IOVANCE BIOTHERAPEUTICS, INC._December 31, 2024

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UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

Form 10-K

(Mark One)

For the fiscal year ended December 31, 2024

For the transaction period from __________ to __________

Commission file number: 001-36860

IOVANCE BIOTHERAPEUTICS, INC.

(Exact Name of Registrant as Specified in Its Charter)

825 Industrial Road, Suite 100, San Carlos, California 94070

(Address of Principal Executive Offices) (Zip Code)

(650) 260-7120

(Registrant’s Telephone Number, Including Area Code)

Securities registered pursuant to Section 12(b) of the Act:

Name Of Each Exchange

Title of Each Class Trading Symbol(s) On Which Registered

Securities registered pursuant to Section 12(g) of the Act:

None

Indicate by check mark if the registrant is a well-known seasoned issuer, as defined in Rule 405 of the Securities Act. Yes⌧ No ◻

Indicate by check mark if the registrant is not required to file reports pursuant to Section 13 or Section 15(d) of the Act. Yes ◻No⌧

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes⌧ No ◻

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes⌧ No ◻

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.

Large accelerated filer þ Accelerated filer ◻

Non-accelerated filer ◻ Smaller reporting company ☐

Emerging growth company ☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ◻

Indicate by check mark whether the registrant has filed a report on and attestation to its management’s assessment of the effectiveness of its internal control over financial reporting under Section 404(b) of the Sarbanes-Oxley Act (15 U.S.C. 7262(b)) by the registered public accounting firm that prepared or issued its audit report. ☒

If the securities are registered pursuant to Section 12(b) of the Act, indicate by check mark whether the financial statements of the registrant included in the filing reflect the correction of an error to previously issued financial statements. ☐

Indicate by check mark whether any of those error corrections are restatements that required a recovery analysis of incentive-based compensation received by any of the registrant’s executive officers during the relevant recovery period pursuant to §240.10D-1(b). ̈

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ☐ No ☒

Securities registered pursuant to Section 12(b) of the Act:

Title of each class Trading Symbol(s) Name of each exchange on which registered

Common stock, par value $0.000041666 per value IOVA The Nasdaq Stock Market, LLC

The aggregate market value of the registrant’s common stock held by non-affiliates on June 30, 2024, the last business day of the registrant’s most recently completed second fiscal quarter, was approximately $2.1 billion. Shares of common stock held by directors and executive officers and any ten percent or greater stockholders and their respective affiliates have been excluded from this calculation, because such stockholders may be deemed to be "affiliates" of the Registrant. This is not necessarily determinative of affiliate status of other purposes. As of February 21, 2025, there were 327,876,694 shares of the registrant’s common stock outstanding.

Documents Incorporated By Reference

Portions of registrant’s proxy statement relating to registrant’s 2024 Annual Meeting of Stockholders (the “Proxy Statement”) to be filed with the Securities and Exchange Commission pursuant to Regulation 14A, not later than 120 days after the close of the registrant’s fiscal year, are incorporated by reference in Part III of this Annual Report on Form 10-K. Except with respect to information specifically incorporated by reference in this Annual Report on Form 10-K, the Proxy Statement is not deemed to be filed as part of this Annual Report on Form 10-K.

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TABLE OF CONTENTS

Page

PART I 4

Item 1. Business 4

Item 1A. Risk Factors 32

Item 1B. Unresolved Staff Comments 86

Item 1C. Cybersecurity 86

Item 2. Properties 87

Item 3. Legal Proceedings 89

Item 4. Mine Safety Disclosures 89

Item 6. [Reserved] 91

Item 7A. Quantitative and Qualitative Disclosures About Market Risk 109

Item 8. Financial Statements and Supplementary Data 109

Item 9A. Controls and Procedures 110

Item 9B. Other Information 110

Item 10. Directors, Executive Officers and Corporate Governance 111

Item 11. Executive Compensation 111

Item 14. Principal Accounting Fees and Services 111

Item 15. Exhibits, Financial Statements Schedules 111

Signatures 116

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Forward-Looking Statements and Market Data

This Annual Report on Form 10-K contains forward-looking statements that are based on management’s beliefs and assumptions and on information currently available to management. All statements other than statements of historical facts contained in this report are forward-looking statements. In some cases, you can identify forward-looking statements by the following words: “may,” “will,” “might,” “could,” “would,” “should,” “expect,” “intend,” “plan,” “anticipate,” “believe,” “estimate,” “predict,” “project,” “aim,” “potential,” “continue,” “ongoing,” “goal,” “forecast,” “guidance,” “outlook,” or the negative of these terms or other similar expressions, although not all forward-looking statements contain these words.

These statements involve risks, uncertainties, and other factors that may cause actual results, levels of activity, performance, or achievements to be materially different from the information expressed or implied by these forward-looking statements. Although we believe that we have a reasonable basis for each forward-looking statement contained in this report, we caution you that these statements are based on a combination of facts and factors currently known by us and our projections of the future, about which we cannot be certain. Forward-looking statements in this Annual Report on Form 10-K include, but are not limited to, statements about:

● the success, cost, enrollment, and timing of our clinical trials;

● the success, cost, and timing of our product development activities;

● the success of competing therapies that are or may become available;

● our ability to attract and retain key scientific or management personnel;

● fluctuations in the trading price of our common stock; and

● our use of cash and other resources.

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Actual results may differ from those set forth in this Annual Report on Form 10-K due to the risks and uncertainties inherent in our business, including those provided in the foregoing list of forward-looking statements and also including, without limitation: the FDA may not agree with our interpretation of the results of our clinical trials; later developments with the FDA that may be inconsistent with already completed FDA meetings; the preliminary clinical results, including efficacy and safety results, from ongoing Phase 2 and Phase 3 clinical trials may not be reflected in the final analyses of these clinical trials including new cohorts within these clinical trials; the results obtained in our ongoing clinical trials, such as the studies and clinical trials referred to in this Annual Report on Form 10-K, may not be indicative of results obtained in future clinical trials or supportive of product approval; regulatory authorities may potentially delay the timing of FDA or other regulatory authority approval of, or other action with respect to, our product candidates, specifically, our description of FDA interactions are subject to the FDA’s interpretation, as well as the FDA’s authority to request new or additional information; we may not be able to obtain or maintain FDA or other regulatory authority approval of our product candidates; our ability to address FDA or other regulatory authority requirements relating to our clinical programs and registrational plans, such requirements including, but not limited to, clinical and safety requirements as well as manufacturing and control requirements; risks related to our accelerated FDA review designations; our ability to obtain and maintain intellectual property rights relating to our product pipeline; and the acceptance by the market of our product candidates and their potential reimbursement by payors, if approved.

We caution you that the risks, uncertainties, and other factors referenced above may not contain all the risks, uncertainties, and other factors that are important to you. In addition, we cannot guarantee future results, level of activity, performance, or achievements. Any forward-looking statement made by us in this Annual Report on Form 10-K speaks only as of the date of this Annual Report on Form 10-K or as of the date on which it is made. Except as required by law, we undertake no obligation to publicly update any forward-looking statements, whether because of new information, future events or otherwise, after the date of this Annual Report on Form 10-K.

Unless the context requires otherwise, in this report the terms “Iovance,” the “Company,” “we,” “us,” and “our” refer to Iovance Biotherapeutics, Inc.

PART I

Item 1. Business

Overview

We are a commercial-stage 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. Our mission is to be the global leader in innovating, developing, and delivering tumor infiltrating lymphocyte, or TIL, cell therapies for patients with solid tumor cancers. We are executing the U.S. launch of Amtagvi® (lifileucel), the first product within our autologous TIL cell therapy platform, while also marketing Proleukin® (aldesleukin), an interleukin-2, or IL-2, product used in the Amtagvi® treatment regimen and in other applications. Amtagvi® is the first and the only one-time, individualized T cell therapy to receive FDA approval for a solid tumor cancer. Amtagvi® is a tumor-derived autologous T cell immunotherapy indicated for the treatment of adult patients with unresectable or metastatic melanoma previously treated with a PD-1 blocking antibody, and if BRAF V600 mutation positive, a BRAF inhibitor with or without a MEK inhibitor. This indication was approved in February 2024 under accelerated approval based on an endpoint of overall response rate, or ORR. Continued approval for this indication may be contingent upon verification and description of clinical benefit in future confirmatory trials. Amtagvi® and Proleukin® are part of a treatment regimen that also includes lymphodepletion.

Beyond the U.S., we plan to launch Amtagvi® into additional markets with a high prevalence of advanced melanoma, including the European Union, or EU, United Kingdom, or UK, Canada, Switzerland, and Australia. In June 2024, we submitted a centralized marketing authorization application, or MAA, to the European Medicines Agency, or the EMA, for lifileucel. In August 2024, the MAA was validated and accepted for review by the EMA. In October 2024, an MAA was submitted to the Medicines and Healthcare products Regulatory Agency in the UK. A new drug submission, or NDS, was deemed eligible for Notice of Compliance with Conditions, or NOC/c, by Health Canada and submitted in December 2024 and then accepted in January 2025. The NOC/c policy includes a prioritized 200-day review process for potential NDS approval in mid-2025. If approved, lifileucel is expected to be the first and only approved therapy in this treatment setting in these markets. Across the U.S. and other targeted global markets, Amtagvi® has the potential to address more than 20,000 previously treated advanced melanoma patients annually.

Iovance was founded to build upon the promise of TIL cell therapy that was previously demonstrated in single-center clinical trials at academic research centers, including the National Cancer Institute, or the NCI. Our multi-center trials, novel TIL cell therapy

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products, manufacturing processes, facilities, and bioanalytical platforms have transformed TIL cell therapy into a commercially viable treatment which thousands of patients with cancer can access.

We manufacture Amtagvi® and our investigational TIL cell therapies using centralized, scalable, and proprietary manufacturing processes which rejuvenate and multiply polyclonal T cells unique to each patient into the billions and yields a cryopreserved, individualized therapy. Amtagvi® is manufactured for commercial use at our manufacturing facility, the Iovance Cell Therapy Center, or the iCTC, and by a contract manufacturing organization, or CMO.

Our development pipeline includes multicenter trials of TIL cell therapies in additional treatment settings and indications for solid tumor cancers. To potentially improve outcomes for patients, we are investigating TIL monotherapies for patients previously treated with standard of care therapies and TIL cell therapy in combination with standard of care therapies for patients in earlier treatment settings. We are conducting two ongoing registrational trials to support a supplementary BLA, or sBLA, of lifileucel in frontline advanced melanoma and in advanced non-small cell lung cancer, or NSCLC, following standard of care chemo-immunotherapy. We are also developing next generation therapies, such as genetically modified TIL cell therapy and next generation cytokines for use in the TIL cell therapy regimen.

Corporate Strategy

A global leader in innovating, developing, and delivering TIL cell therapy

Our mission is to be the global leader in innovating, developing, and delivering TIL cell therapy for patients with solid tumor cancers. We are pioneering this transformational approach to cure cancer by harnessing the human immune system’s ability to recognize and destroy diverse cancer cells in each patient. As we continue to execute the U.S. launch of Amtagvi® and advance our pipeline, we are committed to continuous innovation to develop TIL cell therapies and optimize TIL treatment regimens that may extend and improve life for patients with cancer.

Successfully commercialize our lead product Amtagvi® for the treatment of post-anti-PD-1 advanced melanoma in the U.S.

Following U.S. FDA approval of Amtagvi® for the treatment of patients with post-anti-PD-1 advanced melanoma on February 16, 2024, our top priority is continuing to leverage our experienced marketing, payer access, and distribution teams, as well as a sales force with extensive experience in oncology and cell therapy for our commercialization efforts. Our medical affairs team is also educating key opinion leaders, or KOLs, about Amtagvi® and TIL cell therapy, as well as presenting and publishing our clinical results.

We are focusing ongoing Amtagvi® commercialization efforts on four primary areas:

U.S. Commercial Launch of the First TIL Cell Therapy in Advanced Melanoma

Amtagvi®

Amtagvi® (lifileucel) was approved by the FDA on February 16, 2024 for the treatment of adult patients with unresectable or metastatic melanoma previously treated with a PD-1 blocking antibody, and if BRAF V600 mutation positive, a BRAF inhibitor with or without a MEK inhibitor. The approval is based on safety and efficacy results from the C-144-01 clinical trial, a global, multicenter trial investigating Amtagvi® in patients with advanced melanoma previously treated with anti-PD-1 therapy and targeted therapy, where applicable. We completed the Biologics Licensing Application, or BLA, submission in March 2023, which the FDA accepted in May 2023 for Priority Review.

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Amtagvi® is manufactured using a proprietary process to collect and multiply a patient’s unique T cells from a portion of their tumor. Amtagvi® returns billions of the patient’s T cells back to the body to fight cancer. Amtagvi® is administered to patients as part of a treatment regimen that includes lymphodepletion and a short course of high-dose Proleukin® (aldesleukin).

There are three key steps in the Amtagvi® treatment process.

●Step 1: Sample Collection. A tumor tissue sample of at least 1.5 cm in diameter is collected during a surgical resection and shipped to an FDA-approved, centralized manufacturing facility.

●Step 2: Manufacturing. Upon arrival at the manufacturing facility, TIL are separated from other cells within the patient’s tumor tissue sample. The cells are then multiplied into the billions. Upon completion of manufacturing, Amtagvi® is quality tested to meet specific product release criteria. The final product is cryopreserved and sent back to the ATC for administration to the patient.

●Step 3: Treatment Regimen. The Amtagvi® treatment regimen begins with non-myeloablative lymphodepletion, or NMA-LD, to suppress the immunosuppressive tumor microenvironment, which we believe enhances the efficacy of TIL cell therapy. After NMA-LD, Amtagvi® is infused and followed by a short course of up to six doses of Proleukin® to promote T cell activity.

Prior to the FDA approval of Amtagvi®, there were no FDA approved therapies for patients with advanced melanoma following anti-PD-1 therapy.

Proleukin®

Proleukin® (aldesleukin) is an IL-2 product used in the Amtagvi® treatment regimen and manufacturing process, as well as other commercial, clinical, manufacturing, and research settings, which provides additional revenue. In May 2023, we acquired the worldwide rights to Proleukin®, as well as the manufacturing, supply, and commercialization income generated from such rights and associated operations from Clinigen Holdings Limited, Clinigen Healthcare Limited, and Clinigen, Inc, which we refer to collectively as Clinigen. Ownership of Proleukin® provides an additional revenue source, secures our Proleukin® supply chain, lowers cost of goods, and reduces clinical trial expenses for Proleukin® used with our TIL cell therapies.

Proleukin® has received regulatory approvals for treatment of adults with metastatic melanoma and metastatic renal cell carcinoma in the U.S. Proleukin® is also licensed in multiple countries around the world for treatment of patients with metastatic renal cell carcinoma and/or metastatic melanoma. We also sell aldesleukin for clinical trial use and for use in the manufacturing of various cell and gene therapies to numerous third-party clients.

Manufacturing capacity for forecasted commercial and clinical demand

We are the first company to obtain FDA approval for a TIL cell therapy product. We believe that we are the only company in the U.S. to have a centralized, scalable, and commercially viable TIL manufacturing process. In clinical trials, more than 700 patients have been treated with Iovance TIL cell therapy products manufactured using our proprietary processes across multiple indications. Iovance TIL cell therapies are manufactured for commercial use and clinical trials at our manufacturing facility, the iCTC, and by a CMO. The FDA authorized iCTC for commercial manufacturing of Amtagvi® as well as our CMO for additional capacity to supplement our internal manufacturing. As built, the two facilities together have capacity to treat several thousands of cancer patients annually with commercial product and clinical supply.

The iCTC is the first centralized and scalable current Good Manufacturing Practice, or cGMP, manufacturing facility dedicated to producing TIL cell therapies, as well as the first FDA-approved facility for commercial TIL cell therapy. Located in Philadelphia, Pennsylvania, the 136,000 square foot iCTC is among the largest cell therapy manufacturing facilities globally. iCTC expansion is underway which is expected to increase capacity to supply over five thousand patients annually. Our long-term goal is to establish a manufacturing network that can supply TIL cell therapies to over ten thousand patients per year. The proximity of the iCTC to multiple airports facilitates delivery of TIL cell therapies to treatment centers. The iCTC is expected to cover logistics and delivery of TIL cell therapies in North America, Europe, and Australia. Ownership of our manufacturing facility allows us to control internal manufacturing capacity and product quality, manage supply and delivery logistics, implement process improvement and realize potential cost efficiencies for TIL cell therapies that we may develop and commercialize. We are also exploring next generation TIL cell therapy

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manufacturing processes, treatments and technologies that may further streamline development timelines and costs. The iCTC has a flexible design that facilitates our expansion within the existing shell space and an option to build on an adjacent lot to support future growth and capacity needs.

We plan to carefully manage our cost structure and reduce the long-term cost of manufacturing our products. Details of related agreements are provided in the Research, Development, Manufacturing and License Agreements for TIL Cell Therapy section of this Annual Report on Form 10-K.

TILCellTherapy Clinical Development in Advanced, Metastatic or Unresectable Solid Tumor Cancers

Our TIL cell therapy platform and manufacturing process have been initially validated through the FDA approval of Amtagvi®. TIL cell therapy is a T cell-based immunotherapy technology platform that leverages patient-specific cells to recognize and attack diverse cancer cells that are unique to each patient. Unlike other cell therapies that act on a single or small number of shared antigen targets common to certain tumors, our individualized T cell therapies are polyclonal to target a variety of neoantigens that are unique to the patient and tumor. We believe this polyclonal cell therapy may be applicable to many solid tumor cancers, where the majority of immune targets are patient specific.

We have investigated TIL cell therapy in global, multicenter clinical trials in advanced melanoma, gynecological cancers, non-small cell lung cancer, or NSCLC, and head and neck squamous cell carcinoma, or HNSCC. Through ongoing academic collaborations, as well as government and other partners, we are investigating the next frontier for TIL cell therapy in other tumor types and treatment settings.

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Next-Generation TIL Therapy Product Candidates

Our next-generation technology platforms are designed to optimize outcomes with TIL cell therapy across three key initiatives: genetic modifications, potency, and new treatment regimens.

Additional information is included in the Iovance-Sponsored Clinical Trials section of this Annual Report on Form 10-K.

Intellectual Property

We have established a leading intellectual property portfolio developed internally and licensed from third parties. We currently own more than 250 granted or allowed U.S. and international patents and patent applications pertaining to Amtagvi® and other TIL-related technologies that are expected to provide Amtagvi® with exclusivity into 2042. More than 75 U.S. patents are related to TIL cell therapy, including patents directed to compositions and methods of treatment in a broad range of cancers. Pending patent applications and granted patents cover the fields of TIL cell therapy, genetically edited TIL cell therapy, selected TIL cell therapy, small core or biopsy TIL cell therapy, fresh or frozen tumor digest-derived TIL cell therapy, TIL and ICI combination therapy, marrow infiltrating lymphocytes, or MIL therapy, and peripheral blood lymphocyte, or PBL, therapy. We also license rights to a broad range of technologies related to our platforms. More details on our intellectual property portfolio are included within this Annual Report on Form 10-K.

Iovance-Sponsored Clinical Trials

Frontline Advanced Melanoma

Melanoma is a common type of skin cancer, accounting for an estimated 100,640 patients diagnosed and 8,290 deaths in 2024 in the U.S. according to the Surveillance, Epidemiology and End Results program, or SEER, program. Following the accelerated approval of Amtagvi®, our confirmatory trial, TILVANCE-301, is designed to support a registrational path for lifileucel in combination with pembrolizumab in frontline advanced melanoma as well as to support full U.S. approval for Amtagvi®, which has received an accelerated U.S. approval in its initial indication in post-anti-PD-1 advanced melanoma.

TILVANCE-301 is a Phase 3 multicenter, open-label, randomized, parallel group, treatment clinical trial that will randomize approximately 670 patients with unresectable or metastatic melanoma who have had no prior therapy for metastatic or unresectable disease to investigate lifileucel in combination with pembrolizumab in the experimental arm compared with pembrolizumab monotherapy in the control arm. Patients in the experimental arm receive pembrolizumab prior to and after the lifileucel regimen until disease progression. In the control arm, pembrolizumab monotherapy is given every six weeks until disease progression, with an optional

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crossover to lifileucel monotherapy upon confirmed progressive disease verified by a blinded independent review committee, or BIRC, and if patients meet eligibility criteria.

We reached agreement with the FDA on the TILVANCE-301 clinical trial design, including dual primary endpoints of ORR to support accelerated approval and PFS to support full approval of lifileucel in frontline advanced melanoma. The dual primary endpoints will be assessed by a BIRC using RECIST 1.1.

Our strategy in frontline melanoma is supported by clinical results from the ongoing Cohort 1A of our IOV-COM-202 clinical trial as well as prior published NCI data for TIL monotherapy in anti-PD-1 naïve melanoma patients. As of the most recent detailed Cohort 1A clinical data update in May 2024, we observed a 65% ORR in twenty-three patients per RECIST 1.1. Fifteen patients had a confirmed objective response, including seven complete responses and eight partial responses. Nearly all responders had ongoing responses, and eight responders had a duration of response of more than one year at the time of the data cut. The treatment-emergent adverse event, or TEAE, profile was consistent with the underlying advanced disease and the known adverse event profiles of pembrolizumab, lymphodepletion and IL-2 regimens.

Our strategy is also supported by several NCI trials of TIL cell therapy that were conducted prior to approval of anti-PD-1 therapies. In these trials, ORR was over 50% in anti-PD-1 naïve melanoma patients, and approximately 22-24% of patients had a complete response per RECIST 1.1. Most complete responses remained ongoing in three to seven years of follow up.

Lifileucel for Advanced, or Metastatic or Unresectable NSCLC

According to the SEER program estimates, approximately 234,580 people were diagnosed with lung and bronchus cancers, and approximately 125,070 deaths occurred related to these cancers in the U.S. in 2024. Patients previously treated with standard of care chemo-immunotherapy have a poor prognosis, limited treatment options, and a real-world overall survival of less than six months.

We are developing lifileucel alone and in combination with approved therapies to treat advanced NSCLC in the IOV-LUN-202 and IOV-COM-202 clinical trials.

IOV-LUN-202 Registrational Trial

IOV-LUN-202 is a single-arm, registrational trial investigating lifileucel in patients who have progressed on or after chemotherapy and anti-PD-1 therapy for advanced (unresectable or metastatic) NSCLC without epidermal growth factor receptor, or EGFR, ROS proto-oncogene receptor tyrosine kinase, or ROS, anaplastic lymphoma kinase, or ALK, genomic mutations and had received at least one line of an FDA-approved targeted therapy if indicated by other actionable tumor mutations. IOV-LUN-202 includes two registrational patient cohorts (Cohorts 1 and 2) and two exploratory patient cohorts (Cohort 3 and 4). The programmed death-ligand 1, or PD-L1, tumor proportion score, or TPS, in patients at the time they started frontline therapy was less than one percent or unknown in patients in Cohort 1 and greater than or equal to one percent in patients in Cohort 2. In Cohort 3, TIL is extracted from core biopsy and manufactured using our Gen 3 process. In Cohort 4, patients undergo surgical resection for TIL manufacturing prior to disease progression. Based on the regulatory discussions and positive regulatory feedback received by the FDA regarding the design of the IOV-LUN-202 trial, we plan to enroll a total of approximately 120 patients into the registrational Cohorts 1 and 2 of the IOV-LUN-202 trial.

In July 2023, we announced a preliminary analysis of the IOV-LUN-202 trial from 23 NSCLC patients treated with lifileucel. An objective response rate of 26.1% per RECIST 1.1 was observed in six patients, with one complete response and five partial responses, and a disease control rate of 82.6%. While still early on study, the median duration of response, or DOR, was not reached. The DOR ranged from 1.4+ months to 9.8+ months. Treatment-emergent adverse events were consistent with the underlying disease and known adverse event profiles of non-myeloablative lymphodepletion and interleukin-2. We also reported additional ongoing responses, and duration of response greater than six months for 71% of the confirmed responders in the trial, in an updated analysis from November 2023.

We believe the results from IOV-LUN-202 in previously treated patients with advanced NSCLC continue to support the potential benefit of one-time TIL cell therapy, including the opportunity for more durable responses than available second line chemotherapies.

The opportunity for TIL cell therapy in NSCLC is also supported by clinical results for lifileucel in heavily pre-treated patients with NSCLC in Cohort 3B of our IOV-COM-202 trial in solid tumors. At the Society for Immunotherapy of Cancer, or SITC, in November 2021, we reported Cohort 3B results from 28 patients who had progressed on or after prior immune checkpoint inhibitor, or

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ICI, therapy, including patients with oncogene-driven tumors who received prior tyrosine kinase inhibitor, or TKI, therapy. The ORR was 21.4% per RECIST 1.1, including one complete response and five partial responses. The complete response remained ongoing at 37 months following treatment in a subsequent data extract from November of 2022. All Cohort 3B patients had received prior anti-PD-1/-L1 therapy, and all six responding patients had also received prior chemotherapy. The TEAE profile was consistent with the underlying disease and known adverse event profiles of non-myeloablative lymphodepletion and IL-2.

On December 22, 2023, the FDA placed a partial clinical hold on the IOV-LUN-202 trial in response to a reported Grade 5 (fatal) serious adverse event, or SAE, potentially related to the non-myeloablative lymphodepletion pre-conditioning regimen. In March 2024, the FDA lifted its partial clinical hold and we resumed enrollment in the IOV-LUN-202 trial.

A separate patient cohort, Cohort 3C, in IOV-COM-202 is investigating lifileucel in combination with ipilimumab or nivolumab in patients who previously received only a prior line of approved systemic ICI monotherapy.

Frontline NSCLC Development and Regulatory Strategy

In frontline NSCLC, our goal is to improve the current standard of care pembrolizumab maintenance therapy by administering TIL after completion of the initial chemo-immunotherapy. This approach is supported by initial results from Cohort 3A in the IOV-COM-202 trial which is evaluating lifileucel in combination with pembrolizumab in patients who have not received prior immunotherapy, including ICIs, and will be further investigated in the IOV-COM-202 trial in two new cohorts, 3D and 3E.

In November 2024, we reported updated preliminary results from Cohort 3A in the IOV-COM-202 trial at the Society for Immunotherapy of Cancer Annual Meeting which continue to demonstrate robust response rates and durability for lifileucel in combination with pembrolizumab in NSCLC patients who were not previously treated with immune checkpoint inhibitor therapy. A confirmed objective response was observed in 9 of 14 EGFR wild type patients, or 64.3%, including 6 of 11 patients, or 54.5%, who also had difficult-to-treat PD-L1 negative disease. Median duration of response was not reached at a median study follow up of 26.5 months. This data supports the opening of a new cohort, 3D, in the IOV-COM-202 trial to investigate lifileucel plus pembrolizumab following chemotherapy as part of frontline therapy for patients with EGFR wild type NSCLC, representing the majority of patients with an unmet medical need in this setting.

Gynecological Cancers

According to the SEER program estimates, in 2024, 67,880 women were diagnosed with uterine cancer and approximately 13,250 uterine cancer-related deaths occurred in the U.S. Moreover, approximately 13,820 women were diagnosed with cervical cancer, and approximately 4,630 cervical cancer-related deaths occurred in the U.S.

Advanced endometrial cancer, the most common form of uterine cancer, represents a significant opportunity for TIL cell therapy. Analogous to other tumor types, TIL cell therapy may offer benefit in the emerging treatment setting of patients who have no currently approved therapies for progression after post-anti-PD1 therapy and chemotherapy. We began a Phase 2 trial of lifileucel in post-anti-PD-1 and post-chemotherapy advanced endometrial cancer, including mismatch repair, or MMR, deficient and MMR proficient patient populations in the first half of 2024. Based on the TIL mechanism of action, the benefit of TIL cell therapy is likely to extend across patients with tumors that are MMR mechanism deficient and proficient.

The potential for TIL cell therapy in gynecological cancers is also supported by our clinical data for lifileucel alone and in combination with pembrolizumab in advanced cervical cancer. C-145-04 is a Phase 2, multicenter pivotal clinical trial which evaluated lifileucel monotherapy in patients previously treated with chemotherapy or previously treated with chemotherapy and ICIs, lifileucel in combination with pembrolizumab in Cohort 3 included patients who had not received prior systemic therapy.

Following an assessment of the current treatment landscape in gynecological cancers, we are prioritizing endometrial cancer over cervical cancer. We plan to continue to explore the use of TIL cell therapies in cervical cancer, including using genetically modified TIL products and using TIL products in combination with anti-PD-1/PD-L1 blocking antibody therapies in frontline cervical cancer, with the goal of returning to clinical development in the future.

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IOV-4001 for Advanced Melanoma and NSCLC

We have a worldwide exclusive license from Cellectis that enables us to use certain TALEN® technology addressing multiple gene targets in several cancer indications, to develop genetically edited and potentially more potent TIL cell therapies. Our lead genetically modified TIL cell therapy, IOV-4001, utilizes this TALEN® technology to inactivate the gene coding for PD-1. We are investigating the safety and efficacy of IOV-4001 in IOV-GM1-201, a multicenter, first-in-human Phase 1/2 clinical trial in two patient cohorts. Cohort 1 includes patients with advanced melanoma, who were previously treated with anti-PD-1/PD-L1 blocking antibody therapy and, in those patients with BRAF mutations, after BRAF/MEK inhibitor therapy. In Cohort 2, we are investigating IOV-4001 in patients with metastatic NSCLC who have received no more than three prior lines of therapy, with or without oncogene driver mutations. We treated the first patient with IOV-4001 in the third quarter of 2022 and the Phase 1 safety portion of the clinical trial is completed.

Additional Clinical Trials

We previously investigated the potential for TIL cell therapy in metastatic HNSCC. The Phase 2 C-145-03 trial investigated lifileucel as monotherapy, using various manufacturing processes. The trial began in June 2017 and closed in January 2021 after reaching its pre-specified enrollment target. We also investigated lifileucel in combination with pembrolizumab in patients with HNSCC who are naïve to anti-PD-1 therapy in IOV-COM-202 Cohort 2A. The results from Cohort 2A are supportive of our strategies to develop TIL cell therapy in combination with pembrolizumab in earlier treatment settings for solid tumor cancers.

We have also explored the potential for polyclonal T cell immunotherapies in blood cancers. A first-in-human clinical trial, IOV-CLL-01, evaluated the safety and efficacy of IOV-2001, our polyclonal PBL therapy, in patients with relapsed or refractory chronic lymphocytic leukemia, or CLL, and small lymphocytic lymphoma, or SLL.

Manufacturing Processes

Iovance was founded to build upon the promise of TIL cell therapy that was previously demonstrated in single-center clinical trials at academic centers that have not been scalable or standardized to serve sizeable patient populations. Our multicenter trials and manufacturing processes have transformed TIL cell therapy into a commercially viable treatment which many more patients with cancer can access.

Our internal research and process development team has innovated TIL manufacturing and processing. Our initial Gen 1 manufacturing process modified the NCI’s original TIL manufacturing and processing so that it could be reproduced in a cGMP environment. Gen 1 TIL expansion occurred over a 5-to-6-week period and produced a non-cryopreserved product.

Building upon initial success with the Gen 1 process, our proprietary Gen 2 technology introduced manufacturing and logistical efficiencies aimed at further optimizing treatment and streamlining distribution processes. Gen 2 manufacturing takes about 22 days and produces a cryopreserved final product. We currently use Gen 2 to manufacture our commercial product, Amtagvi®, and in most ongoing Iovance clinical trials. We are also committed to further improving and streamlining the processes for TIL cell therapy manufacturing and tumor sample collection.

Gen 2 Manufacturing Process

During the Gen 2 process, TILs are multiplied into the billions or 109 – 1011 of TIL. The process begins by collecting the patient’s tumor tissue by surgical biopsy for shipment to a central manufacturing facility, the iCTC or our CMO. The tumor is fragmented to facilitate a clear path for TILs to leave the tumor tissue and placed in media that optimizes the growth of TIL rather than other cell types. From days 0-11, cells grow slowly during the pre-rapid expansion, or pre-rep phase. The rapid expansion phase occurs from days 11-22. On Day 11, the cells are transferred to a larger bioreactor and feeder cells are introduced to further activate the TILs to proliferate. On day 16, the TILs are harvested while maintaining a closed system before they are counted and placed into multiple bioreactors which are incubated one last time. On day 22, TILs are filtered, washed, concentrated, and formulated with cryopreservation media before being placed in the final product bags and shipped back to the patient’s treatment center. Our commercial product, Amtagvi®, undergoes additional analytical and quality testing to meet certain criteria for commercial release prior to shipment to the ATCs.

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Large-Scale Centralized Manufacturing for TIL Cell Therapies

The cell processing activities for our TIL cell therapies are conducted at centralized facilities under cGMP, using qualified equipment and materials. We manufacture our commercial product, Amtagvi®, at both our internal facility and a CMO to meet manufacturing capabilities and the current and expected demand for commercialization and clinical trials. The iCTC is the first FDA-approved, centralized and scalable cGMP manufacturing facility dedicated to producing TIL cell therapies. Through a manufacturing service agreement, or MSA, with WuXi Advanced Therapies, Inc., or WuXi, WuXi manufactures, packages, ships and handles quality assurance and quality control of our commercial product, Amtagvi®, working closely with our employees.

Certain clinical trials for our investigational TIL cell therapies are also supported by CMOs. These relationships are described in more detail in the Research, Development, Manufacturing, and License Agreements for TIL Cell Therapy section of this Annual Report on Form 10-K.

We expect to rely on our own manufacturing capabilities, together with other third parties, for the manufacturing and processing of commercial and investigational TIL cell therapy products to ensure sufficient capacity is available for commercial purposes and clinical trials. As an alternative, we also believe that, given sufficient time to hire staff and increase production, we have the ability to move our production of commercial and investigational TIL cell therapy products entirely in-house. We believe that all materials and components utilized in the production of the final TIL product are readily available from qualified suppliers.

Research, Development, Manufacturing, and License Agreements for TIL Cell Therapy

WuXi Advanced Therapies, Inc.

Manufacturing and Services Agreements

Since November 2016, we entered into various manufacturing services agreements with WuXi Advanced Therapies, Inc., and its parent company WuXi Apptec, Co. Ltd, or collectively, WuXi, pursuant to which WuXi agreed to provide manufacturing and other services for two cGMP manufacturing suites for commercial, clinical manufacturing and related testing services. Both suites are capable of use for the commercial manufacture of our products. We do not utilize WuXi for the manufacture of our next generation therapies.

National Institutes of Health and the National Cancer Institute

Cooperative Research and Development Agreement

In August 2011, we signed a five-year Cooperative Research and Development Agreement, or CRADA, with the NCI to work on the development of adoptive cell immunotherapies in multiple solid tumor types, including unmodified TIL as a stand-alone therapy or in combination, improved methods for the generation and selection of TIL cell therapy with anti-tumor reactivity, and strategies for more potent TILs. The CRADA has been amended since then to, among other things, extend the term of the CRADA, include new indications such as bladder, lung, triple-negative breast, and Human Papilloma Virus, or HPV, associated cancers and modify the focus on the development of unmodified TIL as a stand-alone therapy or in combination, 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.

In July 2024, we and the NCI entered into a fourth amendment to the CRADA to extend its term by an additional five years to August 2029. The fourth amendment also includes collaboration on preclinical and clinical development of enhanced tumor reactive TIL products for the treatment of a broad range of common epithelial cancers.

Pursuant to the terms of the CRADA, as amended, we were required to make quarterly payments of $0.5 million to the NCI for support of research activities through the end of 2024. Commencing in 2025, we are required to make quarterly payments of $0.9 million to the NCI for the support of research activities through the end of the CRADA’s term. To the extent we license patent rights relating to a TIL-based product candidate, we will be responsible for all patent-related expenses and fees, past and future, relating to the TIL-based product candidate. In addition, we may be required to supply certain test articles, including TIL, grown and processed under cGMP conditions, suitable for use in clinical trials. We 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.

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

We entered into an Exclusive Patent License Agreement, or the Patent License Agreement, with the National Institutes of Health, or 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 us 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.

In May 2021, we 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-21 cytokine-tethered TIL technology, and expanded the non-exclusive, worldwide field of use to all cancers. In August 2022, we 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 related to enhancing TIL potency.

The Second Amended and Restated Patent License Agreement requires us 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 events, including the exclusivity of the rights, and we expect lower overall royalty payments as a result. We are also required to pay potential milestone payments on the achievement of certain clinical, regulatory, and commercial sales milestones for each of the exclusive indications and other direct costs incurred by the NIH pursuant to the Second Amended and Restated Patent License Agreement. We have made and anticipate making additional milestone 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 our 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

In February 2015, we entered into an exclusive patent license agreement, or the Exclusive Patent License Agreement, with the NIH under which we received an exclusive worldwide license under the selected TIL patents. 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 Agreement

In June 2020, we entered into a Sponsored Research Agreement, or the SRA, with the H. Lee Moffitt Cancer Center, or Moffitt, with a term that ends either upon completion of the research thereunder or on July 1, 2022, whichever is sooner. The SRA was then extended numerous times, most recently to May 31, 2025

The University of Texas M.D. Anderson Cancer Center

Strategic Alliance Agreement

In April 2017, we entered into a Strategic Alliance Agreement, or the SAA, with the University of Texas M.D. Anderson Cancer Center, or MDACC, under which we and MDACC agreed to conduct clinical and preclinical research studies. We 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. In return, we acquired all rights to inventions resulting from the studies and have 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. We have also been granted certain rights to 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 us of all deliverables due from MDACC thereunder. On March 28, 2024, we entered into the first amendment to the SAA, under which we and MDACC agreed to conduct additional preclinical research studies.

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Cellectis S.A.

Research Collaboration and Exclusive Worldwide License Agreement

In December 2019, we entered into a research collaboration and exclusive worldwide license agreement whereby we will license gene-editing technology from Cellectis, a clinical-stage biopharmaceutical company, to develop TIL cell therapies that have been genetically edited, including a PD-1 inactivated product that we refer to as IOV-4001. Financial terms of the license include annual license payments and development, regulatory and sales milestone payments from us to Cellectis, as well as royalty payments based on net sales of TALEN® modified TIL products.

Novartis Pharma AG

License Agreement

In January 2020, we obtained a license from Novartis Pharma AG, or Novartis, to develop and commercialize an antibody cytokine engrafted protein, which we refer to as IOV-3001. Under the agreement, we have 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., the European Union, or EU, and Japan. Novartis is also entitled to low-to-mid single digit percentage royalties from commercial sales of the product.

In May 2023, as part of the completion of the acquisition of the worldwide rights to Proleukin®, or the Acquisition, we 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, we may be required to make future milestone payments based on net sales (as defined in the relevant underlying agreements) in the U.S. and the rest of world, which includes any and all sales outside of the U.S.

Boehringer Ingelheim Biopharmaceuticals GmbH

In May 2023, as part of the Acquisition, we inherited a manufacturing and supply agreement from Clinigen with Boehringer Ingelheim Biopharmaceuticals GmbH, or 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, we must purchase a minimum number of vials each calendar year at fixed prices determined by vial batch size.

TIL Cell Therapy Landscape in Solid Tumors

Immune System and Cancer Surveillance

The immune system recognizes danger signals and responds to threats at a cellular level. The most significant components of the cellular aspect of the adaptive immune response are T cells, or T lymphocytes, so called because they mature in the thymus and are distinguished from B-cells, which mature in the bone marrow. T cells can be distinguished from other white blood cells by T cell receptors present on their cell surface. These receptors contribute to tumor surveillance by helping T cells recognize infected as well as cancerous cells. T cells are involved in both sensing and killing infected or cancerous cells, as well as coordinating the activation of other cells in an immune response.

Challenges for Cancer Immunotherapy

According to SEER, solid tumor cancers represent more than 90 percent of all cancers diagnosed in the U.S. annually. Despite progress over the past several decades, effective treatment of solid tumors continues to be challenging for several reasons, including: (i) intratumoral heterogeneity, (ii) numerous mutations and tumor neoantigens, with <1% shared across patients and lack of clarity on which mutations or neoantigens are critical, and (iii) ability to adapt and evade treatments that target a single mutation. In addition, the tumor itself and the tumor microenvironment can suppress the patient’s natural immune response. When T cells with cancer-specific receptors are absent, present in low numbers, of poor quality, or rendered inactive by suppressive mechanisms employed by tumor tissue, the cancer can grow and spread to various organs. In addition, certain standard of care treatments for cancer can be deleterious to T cells’ ability to kill cancer.

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Advancing Immuno-Oncology with Our TIL Technology Platform

We believe that adoptive cell therapy, specifically the use of human polyclonal TIL cells to reengage the immune system, may be a significant advancement in the treatment of cancer. Our TIL technology platform was validated by the first FDA approval of a TIL cell therapy and is potentially applicable to many solid tumor cancers. This platform is focused on leveraging patient-specific cells to recognize and attack diverse cancer cells that are unique to each patient. Unlike cell therapies that act on a single or small number of shared antigen targets common to certain tumors, TIL cell therapy is an individualized, polyclonal T cell therapy designed to target a variety of neoantigens that are unique to the patient or tumor.

Our initial strategy is to deliver our commercial product, Amtagvi®, as well as investigational TIL cell therapies to patients with late-stage solid tumor cancers. After infusion, TIL can potentially infiltrate the tumor to eliminate cancer cells, further proliferate in the body and potentially overcome several mechanisms of tumor escape to which endogenous T cells may be susceptible due to the immune-suppressive tumor microenvironment.

For earlier intervention, we are investigating our TIL cell therapy in combination with ICIs. These ICIs seek to overcome one of the main escape mechanisms of cancer against an immune system attack. TIL cell therapy and ICIs may work in combination to target and attack cancer cells while breaking down barriers for the immune system to mount a response.

Competition

The biotechnology and pharmaceutical industries put significant resources into developing novel and proprietary therapies for the treatment of cancer. We compete with multiple entities who have developed and are developing immuno-oncology therapies, including large and specialty pharmaceutical and biotechnology companies, academic research institutions, other public and private research institutions, including universities and public and private research institutions in the U.S. and Europe, as well as companies developing novel targeted therapies for cancer. Universities and public and private research institutions in the U.S. and Europe are also potential competitors. For example, a Phase 3 M14TIL clinical trial comparing TIL to standard ipilimumab in patients with metastatic melanoma conducted in Europe by the Netherlands Cancer Institute, the Copenhagen University Hospital at Herlev, and the University of Manchester. Results from the M14TIL clinical trial were presented at the European Society for Medical Oncology Congress in September 2022 and published in the New England Journal of Medicine in December 2022. While these universities and public and private research institutions primarily have educational objectives, they may develop proprietary technologies that lead to other approved therapies or secure patent protection that we may need for the development of our technologies and products.

Due to the promising clinical therapeutic effect of competitor therapies in clinical trials, we anticipate substantial direct competition from other organizations developing therapies in our commercial and pipeline target indications. In particular, we expect to compete with other new therapies for our lead indications developed by companies such as BioNtech, Bristol-Myers Squibb, Daiichi Sankyo, Eisai, Genmab, Immunocore, IO Biotech, Merck, Moderna, Pfizer, Regeneron Pharmaceuticals, and Replimune. We also may compete with other T cell therapies in development, including therapies based on genetically engineered T cell receptors rendered reactive against tumor-associated antigens prior to their administration, other genetically engineered TIL products, and TIL products designed to be reactive to specific neoantigens, by companies such as AbelZeta Pharma, Achilles Therapeutics, Adaptimmune Therapeutics, Alaunos Therapeutics, Biosyngen, GRIT Biotechnology, Immatics, Immunocore, Intima Bioscience, KSQ Therapeutics, Lyell Immunopharma, Marker Therapeutics, Obsidian Therapeutics, TILT Biotherapeutics, and others. To date, these technologies have been primarily applicable to hematologic malignancies, but their application in solid tumor indications may create competition with us. We may also face competition from immunotherapy treatments offered by companies such as Amgen, AstraZeneca, Bristol-Myers Squibb, Merck, Pfizer, Regeneron Pharmaceuticals, Roche, and others. We may also face competition from novel IL-2 treatments in development by Alkermes, ILToo Pharma, Merck, Nektar Therapeutics, Sanofi, Werewolf Therapeutics, and others. Many of these companies and our other current and potential competitors have substantially greater research and development capabilities and financial, scientific, regulatory, manufacturing, marketing, sales, human resources, and experience than we do. Many of our competitors have several therapeutic products that have already been developed, approved, and successfully commercialized, or are in the process of obtaining regulatory approval for their therapeutic products in the U.S. and internationally. Our competitors may obtain regulatory approval for their products more rapidly than we may obtain approval for ours, which could result in competitors establishing a strong market position before we are able to enter the market.

Our portfolio includes our commercial products Amtagvi® and Proleukin® as well as our pipeline of investigational TIL cell therapies. Currently, there are numerous companies that are developing various alternate treatments for advanced melanoma, NSCLC and other solid tumor cancers that we are seeking to address, including patients that have progressed after prior treatment with checkpoint

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inhibitors and chemotherapy. Accordingly, our TIL cell therapies face significant competition from multiple companies. Even with the regulatory approval for Amtagvi®, the availability and price of our competitors’ products could limit the demand and the price we are able to charge for our therapies.

Mergers and acquisitions in the biotechnology and pharmaceutical industries may result in even more resources being concentrated among a smaller number of our competitors. Early-stage companies may also prove to be significant competitors, including through collaborative arrangements with large and established companies. These companies compete with us in recruiting and retaining qualified scientific and management personnel and establishing clinical trial sites and patient registration for clinical trials, as well as in acquiring technologies that are similar to those that we have developed or that we use for, or that are complementary to, or necessary for, our programs.

Our commercial success may depend in part on our ability to obtain and maintain patent and other proprietary protection for commercially important technology, inventions, and know-how related to our business; defend and enforce our patents; preserve the confidentiality of our trade secrets; and operate without infringing the valid enforceable patents and proprietary rights of third parties. Our ability to stop third parties from making, using, selling, offering to sell, or importing our products may depend on the extent to which we have rights under valid and enforceable patents or trade secrets that cover these activities. With respect to both licensed and company-owned intellectual property, we cannot be sure that patents will be granted with respect to any of our pending patent applications or with respect to any patent applications filed by us in the future, nor can we be sure that any of our existing patents or any patents that may be granted to us in the future will be commercially useful in protecting our commercial products and methods of manufacturing the same. We may rely, in some circumstances, on trade secrets to protect our technology. However, trade secrets can be difficult to protect.

We seek to protect our proprietary technology and processes, in part, by entering into confidentiality agreements with our employees, consultants, scientific advisors and contractors. We also seek to preserve the integrity and confidentiality of our data and trade secrets by maintaining physical security of our premises and physical and electronic security of our information technology systems. While we require these individuals, organizations, and systems to take steps to abide by the terms and conditions of the confidentiality agreements, confidentiality may be breached, or our data may be improperly used or disclosed, and we may not have adequate remedies for any breach or improper use or disclosure. In addition, our trade secrets may otherwise become known or be independently discovered by competitors. To the extent that our consultants, contractors or collaborators use intellectual property owned by others in their work for us, disputes may arise as to the rights in related or resulting know-how and inventions.

Intellectual Property

We aim to lead in the field of T cell-based immunotherapy by building and augmenting the patent rights for our proprietary TIL technology platform, which we have developed internally and licensed from third parties. Intellectual property is of importance in our field and in biotechnology generally. We seek to protect and enhance proprietary technology, inventions, and improvements that are commercially important to the development of our business by seeking, maintaining, and defending patent rights. We also plan to rely on regulatory protection afforded through Orphan Drug Designation, or ODD, available regulatory exclusivities, and patent term extensions where available. To achieve this objective, our strategic focus has been to develop our own intellectual property, while also identifying and licensing patents from third parties that provide protection and serve as an optimal platform to enhance our intellectual property and technology base. We expect to further develop our patent portfolio as a strategic focus in 2025.

We have established a leading intellectual property portfolio developed internally and licensed from third parties. We currently own more than 75 U.S. patents related to TIL cell therapy, including patents directed to compositions and methods of treatment in a broad range of cancers, such as U.S. Patent Nos. 10,130,659; 10,166,257; 10,272,113; 10,363,273; 10,398,734; 10,420,799; 10,463,697; 10,517,894; 10,537,595; 10,639,330; 10,646,517; 10,653,723; 10,695,372; 10,894,063; 10,905,718; 10,918,666; 10,925,900; 10,933,094; 10,946,044; 10,946,045; 10,953,046; 10,953,047; 11,007,225; 11,007,226; 11,013,770; 11,026,974; 11,040,070; 11,052,115; 11,052,116; 11,058,728; 11,083,752; 11,123,371; 11,141,438; 11,168,303; 11,168,304; 11,179,419; 11,202,803; 11,202,804; 11,220,670; 11,241,456; 11,254,913; 11,266,694; 11,273,180; 11,273,181; 11,291,687; 11,304,979; 11,304,980; 11,311,578; 11,337,998; 11,344,579; 11,344,580; 11,344,581; 11,351,197; 11,351,198; 11,351,199; 11,364,266; 11,369,637; 11,384,337; 11,433,097; 11,517,592; 11,529,372; 11,541,077; 11,713,446; 11,819,517; 11,857,573; 11,865,140; 11,866,688; 11,939,596; 11,969,444; 11,975,028; 11,981,921; 12,023,355; 12,024,718; 12,031,157; 12,104,172; 12,121,541; 12,159,700; 12,170,134; 12,188,048 and 12,194,061. More than 40 of these patents are related to our Gen 2 TIL manufacturing processes and have terms that we anticipate will extend to October 2037 or January 2038, not including any patent term extensions or adjustments that may be available. Our owned and licensed intellectual property portfolio also includes patents and patent applications relating to TIL, marrow

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infiltrating lymphocytes, or MIL, and peripheral blood lymphocyte, or PBL, therapies; frozen tumor-based TIL technologies; remnant TIL and digest TIL compositions, methods and processes; methods of manufacturing TIL, MIL, and PBL therapies; the use of costimulatory and T cell modulating molecules in TIL cell therapy and manufacturing; stable and transient genetically-modified TIL cell therapies, including genetic knockouts of immune checkpoints; cytokine-tethered TIL cell therapies; methods of using ICIs in combination with TIL cell therapies; TIL selection technologies; and methods of treating patient subpopulations.

Government Regulations

The FDA and other regulatory authorities at federal, state, and local levels, as well as in foreign countries, extensively regulate, among other things, the research, development, testing, manufacture, quality control, import, export, safety, effectiveness, labeling, packaging, storage, distribution, record keeping, approval, advertising, promotion, marketing, post-approval monitoring, and post-approval reporting of biologics such as those we are developing. We, along with our third-party contractors, will be required to navigate the various preclinical, clinical, and commercial approval and post-approval requirements of the governing regulatory agencies of the countries in which we wish to conduct studies or seek approval or licensure of our product candidates. The process of obtaining regulatory approvals and the subsequent compliance with appropriate federal, state, local, and foreign statutes and regulations require the expenditure of substantial time and financial resources.

Biologic products are regulated by the FDA under a combination of the federal Food, Drug, and Cosmetic Act, or FDCA, and Public Health Services Act, or PHSA, and the FDA’s implementing regulations. Failure to comply with regulatory requirements may result in significant regulatory actions. Such actions may include refusal to approve pending applications, license suspension or revocation, withdrawal of an approval, imposition of a clinical hold or termination of clinical trials, warning letters, untitled letters, modification of promotional materials or labeling, provision of corrective information, imposition of post-market requirements, including the need for additional testing, imposition of distribution or other restrictions under a Risk Evaluation and Mitigation Strategy, or REMS, product recalls, product seizures or detentions, refusal to allow imports or exports, total or partial suspension of production or distribution, FDA debarment, injunctions, fines, consent decrees, corporate integrity agreements, debarment from receiving government contracts and new orders under existing contracts, exclusion from participation in federal and state healthcare programs, restitution, disgorgement, or civil or criminal penalties, including fines and imprisonment, and adverse publicity, among other adverse consequences.

The process required by the FDA before biologic product candidates may be marketed in the U.S. generally involves the following:

● satisfactory completion of an FDA Advisory Committee review, if applicable;

The testing and approval process requires substantial time, effort and financial resources, and we cannot be certain that any approvals for our product candidates will be granted on a timely basis, if at all. Prior to beginning the first clinical trial with a new product candidate, we must submit an IND to the FDA. An IND is a request for authorization from the FDA to administer an investigational new drug product to humans. The central focus of an IND submission is on the general investigational plan and the

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protocol(s) for clinical trials. The IND also includes results of animal and in vitro studies assessing the toxicology, pharmacokinetics, pharmacology, and pharmacodynamic characteristics of the product; chemistry, manufacturing, and controls information; and any available human data or literature to support the use of the investigational product. An IND must become effective before human clinical trials may begin. The IND automatically becomes effective 30 days after receipt by the FDA, unless the FDA, within that initial 30-day time period, raises concerns or questions about the proposed clinical trial. In such a case, the IND may be placed on clinical hold and the IND sponsor and the FDA must resolve any outstanding concerns or questions before the clinical trial can begin. Clinical holds also may be imposed by the FDA at any time before or during clinical trials due to safety concerns or non-compliance. Submission of an IND therefore may or may not result in FDA authorization to begin a clinical trial.

Human immunotherapy products are a new category of therapeutics. Because this is a relatively new and expanding area of novel therapeutic interventions, there can be no assurance as to the length of the clinical trial period, the number of patients the FDA will require to be enrolled in the clinical trials in order to establish the safety, efficacy, purity, and potency of immunotherapy products, or that the data generated in these clinical trials will be acceptable to the FDA to support marketing approval.

Clinical trials involve the administration of the investigational product to human subjects under the supervision of qualified investigators in accordance with cGCPs, which include the requirement that all research subjects provide their informed consent for their participation in any clinical trial. Clinical trials are conducted under protocols detailing, among other things, the objectives of the clinical trial, the parameters to be used in monitoring safety and the effectiveness criteria to be evaluated, and a statistical analysis plan. A separate submission to the existing IND must be made for each successive clinical trial conducted during product development and for any subsequent protocol amendments. Investigators must also provide certain information to the clinical trial sponsors to allow the sponsors to make certain financial disclosures to the FDA.

Furthermore, an independent IRB for each site proposing to conduct the clinical trial centrally must review and approve the plan for any clinical trial, its informed consent documentation and processes, and any subject communications before the clinical trial begins at that site and upon amendment of the clinical trial protocol, and must monitor the clinical trial until completed. An IRB considers, among other things, whether the risks to individuals participating in the clinical trials are minimized and are reasonable in relation to anticipated benefits and whether the planned human subject protections are adequate. Informed consent must be received from each clinical trial subject prior to participation in a clinical trial. Progress reports detailing the results of the clinical trials must also be submitted at least annually to the FDA and the IRB and more frequently if serious adverse events or other significant safety information is found.

Regulatory authorities, the IRB, or the sponsor may suspend a clinical trial at any time on various grounds, including a finding that the subjects are being exposed to an unacceptable health risk, that the clinical trial is not being conducted in accordance with regulatory or IRB requirements, or that the clinical trial is unlikely to meet its stated objectives. Sponsors may also discontinue studies or development programs for many reasons, including changing business objectives. Some studies also include oversight by an independent group of qualified experts organized by the clinical trial sponsor, known as a data safety monitoring board, or DSMB, which provides recommendations and assessments for whether or not a clinical trial should move forward at designated check points based on access to certain data from the clinical trial. Following a review by a DSMB, the clinical trial may be halted if there is an unacceptable safety risk for subjects or on other grounds, such as failure to demonstrate efficacy. There are also requirements governing the reporting of ongoing clinical trials and clinical trial results to public registries. For instance, we are required to register certain clinical trials and post the results of certain completed clinical trials on a government-sponsored database, ClinicalTrials.gov, within specified timeframes, and also to certify to the FDA our compliance with these requirements when we make FDA submissions. Failure to make required ClinicalTrials.gov submissions, submitting false or misleading information to ClinicalTrials.gov, or making false certifications to the FDA could result in enforcement actions, including civil money penalties and adverse publicity.

For purposes of BLA approval, human clinical trials are typically conducted in three sequential phases that may overlap. Although these are the typical phases for progression and characteristics of the phases of a clinical development program, certain expedited programs allow for variations that could support a marketing application based on surrogate endpoints, intermediate clinical endpoints, or single-arm as opposed to comparative or placebo-controlled studies.

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Additional types of data may also help to support a BLA, such as real-world evidence and patient experience data. Phase 1, Phase 2 and Phase 3, and Phase 4 testing, if applicable, may not be completed successfully within a specified period, if at all, and there can be no assurance that the data collected will support FDA approval or licensure of the product. Concurrently with clinical trials, companies may complete additional animal studies and develop additional information about the biological characteristics of the product candidate and must finalize a process for manufacturing the product in commercial quantities in accordance with cGMP requirements. The manufacturing process must be capable of consistently producing quality batches of the product candidate and, among other things, must develop methods for testing the identity, strength, quality, and purity of the final product, or for biologics, the safety, purity and potency. Additionally, appropriate packaging must be selected and tested, and stability studies must be conducted to demonstrate that the product candidate does not undergo unacceptable deterioration over its shelf life and manufacturing processes must be validated.

The manufacture of investigational biologics for the conduct of human clinical trials is subject to cGMP requirements. Investigational biologics and active ingredients imported into the U.S. are also subject to regulation by the FDA relating to their labeling and distribution. Further, the export of investigational products outside of the U.S. is subject to regulatory requirements of the importing country as well as U.S. export requirements under the FDCA. Additional U.S. and foreign laws and regulations may also be applicable to the handling, import, export, and transportation of biological materials, including tissue samples.

In December 2022, with the passage of Food and Drug Omnibus Reform Act, Congress required sponsors to develop and submit a diversity action plan for each Phase 3 clinical trial or any other “pivotal study” of a new drug or biological product. These plans are meant to encourage the enrollment of more diverse patient populations in late-stage clinical trials of FDA-regulated products. Specifically, diversity action plans must include the sponsor’s goals for enrollment, the underlying rationale for those goals, and an explanation of how the sponsor intends to meet them. In terms of the compliance deadline, the requirement to submit a diversity action plan applies to clinical studies for which enrollment begins 180 days after the final guidance is published, which was originally anticipated to occur in June 2025. In January 2025, the draft guidance was removed from the FDA website, which may impact the eventual publication date of the final guidance, and as a result, may delay the compliance deadline beyond June 2025.

During the development of a new therapeutic, a sponsor may be able to request a Special Protocol Assessment, or SPA, the purpose of which is to reach an agreement with the FDA on the Phase 3 clinical trial protocol design and analysis that will form the primary basis of product approval and an efficacy claim, as well as preclinical carcinogenicity trials and stability studies. An SPA may only be modified with the agreement of the FDA and the clinical trial sponsor, or if the director of the FDA reviewing division determines that a substantial scientific issue essential to determining the safety or efficacy of the product was identified after the testing began. An SPA is intended to provide assurance that, in the case of clinical trials, if the agreed upon clinical trial protocol is followed, the clinical trial endpoints are achieved, and there is a favorable risk-benefit profile, the data may serve as the primary basis for an efficacy claim in support of a BLA. However, SPA agreements are not a guarantee of approval of a product candidate or any permissible claims about the product candidate. In particular, SPAs are not binding on the FDA if, among other reasons, previously unrecognized public health concerns arise during the performance of the clinical trial, other new scientific concerns regarding the product candidate’s safety or efficacy arise, or if the sponsoring company fails to comply with the agreed upon clinical trial protocol.

In addition, under the Pediatric Research Equity Act, or PREA, a BLA or supplement to a BLA for a new active ingredient, indication, dosage form, dosage regimen, or route of administration, must contain data that are adequate to assess the safety and effectiveness of the product for the claimed indications in all relevant pediatric subpopulations, and to support dosing and administration for each pediatric subpopulation for which the product is safe and effective. Also, under the FDA Reauthorization Act of 2017, beginning in 2020, sponsors submitting applications for product candidates intended for the treatment of adult cancer which are directed at

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molecular targets that the FDA determines to be substantially relevant to the growth or progression of pediatric cancer must submit, with the application, reports from molecularly targeted pediatric cancer investigations designed to yield clinically meaningful pediatric clinical trial data, using appropriate formulations, to inform potential pediatric labeling. The FDA may, on its own initiative or at the request of the applicant, grant deferrals for submission of some or all pediatric data until after approval of the product for use in adults, or full or partial waivers from the pediatric data requirements. Orphan products are also exempt from PREA requirements.

The FDA also may require submission of REMS to ensure that the benefits of the biologic outweigh the risks. The REMS plan could include medication guides, physician communication plans, and elements to assure safe use, such as restricted distribution methods, patient registries, or other risk minimization tools. An assessment of the REMS must also be conducted at set intervals. Following product approval, a REMS may also be required by the FDA if new safety information is discovered, and the FDA determines that a REMS is necessary to ensure that the benefits of the biologic outweigh the risks.

BLA Approval and Post-Approval Requirements

BLA Submission and Review by the FDA

Assuming successful completion of all required testing in accordance with all applicable regulatory requirements, the results of product development, nonclinical studies, and clinical trials are submitted to the FDA as part of a BLA requesting approval to market the product for one or more indications. The BLA must include all relevant data available from pertinent preclinical and clinical studies, including negative or ambiguous results as well as positive findings, together with detailed information relating to the product’s chemistry, manufacturing, controls, and proposed labeling, among other things. Data can come from company-sponsored clinical studies intended to test the safety and effectiveness of a use of the product, or from a number of alternative sources, including studies initiated by investigators. The submission of a BLA requires payment of a substantial user fee to the FDA, under PDUFA, and the sponsor of an approved BLA is also subject to annual program fees. These fees are typically increased annually. A waiver of user fees may be obtained under certain limited circumstances.

Once a BLA has been submitted, the FDA has sixty days to determine whether it will accept the application for filing. The FDA accepts applications for filing if it determines that the application is substantially complete to permit a substantive review. The FDA may request additional information rather than accept a BLA for filing. In this event, the application must be resubmitted with the additional information. The resubmitted application is also subject to review before the FDA accepts it for filing. Once the submission is accepted for filing, the FDA begins an in-depth substantive review.

The FDA’s goal is to review the application within ten months after it accepts the application for filing, or, if the application relates to a serious or life-threatening indication and, if approved, the product would provide a significant improvement in safety and efficacy, six months after the FDA accepts the application for filing, which is referred to as Priority Review. The review process is often significantly extended if the FDA requests additional information or clarification. The FDA reviews a BLA to determine, among other things, whether a product is safe, pure, and potent and the facility in which it is manufactured, processed, packed, or held meets standards designed to assure the product’s continued safety, purity and potency. There are numerous FDA personnel assigned to review different aspects of a BLA, and uncertainties can be presented by their ability to exercise judgment and discretion during the review process. The development and provision of additional data and information requested by FDA during review of a BLA may be time consuming and expensive.

The FDA may convene an advisory committee to provide clinical insight on application review questions. Before approving a novel biologic, the FDA must either refer that biologic to an external advisory committee or provide, in an action letter, a summary of the reasons why the FDA did not refer the product candidate to an advisory committee. An advisory committee is typically a panel that includes clinicians and other experts, which review, evaluate, and make a recommendation as to whether the application should be approved and under what conditions. The FDA is not bound by the recommendations of an advisory committee, but it considers such recommendations carefully when making decisions.

Before approving a BLA, the FDA will typically inspect the facility or facilities where the product is manufactured. The FDA will not approve an application unless it determines that the manufacturing processes and facilities are in compliance with cGMP requirements and adequate to assure consistent commercial production of the product within required specifications. Additionally, before approving a BLA, the FDA will typically inspect one or more clinical sites to ensure compliance with cGCP.

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If the FDA determines that the application, manufacturing process or manufacturing facilities are not acceptable, it will outline the deficiencies in the submission and often will request additional testing, clinical trials, application modifications, or information in a complete response letter, or CRL. A CRL indicates that the review cycle for the application is complete, and that the application is not ready for approval. If a CRL is issued, the applicant may either: resubmit the BLA, addressing all the deficiencies identified in the letter; withdraw the application; or request an opportunity for a hearing. Notwithstanding the submission of any requested additional information, the FDA ultimately may decide that the application does not satisfy the regulatory criteria for approval. Data obtained from clinical trials are not always conclusive and the FDA may interpret data differently than an applicant interprets the same data.

If the FDA finds that a BLA is approvable, the FDA may issue an approval letter. An approval letter authorizes commercial marketing of the product with specific prescribing information for specific indications. However, even if the FDA approves a product, it may limit the approved indications for use of the product, require that contraindications, warnings, or precautions be included in the product labeling, including a boxed warning, require that post-approval studies, including Phase 4 clinical trials, be conducted to further assess a product’s safety and efficacy after approval, require testing and surveillance programs to monitor the product after commercialization, or impose other conditions, including distribution restrictions or other risk management mechanisms under a REMS which can materially affect the potential market and profitability of the product. The FDA may also not approve label statements that are necessary for successful commercialization and marketing.

If compliance with the pre-and post-marketing regulatory standards are not maintained or if problems occur after the product reaches the marketplace, the FDA may also withdraw the product approval. Further, should new safety information arise, additional testing, product labeling, or FDA notification may be required.

A sponsor may seek approval of its product candidate under programs designed to accelerate the FDA’s review and approval of new drugs and biological products that meet certain criteria. Specifically, new drugs and biological products are eligible for Fast Track designation if they are intended to treat a serious or life-threatening condition and demonstrate the potential to address unmet medical needs for the condition. For a Fast Track designation, the FDA may consider sections of the BLA for review on a rolling basis before the complete application is submitted if relevant criteria are met. Fast Track-designated products are also eligible for more frequent FDA interactions. A Fast Track-designated product candidate may also qualify for Priority Review, under which the FDA sets the target date for FDA action on the BLA at six months after the FDA accepts the application for filing. Priority Review is granted when there is evidence that the proposed product would be a significant improvement in the safety or effectiveness of the treatment, diagnosis, or prevention of a serious condition. If criteria are not met for Priority Review, the application is subject to the standard FDA review period of 10 months after the FDA accepts the application for filing. Priority Review designation does not change the scientific/medical standard for approval or the quality of evidence necessary to support approval.

Under the Accelerated Approval Program, the FDA may approve a BLA on the basis of either a surrogate endpoint that is reasonably likely to predict clinical benefit, or on a clinical endpoint that can be measured earlier than irreversible morbidity or mortality, that is reasonably likely to predict an effect on irreversible morbidity or mortality or other clinical benefit, taking into account the severity, rarity, or prevalence of the condition and the availability or lack of alternative treatments. To qualify for Accelerated Approval, the product must be intended to treat a serious condition and must generally provide a meaningful advantage over available therapies. Post-marketing studies or completion of ongoing studies after marketing approval are required to verify the biologic’s clinical benefit in relationship to the surrogate endpoint or ultimate outcome in relationship to the clinical benefit. If this clinical trial is not conducted, if it fails to verify the benefit, if other evidence demonstrates that the product is not safe, pure, or potent, or if the applicant disseminates false or misleading promotional material, the FDA may withdraw approval of the application on an expedited basis. Sponsors of products under the Accelerated Approval Pathway must further submit promotional materials to the FDA before dissemination.

In addition, the Food and Drug Administration Safety and Innovation Act, or FDASIA, which was enacted and signed into law in 2012, established the new Breakthrough Therapy Designation, or BTD. A sponsor may seek FDA designation of its product candidate as a Breakthrough Therapy if the product candidate is intended, alone or in combination with one or more other drugs or biologics, to treat a serious or life-threatening disease or condition and preliminary clinical evidence indicates that the therapy may demonstrate substantial improvement over existing therapies on one or more clinically significant endpoints, such as substantial treatment effects observed early in clinical development. Sponsors may request the FDA to designate a Breakthrough Therapy at the time of or any time after the submission of an IND, but ideally before an end-of-Phase 2 meeting with the FDA. If the FDA designates a Breakthrough Therapy, it may take actions appropriate to expedite the development and review of the application, which may include holding meetings with the sponsor and the review team throughout the development of the therapy; providing timely advice to, and interactive communication with, the sponsor regarding the development of the drug to ensure that the development program to gather the nonclinical and clinical data necessary for approval is as efficient as practicable; involving senior managers and experienced review staff, as

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appropriate, in a collaborative, cross-disciplinary review; assigning a cross-disciplinary project lead for the FDA review team to facilitate an efficient review of the development program and to serve as a scientific liaison between the review team and the sponsor; and considering alternative clinical trial designs when scientifically appropriate, which may result in smaller clinical trials or more efficient clinical trials that require less time to complete and may minimize the number of patients exposed to a potentially less efficacious treatment. BTD also allows the sponsor to file sections of the BLA for review on a rolling basis.

Through the 21st Century Cures Act, or Cures Act, Congress also established another expedited program, called a Regenerative Medicine Advanced Therapy, or RMAT, designation. The Cures Act directs the FDA to facilitate an efficient development program for and expedite review of RMATs. To qualify for this program, the product must be a cell therapy, therapeutic tissue engineering product, human cell and tissue product, or a combination of such products, and not a product solely regulated as a human cell and tissue product. The product must be intended to treat, modify, reverse, or cure a serious or life-threatening disease or condition, and preliminary clinical evidence must indicate that the product has the potential to address an unmet need for such disease or condition. Advantages of the RMAT designation include all the benefits of the Fast Track and breakthrough therapy designation programs, including early interactions with the FDA. These early interactions may be used to discuss potential surrogate or intermediate endpoints to support accelerated approval.

Post-Approval Requirements

Any products for which we receive FDA approvals are subject to continuing regulation by the FDA, including, among other things, record-keeping requirements, reporting of adverse experiences with the product and deviations, annual reporting and monitoring and providing the FDA with updated safety and efficacy information, product sampling and distribution requirements, certain electronic records and signature requirements, fulfilling post-marketing clinical trial and REMS commitments, and complying with FDA promotion and advertising requirements, which include, among other things, standards for direct-to-consumer advertising, restrictions on promoting products for uses or in patient populations that are not described in the product’s approved uses or otherwise consistent with the FDA-approved product labeling (known as “off-label use”), limitations on industry-sponsored scientific and educational activities, rules regarding communication of health care economic information regarding biopharmaceutical products to payors and formularies, and requirements for promotional activities involving the internet. Although physicians may prescribe legally available products for off-label use, if they deem such use to be appropriate in their professional medical judgment, manufacturers may not market or promote such off-label uses. In the past several years, certain court decisions have impacted FDA’s enforcement activity regarding off-label promotion in light of First Amendment considerations; however, there are still significant risks in this area, in part due to the potential for False Claims Act exposure.

In addition, quality control and manufacturing procedures must continue to conform to applicable manufacturing requirements after approval to ensure the long-term stability of the product. cGMP regulations require among other things, quality control and quality assurance as well as the corresponding maintenance of records and documentation and the obligation to investigate and correct any deviations from cGMP. Manufacturers and other entities involved in the manufacture and distribution of approved products are required to register their establishments and list their products with the FDA and certain state agencies and are subject to periodic unannounced inspections by the FDA and certain state agencies for compliance with cGMP and other applicable laws. Accordingly, manufacturers must continue to expend time, money, and effort in the areas of production and quality control to maintain cGMP compliance. Discovery of problems with a product after approval may result in restrictions on a product, manufacturer, or holder of an approved BLA, including, among other things, withdrawal of approval, recall, or withdrawal of the product from the market. In addition, changes to the manufacturing process are strictly regulated, and depending on the significance of the change, may require prior FDA approval or notification before being implemented. Other types of changes to the approved product, such as adding new indications and claims to the product labeling, are also subject to further FDA review and approval.

Commercial products must meet the requirements of the Drug Supply Chain Security Act, or DSCSA, which imposes obligations on manufacturers of prescription biopharmaceutical products for commercial distribution, regulating the distribution of the products at the federal level, and sets certain standards for federal or state registration and compliance of entities in the supply chain, including manufacturers and repackagers, wholesale distributors, third-party logistics providers, and dispensers. The DSCSA preempts previously enacted state laws and the pedigree requirements of the Prescription Drug Marketing Act, or PDMA. Trading partners within the drug supply chain must now ensure certain product tracing requirements are met; that they are doing business with other authorized trading partners; and they are required to exchange transaction information, transaction history, and transaction statements. Product identifier information, an aspect of the product tracing scheme, is required. The DSCSA requirements, development of standards, and the system for product tracing have been and will continue to be phased in over a period of years, with the FDA indicating that it would permit certain exemptions and exclusions, and exercise enforcement discretion on certain aspects of the law due to the COVID-19 pandemic,

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although this situation may continue to evolve. The distribution of product samples continues to be regulated under the PDMA, and some states also impose regulations on drug sample distribution.

As previously mentioned, the FDA may also require Phase 4 testing and surveillance to monitor the effects of an approved product. Discovery of previously unknown problems with a product or the failure to comply with applicable FDA requirements can have negative consequences, including adverse publicity, judicial or administrative enforcement, warning letters from the FDA, mandated corrective advertising or communications with doctors, and civil or criminal penalties, among others. Newly discovered or developed safety or effectiveness data may require changes to a product’s approved labeling, including the addition of new warnings and contraindications, and may require the implementation of other risk management measures. Also, new government requirements, including those resulting from new legislation, may be established, or the FDA’s policies may change, which could delay or prevent regulatory approval of our products under development.

Regulatory Designations

The FDA has granted ODD for lifileucel in the U.S. to treat malignant melanoma stages IIB-IV and for the treatment of cervical cancer with a tumor size of greater than 2 cm in diameter; Fast Track and RMAT designations for lifileucel to treat advanced metastatic melanoma; Fast Track and BTD for lifileucel to treat metastatic cervical cancer; and Fast Track designation for lifileucel in combination with pembrolizumab for the treatment of ICI naïve metastatic melanoma.

Orphan Drug Designations

During 2015, we received ODD for lifileucel in the U.S. to treat malignant melanoma stages IIB-IV, and in 2018, we received an ODD for lifileucel for the treatment of cervical cancer with a tumor size of greater than 2 cm in diameter. If approved, an ODD provides seven years of market exclusivity in the U.S., which means that the FDA may not approve any other applications, including a full BLA, to market the same biologic, as sameness is defined in the FDA’s regulations, for the same indication for seven years, subject to certain limited exceptions. However, an ODD does not convey any advantage in, or shorten the duration of, the regulatory review or approval process. The benefits and limitations of ODD are described in more detail under the Government Regulations section in this Annual Report on Form 10-K.

Fast Track Designations

In August 2017, we announced that the FDA had granted Fast Track designation for lifileucel for the treatment of advanced metastatic melanoma. In February 2019, we announced that the FDA had granted Fast Track designation for lifileucel in the treatment of metastatic cervical cancer. Additionally, in November 2021, we announced that the FDA granted Fast Track designation for lifileucel in combination with pembrolizumab for the treatment of ICI-naïve metastatic melanoma. The FDA’s Fast Track process is designed to facilitate the development and expedite the review of drugs that treat serious conditions and fill an unmet medical need. Fast Track designation allows more frequent meetings and communications with the FDA to discuss the drug’s development plans and review process. The Fast Track designation also allows for the possibility for rolling review of a BLA by FDA, where the FDA may consider beginning review portions of a marketing application before the full submission is complete, and also potential eligibility if certain criteria are met for accelerated approval.

Regenerative Medicine Advanced Therapy Designation

In October 2018, we announced that the FDA had granted RMAT designation for lifileucel for the treatment of patients with metastatic melanoma. The RMAT designation is based on data provided to the FDA from our C-144-01 trial. RMAT designation is granted for regenerative medicine drugs and allows for increased access to FDA during development. Under this designation, surrogate endpoints can be used to receive approval for a product, accelerated approval may be granted, and a rolling review of a BLA may be permitted by FDA.

Breakthrough Therapy Designation

In May 2019, we announced that the FDA had granted BTD for lifileucel for the treatment of patients with metastatic cervical cancer. The BTD was granted based on data provided to the FDA from our C-145-04 clinical trial. Under a BTD, the FDA may take actions that help expedite the development and review of the application for a product candidate, including seeking to provide timely advice and interactive communications to the sponsor with intensive guidance during development, to help the sponsor design and

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conduct a more efficient development program. Product candidates with BTD may be suitable for alternative clinical trial designs when scientifically appropriate, which may result in smaller clinical trials or more efficient clinical trials that require less time to complete. BTD also allows the sponsor to submit portions of the BLA on an ongoing basis for rolling review. In addition, BTD status allows for the potential to request priority review of our BLA at the time of BLA submission if supported by clinical data. The clinical evidence needed to support breakthrough designation is preliminary, and the FDA has authority to rescind a BTD if a product candidate no longer meets the qualifying criteria.

Orphan Drugs

Under the Orphan Drug Act, the FDA may grant ODD to a drug or biologic intended to treat a rare disease or condition, defined as a disease or condition with a patient population of fewer than 200,000 individuals in the U.S., or a patient population greater than 200,000 individuals in the U.S. and when there is no reasonable expectation that the cost of developing and making available the drug or biologic in the U.S. will be recovered from sales in the U.S. for that drug or biologic. Additionally, sponsors must present a plausible hypothesis for clinical superiority to obtain ODD if there is a product already approved by the FDA that is intended for the same indication and that is considered by the FDA to be the same product as the already approved product. This hypothesis for clinical superiority must be demonstrated to obtain orphan exclusivity. ODD must be requested before submitting a BLA. After the FDA grants ODD, the generic identity of the therapeutic agent and its potential orphan use are disclosed publicly by the FDA.

If a product that has ODD subsequently receives the first FDA approval for a particular active ingredient for the disease for which it has such designation, the product is entitled to orphan product exclusivity, a seven-year period of marketing exclusivity, which means that the FDA may not approve any other applications, including a full BLA, to market the same biologic, as sameness is defined in the FDA’s regulations, for the same indication for seven years, except in limited circumstances, such as a showing of clinical superiority to the product with orphan drug exclusivity or if the FDA finds that the holder of the orphan drug exclusivity has not shown that it can assure the availability of sufficient quantities of the orphan drug to meet the needs of patients with the disease or condition for which the drug was designated. Orphan drug exclusivity does not prevent the FDA from approving a different drug or biologic for the same disease or condition, or the same drug or biologic for a different disease or condition. Among the other benefits of ODD are tax credits for certain research, opportunities for certain research grant funding, and a waiver of the BLA application fees. The tax credit, however, was recently limited through Congress’s tax reform efforts. Despite these benefits, the ODD does not convey any advantage in, or shorten the duration of, the regulatory review or approval process.

A designated orphan drug may not receive orphan drug exclusivity if it is approved for a use that is broader than the indication for which it received orphan designation. In addition, orphan drug exclusive marketing rights in the U.S. may be lost if the FDA later determines that the request for designation was materially defective or if the manufacturer is unable to assure sufficient quantities of the product to meet the needs of patients with the rare disease or condition. The FDA may also approve a product deemed to be the same as an approved orphan product for the same orphan indication, despite periods of exclusivity, if the new product is demonstrated to be clinically superior to the former product.

We plan to seek ODD for some or all of our product candidates in specific orphan indications in which there is a medically plausible basis for the use of such products.

Market and Data Exclusivity and Biosimilars

While under the Biologics Price Competition and Innovation Act of 2009, or BPCIA, the FDA may eventually license products, as further described below, that are biosimilar to any of our product candidates that are approved, our products may receive periods of regulatory exclusivity, separately from orphan drug exclusivity for those products with ODDs, providing additional protection from certain forms of competition. For instance, our products may receive 12 years of reference product exclusivity that begins running at the time of first licensure. During this 12-year time period, the period of marketing exclusivity, the FDA may not make an approval of a biosimilar product effective. In addition, the FDA may not accept a biosimilar application until after four years from the date of first licensure, the period of data exclusivity. However, certain changes and supplements to an approved BLA, and subsequent applications filed by the same sponsor, manufacturer, licensor, predecessor in interest, or other related entity do not qualify for the exclusivity period. The PHSA also includes provisions governing patent litigation over patents that are directed to the reference products. The biosimilar product sponsor and reference product sponsor may, but are not required to, exchange certain patent and product information for the purpose of negotiating and determining the scope of patent litigation, including the patents to be asserted and challenged. Based on the outcome of negotiations surrounding the exchanged information, the reference product sponsor may bring a patent infringement suit

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and injunction proceedings against the biosimilar product sponsor. The biosimilar applicant may also be able to bring an action for declaratory judgment concerning the patent under certain circumstances.

The BPCIA created an abbreviated approval pathway for biological products shown to be highly similar to or interchangeable with an FDA-licensed reference biological product. Accordingly, if we receive FDA licensure, we may face competition from biosimilar products. Biosimilarity sufficient to reference a prior FDA-approved product requires a high similarity to the reference product notwithstanding minor differences in clinically inactive components, and no clinically meaningful differences between the biological product and the reference product in terms of safety, purity, and potency. Biosimilarity must be shown through analytical studies, animal studies, and at least one clinical trial, absent a waiver by the FDA. There must be no difference between the reference product and a biosimilar in conditions of use, route of administration, dosage form, and strength. Further, a biosimilar product may be deemed interchangeable with a prior approved product if it meets the higher hurdle of demonstrating that it can be expected to produce the same clinical results as the reference product and, for products administered multiple times, the biologic and the reference biologic may be switched after one has been previously administered without increasing safety risks or risks of diminished efficacy relative to exclusive use of the reference biologic.

Pediatric Exclusivity and Patent Term Extension

Pediatric exclusivity is another type of non-patent marketing exclusivity in the U.S. and, if granted, provides for the attachment of an additional six months of marketing protection to the term of any existing regulatory exclusivity. Under the Best Pharmaceuticals for Children Act, a six-month exclusivity may be granted if a sponsor submits pediatric data that fairly responds to a written request from the FDA for such data. The FDA may issue such a written request on its own initiative or at the request of the sponsor. The data do not need to show the product to be effective in the pediatric population studied; rather, if the clinical trial is deemed to fairly respond to the FDA’s request, the additional protection is granted. If reports of requested pediatric studies are submitted to and accepted by the FDA, whatever regulatory periods of exclusivity that already cover the product are extended by six months. Pediatric exclusivity is thus an “add-on” exclusivity and is unique in this regard among the various regulatory exclusivities provided by FDA. The FDA can also require pediatric studies of a drug submitted in a new drug application if the FDA determines that the product is likely to be used in a substantial number of pediatric patients, or if the product would provide a meaningful benefit in the pediatric population over existing treatments. This requirement may be waived in certain circumstances, for example, where the indication does not occur or is not highly prevalent in the pediatric population.

If approved, biologics may also be eligible for periods of U.S. patent term restoration. If granted, patent term restoration extends the patent life of a single unexpired patent that has not previously been extended, for a maximum of five years. The total patent life of the product with the extension also cannot exceed fourteen years from the product’s approval date. Subject to the prior limitations, the period of the extension is calculated by adding half of the time from the effective date of an IND to the initial submission of a marketing application, and all the time between the submission of the marketing application and its approval. This period may also be reduced by any time that the applicant did not act with due diligence. Whether any of our product candidates will be eligible for patent term restoration is currently unknown. Even if any of our product candidates are found to be eligible for patent term protection, the applicable authorities may subsequently determine that we are not eligible for such restoration periods.

Additional Biologic Requirements

To help reduce the increased risk of the introduction of adventitious agents, the PHSA emphasizes the importance of manufacturing controls for products whose attributes cannot be precisely defined. The PHSA also provides authority to the FDA to immediately suspend licenses in situations where there exists a danger to public health, to prepare or procure products in the event of shortages and critical public health needs, and to authorize the creation and enforcement of regulations to prevent the introduction or spread of communicable diseases in the U.S. and between states.

After a BLA is approved, the product may also be subject to official lot release as a condition of approval. As part of the manufacturing process, the manufacturer is required to perform certain tests on each lot of the product before it is released for distribution. If the product is subject to official release by the FDA, the manufacturer submits samples of each lot of product to the FDA, together with a release protocol showing the results of all the manufacturer's tests performed on the lot. The FDA may also perform certain confirmatory tests on lots of some products before releasing the lots for distribution by the manufacturer.

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In addition, the FDA conducts laboratory research related to the regulatory standards on the safety, purity, potency, and effectiveness of biological products. After approval of biologics, manufacturers must address any safety issues that arise, are subject to recalls or a halt in manufacturing, and are subject to periodic inspection after approval.

Other Healthcare Laws and Compliance Requirements

Our sales, promotion, medical education, and other activities following product approval are subject to regulation by numerous federal, state, and local regulatory and law enforcement authorities in the U.S., and in addition to the FDA, these entities may include the Federal Trade Commission, or the FTC; the Department of Justice; the Centers for Medicare & Medicaid Services, or CMS; other divisions of the Department of Health and Human Services; and state and local governments. Our promotional and scientific/educational programs must comply with laws and regulations such as the federal Anti-Kickback Statute, or AKS; the civil monetary penalties statute, or the CMP Law; the Foreign Corrupt Practices Act, or the FCPA; the False Claims Act, or the FCA; the Veterans Health Care Act, or the VHCA; physician payment transparency laws; privacy and security laws; and other federal, state, and local laws similar to the foregoing.

The federal AKS prohibits, among other things, any person or entity, from knowingly and willfully offering, paying, soliciting, or receiving any remuneration, directly or indirectly, overtly or covertly, in cash or in kind, to induce or in return for purchasing, leasing, ordering, or arranging for the purchase, lease, or order of any item or service reimbursable under Medicare, Medicaid, or other federal healthcare programs, in whole or in part. The term remuneration has been interpreted broadly to include anything of value. The federal AKS has been interpreted broadly to apply to arrangements between pharmaceutical manufacturers on the one hand and prescribers, purchasers, and formulary managers on the other. The term “remuneration” includes kickbacks, bribes, or rebates, and also has been broadly interpreted to include anything of value, including, for example, gifts, discounts, waivers of payment, ownership interest, and providing anything at less than its fair market value. Additionally, the intent standard under the federal AKS provides that a person or entity need not have actual knowledge of the statute or specific intent to violate it in order to have committed a violation. In addition, a claim including items or services resulting from a violation of the federal AKS constitutes a false or fraudulent claim for purposes of the federal civil FCA. There are a number of statutory exceptions and regulatory safe harbors protecting some common activities from prosecution or other regulatory sanctions. The exceptions and safe harbors are drawn narrowly, and practices that involve remuneration that may be alleged to be intended to induce prescribing, purchasing, or recommending may be subject to scrutiny if they do not qualify for an exception or safe harbor. Failure to meet all the requirements of a particular applicable statutory exception or regulatory safe harbor does not make the conduct per se illegal under the AKS. Instead, the legality of the arrangement will be evaluated on a case-by-case basis based on a cumulative review of all such arrangement’s facts and circumstances. Our practices may not in all cases meet all the criteria for protection under a statutory exception or regulatory safe harbor. The exceptions and safe harbors are subject to change through legislative and regulatory action, are also subject to changes in interpretation and application by government agencies and courts, and we may decide to adjust our business practices from time to time.

The CMP Law establishes penalties that may be assessed against any person or entity who, among other things, is determined to have presented or caused to be presented a claim for payment, or approval, to a federal healthcare program that the person knows or should know is for an item or service that was not provided as claimed or is false or fraudulent.

The FCA prohibits any persons from, among other things, knowingly presenting or causing to be presented false or fraudulent claims for payment to, or approval by the government, knowingly making or using, or causing to be made or used a false statement or record material in a claim to the government, or avoiding, decreasing, or concealing an obligation to pay money to the government. A claim includes “any request or demand” for money or property presented directly or indirectly to the federal government. The civil FCA has been or might be used to assert liability on the basis of kickbacks and other improper referrals, improperly reported government pricing metrics such as Best Price and Average Manufacturer Price, improper promotion of uses not expressly approved by the FDA in a drug’s label, false statements associated with government grants, and allegations of misrepresentations with respect to services rendered, as well as claims for payment that are inaccurate or fraudulent, that are for services not provided as claimed, or for services that are not medically necessary. FCA claims might be based on noncompliance with regulatory requirements under an implied certification theory if material to the government’s decision to buy or pay for a drug. Intent to deceive is not required to establish liability under the civil FCA. Civil FCA liability may also be imposed for Medicare or Medicaid overpayments caused by understated rebate amounts that are not refunded within 60 days of discovering the overpayment, even if the overpayment was not caused by a false or fraudulent act. Actions under the FCA may be brought by the government or as a qui tam action by a private individual in the name of the government. If the government intervenes in a qui tam action, and prevails, the qui tam plaintiff will share in the proceeds from damages and fines or settlement funds. If the government declines to intervene, the qui tam plaintiff may pursue the case alone. Violations of the FCA can result in significant monetary penalties and treble damages. The government may further prosecute conduct

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under the criminal FCA, which prohibits the making or presenting of a claim to the government knowing the claim to be false, fictitious or fraudulent. Unlike the civil FCA, conviction requires proof of intent to submit a false claim. In addition, federal AKS violations (which may be alleged based on certain marketing practices, including allegations of off-label promotion) might implicate the FCA.

The compliance and enforcement landscape, and related risk, is informed by government regulatory, enforcement, and other activities, such as litigation and settlement precedent, advisory opinions, and special fraud alerts. Our approach to compliance may evolve over time in light of these types of developments.

Additionally, the FCPA, and similar worldwide anti-bribery laws, generally prohibit companies and their intermediaries from making, offering, or authorizing improper payments or other items of value, directly or indirectly, to foreign officials, political parties, or candidates for the purpose of obtaining or retaining business. The FCPA also obligates companies whose securities are listed in the U.S. to comply with accounting provisions requiring us to maintain books and records that accurately and fairly reflect all transactions of the corporation, including international subsidiaries, and to devise and maintain an adequate system of internal accounting controls for international operations. Activities that violate the FCPA, even if they occur wholly outside the U.S., can result in criminal and civil fines, imprisonment, disgorgement, oversight, and debarment from securing government contracts. We cannot assure you that our internal control policies and procedures will protect us from reckless or negligent acts committed by our employees, future distributors, partners, collaborators or agents. Violations of these laws, or allegations of such violations, could result in fines, penalties or prosecution and have a negative impact on our business, results of operations and reputation.

Payment or reimbursement of prescription drugs by Medicaid or Medicare requires manufacturers of the drugs to submit pricing information to CMS. The Medicaid Drug Rebate statute requires manufacturers to calculate and report price points, which are used to determine Medicaid rebate payments shared between the states and the federal government and Medicaid payment rates for the drug. For drugs paid under Medicare Part B, manufacturers must also calculate and report their Average Sales Price or ASP, which is used to determine the Medicare Part B payment rate for the drug. Drugs that are approved under a BLA or a New Drug Application, or NDA, including 505(b)(2) drugs, are subject to an additional inflation penalty which can substantially increase rebate payments. In addition, for BLA and NDA drugs, the VHCA requires manufacturers to calculate and report to the Veterans Administration, or VA, a different price called the Non-Federal Average Manufacturing Price, which is used to determine the maximum price that can be charged to certain federal agencies, referred to as the Federal Ceiling Price, or FCP. Like the Medicaid rebate amount, the FCP includes an inflation penalty. A Department of Defense regulation requires manufacturers to provide this discount on drugs dispensed by retail pharmacies when paid by the TRICARE Program. All these price reporting requirements create the risk of submitting false information to the government, and potential FCA liability.

The VHCA also requires manufacturers of covered drugs participating in the Medicaid program to enter into Federal Supply Schedule contracts with the VA through which their covered drugs must be sold to certain federal agencies at FCP and to report pricing information. This necessitates compliance with applicable federal procurement laws and regulations and subjects us to contractual remedies as well as administrative, civil, and criminal sanctions. In addition, the VHCA requires manufacturers participating in Medicaid to agree to provide different mandatory discounts to certain Public Health Service grantees and other safety net hospitals and clinics.

The federal Health Insurance Portability and Accountability Act of 1996, or HIPAA, which imposes criminal and civil penalties, prohibits, among other actions, knowingly and willfully executing, or attempting to execute, a scheme to defraud or to obtain, by means of false or fraudulent pretenses, representations, or promises, any of the money or property owned by, or under the custody or control of, any healthcare benefit program, regardless of whether the payor is public or private third-party, knowingly and willfully embezzling or stealing from a health care benefit program, willfully obstructing a criminal investigation of a health care offense, and knowingly and willfully falsifying, concealing, or covering up by any trick or device a material fact or making any materially false statements in connection with the delivery of, or payment for, healthcare benefits, items, or services relating to healthcare matters. A person or entity does not need to have actual knowledge of the statute, or the specific intent to violate it, to have committed a violation.

We may also be subject to data privacy and security laws and regulation by both the federal government and the states in which we conduct our business. HIPAA, as amended by the Health Information Technology for Economic and Clinical Health Act, or the HITECH Act, and their respective implementing regulations, including as such regulations were amended by the final omnibus rule published on January 25, 2013, and subsequent rulemaking, imposes specific requirements relating to the privacy, security, and transmission of individually identifiable health information held by covered entities and their business associates. While we would not be a “covered entity” under HIPAA, it is possible that we may enter into a service or business arrangement that would cause us to serve as a “business associates,” defined as a person or entity that performs certain functions or activities that involve the use or disclosure of protected health information in connection with providing a service for or on behalf of, or provide services to, a covered entity. The

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HITECH Act also increased the civil and criminal penalties that may be imposed against covered entities, business associates, and possibly other persons and gave state attorneys general new authority to file civil actions for damages or injunctions in federal courts to enforce the federal HIPAA laws and seek attorneys’ fees and costs associated with pursuing federal civil actions. In addition, state laws govern the privacy and security of health information in certain circumstances, many of which differ from each other in significant ways and may not have the same effect. The Department of Health and Human Services Office of Civil Rights, or the OCR, has increased its focus on compliance and continues to train state attorneys general for enforcement purposes.

Even for entities that are not deemed “covered entities” or “business associates” under HIPAA, according to the FTC, failing to take appropriate steps to keep consumers’ personal information secure constitutes unfair acts or practices in or affecting commerce in violation of Section 5(a) of the Federal Trade Commission Act, or the FTCA, 15 USC § 45(a). The FTC expects a company's data security measures to be reasonable and appropriate in light of the sensitivity and volume of consumer information it holds, the size and complexity of its business, and the cost of available tools to improve security and reduce vulnerabilities. Medical data is considered sensitive data that merits stronger safeguards. The FTC's guidance for appropriately securing consumers' personal information is similar to what is required by the HIPAA Security Rule.

In addition to the laws discussed above, we may see more stringent state and federal privacy legislation in 2025 and beyond, as a continued increase in cyber-attacks have heightened attention to data privacy and security in the U.S. and other jurisdictions. We cannot predict where new legislation might arise, the scope of such legislation, or the potential impact to our business and operations.

Payments made to physicians and other healthcare providers, and other financial interests, have been the subject of a range of federal and state laws. The federal physician payment transparency requirements, sometimes referred to as the Physician Payments Sunshine Act, or the Sunshine Act, was created under the Patient Protection and Affordable Care Act, or the ACA, and implemented as the Open Payments Program. The Sunshine Act, among other things, imposes reporting requirements on drug manufacturers for payments or other transfers of value made by them to physicians and teaching hospitals, as well as ownership and investment interests held by physicians, other healthcare providers, and their immediate family members. Failure to submit required information may result in civil monetary penalties of up to an aggregate of $150,000 per year and up to an additional aggregate of $1 million per year for “knowing failures,” for all payments, transfers of value, or ownership or investment interests that are not timely, accurately, and completely reported in an annual submission. The Sunshine Act requires applicable manufacturers to track payments and transfers of value to physicians, physician assistants, nurse practitioners, and other mid-level HCPs. Additionally, certain states also mandate implementation of commercial compliance programs, impose restrictions on drug manufacturer marketing practices and/or require the tracking and reporting of gifts, compensation, and other remuneration to physicians and other HCPs.

Analogous state laws and regulations, such as state anti-kickback and false claims laws, and other state laws addressing the pharmaceutical and healthcare industries, which may apply to items or services reimbursed by any third-party payor, including commercial insurers, and in some cases, may apply regardless of payor, i.e., even if reimbursement is not available. Some state laws require pharmaceutical companies to comply with the pharmaceutical industry's voluntary compliance guidelines, known as the Pharmaceutical Research and Manufacturers of America Code, and the relevant compliance program guidance promulgated by the federal government in addition to requiring drug manufacturers to report pricing and marketing information, including, among other things, information related to gifts, payments, or other remuneration to physicians and other healthcare providers or marketing expenditures, state and local laws that require the registration of pharmaceutical sales representatives, and state laws governing the privacy and security of health information and the use of prescriber-identifiable data in certain circumstances, many of which differ from each other in significant ways and may not have the same effect, thus complicating compliance efforts. For example, California enacted the California Consumer Privacy Act, or CCPA, which went into effect on January 1, 2020, andwas subsequently amended and expanded by the California Privacy Rights Act, or CPRA, passed on November 3, 2020. The CPRA’s substantive provisions took full effect as of January 1, 2023, including the CPRA’s expansion of the “Right to Know” that impacts personal information collected on or after January 1, 2022. The CCPA and CPRA, among other things, create new data privacy obligations for covered companies and provide new privacy rights to California residents, including the right to opt out of certain disclosures of their information. The CCPA also created a private right of action with statutory damages for certain data breaches, thereby potentially increasing risks associated with a data breach. It remains unclear what, if any, additional modifications will be made to the CCPA and CPRA by the California legislature or how they will be interpreted. Therefore, the effects of the CCPA and CPRA are significant and will likely require us to modify our data processing practices and may cause us to incur substantial costs and expenses to comply. Since the passage of the CCPA, certain other states have passed similar laws that may also have similar impacts on our data processing practices and incurred costs. Some of these state laws have not taken effect, and we cannot predict if states will subsequently amend those laws, if other states will pass similar laws, or the costs and expenses that we will incur to comply with such laws.

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To the extent that any of our products are sold in a foreign country, we may be subject to similar foreign laws and regulations, which may include, for instance, applicable post-marketing requirements, including safety surveillance, anti-fraud and abuse laws, and implementation of corporate compliance programs and reporting of payments or transfers of value to HCPs.

Because of the breadth of these laws and the narrowness of the statutory exceptions and safe harbors available under such laws, it is possible that certain business activities could be subject to challenge under one or more of such laws. The scope and enforcement of each of these laws is uncertain and subject to rapid change in the current environment of healthcare reform, especially in light of the lack of applicable precedent and regulations. Federal and state enforcement bodies have recently increased their scrutiny of interactions between healthcare companies and healthcare providers, which has led to a number of investigations, prosecutions, convictions, and settlements in the healthcare industry. Ensuring that business arrangements with third parties comply with applicable healthcare laws, as well as responding to possible investigations by government authorities, can be time- and resource-consuming and can divert management's attention from the business.

If our operations are found to be in violation of any of such health regulatory laws described above or any other governmental laws and regulations that apply to us, we may be subject to penalties, including, without limitation, civil, administrative, and criminal penalties, damages, fines, disgorgement, the curtailment or restructuring of our operations, exclusion from participation in federal and state healthcare programs, individual imprisonment, injunctions, private qui tam actions brought by individual whistleblowers in the name of the government, as well as additional reporting obligations and oversight if we become subject to a corporate integrity agreement or other agreement to resolve allegations of non-compliance with these laws, any of which could adversely affect our ability to operate our business and our financial results.

Coverage and Reimbursement

Sales of pharmaceutical products depend significantly on the availability of third-party coverage and reimbursement. Third-party payors include Medicare, Medicaid, and other government programs at the federal and state level, managed care entities, private health insurers, and other organizations. Third party payors decide which drugs they will pay for on behalf of their beneficiaries and establish reimbursement levels for health care services and products. Although we currently believe that third-party payors will provide coverage and reimbursement for our products and product candidates, if approved, these third-party payors are increasingly challenging the price and examining the cost-effectiveness of medical products and services, with a recent focus on prioritization of “equivalent,” less expensive alternatives when available. In addition, significant uncertainty exists as to the reimbursement status of newly approved healthcare products. We may need to conduct expensive clinical trials to demonstrate the comparative cost-effectiveness of our products. The products and product candidates that we develop may not be considered cost-effective. It is time-consuming and expensive for us to seek coverage and reimbursement from third-party payors. Moreover, a payor’s decision to provide coverage for a drug product does not imply that an adequate reimbursement rate will be approved, especially for products and product candidates such as ours, which are used in the inpatient setting, usually resulting in no separate reimbursement for pharmaceuticals. There are additional pressures on pricing as a result of other, peripheral policies impacting reimbursement across both government and private payors. Non-health specific policies may impart downstream impacts on private insurance reimbursement decision-making. In consideration of these numerous factors, reimbursement may not be available or sufficient to allow us to sell our products on a competitive and profitable basis.

Medicare is a federally funded program managed by CMS through local contractors that administer coverage and reimbursement for certain healthcare items and services furnished to the elderly and disabled. Medicare “Part A” covers inpatient hospitalization and certain other settings, and Medicare “Part B” covers outpatient medical services, including limited outpatient prescription drugs. Medicare coverage of drugs and biological products and payment rates to providers are established by federal law and regulations. Medicaid is an insurance program for certain categories of low-income people, families and children, pregnant people, elderly people, and people with disabilities, and is both federally and state funded and managed by each state. The federal government sets general guidelines for Medicaid and requires rebates on outpatient drugs and biological products, including those administered by physicians if the cost is billed separately. Each state creates specific regulations that govern its individual program, including supplemental rebate programs that prioritize coverage for drugs on the state Preferred Drug List. Government laws and regulations also establish price controls on prescription drugs purchased by government agencies that provide health care and certain federally funded hospital outpatient departments and clinics. In the U.S., private health insurers and other third-party payors often provide reimbursement for products and services based on the level at which the government provides reimbursement through the Medicare or Medicaid programs for such products and services. These restrictions and limitations influence the purchase of health care services and products. In addition, government programs like Medicaid include substantial penalties for increasing commercial prices over the rate of inflation, which can affect realization and return on investment.

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In the U.S., Europe, and other potentially significant markets for our products and product candidates, government authorities and private third-party payors are increasingly attempting to limit or regulate the price of medical products and services, particularly for new and innovative products and therapies, which often has resulted in average selling prices lower than they would otherwise be. Manufacturers frequently must rebate a portion of the prescription price to the third-party payors as a condition of coverage, which can greatly reduce realization on the sale. Third-party payors are increasingly challenging the price and examining the medical necessity and cost-effectiveness of medical products and services, in addition to their safety and efficacy, and are developing increasingly sophisticated methods of controlling healthcare costs. They may limit coverage to specific drug products on an approved list, or formulary, which might not include all the FDA-approved drug products for a particular indication, or they may control costs, particularly for new expensive therapies, by requiring prior authorization or imposing other restrictions before covering certain products, or they may condition payment based on achieving performance metrics. Legislative proposals to reform healthcare or reduce costs under government programs may result in lower reimbursement for our products and product candidates or exclusion of our products and product candidates from coverage.

Achieving favorable CMS coverage and reimbursement is usually a significant gating issue for successful introduction of a new product because Medicare and Medicaid can represent a sizeable share of the market and because private payors often rely on the lead of the governmental payors in rendering coverage and reimbursement determinations. Further, the increased emphasis on managed healthcare in the U.S. and on country and regional pricing and reimbursement controls in Europe will likely put additional pressure on product pricing, reimbursement, and utilization, which may adversely affect our future product sales and results of operations. These pressures can arise from rules and practices of managed care entities, competition within therapeutic classes, availability of generic equivalents, judicial decisions and governmental laws and regulations related to Medicare, Medicaid, and healthcare reform, pharmaceutical coverage and reimbursement policies, and pricing in general. Patients who are prescribed treatments for their conditions and providers performing the prescribed services generally rely on third-party payors to reimburse all or part of the associated healthcare costs. Sales of our products and product candidates will therefore depend substantially, both domestically and abroad, on the extent to which the costs of our products will be paid by health maintenance, managed care, pharmacy benefit, and similar healthcare management organizations, or reimbursed by government health administration authorities, such as Medicare and Medicaid, private health insurers, and other third-party payors.

As a result of the above, we may need to conduct expensive pharmacoeconomic studies in order to demonstrate the medical necessity and cost-effectiveness of our products, in addition to the costs required to obtain FDA approvals. Our products and product candidates may not be considered medically necessary or cost-effective. A payor’s decision to provide coverage for a drug product does not imply that an adequate reimbursement rate will be approved. Adequate third-party reimbursement may not be available to ensure acceptance and use of our products and product candidates or enable us to maintain price levels sufficient to realize an appropriate return on our investment in drug development. Legislative and regulatory proposals to reform healthcare or reduce costs under government insurance programs may result in lower reimbursement for our products and product candidates or exclusion of our products and product candidates from coverage. The cost containment measures that healthcare payors and providers are instituting and any healthcare reform could significantly reduce our revenues from the sale of products and any approved product candidates. We cannot provide any assurances that we will be able to obtain and maintain third-party coverage or adequate reimbursement for our products and product candidates in whole or in part.

Healthcare Reform

The U.S. and some foreign jurisdictions are considering enacting or have enacted a number of legislative and regulatory proposals to change the healthcare system in ways that could affect our ability to sell our products profitably. Among policy makers and payors in the U.S. and elsewhere, there is significant interest in promoting changes in healthcare systems with the stated goals of containing healthcare costs, improving quality and/or expanding access. In the U.S., the pharmaceutical industry has been a particular focus of these efforts and has been significantly affected by major federal and state legislative initiatives.

In addition, other legislative and regulatory changes have been proposed and adopted since the ACA was enacted. These changes include aggregate reductions to Medicare payments to providers of up to 2% per fiscal year, starting in 2013, which will remain in effect through 2032 unless additional Congressional action is taken. In January 2013, the American Taxpayer Relief Act of 2012, which, among other things, further reduced Medicare payments to several providers, including hospitals and cancer treatment centers, increased the statute of limitations period for the government to recover overpayments to providers from three to five years. In 2017, CMS promulgated a rule reducing Medicare Part B reimbursement to hospitals for drugs purchased under the 340B program by 30%. Following an adverse U.S. Supreme Court decision, however, CMS subsequently modified its policies to restore certain payments owed to hospitals and to restore the reimbursement to the full, applicable rate going forward.

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In recent years, there have been and continue to be proposals by the federal government, state governments, regulators, and third-party payors to control these costs and, more generally, to reform the U.S. health care system. Certain of these proposals could limit the prices we are able to charge for our products or the amounts of reimbursement available for our products. These laws and future laws may result in additional reductions in Medicare and other healthcare funding, which could have a material adverse effect on customers for our products and product candidates, if approved, and, accordingly, our financial operations.

Any reduction in reimbursement from Medicare or other government-funded programs may result in a similar reduction in payments from private payors. The implementation of cost containment measures or other healthcare reforms may prevent us from being able to generate revenue, attain profitability or commercialize our drugs.

The cost of pharmaceuticals continues to generate substantial governmental and third-party payor interest and states have begun to take action to increase transparency in drug pricing through mandatory reporting requirements. We expect that the pharmaceutical industry will experience pricing pressures due to the trend toward managed healthcare, the increasing influence of managed care organizations, and additional legislative proposals. Our results of operations could be adversely affected by current and future healthcare reforms. While we cannot predict whether any proposed cost-containment measures will be adopted or otherwise implemented in the future, the announcement or adoption of these proposals could have a material adverse effect on our ability to obtain adequate prices for our products and product candidates and operate profitably.

Foreign Regulation

In addition to regulations in the U.S., we will be subject to a variety of foreign regulations governing clinical trials and commercial sales and distribution of our products to the extent we choose to develop or sell any products outside of the U.S. The approval process varies from country to country and the time may be longer or shorter than that required to obtain FDA approval. The requirements governing the conduct of clinical trials, product licensing, pricing, and reimbursement vary greatly from country to country.

In the EU and the UK, both regulatory clearances by the national competent authority and a favorable ethics committee opinion are required prior to the commencement of a clinical trial. In the EU/European Economic Area, or EEA, Regulation (EU) 536/2014 on clinical trials, or CTR, requires the sponsor to submit a single clinical trial application, or CTA, through the Clinical Trials Information System, or the CTIS, an online portal to streamline the authorization process. While under the previously applicable Directive 2001/20/EC, or CTD, sponsors had to request separate approvals in each EU/EEA member state, the CTIS is a single-entry point that allows sponsors to apply for authorization to run a clinical trial in up to 30 EU/EEA countries. The CTIS authorization procedure is composed of two parts: (i) member states jointly cooperate during the Part I assessment of the applicable CTA and (ii) during Part II, the applicable CTA is assessed by each member state individually. All ongoing clinical trials in the EU/EEA were required to transition to the CTIS by January 30, 2025. This date marked the end of a three-year transition period that began when the CTR became applicable. Following the UK's departure from the EU, the CTR does not apply in the UK with the applicable rules currently being based largely on those set out in the CTD as have been implemented nationally via the Medicines for Human Use (Clinical Trials) Regulation 2004, as amended. However, new UK legislation was laid before Parliament in December 2024 which will update the existing regulations, and which aims to provide a more efficient, streamlined, and adaptable regulatory framework for clinical trials. Once made into law, the new legislation will come into force following a 12-month implementation period to ensure readiness.

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IOVA · 10-K · period ended 2024-12-31

Item 1. Business

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IOVA · 10-K · period ended 2024-12-31

Item 1. Business

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