stock equivalents outstanding during the period. The Company’s potentially dilutive common stock equivalent shares, which include incremental common shares issuable upon (i) the exercise of outstanding stock options, (ii) purchases though the 2020 Employee Stock Purchase Plan (the “2020 ESPP”), (iii) vesting of restricted stock units, and (iv) conversion of preferred stock, are only included in the calculation of diluted net loss per share when their effect is dilutive.

As of June 30, 2023 and 2022, the following outstanding common stock equivalents have been excluded from the calculation of net loss per share because their impact would be anti-dilutive:


	June 30,
	2023	2022
Stock options	19,438,306	14,519,506
Employee Stock Purchase Plan	225,110	193,194
Restricted stock units	4,153,569	2,499,178
Series A Convertible Preferred Stock*	97,000	97,000
Series B Convertible Preferred Stock*	2,842,158	2,842,158
	26,756,143	20,151,036

* on an as-converted basis

The dilutive effect of potentially dilutive securities would be reflected in diluted earnings per common share by application of the treasury stock method. Under the treasury stock method, an increase in the fair market value of the Company's common stock could result in a greater dilutive effect from potentially dilutive securities.

Use of Estimates

The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of expenses during the reporting period. Actual results could differ from those estimates. Significant items subject to such estimates and assumptions include assumptions made in the fair value of intangible assets, inventories acquired as part of the acquisition of Proleukin®, equity awards and related stock-based compensation, assumptions used in measuring operating right-of-use assets and operating lease liabilities, accounting for potential liabilities, including estimates inherent in accruals related to clinical trials, and the realizability of the Company’s deferred tax assets.

Principles of Consolidation

The accompanying Condensed Consolidated Financial Statements include the accounts of Iovance Biotherapeutics, Inc. and its wholly-owned subsidiaries, Iovance Biotherapeutics Manufacturing LLC, Iovance Biotherapeutics GmbH, Iovance Biotherapeutics B.V., Iovance Biotherapeutics UK Ltd and Clinigen SP Ltd (together, the “UK subsidiaries”), and Iovance Biotherapeutics Canada, Inc. All intercompany accounts and transactions have been eliminated.

Foreign Currency Translation

The assets and liabilities of the Company’s subsidiaries whose functional currencies are not in U.S. dollars are translated into U.S. dollars at the related period-end exchange rate. The U.S. dollar effects that arise from translation of net assets of these subsidiaries at changing rates are recognized in Accumulated Other Comprehensive Income (Loss) in the Condensed Consolidated Balance Sheets. The subsidiaries’ net loss is translated into U.S. dollars by using the average exchange rate for the applicable period. The Condensed Consolidated Financial Statements are presented in U.S. dollars, which is the Company’s reporting currency.

Segment Reporting

The Company operates in one segment, focused on innovating, developing and commercializing therapies using autologous TIL for the treatment of advanced melanoma and other solid tumor cancers.

Recent Accounting Standards

There were no applicable recently issued accounting standards nor did we adopt any new accounting standards during either the three or six months ended June 30, 2023.

INTANGIBLE ASSETS, NET

6 Months Ended

Jun. 30, 2023

INTANGIBLE ASSETS, NET

INTANGIBLE ASSETS, NET

NOTE 5. INTANGIBLE ASSETS, NET

The gross carrying amounts and net book value of intangible assets as of June 30, 2023 are as follows (in thousands):


	June 30, 2023
	Gross carrying amounts		Accumulated amortization		Intangible assets, net
Intangible assets:
Developed technology	$	236,793	$	(1,903)	$	234,890
Assembled workforce		647		(26)		621
Total Intangible Assets	$	237,440	$	(1,929)	$	235,511
* Amounts are translated using the foreign exchange rate as of 6/30/2023.

The Company recognized $1.9 million of amortization expense during the three and six months ended June 30, 2023. Amortization expense for the developed technology and assembled workforce is recorded in Cost of Sales and Selling, General and Administrative expense, respectively, in the Condensed Consolidated Statement of Operations for the three and six months ended June 30, 2023. There was no such expense recorded in the three and six months ended June 30, 2022.

The total estimated amortization of the Company’s intangible assets for the remaining six months ending December 31, 2023, and the years ending December 31, 2024, 2025, 2026, 2027 and 2028, are $7.9 million, $15.7 million, $15.7 million, $15.6 million, $15.5 million and $15.5 million, respectively.

Condensed Consolidated Statements of Operations - USD ($) shares in Thousands, $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2023	Jun. 30, 2022	Jun. 30, 2023	Jun. 30, 2022
Condensed Consolidated Statements of Operations
Total revenue	$ 238		$ 238
Revenue from Contract with Customer, Product and Service [Extensible Enumeration]	Product [Member]	Product [Member]	Product [Member]	Product [Member]
Costs and expenses
Cost of sales	$ 2,050		$ 2,050
Research and development	86,347	$ 73,406	169,081	$ 141,706
Selling, general and administrative	21,927	26,328	50,049	49,741
Total costs and expenses	110,324	99,734	221,180	191,447
Loss from operations	(110,086)	(99,734)	(220,942)	(191,447)
Other income
Interest income, net	3,081	385	6,567	491
Net Loss before income taxes	(107,005)	(99,349)	(214,375)	(190,956)
Income tax benefit	477		477
Net Loss	$ (106,528)	$ (99,349)	$ (213,898)	$ (190,956)
Net Loss Per Share of Common Stock, Basic	$ (0.47)	$ (0.63)	$ (0.98)	$ (1.21)
Net Loss Per Share of Common Stock, Diluted	$ (0.47)	$ (0.63)	$ (0.98)	$ (1.21)
Weighted Average Shares of Common Stock Outstanding, Basic	224,481	157,274	219,117	157,194
Weighted Average Shares of Common Stock Outstanding, Diluted	224,481	157,274	219,117	157,194

CASH EQUIVALENTS, INVESTMENTS AND RECURRING FAIR VALUE MEASUREMENTS - Fair value of company's financial assets (Details) - Recurring - USD ($) $ in Thousands	Jun. 30, 2023	Dec. 31, 2022
Total	$ 196,861	$ 372,470
U.S. treasury securities
Total	15,464	117,720
U.S. government agency securities
Total		11,265
Corporate securities
Total		7,230
Commercial paper
Total	5,420	148,254
Money market funds
Total	175,977	88,001
Level 1
Total	191,441	205,721
Level 1 \| U.S. treasury securities
Total	15,464	117,720
Level 1 \| Money market funds
Total	175,977	88,001
Level 2
Total	5,420	166,749
Level 2 \| U.S. government agency securities
Total		11,265
Level 2 \| Corporate securities
Total		7,230
Level 2 \| Commercial paper
Total	$ 5,420	$ 148,254

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Tables)

6 Months Ended

Jun. 30, 2023

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Schedule of cash and cash equivalents and restricted cash


	June 30,
	2023		2022
Cash and cash equivalents	$	230,010	$	108,075
Restricted cash		66,430		6,430
Total cash, cash equivalents and restricted cash	$	296,440	$	114,505

Schedule of Antidilutive securities excluded from computation of earnings per share


	June 30,
	2023	2022
Stock options	19,438,306	14,519,506
Employee Stock Purchase Plan	225,110	193,194
Restricted stock units	4,153,569	2,499,178
Series A Convertible Preferred Stock*	97,000	97,000
Series B Convertible Preferred Stock*	2,842,158	2,842,158
	26,756,143	20,151,036

* on an as-converted basis

REVENUE (Details) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
REVENUE (Details) - USD ($) $ in Thousands	Jun. 30, 2023	Jun. 30, 2022	Jun. 30, 2023	Jun. 30, 2022
REVENUE
Total revenue	$ 238		$ 238
Revenue from Contract with Customer, Product and Service [Extensible Enumeration]	Product [Member]	Product [Member]	Product [Member]	Product [Member]
Outside of U.S.
REVENUE
Total revenue	$ 200		$ 200
In U.S.
REVENUE
Total revenue	$ 0		$ 0
Revenue from Contract with Customer, Product and Service [Extensible Enumeration]			Product [Member]

- Definition

Line items represent financial concepts included in a table. These concepts are used to disclose reportable information associated with domain members defined in one or many axes to the table.

+ References + Details

- Definition

Amount, excluding tax collected from customer, of revenue from satisfaction of performance obligation by transferring promised good or service to customer. Tax collected from customer is tax assessed by governmental authority that is both imposed on and concurrent with specific revenue-producing transaction, including, but not limited to, sales, use, value added and excise.

+ References

Reference 1: http://www.xbrl.org/2003/role/disclosureRef
-Topic 924
-SubTopic 10
-Name Accounting Standards Codification
-Section S99
-Paragraph 1
-Subparagraph (SAB Topic 11.L)
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147479941/924-10-S99-1

Reference 2: http://www.xbrl.org/2003/role/disclosureRef
-Topic 606
-SubTopic 10
-Name Accounting Standards Codification
-Section 50
-Paragraph 5
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147479806/606-10-50-5

Reference 3: http://www.xbrl.org/2003/role/disclosureRef
-Topic 280
-SubTopic 10
-Name Accounting Standards Codification
-Section 50
-Paragraph 30
-Subparagraph (a)
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147482810/280-10-50-30

Reference 4: http://www.xbrl.org/2003/role/disclosureRef
-Topic 280
-SubTopic 10
-Name Accounting Standards Codification
-Section 50
-Paragraph 42
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147482810/280-10-50-42

Reference 5: http://www.xbrl.org/2003/role/disclosureRef
-Topic 280
-SubTopic 10
-Name Accounting Standards Codification
-Section 50
-Paragraph 22
-Subparagraph (b)
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147482810/280-10-50-22

Reference 6: http://www.xbrl.org/2003/role/disclosureRef
-Topic 280
-SubTopic 10
-Name Accounting Standards Codification
-Section 50
-Paragraph 32
-Subparagraph (b)
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147482810/280-10-50-32

Reference 7: http://www.xbrl.org/2003/role/disclosureRef
-Topic 280
-SubTopic 10
-Name Accounting Standards Codification
-Section 50
-Paragraph 40
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147482810/280-10-50-40

Reference 8: http://www.xbrl.org/2003/role/disclosureRef
-Topic 280
-SubTopic 10
-Name Accounting Standards Codification
-Section 50
-Paragraph 22
-Subparagraph (a)
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147482810/280-10-50-22

Reference 9: http://www.xbrl.org/2003/role/disclosureRef
-Topic 280
-SubTopic 10
-Name Accounting Standards Codification
-Section 50
-Paragraph 32
-Subparagraph (a)
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147482810/280-10-50-32

Reference 10: http://www.xbrl.org/2003/role/disclosureRef
-Topic 280
-SubTopic 10
-Name Accounting Standards Codification
-Section 50
-Paragraph 41
-Subparagraph (a)
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147482810/280-10-50-41

Reference 11: http://www.xbrl.org/2003/role/disclosureRef
-Topic 606
-SubTopic 10
-Name Accounting Standards Codification
-Section 50
-Paragraph 4
-Subparagraph (a)
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147479806/606-10-50-4

+ Details

CASH EQUIVALENTS, INVESTMENTS AND RECURRING FAIR VALUE MEASUREMENTS - Cost and fair value (Details) - USD ($) $ in Thousands	Jun. 30, 2023	Dec. 31, 2022
Amortized Cost	$ 196,869	$ 373,372
Gross Unrealized Gains		8
Gross Unrealized Losses	(8)	(910)
Fair Value	196,861	372,470
U.S. treasury securities
Amortized Cost	15,471	118,570
Gross Unrealized Losses	(7)	(850)
Fair Value	15,464	117,720
U.S. government agency securities
Amortized Cost		11,272
Gross Unrealized Losses		(7)
Fair Value		11,265
Corporate securities
Amortized Cost		7,230
Fair Value		7,230
Commercial paper
Amortized Cost	5,421	148,299
Gross Unrealized Gains		8
Gross Unrealized Losses	(1)	(53)
Fair Value	5,420	148,254
Money market funds
Amortized Cost	175,977	88,001
Fair Value	$ 175,977	$ 88,001

CASH EQUIVALENTS, INVESTMENTS AND RECURRING FAIR VALUE MEASUREMENTS - Available for sale debt securities (Details) - USD ($) $ in Thousands	Jun. 30, 2023	Dec. 31, 2022
Cash and Cash Equivalents [Line Items]
Short-term investments	$ 20,884	$ 240,114
Total investments	196,861	372,470
Money market funds
Cash and Cash Equivalents [Line Items]
Cash equivalents	$ 175,977	$ 132,356

ACCRUED EXPENSES (Tables)

6 Months Ended

Jun. 30, 2023

ACCRUED EXPENSES

Schedule of accrued expenses

Accrued expenses consist of the following (in thousands):


	June 30,		December 31,
	2023		2022
Accrued payroll and employee related expenses	$	18,359	$	19,407
Clinical related		10,135		14,812
Manufacturing related		7,350		4,652
Facilities related		3,537		6,510
Legal and related services		1,416		3,015
Proleukin® acquisition related		1,249		—
Other accrued expenses		4,574		3,899
Total accrued expenses	$	46,620	$	52,295

LEGAL PROCEEDINGS (Details) $ in Millions				1 Months Ended
LEGAL PROCEEDINGS (Details) $ in Millions	Oct. 14, 2021 USD ($)	May 12, 2020 USD ($)	Apr. 08, 2016 USD ($) item	Nov. 30, 2012 USD ($)	Jun. 30, 2012 USD ($)
Damages claimed			$ 0.5
Solomon Capital LLC Litigation
Proceeds from lawsuit filed				$ 0.2	$ 0.1
Face amount			$ 0.2
Debt instrument, convertible, number of equity instruments \| item			1,110
Estimate of possible loss			$ 1.5
Reverse split ratio			0.01
Maximum
Equity claim	$ 0.1	$ 0.1

INTANGIBLE ASSETS, NET (Tables)

6 Months Ended

Jun. 30, 2023

INTANGIBLE ASSETS, NET

Summary of gross carrying amounts and net book value of intangible assets

The gross carrying amounts and net book value of intangible assets as of June 30, 2023 are as follows (in thousands):


	June 30, 2023
	Gross carrying amounts		Accumulated amortization		Intangible assets, net
Intangible assets:
Developed technology	$	236,793	$	(1,903)	$	234,890
Assembled workforce		647		(26)		621
Total Intangible Assets	$	237,440	$	(1,929)	$	235,511
* Amounts are translated using the foreign exchange rate as of 6/30/2023.

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - Cash, Cash equivalents and Restricted Cash (Details) - USD ($) $ in Thousands	6 Months Ended
	Jun. 30, 2023	Dec. 31, 2022	Jun. 30, 2022	Dec. 31, 2021
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
Restricted security deposit	$ 5,450
Letter of credit	60,000
Cash and cash equivalents	230,010	$ 231,731	$ 108,075
Restricted cash	66,430	6,430	6,430
Total cash, cash equivalents and restricted cash	296,440	$ 238,161	$ 114,505	$ 84,313
Commercial manufacturing facility
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
Security deposit	5,450
Decrease in letters of credit	1,000
Commercial manufacturing facility \| Minimum
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
Security deposit	1,500
Headquarters lease
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
Security deposit	600
Future milestone payment	$ 60,000

Condensed Consolidated Balance Sheets - USD ($) $ in Thousands	Jun. 30, 2023	Dec. 31, 2022
Current Assets
Cash and cash equivalents	$ 230,010	$ 231,731
Trade accounts receivable	33
Short-term investments	20,884	240,114
Inventory	9,720
Prepaid expenses and other assets	14,231	7,271
Total Current Assets	274,878	479,116
Property and equipment, net	112,549	105,232
Intangible assets, net	235,511
Operating lease right-of-use assets	67,631	73,015
Restricted cash	66,430	6,430
Long-term assets	294	189
Total Assets	757,293	663,982
Current Liabilities
Accounts payable	31,157	26,603
Accrued expenses	46,620	52,295
Operating lease liabilities	10,866	12,587
Total Current Liabilities	88,643	91,485
Non-Current Liabilities
Operating lease liabilities - non-current	68,844	71,859
Deferred tax liabilities	20,237
Long-term note payable	1,000	1,000
Total Non-Current Liabilities	90,081	72,859
Total Liabilities	178,724	164,344
Commitments and contingencies
Stockholders' Equity
Common stock, $0.000041666 par value; 500,000,000 shares authorized, 224,688,434 and 187,812,072 shares issued and outstanding as of June 30, 2023 and December 31, 2022, respectively	9	8
Accumulated other comprehensive income (loss)	325	(902)
Additional paid-in capital	2,360,468	2,068,867
Accumulated deficit	(1,782,236)	(1,568,338)
Total Stockholders' Equity	578,569	499,638
Total Liabilities and Stockholders' Equity	757,293	663,982
Series A Convertible Preferred Stock
Stockholders' Equity
Preferred stock, Value	0	0
Series B Convertible Preferred Stock
Stockholders' Equity
Preferred stock, Value	$ 3	$ 3

INVENTORY

6 Months Ended

Jun. 30, 2023

INVENTORY

INVENTORY

NOTE 6. INVENTORY

Inventories presented in the Condensed Consolidated Balance Sheet as of June 30, 2023 pertain solely to Proleukin®. Inventory classified as work in process are unlabeled vials of Proleukin®.

Inventories consist of the following (in thousands):


		June 30,		December 31,
		2023		2022
Work in process	$	8,587	$	—
Finished goods		1,133		—
Total inventory	$	9,720	$	—

ACCRUED EXPENSES (Details) - USD ($) $ in Thousands	Jun. 30, 2023	Dec. 31, 2022
ACCRUED EXPENSES
Accrued payroll and employee related expenses	$ 18,359	$ 19,407
Clinical related	10,135	14,812
Manufacturing related	7,350	4,652
Facilities related	3,537	6,510
Legal and related services	1,416	3,015
Proleukin acquisition related	1,249
Other accrued expenses	4,574	3,899
Total accrued expenses	$ 46,620	$ 52,295

LICENSES AND AGREEMENTS (Details) $ in Thousands					1 Months Ended				3 Months Ended		6 Months Ended		12 Months Ended
LICENSES AND AGREEMENTS (Details) $ in Thousands	May 18, 2023 USD ($) item	May 07, 2018 USD ($)	Apr. 17, 2017 USD ($)	Jun. 28, 2014 USD ($)	Oct. 31, 2022 item	Aug. 31, 2021 USD ($)	Nov. 30, 2016 item	Aug. 31, 2011	Jun. 30, 2023 USD ($)	Jun. 30, 2022 USD ($)	Jun. 30, 2023 USD ($)	Jun. 30, 2022 USD ($)	Dec. 31, 2021 USD ($)	Dec. 31, 2020 USD ($)
Research and development									$ 86,347	$ 73,406	$ 169,081	$ 141,706
Strategic Alliance Agreement
Research and development									0	0	0	100
Manufacturing and Supply Agreement With Boehringer Ingelheim Biopharmaceuticals GmbH
Renewal term of agreement	2 years
Inventory purchased									0	0	0	0
Expense recorded									0	0	0	0
Maximum \| Strategic Alliance Agreement
Research and development arrangement, contract to perform for others, costs incurred, gross			$ 14,200
Sponsored research agreement
Research and development									100	200	200	300
Second license agreement
Research and development										100	100	100
First WuXi Manufacturing and Services Agreement
Agreement term							3 years
Number Of Statements Of Work \| item							1
Number Of Suites Under The Agreement \| item							2
Second WuXi Manufacturing and Services Agreement
Agreement term					3 years
Number Of Suites Under The Agreement \| item					2
Termination notice period					120 days
Period to address issues within receipt of FDA response letter in collaboration arrangement					90 days
Research and development \| Strategic Alliance Agreement
Research and development arrangement, contract to perform for others, costs incurred, gross											5,300
Cooperative Research and Development Agreement
Agreement term						3 years		5 years
Research and development						$ 500			500	500	1,000	1,000
Notification Period To Terminate Agreement						60 days
Research Collaboration And Clinical Grant Agreements With Moffitt
Research and development									0	0	0	100
Moffitt License Agreement One
Agreement term				20 years
Research and development									0	0	0	0
Moffitt License Agreement One \| Research and development
Payments for upfront licensing fee				$ 100
Moffitt License Agreement Two
Payments for upfront licensing fee		$ 100
Additional milestone payable									400		400
Moffitt License Agreement Two, Amended and Restated
Research and development											0	0
Payments for upfront licensing fee													$ 200
WuXi Apptech, Inc - Manufacturing and Services Agreement
Research and development									4,800	3,200	8,700	7,100
Cellectis S.A
Research and development									100	100	200	200
Novartis Pharma AG and Related Entities - License Agreement
Research and development									0	0	0	0		$ 10,000
Number of historical asset purchase agreement. \| item	2
Number of historical master cell bank license and working cell bank transfer agreement \| item	1
Number of historical license agreement \| item	1
amount of milestone payment made during the period under the license agreement									$ 0	$ 0	$ 0	$ 0
Percent of milestone payments reimbursable	25.00%
Novartis Pharma AG and Related Entities - License Agreement \| Maximum \| UNITED STATES
Amount of milestone payments payable under the license agreement	$ 30,000
Novartis Pharma AG and Related Entities - License Agreement \| Maximum \| Non-US
Amount of milestone payments payable under the license agreement	$ 15,000

Pay vs Performance Disclosure - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
Pay vs Performance Disclosure - USD ($) $ in Thousands	Jun. 30, 2023	Jun. 30, 2022	Jun. 30, 2023	Jun. 30, 2022
Pay vs Performance Disclosure
Net Income (Loss)	$ (106,528)	$ (99,349)	$ (213,898)	$ (190,956)

- Definition

The portion of profit or loss for the period, net of income taxes, which is attributable to the parent.

+ References

Reference 1: http://www.xbrl.org/2003/role/disclosureRef
-Topic 235
-SubTopic 10
-Name Accounting Standards Codification
-Section S99
-Paragraph 1
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Reference 2: http://www.xbrl.org/2003/role/disclosureRef
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Reference 34: http://www.xbrl.org/2003/role/disclosureRef
-Topic 205
-SubTopic 20
-Name Accounting Standards Codification
-Section 50
-Paragraph 7
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147483499/205-20-50-7

Reference 35: http://fasb.org/us-gaap/role/ref/legacyRef
-Topic 230
-SubTopic 10
-Name Accounting Standards Codification
-Section 45
-Paragraph 28
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147482740/230-10-45-28

Reference 36: http://www.xbrl.org/2003/role/disclosureRef
-Topic 220
-SubTopic 10
-Name Accounting Standards Codification
-Section 45
-Paragraph 1A
-Subparagraph (a)
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147482790/220-10-45-1A

Reference 37: http://www.xbrl.org/2003/role/disclosureRef
-Topic 220
-SubTopic 10
-Name Accounting Standards Codification
-Section 45
-Paragraph 1B
-Subparagraph (a)
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147482790/220-10-45-1B

Reference 38: http://fasb.org/us-gaap/role/ref/legacyRef
-Topic 220
-SubTopic 10
-Name Accounting Standards Codification
-Section S99
-Paragraph 2
-Subparagraph (SX 210.5-03(20))
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147483621/220-10-S99-2

Reference 39: http://fasb.org/us-gaap/role/ref/legacyRef
-Topic 942
-SubTopic 220
-Name Accounting Standards Codification
-Section S99
-Paragraph 1
-Subparagraph (SX 210.9-04(22))
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147483589/942-220-S99-1

+ Details

LEGAL PROCEEDINGS

6 Months Ended

Jun. 30, 2023

LEGAL PROCEEDINGS

LEGAL PROCEEDINGS

NOTE 13. LEGAL PROCEEDINGS

Derivative Lawsuit. On December 11, 2020, a purported stockholder derivative complaint was filed by plaintiff Leo Shumacher against the Company, as nominal defendant, and then current directors, as defendants, in the Court of Chancery in the State of Delaware (the “Court”). The complaint alleges breach of fiduciary duty and a claim for unjust enrichment in connection with alleged excessive compensation of certain non-executive directors of the Company and seeks unspecified damages on behalf of the Company. The parties have agreed to a proposed settlement, which was submitted to the Court on June 15, 2022. After a hearing on November 17, 2022, the Court required the parties to take additional steps before it would approve the settlement. The Company, as nominal defendant, and its current directors, as defendants, answered the complaint on February 3, 2023.

Solomon Capital, LLC. On April 8, 2016, a lawsuit (“the First Solomon Suit”) titled Solomon Capital, LLC, Solomon Capital 401(K) Trust, Solomon Sharbat and Shelhav Raff v. Lion Biotechnologies, Inc. was filed by Solomon Capital, LLC, Solomon Capital 401(k) Trust, Solomon Sharbat and Shelhav Raff (“Solomon Plaintiffs”) against the Company in the Supreme Court of the State of New York, County of New York (index no. 651881/2016). The Solomon Plaintiffs allege that, between June and November 2012, they provided the Company $0.1 million and that they advanced and paid on behalf of the Company an additional $0.2 million.

The complaint further alleges that the Company agreed to (i) provide them with promissory notes totaling $0.2 million, plus interest, (ii) issue a total of 1,110 shares to the Solomon Plaintiffs (after the 1-for-100 reverse split of the Company’s common stock

effected in March 2013) (the “Equity Claim”), and (iii) allow the Solomon Plaintiffs to convert the foregoing funds into its securities in the next financing of the Company on the same terms offered to other investors, which Solomon Plaintiffs allege, should have given them the right to convert their advances and payments into shares of the Company's common stock in the restructuring that took effect in May 2013. Based on the foregoing, the Solomon Plaintiffs allege causes for breach of contract and unjust enrichment and demand judgment against the Company in an unspecified amount exceeding $1.5 million, plus interest. On June 3, 2016, the Company filed an answer and counterclaims in the lawsuits. The Company has asserted counterclaims for fraudulent inducement, fraudulent misrepresentation, fraudulent concealment, breach of fiduciary duty, and breach of contract, alleging principally that the counterclaim defendants misrepresented their qualifications and failed to disclose that Solomon Sharbat was the subject of an investigation by the Financial Industry Regulatory Authority (“FINRA”) that resulted in the loss of his FINRA license.

In its counterclaims, the Company is seeking damages in an amount exceeding $0.5 million and an order rescinding any and all agreements that the Solomon Plaintiffs contend entitled them to obtain shares of Company stock. On May 12, 2020, the court granted the Company’s motion for summary judgment limiting the Solomon Plaintiffs’ damages for the Equity Claim to less than $0.1 million. The Solomon Plaintiffs filed a notice of appeal of this summary judgment on June 9, 2020. On July 2, 2020, the court granted the Company’s motion to dismiss the First Solomon Suit for want of prosecution. On January 4, 2021, the court granted the Solomon Plaintiffs motion for reconsideration, and reinstituted the case. On January 15, 2021, the Company filed a notice of appeal of the court’s grant of the Solomon Plaintiffs motion for reconsideration. On May 11, 2021, the Appellate Division upheld the court’s grant of the Solomon Plaintiffs’ motion for reconsideration of the dismissal of the First Solomon Suit for want of prosecution. On October 14, 2021, the Appellate Division upheld the court’s grant of the Company’s motion for summary judgment limiting the Solomon Plaintiffs’ damages for the Equity Claim to less than $0.1 million.

On September 27, 2019, the Solomon Plaintiffs filed a new lawsuit (through new legal counsel) (“the Second Solomon Suit”) titled Solomon Capital, LLC, Solomon Capital 401(K) Trust, Solomon Sharbat and Shelhav Raff v. Iovance Biotherapeutics, Inc., f/k/a/ Lion Biotechnologies Inc. f/k/a/ Genesis Biopharma Inc., and Manish Singh in the Supreme Court of the State of New York, County of New York (index no. 655668/2019). In the Second Solomon Suit, the Solomon Plaintiffs allege that they are third party beneficiaries of a “finder’s fee agreement” that prior management entered into with a third party unlicensed entity in 2012 in connection with seeking financing, that an agreement or understanding existed between the Company and the plaintiffs that the plaintiffs would be paid fees and commissions (in cash and stock) if they obtained financing for the Company, and that they directly and indirectly introduced investors to the Company who invested in the Company, or were willing to invest in the Company. Finally, the Solomon Plaintiffs allege that they were promised a license to use the Company’s technology in Israel. The plaintiffs claim that the Company breached the foregoing understandings, promises and agreements and, as a result, they are entitled to certain damages. The Solomon Plaintiffs also allege that Manish Singh, the Company’s former Chief Executive Officer, committed fraud and took shares belonging to them. On February 18, 2020, the Company filed a removal petition and removed the Second Solomon Suit to the U.S. District Court for the Southern District of New York, where the case has been assigned case no. 1:20-cv-1391. On May 22, 2020, the Company moved to dismiss the Second Solomon Suit for lack of personal jurisdiction. On March 26, 2021, the Court denied the Company’s motion to dismiss for lack of personal jurisdiction. The Company filed a response to the complaint in the Second Solomon Suit on April 30, 2021. On May 26, 2021, the Company and Singh filed motions for judgment on the pleadings with respect to the second and third claims asserted against the Company and all claims asserted against Singh, respectively, in the Second Solomon Suit. On January 5, 2022, the Court granted the Company’s motions for judgement on the pleadings, dismissing the second and third claims against the Company and dismissing all claims against Singh. On January 4, 2023, the Court granted in part the Company’s motion for sanctions against Plaintiffs for violating Rule 11 of the Federal Rules of Civil Procedure, in a decision and order that dismissed Plaintiffs’ first claim against the Company, denied Plaintiffs’ motion for leave to amend the complaint, and ordered Plaintiffs to pay the Company’s attorneys’ fees incurred in connection with the Rule 11 motion. Following the Court’s decision and order on the Rule 11 motion, only Plaintiffs’ fifth and sixth claims, for unjust enrichment and indemnification, respectively, remain pending against the Company.

The Company intends to vigorously defend these complaints and pursue its counterclaims, as applicable. At the current stage of the litigation, in both the First Solomon Suit and the Second Solomon Suit, it is not possible to estimate the amount or range of possible loss that might result from an adverse judgment or a settlement of these matters.

The Company may be involved, from time to time, in legal proceedings and claims arising in the ordinary course of its business. Such matters are subject to many uncertainties and outcomes are not predictable with assurance. The Company accrues amounts, to the extent they can be reasonably estimated, that it believes are adequate to address any liabilities related to legal proceedings and other loss contingencies that it believes will result in a probable loss. While there can be no assurances as to the ultimate outcome of any legal proceeding or other loss contingency involving the Company, management does not believe any

pending matter will be resolved in a manner that would have a material adverse effect on its financial position, results of operations or cash flows.

- Definition

The entire disclosure for loss and gain contingencies. Describes any existing condition, situation, or set of circumstances involving uncertainty as of the balance sheet date (or prior to issuance of the financial statements) as to a probable or reasonably possible loss incurred by an entity that will ultimately be resolved when one or more future events occur or fail to occur, and typically discloses the amount of loss recorded or a range of possible loss, or an assertion that no reasonable estimate can be made.

+ References + Details

LEASES - Maturities of the Company's operating lease liabilities (Details) - USD ($) $ in Thousands	Jun. 30, 2023	Dec. 31, 2022
Remainder of 2023	$ 9,897
2024	10,690
2025	8,284
2026	7,989
2027	8,186
Thereafter	83,827
Total lease payments	128,873
Less: Present value adjustment	(49,163)
Operating lease liabilities	79,710	$ 84,446
Facility leases
Remainder of 2023	4,167
2024	8,510
2025	8,284
2026	7,989
2027	8,186
Thereafter	83,827
Total lease payments	120,963
Less: Present value adjustment	(48,839)
Operating lease liabilities	72,124
CMO embedded leases
Remainder of 2023	5,730
2024	2,180
Total lease payments	7,910
Less: Present value adjustment	(324)
Operating lease liabilities	$ 7,586

INTANGIBLE ASSETS, NET (Details) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
INTANGIBLE ASSETS, NET (Details) - USD ($) $ in Thousands	Jun. 30, 2023	Jun. 30, 2022	Jun. 30, 2023	Jun. 30, 2022
Gross carrying amounts and net book value of intangible assets
Gross carrying amounts	$ 237,440		$ 237,440
Accumulated amortization	(1,929)		(1,929)
Intangible assets, net	235,511		235,511
Amortization expense	1,900	$ 0	1,933	$ 0
Total estimated amortization of the Company's intangible assets:
Remaining six months ending December 31, 2023	7,900		7,900
Years ending December 31, 2024	15,700		15,700
Years ending December 31, 2025	15,700		15,700
Years ending December 31, 2026	15,600		15,600
Years ending December 31, 2027	15,500		15,500
Years ending December 31, 2028	15,500		15,500
Developed technology
Gross carrying amounts and net book value of intangible assets
Gross carrying amounts	236,793		236,793
Accumulated amortization	(1,903)		(1,903)
Intangible assets, net	234,890		234,890
Assembled workforce
Gross carrying amounts and net book value of intangible assets
Gross carrying amounts	647		647
Accumulated amortization	(26)		(26)
Intangible assets, net	$ 621		$ 621

INVENTORY (Tables)

6 Months Ended

Jun. 30, 2023

INVENTORY

Summary of inventories

Inventories consist of the following (in thousands):


		June 30,		December 31,
		2023		2022
Work in process	$	8,587	$	—
Finished goods		1,133		—
Total inventory	$	9,720	$	—

PROLEUKIN ACQUISITION - Cash consideration and allocated fair value of assets acquired and liability assumed (Details) - PROLEUKIN - USD ($) $ in Thousands	Jun. 30, 2023	May 18, 2023
Total cash consideration and allocated acquisition date fair values of assets acquired and liabilities assumed
Cash		$ 35
Inventory		9,688
Deferred tax liability		(20,352)
Total Cost of Acquisition	$ 222,700	222,672
Developed technology
Total cash consideration and allocated acquisition date fair values of assets acquired and liabilities assumed
Intangible assets		232,665
Assembled workforce
Total cash consideration and allocated acquisition date fair values of assets acquired and liabilities assumed
Intangible assets		$ 636

PROPERTY AND EQUIPMENT, NET

6 Months Ended

Jun. 30, 2023

PROPERTY AND EQUIPMENT, NET

PROPERTY AND EQUIPMENT, NET

NOTE 8. PROPERTY AND EQUIPMENT, NET

Property and equipment, net consists of the following (in thousands):


	June 30,		December 31,
	2023		2022
Leasehold improvements	$	76,724	$	74,305
Lab, process, and validation equipment		22,524		22,136
Utility equipment		5,990		5,951
Office furniture and equipment		3,404		2,927
Computer software		6,736		6,736
Computer equipment		695		695
Machinery and equipment		251		82
Construction in progress		18,529		9,118
Total property and equipment, cost		134,853		121,950
Less: Accumulated depreciation and amortization		(22,304)		(16,718)
Property and equipment, net	$	112,549	$	105,232

Depreciation and amortization expense for the three months ended June 30, 2023 and 2022, was $2.9 million and $2.2 million, respectively. Depreciation and amortization expense for the six months ended June 30, 2023 and 2022, was $5.7 million and $4.0 million, respectively.

PROLEUKIN ACQUISITION - Additional information (Details) - PROLEUKIN $ in Thousands, £ in Millions	Jun. 30, 2023 USD ($)	May 18, 2023 USD ($)	May 18, 2023 GBP (£)
PROLEUKIN ACQUISITION
Total Cost of Acquisition	$ 222,700	$ 222,672
Cash payment	210,200	207,200	£ 166.9
Direct transaction costs incurred	$ 12,500
Contingent cash payments, milestone payment		$ 50,000	£ 41.7
Deferred consideration term		12 years	12 years
Fair value of acquired inventory		$ 9,688
Deferred tax liability		$ (20,352)
Assembled workforce
PROLEUKIN ACQUISITION
Expected useful life of intangible assets		15 years
Assembled workforce \| Selling, general and administrative
PROLEUKIN ACQUISITION
Expected useful life of intangible assets		3 years

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - Net Loss per Share (Details) - shares	6 Months Ended
	Jun. 30, 2023	Jun. 30, 2022
Antidilutive securities excluded from calculation of net loss per share	26,756,143	20,151,036
Employee Stock Option [Member]
Antidilutive securities excluded from calculation of net loss per share	19,438,306	14,519,506
Employee Stock Purchase Plan
Antidilutive securities excluded from calculation of net loss per share	225,110	193,194
Restricted stock units
Antidilutive securities excluded from calculation of net loss per share	4,153,569	2,499,178
Series A Convertible Preferred Stock
Antidilutive securities excluded from calculation of net loss per share	97,000	97,000
Series B Convertible Preferred Stock
Antidilutive securities excluded from calculation of net loss per share	2,842,158	2,842,158

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

6 Months Ended

Jun. 30, 2023

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

NOTE 2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Cash, Cash Equivalents, and Investments

Restricted Cash


	June 30,
	2023		2022
Cash and cash equivalents	$	230,010	$	108,075
Restricted cash		66,430		6,430
Total cash, cash equivalents and restricted cash	$	296,440	$	114,505

Asset Acquisitions

Inventory and Cost of Sales

Trade Accounts Receivable

Intangible Assets

Leases

For lease agreements entered into by the Company that include lease and non-lease components, such components are generally accounted for separately.

Revenue Recognition

Indirect taxes collected from customers and remitted to government authorities that are related to sales of the Company’s products, primarily in Europe, are excluded from revenues.

Stock-Based Compensation

Accrued Research and Development Costs

The Company makes judgements and estimates in determining the accrual balance in each reporting period.

Selling, general and administrative expense

Net Loss per Share

Basic net loss per share is computed by dividing the net loss by the weighted average number of common shares outstanding during the period.

As of June 30, 2023 and 2022, the following outstanding common stock equivalents have been excluded from the calculation of net loss per share because their impact would be anti-dilutive:


	June 30,
	2023	2022
Stock options	19,438,306	14,519,506
Employee Stock Purchase Plan	225,110	193,194
Restricted stock units	4,153,569	2,499,178
Series A Convertible Preferred Stock*	97,000	97,000
Series B Convertible Preferred Stock*	2,842,158	2,842,158
	26,756,143	20,151,036

* on an as-converted basis

Use of Estimates

Principles of Consolidation

Foreign Currency Translation

Segment Reporting

The Company operates in one segment, focused on innovating, developing and commercializing therapies using autologous TIL for the treatment of advanced melanoma and other solid tumor cancers.

Recent Accounting Standards

There were no applicable recently issued accounting standards nor did we adopt any new accounting standards during either the three or six months ended June 30, 2023.

INCOME TAXES

6 Months Ended

Jun. 30, 2023

INCOME TAXES

INCOME TAXES

NOTE 14. INCOME TAXES

Upon the completion of the Acquisition on May 18, 2023, a deferred tax liability of $20.4 million was recognized on the temporary differences related to the book and tax basis of the acquired intangible assets. The deferred tax liability and resulting adjustment to the carrying amount of the acquired intangibles was calculated using the simultaneous equations method under ASC 740. The tax rate used is based on the estimated statutory rates in the United Kingdom as this is where the intangible assets are domiciled.

The Company recorded a tax benefit of $0.5 million for the three and six months ended June 30, 2023, which resulted in effective tax rates of 0.4% and 0.2%, respectively. The effective tax rate is different from U.S. statutory rate of 21% due to the full valuation allowance against tax losses in the U.S. The income tax benefit for the periods presented primarily relates to operations in the United Kingdom and realization of related deferred taxes.

As of June 30, 2023, the Company continued to remain its full valuation allowance against net deferred tax assets from the operations in the U.S. territory as it expected to be in a cumulative loss position and does not have sufficient positive evidence to realize its net deferred tax assets in the U.S. territory.

- Definition

The entire disclosure for income taxes. Disclosures may include net deferred tax liability or asset recognized in an enterprise's statement of financial position, net change during the year in the total valuation allowance, approximate tax effect of each type of temporary difference and carryforward that gives rise to a significant portion of deferred tax liabilities and deferred tax assets, utilization of a tax carryback, and tax uncertainties information.

+ References

Reference 1: http://www.xbrl.org/2003/role/disclosureRef
-Topic 946
-SubTopic 20
-Name Accounting Standards Codification
-Section 50
-Paragraph 13
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147480990/946-20-50-13

Reference 2: http://www.xbrl.org/2003/role/disclosureRef
-Topic 235
-SubTopic 10
-Name Accounting Standards Codification
-Section S99
-Paragraph 1
-Subparagraph (SX 210.4-08(h)(2))
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147480678/235-10-S99-1

Reference 3: http://www.xbrl.org/2003/role/disclosureRef
-Topic 740
-Name Accounting Standards Codification
-Publisher FASB
-URI https://asc.fasb.org//740/tableOfContent

Reference 4: http://www.xbrl.org/2003/role/disclosureRef
-Topic 740
-SubTopic 10
-Name Accounting Standards Codification
-Section 50
-Paragraph 14
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147482685/740-10-50-14

Reference 5: http://www.xbrl.org/2003/role/disclosureRef
-Topic 740
-SubTopic 10
-Name Accounting Standards Codification
-Section 50
-Paragraph 21
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147482685/740-10-50-21

Reference 6: http://www.xbrl.org/2003/role/disclosureRef
-Topic 740
-SubTopic 270
-Name Accounting Standards Codification
-Section 50
-Paragraph 1
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147482526/740-270-50-1

Reference 7: http://www.xbrl.org/2003/role/disclosureRef
-Topic 740
-SubTopic 10
-Name Accounting Standards Codification
-Section 50
-Paragraph 17
-Subparagraph (b)
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147482685/740-10-50-17

Reference 8: http://www.xbrl.org/2003/role/disclosureRef
-Topic 740
-SubTopic 10
-Name Accounting Standards Codification
-Section S99
-Paragraph 1
-Subparagraph (SAB TOPIC 6.I.5.Q1)
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147479360/740-10-S99-1

Reference 9: http://www.xbrl.org/2003/role/disclosureRef
-Topic 740
-SubTopic 10
-Name Accounting Standards Codification
-Section S99
-Paragraph 2
-Subparagraph (SAB Topic 11.C)
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147479360/740-10-S99-2

Reference 10: http://www.xbrl.org/2003/role/disclosureRef
-Topic 740
-SubTopic 30
-Name Accounting Standards Codification
-Section 50
-Paragraph 2
-Subparagraph (a)
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147482603/740-30-50-2

+ Details

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - Revenue Recognition (Details) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2023	Jun. 30, 2022	Jun. 30, 2023	Jun. 30, 2022
Total revenue	$ 238		$ 238
Revenue from Contract with Customer, Product and Service [Extensible Enumeration]	Product	Product	Product	Product
Product
Total revenue	$ 200		$ 200

- Definition

+ References

+ Details

SUBSEQUENT EVENTS (Details) - Subsequent Event $ / shares in Units, $ in Millions	Jul. 13, 2023 USD ($) $ / shares shares
SUBSEQUENT EVENTS
Common stock issued, net of offering costs (in shares)	23,000,000
Common stock issued upon exercise of stock options (in shares)	3,000,000
Public offering price \| $ / shares	$ 7.50
Total net proceeds from the offering \| $	$ 161.4

LEASES

6 Months Ended

Jun. 30, 2023

LEASES

LEASES

NOTE 12. LEASES

Operating Leases

The Company leases corporate office space in California, including 49,918 square feet for its current corporate headquarters’ office space in San Carlos, California, manufacturing, research and development lab facilities and office space in Philadelphia, Pennsylvania, including 136,000 square feet of commercial manufacturing and lab space at the iCTC, and research and development lab facilities in Tampa, Florida. The determination if an arrangement is a lease occurs at inception, and for leases with terms greater than 12 months, the Company records a related right-of-use asset and lease liability at the present value of lease payments over the term. Many leases include fixed rental escalation clauses, renewal options and/or termination options that are factored into the determination of lease payments when appropriate. The Company’s leases do not provide an implicit rate, and thus the Company estimated the incremental borrowing rate in calculating the present value of the lease payments.

The Company’s leases have remaining lease terms that range from less than one year to approximately 20 years. Some of the Company’s leases include one or more options to renew with renewal terms that can extend the lease for additional years, or options to terminate the leases, both at the Company’s discretion. The Company’s leases may include options to extend or terminate the lease, which is considered in the lease term when it is reasonably certain that the Company will exercise any such options. Lease expense for minimum lease payments is recognized on a straight-line basis based on the fixed components of a lease arrangement.

Variable lease cost is determined based on performance or usage in accordance with the contractual agreements, and not based on an index or rate. Such costs that are not fixed in nature are recognized as incurred.

The Company also leases certain furniture and equipment that has a lease term of 12 months or less. Since the lease agreement do not include an option to purchase the underlying asset, the Company elected not to apply the recognition requirements of Topic 842 for short-term leases, however, the lease costs that pertain to the short-term leases are disclosed in the components of lease costs table below.

Manufacturing Contracts

The Company uses contract manufacturing organizations (collectively the “CMOs” and each a “CMO”) to manufacture and supply TILs for clinical and commercial purposes. The CMO contractual obligations consist of the use of manufacturing facilities and minimum fixed commitment fees, such as personnel, general support fees, and minimum production or material fees. In addition to the minimum fixed commitment fees, the CMO contractual obligations include variable costs such as production and material costs in excess of the minimum quantity specified in each CMO agreement. During the term of each CMO agreement, the Company has access to and control of the use of a dedicated suite in each of the CMOs’ facilities for manufacturing activities. The contracts with CMOs generally contain embedded operating leases based on the fact that the suites are used for the Company’s production are implicitly identified, are used exclusively by the Company during the contractual term of the arrangements, and the CMOs have no substantive contractual rights to substitute the facilities used by the Company.

Further, the Company controls the use of the facilities by obtaining all of the economic benefits from the use of the facilities and direct the use of the facilities throughout the period of use. The terms of the CMO contracts include options to terminate the lease with advance notice of five to six months. The termination clauses and extension clauses are included in the calculation of the lease term for each of the CMOs when it is reasonably certain that it will not exercise such options.

For contracts with multiple deliverables, Topic 842 requires the Company to first identify a lease deliverable and non-lease deliverable included in the arrangements, and then allocate the fixed contractual consideration to the lease deliverable(s) and the non-lease deliverable(s) on a relative standalone selling price basis to determine the amount of operating lease right-of-use assets and liabilities. The Company identified the use of a dedicated suite as a single lease deliverable, and related labor services as a single non-lease deliverable in each of the CMO arrangements. Judgment is required to determine the relative standalone selling price of each deliverable as the observable standalone selling prices are not readily available. Therefore, management uses estimates and assumptions in determining relative standalone selling price of lease of a suite and labor service using information that includes market and other observable inputs to the extent possible.

The balance sheet classification of the Company’s right-of-use asset and lease liabilities was as follows (in thousands):


	June 30,		December 31,
	2023		2022
Operating lease right-of-use assets	$	67,631	$	73,015
Operating lease liabilities
Current portion included in current liabilities		10,866		12,587
Long-term portion included in non-current liabilities		68,844		71,859
Total operating lease liabilities	$	79,710	$	84,446


	Three Months Ended				Six Months Ended
	June 30,				June 30,
	2023		2022		2023			2022
Operating lease cost	$	4,521	$	4,399	$	9,044		$	8,954
Variable lease cost		2,307		1,236		4,001			2,216
Short-term lease cost		109		35		154			77
Total lease cost	$	6,937	$	5,670	$	13,199		$	11,247

Other information
Cash paid for amounts included in the measurement of lease liabilities included in cash flows from operations	$	4,235	$	3,262	$	8,396		$	7,073
Tenant improvement allowance received for amounts included in the measurement of lease liabilities included in cash flows from operations	$	—	$	2,085		—			5,200
Right-of-use assets obtained from entering new leases	$	177	$	553	$	177		$	553
Increase in right-of-use assets from lease modifications	$	—	$	(180)	$	349		$	7,493
Weighted-average remaining lease terms (years)						12.95			14.01
Weighted-average discount rates						7.5	%		7.3	%

As of June 30, 2023, the maturities of the Company’s operating lease liabilities were as follows (in thousands):


			CMO
	Facility		embedded
Year Ending December 31,	leases		leases		Total
Remainder of 2023	$	4,167	$	5,730	$	9,897
2024		8,510		2,180		10,690
2025		8,284		—		8,284
2026		7,989		—		7,989
2027		8,186		—		8,186
Thereafter		83,827		—		83,827
Total lease payments	$	120,963	$	7,910	$	128,873
Less: Present value adjustment		(48,839)		(324)		(49,163)
Operating lease liabilities	$	72,124	$	7,586	$	79,710

PROLEUKIN ACQUISITION (Tables)

6 Months Ended

Jun. 30, 2023

PROLEUKIN ACQUISITION

Summary of the total cash consideration and allocated acquisition date fair values of assets acquired and liabilities assumed

The following table summarizes the total cash consideration and allocated acquisition date fair values of assets acquired and liabilities assumed (in thousands):


		Amounts
Cash	$	35
Inventory		9,688
Developed technology		232,665
Assembled workforce		636
Deferred tax liability		(20,352)
Total Cost of Acquisition	$	222,672

Condensed Consolidated Statements of Comprehensive Loss - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2023	Jun. 30, 2022	Jun. 30, 2023	Jun. 30, 2022
Condensed Consolidated Statements of Comprehensive Loss
Net Loss	$ (106,528)	$ (99,349)	$ (213,898)	$ (190,956)
Other comprehensive loss:
Unrealized gain/(loss) on investments	118	(354)	894	(2,096)
Foreign currency translation adjustment	333		333
Comprehensive Loss	$ (106,077)	$ (99,703)	$ (212,671)	$ (193,052)

- Definition

The portion of profit or loss for the period, net of income taxes, which is attributable to the parent.

+ References

+ Details

CASH EQUIVALENTS, INVESTMENTS AND RECURRING FAIR VALUE MEASUREMENTS (Tables)

6 Months Ended

Jun. 30, 2023

CASH EQUIVALENTS, INVESTMENTS AND RECURRING FAIR VALUE MEASUREMENTS

Schedule of cost and fair value of cash equivalents and short-term investments

The amortized cost and fair value of cash equivalents and investments as of June 30, 2023 and December 31, 2022 were as follows (in thousands):


			Gross		Gross
	Amortized		Unrealized		Unrealized
As of June 30, 2023	Cost		Gains		Losses		Fair Value
U.S. treasury securities	$	15,471	$	—	$	(7)	$	15,464
Commercial paper		5,421		—		(1)		5,420
Money market funds		175,977		—		—		175,977
Total investments	$	196,869	$	—	$	(8)	$	196,861


			Gross		Gross
	Amortized		Unrealized		Unrealized
As of December 31, 2022	Cost		Gains		Losses		Fair Value
U.S. treasury securities	$	118,570	$	—	$	(850)	$	117,720
U.S. government agency securities		11,272		—		(7)		11,265
Corporate securities		7,230		—		—		7,230
Commercial paper		148,299		8		(53)		148,254
Money market funds		88,001		—		—		88,001
Total investments	$	373,372	$	8	$	(910)	$	372,470

Schedule of available-for-sale debt securities

The fair value of cash equivalents and investments as of June 30, 2023 and December 31, 2022 are classified as follows in the Company’s Consolidated Balance Sheets (in thousands):


	June 30,		December 31,
Classified as:	2023		2022
Cash equivalents	$	175,977	$	132,356
Short-term investments		20,884		240,114
Total investments	$	196,861	$	372,470

Schedule of fair value of the company's financial assets


	Assets at Fair Value as of June 30, 2023
	Level 1		Level 2		Level 3		Total
U.S. treasury securities	$	15,464	$	—	$	—	$	15,464
Commercial paper		—		5,420		—		5,420
Money market funds		175,977		—		—		175,977
Total	$	191,441	$	5,420	$	—	$	196,861


	Assets at Fair Value as of December 31, 2022
	Level 1		Level 2		Level 3		Total
U.S. treasury securities	$	117,720	$	—	$	—	$	117,720
U.S. government agency securities		—		11,265		—		11,265
Corporate securities		—		7,230		—		7,230
Commercial paper		—		148,254		—		148,254
Money market funds		88,001		—		—		88,001
Total	$	205,721	$	166,749	$	—	$	372,470

- Definition

Tabular disclosure of investment in debt security measured at fair value with change in fair value recognized in other comprehensive income (available-for-sale).

+ References

Reference 1: http://www.xbrl.org/2009/role/commonPracticeRef
-Topic 320
-SubTopic 10
-Name Accounting Standards Codification
-Section 50
-Paragraph 9
-Subparagraph (a)
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147481800/320-10-50-9

Reference 2: http://www.xbrl.org/2009/role/commonPracticeRef
-Topic 320
-SubTopic 10
-Name Accounting Standards Codification
-Section 50
-Paragraph 3
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147481800/320-10-50-3

Reference 3: http://www.xbrl.org/2009/role/commonPracticeRef
-Topic 320
-SubTopic 10
-Name Accounting Standards Codification
-Section 50
-Paragraph 2
-Subparagraph (b)
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147481800/320-10-50-2

Reference 4: http://www.xbrl.org/2009/role/commonPracticeRef
-Topic 320
-SubTopic 10
-Name Accounting Standards Codification
-Section 50
-Paragraph 2
-Subparagraph (c)
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147481800/320-10-50-2

Reference 5: http://www.xbrl.org/2009/role/commonPracticeRef
-Topic 320
-SubTopic 10
-Name Accounting Standards Codification
-Section 50
-Paragraph 2
-Subparagraph (a)
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147481800/320-10-50-2

Reference 6: http://www.xbrl.org/2009/role/commonPracticeRef
-Topic 320
-SubTopic 10
-Name Accounting Standards Codification
-Section 50
-Paragraph 2
-Subparagraph (aa)
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147481800/320-10-50-2

Reference 7: http://www.xbrl.org/2009/role/commonPracticeRef
-Topic 320
-SubTopic 10
-Name Accounting Standards Codification
-Section 50
-Paragraph 2
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Reference 8: http://www.xbrl.org/2009/role/commonPracticeRef
-Topic 320
-SubTopic 10
-Name Accounting Standards Codification
-Section 50
-Paragraph 2
-Subparagraph (d)
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147481800/320-10-50-2

Reference 9: http://www.xbrl.org/2009/role/commonPracticeRef
-Topic 320
-SubTopic 10
-Name Accounting Standards Codification
-Section 50
-Paragraph 3
-Subparagraph (a)
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147481800/320-10-50-3

Reference 10: http://www.xbrl.org/2009/role/commonPracticeRef
-Topic 320
-SubTopic 10
-Name Accounting Standards Codification
-Section 50
-Paragraph 3
-Subparagraph (b)
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147481800/320-10-50-3

Reference 11: http://www.xbrl.org/2009/role/commonPracticeRef
-Topic 320
-SubTopic 10
-Name Accounting Standards Codification
-Section 50
-Paragraph 3
-Subparagraph (c)
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147481800/320-10-50-3

Reference 12: http://www.xbrl.org/2009/role/commonPracticeRef
-Topic 320
-SubTopic 10
-Name Accounting Standards Codification
-Section 50
-Paragraph 3
-Subparagraph (d)
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147481800/320-10-50-3

+ Details

Document And Entity Information - shares	6 Months Ended
Document And Entity Information - shares	Jun. 30, 2023	Aug. 03, 2023
Document And Entity Information
Document Type	10-Q
Document Quarterly Report	true
Document Period End Date	Jun. 30, 2023
Current Fiscal Year End Date	--12-31
Document Transition Report	false
Entity File Number	001-36860
Entity Registrant Name	IOVANCE BIOTHERAPEUTICS, INC.
Entity Incorporation, State or Country Code	DE
Entity Tax Identification Number	75-3254381
Entity Address, Address Line One	825 Industrial Road, Suite 400
Entity Address, City or Town	San Carlos
Entity Address, State or Province	CA
Entity Address, Postal Zip Code	94070
City Area Code	650
Local Phone Number	260-7120
Title of 12(b) Security	Common Stock, par value $0.000041666
Trading Symbol	IOVA
Security Exchange Name	NASDAQ
Entity Current Reporting Status	Yes
Entity Interactive Data Current	Yes
Entity Filer Category	Large Accelerated Filer
Entity Small Business	false
Entity Emerging Growth Company	false
Entity Shell Company	false
Entity Common Stock, Shares Outstanding		247,776,653
Entity Central Index Key	0001425205
Document Fiscal Year Focus	2023
Document Fiscal Period Focus	Q2
Amendment Flag	false

Condensed Consolidated Balance Sheets (Parenthetical) - $ / shares	Jun. 30, 2023	Dec. 31, 2022
Common stock, par or stated value per share	$ 0.000041666	$ 0.000041666
Common stock, shares authorized	500,000,000	500,000,000
Common Stock, Shares, Issued	224,688,434	187,812,072
Common Stock, Shares, Outstanding	224,688,434	187,812,072
Series A Convertible Preferred Stock
Preferred stock, par or stated value per share	$ 0.001	$ 0.001
Preferred stock, shares authorized	17,000	17,000
Preferred Stock, Shares Issued	194	194
Preferred stock, shares outstanding	194	194
Series B Convertible Preferred Stock
Preferred stock, par or stated value per share	$ 0.001	$ 0.001
Preferred stock, shares authorized	11,500,000	11,500,000
Preferred Stock, Shares Issued	2,842,158	2,842,158
Preferred stock, shares outstanding	2,842,158	2,842,158

GENERAL ORGANIZATION, BUSINESS AND LIQUIDITY (Details) - USD ($) $ in Thousands		3 Months Ended		6 Months Ended
	Jul. 13, 2023	Jun. 30, 2023	Jun. 30, 2022	Jun. 30, 2023	Jun. 30, 2022	Dec. 31, 2022
Net Income (Loss)		$ (106,528)	$ (99,349)	$ (213,898)	$ (190,956)
Net cash used in operating activities				(193,767)	(151,437)
Cash equivalents, short-term investments, and restricted cash		317,300		317,300
Cash and cash equivalents		230,010	108,075	230,010	108,075	$ 231,731
Short-term investments		20,884		20,884		240,114
Restricted cash		$ 66,430	$ 6,430	$ 66,430	$ 6,430	$ 6,430
Subsequent Event [Member]
Net proceeds from public offering	$ 161,400

- Definition

The portion of profit or loss for the period, net of income taxes, which is attributable to the parent.

+ References

+ Details

PROPERTY AND EQUIPMENT, NET - (Details) - USD ($) $ in Thousands	Jun. 30, 2023	Dec. 31, 2022
Property, Plant and Equipment [Line Items]
Total property and equipment, cost	$ 134,853	$ 121,950
Less: Accumulated depreciation and amortization	(22,304)	(16,718)
Property and equipment, net	112,549	105,232
Leasehold improvements
Property, Plant and Equipment [Line Items]
Total property and equipment, cost	76,724	74,305
Lab, process, and validation equipment
Property, Plant and Equipment [Line Items]
Total property and equipment, cost	22,524	22,136
Utility equipment
Property, Plant and Equipment [Line Items]
Total property and equipment, cost	5,990	5,951
Office furniture and equipment
Property, Plant and Equipment [Line Items]
Total property and equipment, cost	3,404	2,927
Computer software
Property, Plant and Equipment [Line Items]
Total property and equipment, cost	6,736	6,736
Computer equipment
Property, Plant and Equipment [Line Items]
Total property and equipment, cost	695	695
Machinery and equipment
Property, Plant and Equipment [Line Items]
Total property and equipment, cost	251	82
Construction in progress
Property, Plant and Equipment [Line Items]
Total property and equipment, cost	$ 18,529	$ 9,118

STOCKHOLDERS' EQUITY - Restricted Stock Units and Performance Restricted Stock Units (Details) - RSUs and PRSUs	6 Months Ended
	Jun. 30, 2023 $ / shares shares
Number of Shares
Outstanding, Beginning Balance \| shares	2,436,764
Granted \| shares	2,729,348
Vested/Released \| shares	(917,621)
Canceled/forfeited \| shares	(94,922)
Outstanding, Ending balance \| shares	4,153,569
Ending vested and expected to vest \| shares	4,153,569
Weighted Average Grant Date Fair Value
Weighted Average Grant Date Fair Value, Beginning Balance \| $ / shares	$ 14.74
Weighted Average Grant Date Fair Value, Granted \| $ / shares	7.19
Weighted Average Grant Date Fair Value, Vested/Released \| $ / shares	16.89
Weighted Average Grant Date Fair Value, Canceled/forfeited \| $ / shares	11.28
Weighted Average Grant Date Fair Value, Ending Balance \| $ / shares	9.38
Weighted Average Grant Date Fair Value, Ending vested and expected to vest \| $ / shares	$ 9.38

STOCKHOLDERS' EQUITY

6 Months Ended

Jun. 30, 2023

STOCKHOLDERS' EQUITY

STOCKHOLDERS' EQUITY

NOTE 10. STOCKHOLDERS’ EQUITY

Common Stock

The Company’s certificate of incorporation, as amended, authorizes the issuance of up to 500,000,000 shares of the Company’s common stock, par value $0.000041666. As of June 30, 2023, 224,688,434 shares of the Company’s common stock were issued and outstanding.

At the Market Offering Program

On November 18, 2022, the Company entered into an Open Market Sales Agreement (the “2022 Sales Agreement”) with Jefferies LLC (“Jefferies”). Under the terms of the 2022 Sales Agreement, the Company was able to, from time to time, at its sole discretion, issue and sell up to $500.0 million of shares of the Company’s Common Shares. On June 16, 2023, the Company entered into a new Open Market Sales Agreement (the “2023 Sales Agreement”), which superseded and replaced in its entirety the 2022 Sales Agreement. Under the terms of the 2023 Sales Agreement, the Company may, from time to time, in its sole discretion, issue and sell up to $450.0 million of shares of the Company’s Common Shares. The issuance and sale, if any, of the Common Shares by the Company under the 2022 Sales Agreement and the 2023 Sales Agreement (together, the “Sales Agreements”) was or will be made pursuant to a prospectus supplement, dated November 18, 2022 and June 16, 2023, respectively, to the Company’s Registration Statement on Form S-3ASR, which became effective immediately upon filing with the Securities and Exchange Commission on May 27, 2020 and June 16, 2023.

Pursuant to the Sales Agreements, Jefferies may sell the Common Shares by any method permitted by law deemed to be an “at the market” offering as defined in Rule 415 of the Securities Act of 1933, as amended. Jefferies will use commercially reasonable efforts consistent with its normal trading and sales practices to sell the Common Shares from time to time, based upon instructions from the Company (including any price or size limits or other customary parameters or conditions the Company may impose). The Company will pay Jefferies a commission of up to 3.0% of the gross sales proceeds of any Common Shares sold through Jefferies under the Sales Agreements.

The Company is not obligated to make any sales of Common Shares under the Sales Agreements. The offering of Common Shares pursuant to the Sales Agreements will terminate upon the earlier to occur of (i) the issuance and sale, through Jefferies, of all Common Shares subject to the Sales Agreements and (ii) termination of the Sales Agreements in accordance with its terms.

During the six months ended June 30, 2023, the Company received approximately $260.1 million in proceeds, net of offering costs, through the sale of 36,080,226 shares of its Common Shares pursuant to the 2022 Sales Agreement at a weighted average price per share of $7.35. No sales were made pursuant to the Sales Agreements during the three months ended June 30, 2023 and the three and six months ended June 30, 2022.

Preferred Stock

The Company’s certificate of incorporation authorizes the issuance of up to 50,000,000 shares of “blank check” preferred stock. As of June 30, 2023, 17,000 shares were designated as Series A Convertible Preferred Stock (“Series A Convertible Preferred Stock”) and 11,500,000 shares were designated as Series B Convertible Preferred Stock (“Series B Convertible Preferred Stock”).

Series A Convertible Preferred Stock

A total of 17,000 shares of Series A Convertible Preferred Stock have been authorized for issuance under the Company’s Certificate of Designation of Preferences and Rights of Series A Convertible Preferred Stock. The shares of Series A Convertible Preferred Stock have a stated value of $1,000 per share and are initially convertible into shares of common stock at a price of $2.00 per share, subject to adjustment. Each share of Series A Preferred Stock is initially convertible into 500 shares of common stock.

The Series A Convertible Preferred Stock may, at the option of each investor, be converted into fully paid and non-assessable shares of common stock. The holders of shares of Series A Convertible Preferred Stock do not have the right to vote on matters that come before the Company’s stockholders. In the event of any dissolution or winding up of the Company, proceeds shall be paid pari passu among the holders of common stock and preferred stock, pro rata based on the number of shares held by each holder. The Company may not declare, pay, or set aside any dividends on shares of capital stock of the Company (other than dividends on shares of common stock payable in shares of common stock) unless the holders of the Series A Convertible Preferred Stock shall first receive an equal dividend on each outstanding share of Series A Convertible Preferred Stock.

During the three and six months ended June 30, 2023 and 2022, no shares of Series A Convertible Preferred Stock were converted into shares of common stock. As of June 30, 2023 and December 31, 2022, 194 shares of Series A Convertible Preferred Stock (that are convertible into 97,000 shares of common stock) remained outstanding.

Series B Convertible Preferred Stock

A total of 11,500,000 shares of Series B Convertible Preferred Stock are authorized for issuance under the Company’s Series B Certificate of Designation of Rights, Preferences and Privileges of Series B Convertible Preferred Stock. The shares of Series B Convertible Preferred Stock have a stated value of $4.75 per share and are convertible into shares of the Company’s common stock at an initial conversion price of $4.75 per share. Each share of Series B Preferred Stock is initially convertible into 1 share of common stock.

The Series B Convertible Preferred Stock may, at the option of each investor, be converted into fully paid and non-assessable shares of common stock. The holders of shares of Series B Convertible Preferred Stock do not have the right to vote on matters that come before the Company's stockholders. In the event of any dissolution or winding up of the Company, proceeds shall be paid pari passu among the holders of common stock and preferred stock, pro rata based on the number of shares held by each holder. Holders of Series B Convertible Preferred Stock are entitled to dividends on an as-if-converted basis in the same form as any dividends actually paid on shares of the Series A Convertible Preferred Stock or the Company’s common stock. So long as any Series B Convertible Preferred Stock remains outstanding, the Company may not redeem, purchase, or otherwise acquire any material amount of the Series A Convertible Preferred Stock or any securities junior to the Series B Convertible Preferred Stock.

During the three and six months ended June 30, 2023 and 2022, no shares of Series B Convertible Preferred Stock were converted into shares of common stock. As of June 30, 2023 and December 31, 2022, 2,842,158 shares of Series B Preferred Stock (that are convertible into 2,842,158 shares of common stock) remained outstanding.

Equity Incentive Plans

The Company has multiple equity incentive plans under which it grants awards. As of June 30, 2023, there are 77,086 shares available to grant under the 2014 Equity Incentive Plan (the “2014 Plan”).

On April 22, 2018, the Company’s board of directors (the “Board”) adopted the Iovance Biotherapeutics, Inc. 2018 Equity Incentive Plan (as amended, the “2018 Plan”), which was approved by the Company’s stockholders in June 2018. The 2018 Plan as approved initially authorized the issuance up to an aggregate of 6,000,000 shares of common stock in the form of incentive (qualified) stock options, non-qualified options, common stock, stock appreciation rights, restricted stock awards, restricted stock units, other stock-based awards, other cash-based awards or any combination of the foregoing. On June 8, 2020, the Company's stockholders approved an amendment to the 2018 Plan to increase the number of shares available for issuance under the 2018 Plan from 6,000,000 to 14,000,000 shares, which became effective immediately. On June 10, 2022, the Company’s stockholders approved an amendment to the 2018 Plan to increase the number of shares available for issuance under the 2018 Plan from 14,000,000 to 20,700,000 shares, which became effective immediately. On June 6, 2023, the Company’s stockholders approved an amendment to the 2018 plan to increase the number of shares available for issuance under the 2018 plan from 20,700,000 to 29,700,000, which became effective immediately. As of June 30, 2023, 8,879,043 shares of common stock were available for grant under the 2018 Plan.

On September 22, 2021, the Board adopted the Iovance Biotherapeutics, Inc. 2021 Inducement Plan (as amended, the “2021 Inducement Plan”). The 2021 Inducement Plan provides for the grant of non-qualified options, common stock, stock appreciation rights, restricted stock awards, restricted stock units, other stock-based awards, other cash-based awards, or any combination of the foregoing. The 2021 Inducement Plan was recommended for approval by the Compensation Committee of the Board (the “Compensation Committee”), and subsequently approved and adopted by the Board without stockholder approval pursuant to Rule 5635(c)(4) of the rules and regulations of The Nasdaq Stock Market, LLC (the “Nasdaq Listing Rules”).

The Board initially reserved 1,000,000 shares of the Company’s common stock for issuance pursuant to equity awards granted under the 2021 Inducement Plan, and the 2021 Inducement Plan is administered by the Compensation Committee. On January 12, 2022, the Compensation Committee approved an amendment to the 2021 Inducement Plan solely to increase the number of shares reserved for issuance under the 2021 Inducement Plan from 1,000,000 shares of the Company’s common stock to 1,750,000 shares of the Company’s common stock without stockholder approval pursuant to Rule 5635(c)(4) of the Nasdaq Listing Rules. On March 13, 2023, the Compensation Committee approved an additional amendment to the 2021 Inducement Plan solely to increase the number of shares reserved for issuance under the 2021 Inducement Plan from 1,750,000 shares of the Company’s common stock

to 2,250,000 shares of the Company’s common stock without stockholder approval pursuant to Rule 5635(c)(4) of the Nasdaq Listing Rules.

In accordance with Rule 5635(c)(4) of the Nasdaq Listing Rules, equity awards under the 2021 Inducement Plan may only be made to an employee if such employee is granted such equity awards in connection with his or her commencement of employment with the Company or a subsidiary and such grant is an inducement material to his or her entering into employment with the Company or such subsidiary. In addition, awards under the 2021 Inducement Plan may only be made to employees who have not previously been an employee or member of the Board (or any parent or subsidiary of the Company) or following a bona fide period of non-employment of the employee by the Company (or a parent or subsidiary of the Company). As of June 30, 2023, 691,851 shares of common stock were available for grant under the 2021 Inducement Plan.

Stock Options

A summary of the stock option activity during the six months ended June 30, 2023, is presented in the following table:


				Weighted
		Weighted		Average	Aggregate
	Number	Average		Remaining	Intrinsic
	of	Exercise		Contract	Value
	Options	Price		Life
Outstanding at December 31, 2022	15,240,197	$	22.45
Issued	4,873,795		7.19
Exercised	(7,860)		6.97
Expired/Cancelled	(667,826)		18.43
Outstanding at June 30, 2023	19,438,306	$	18.77	7.39	$	646,711
Ending vested and expected to vest at June 30, 2023	19,438,306	$	18.77	7.39	$	646,711
Options exercisable at June 30, 2023	11,255,242	$	23.09	6.10	$	428,090

As of June 30, 2023, there was $55.9 million of total unrecognized compensation expense related to the options that is expected to be recognized over a weighted average period of 2.08 years.

The weighted average grant date fair value for employee options granted under the Company’s stock option plans during the six months ended June 30, 2023 and 2022 was $5.01 and $8.89 per option, respectively.

The aggregate intrinsic value in the table above reflects the total pre-tax intrinsic value (calculated as the difference between the Company’s closing stock price on the last trading day of the quarter ended June 30, 2023 and the exercise price of the options, multiplied by the number of in-the-money stock options) that would have been received by the option holders had all option holders exercised their options on June 30, 2023. The intrinsic value of the Company’s stock options changes based on the closing price of the Company’s common stock.

Employee Stock Purchase Plan

In June 2020, the Company adopted the 2020 Employee Stock Purchase Plan (as amended, the “2020 ESPP”) upon its approval by the Company’s shareholders at its Annual Stockholders Meeting on June 8, 2020. The Company reserved 500,000 shares of its common stock for issuance under the 2020 ESPP. On June 6, 2023, the Company's stockholders approved an amendment to the 2020 ESPP plan, to increase the number of shares reserved for issuance under the 2020 ESPP plan from 500,000 shares of the Company’s common stock to 1,400,000 shares of the Company’s common stock, which became effective immediately.

Under the 2020 ESPP, employees of the Company can purchase shares of its common stock based on a percentage of their compensation subject to certain limits. The purchase price per share is equal to the lower of 85% of the fair market value of its common stock on the offering date or the purchase date with a six-month look-back feature. The 2020 ESPP purchases are settled with common stock from the 2020 ESPP’s previously authorized and available pool of shares.

The compensation expense related to the 2020 ESPP for the three and six months ended June 30, 2023 was $0.3 million and $0.6 million, respectively. The compensation expense related to the 2020 ESPP for the three and six months ended June 30, 2022 was $0.3 million and $0.5 million, respectively. As of June 30, 2023, 583,045 shares have been issued to date under the 2020 ESPP and

there was $0.6 million of unrecognized compensation cost associated with the 2020 ESPP, which is expected to be recognized over the remaining 5.4 months.

Restricted Stock Units and Performance Restricted Stock Units

In addition to RSUs that have time-based vesting requirements, from time to time the Company may issue RSUs that include certain performance vesting criteria based upon the satisfaction of stated objectives (“PRSUs”). Compensation expense related to PRSUs is based on the grant date fair value of the award and recorded from the period that achievement is determined to be probable through the stated service period associated with the award.

Activity for RSUs and PRSUs during the six months ended June 30, 2023 is presented in the following table:


		Weighted
	Number	Average
	of	Grant Date
	RSUs and PRSUs	Fair Value
Outstanding as of December 31, 2022	2,436,764	$	14.74
Granted	2,729,348		7.19
Vested/Released	(917,621)		16.89
Canceled/Forfeited	(94,922)		11.28
Outstanding as of June 30, 2023	4,153,569	$	9.38
Ending vested and expected to vest at June 30, 2023	4,153,569	$	9.38

As of June 30, 2023 there was $30.9 million of unrecognized stock-based compensation expense associated with unvested RSU and PRSUs, which the Company expects to recognize over a remaining weighted-average period of 2.13 years. The aggregate intrinsic value of the unvested RSUs and PRSUs outstanding as of June 30, 2023 was $29.2 million.

Stock-Based Compensation

Total stock-based compensation expense related to all of the Company’s stock-based awards was recorded on the Condensed Consolidated Statements of Operations as follows (in thousands):


	Three Months Ended				Six Months Ended
	June 30,				June 30,
	2023		2022		2023		2022
Research and development	$	9,390	$	13,940	$	18,249	$	27,591
Selling, general and administrative		7,350		8,528		14,156		17,142
Total stock-based compensation expense	$	16,740	$	22,468	$	32,405	$	44,733

Total stock-based compensation expense by type of award was as follows (in thousands):


	Three Months Ended				Six Months Ended
	June 30,				June 30,
	2023		2022		2023		2022
Stock option expense	$	11,893	$	15,130	$	23,595	$	29,997
Restricted stock expense		4,543		7,084		8,203		14,246
ESPP expense		304		254		607		490
Total stock-based compensation expense	$	16,740	$	22,468	$	32,405	$	44,733

- Definition

The entire disclosure for equity.

+ References

Reference 1: http://www.xbrl.org/2003/role/disclosureRef
-Topic 505
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Reference 2: http://www.xbrl.org/2003/role/disclosureRef
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Reference 4: http://www.xbrl.org/2003/role/disclosureRef
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+ Details