0001558370-24-005774 | 10-Q | XBRL Viewer | Kiniksa Pharmaceuticals LTD

Three Months Ended

March 31,

Product revenue, net

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CONSOLIDATED BALANCE SHEETS (Parenthetical) - $ / shares	Mar. 31, 2024	Dec. 31, 2023
Class A common shares
Common stock, par value (in dollars per share)	$ 0.000273235	$ 0.000273235
Common stock, shares issued (in shares)	40,184,356	40,184,356
Common stock, shares outstanding (in shares)	35,781,373	35,781,373
Class B common shares
Common stock, par value (in dollars per share)	$ 0.000273235	$ 0.000273235
Common stock, shares issued (in shares)	1,795,158	1,795,158
Common stock, shares outstanding (in shares)	1,795,158	1,795,158
Class A1 common shares
Common stock, par value (in dollars per share)	$ 0.000273235	$ 0.000273235
Common stock, shares issued (in shares)	12,781,964	16,826,468
Common stock, shares outstanding (in shares)	12,781,964	16,826,468
Class B1 common shares
Common stock, par value (in dollars per share)	$ 0.000273235	$ 0.000273235
Common stock, shares issued (in shares)	16,057,618	16,057,618
Common stock, shares outstanding (in shares)	16,057,618	16,057,618

Share-Based Compensation

3 Months Ended

Mar. 31, 2024

Share-Based Compensation

Share-Based Compensation

8. Share-Based Compensation

The Company maintains several equity compensation plans, including the 2018 Incentive Award Plan (the “2018 Plan”), 2018 Employee Share Purchase Plan (the “2018 ESPP”), and Rilonacept Long-Term Incentive Plan (“RLTIP”) which was approved under the 2018 Plan. Upon the effectiveness of the 2018 Plan, the Company ceased granting awards under its 2015 Equity Incentive Plan (as amended, the “2015 Plan” and together with the 2018 Plan, the “Plans”).

2015 Plan

As of March 31, 2024, there were 1,814,958 Class A common shares subject to outstanding awards under the 2015 Plan and reserved for issuance thereunder pursuant to such awards.

2018 Plan

The 2018 Plan provides for the grant of incentive share options, nonqualified share options, share appreciation rights, restricted shares, dividend equivalents, restricted share units (“RSUs”) and other share- or cash- based awards. Pursuant to the 2018 Plan’s evergreen provision, the number of shares available for future issuance under the 2018 Plan, as of January 1, 2024, increased by 2,818,425 Class A common shares. As of March 31, 2024, 4,207,733 shares remained available for future grant under the 2018 Plan.

2018 ESPP

In December 2023, the Company’s board of directors approved an increase, as of January 1, 2024, of 215,000 Class A common shares under the 2018 ESPP. As of March 31, 2024, 702,707 Class A common shares were available for future issuance under the 2018 ESPP.

Options

Share option activity under the Plans is summarized as follows:


		Weighted
	Number of	Average
	Shares	Exercise Price
Outstanding as of December 31, 2023	11,599,089	$	13.67
Granted	26,750	$	18.73
Exercised	(282,269)	$	12.38
Forfeited	(104,605)	$	14.21
Outstanding as of March 31, 2024	11,238,965	$	13.71
Share options exercisable as of March 31, 2024	7,489,111	$	13.67
Share options unvested as of March 31, 2024	3,749,854	$	13.71

As of March 31, 2024, total unrecognized compensation expense related to the unvested share option awards was $30,915 which is expected to be recognized over a weighted average remaining period of 2.42 years.

Restricted Share Units

The Company grants RSUs with service conditions (“Time-Based RSUs”) to eligible employees as part of its equity incentive compensation. The Time-Based RSUs vest 25% on each of the first, second, third and fourth anniversaries of the date of grant, subject to continued employment through such dates.

During the years ended December 31, 2020 and 2019, the Company granted the first RSU awards (“First RLTIP RSU Awards”) as part of the RLTIP to eligible employees. During the year ended December 31, 2021, the FDA Milestone (as defined in RLTIP) was achieved (the date of such achievement, the “Achievement Date”) and (1) the number of Class A common shares issuable under the First RLTIP RSU Awards were determined in accordance with the RLTIP and vested in one installment in March 2022, and (2) the Company granted a second set of RSU awards to eligible employees on the Achievement Date with respect to a number of shares determined in accordance with the RLTIP, which vested in one installment in March 2023.

During the three months ended March 31, 2024 and 2023, the Company recognized compensation expense of $2,284 and $1,529, respectively, related to RSUs including those granted in connection with the RLTIP.

The following table summarizes RSU activity, including the RSUs issued under the RLTIP for the three months ended March 31, 2024:


		Weighted
		Average
	Number of	Grant Date
	Shares	Fair Value
Unvested RSUs as of December 31, 2023	2,396,888	$	14.00
Granted	41,410	$	18.59
Vested	(55,014)	$	18.57
Forfeited	(122,026)	$	14.12
Unvested RSUs as of March 31, 2024	2,261,258	$	13.96

As of March 31, 2024, total unrecognized compensation cost related to the RSU awards was $25,376 which is expected to be recognized over a weighted average remaining period of 2.73 years.

Share-Based Compensation

Share-based compensation expense was classified in the consolidated statements of operations and comprehensive loss as follows:


	Three Months Ended
	March 31,
	2024		2023
Cost of goods sold	$	359	$	286
Research and development expenses		1,453		1,444
Selling, general and administrative expenses		5,394		4,385
	$	7,206	$	6,115

Commitments and Contingencies	3 Months Ended
Mar. 31, 2024
Commitments and Contingencies
Commitments and Contingencies	13. Commitments and Contingencies License Agreements The Company entered into license agreements with various parties under which it is obligated to make contingent and non-contingent payments (see Note 10). Manufacturing Commitments The Company has a supply agreement with Regeneron pursuant to which the Company may order both clinical and commercial product (see Note 10). In May 2023, the Company signed a letter of intent with a contract development and manufacturing organization (a “CDMO”) related to its technology transfer of the manufacturing process for ARCALYST drug substance. The Company has additionally entered into agreements with several CDMOs to provide the Company with preclinical and clinical trial materials for its non-ARCALYST assets. As of March 31, 2024, the Company had committed to minimum payments under all of these agreements totaling $148,039, of which $56,140 is due within one year. Indemnification Agreements The Company is not aware of any claims under indemnification arrangements that are expected to have a material effect on its financial position, results of operations or cash flows, and it has not accrued any liabilities related to such obligations in its consolidated financial statements as of March 31, 2024 or December 31, 2023. Legal Proceedings The Company is not a party to any material litigation and does not have contingency reserves established for any litigation liabilities.

Commitments and Contingencies

3 Months Ended

Mar. 31, 2024

Commitments and Contingencies

Commitments and Contingencies

13. Commitments and Contingencies

License Agreements

The Company entered into license agreements with various parties under which it is obligated to make contingent and non-contingent payments (see Note 10).

Manufacturing Commitments

The Company has a supply agreement with Regeneron pursuant to which the Company may order both clinical and commercial product (see Note 10). In May 2023, the Company signed a letter of intent with a contract development and manufacturing organization (a “CDMO”) related to its technology transfer of the manufacturing process for ARCALYST drug substance. The Company has additionally entered into agreements with several CDMOs to provide the Company with preclinical and clinical trial materials for its non-ARCALYST assets. As of March 31, 2024, the Company had committed to minimum payments under all of these agreements totaling $148,039, of which $56,140 is due within one year.

Indemnification Agreements

The Company is not aware of any claims under indemnification arrangements that are expected to have a material effect on its financial position, results of operations or cash flows, and it has not accrued any liabilities related to such obligations in its consolidated financial statements as of March 31, 2024 or December 31, 2023.

Legal Proceedings

The Company is not a party to any material litigation and does not have contingency reserves established for any litigation liabilities.

Out-Licensing Agreements (Tables)

3 Months Ended

Mar. 31, 2024

Out-Licensing Agreements

Schedule of identified performance obligations to recognize revenue


Performance Obligation		Method of Recognition
Exclusive license for vixarelimab		Point in time; upon transfer of the license to Genentech, as control of the license was transferred on the Genentech Effective Date and Genentech could begin to use and benefit from the license on that date.
Initial drug supply delivery		Point in time upon delivery.
Drug product resupply delivery		Point in time upon delivery.
Completion of the phase 2b clinical trial for vixarelimab		Over time; using the cost-to-cost input method, which is believed to best depict the transfer of control to the customer. Under the cost-to-cost input method, the percent of completion is based on the ratio of actual costs incurred as of the period end to the total estimated costs. Revenue is recorded as a percentage of the allocated transaction price times the percent of completion.

Schedule of contract liabilities and contract assets in connection with license and collaboration agreements


	Balance at				Revenue				Balance at End
	Beginning of Period		Additions		Recognized		Reclassification		of Period
Three Months Ended March 31, 2024
Contract Liabilities:
Genentech vixarelimab	$	261	$	—	$	(105)	$	—	$	156
Huadong rilonacept		12,000		—		(189)		—		11,811
Total Contract Liabilities	$	12,261	$	—	$	(294)	$	—	$	11,967

Inventory (Details) - USD ($) $ in Thousands	Mar. 31, 2024	Dec. 31, 2023
Inventory
Raw materials	$ 2,052
Semi-finished goods	8,721	$ 18,258
Finished goods	17,531	12,864
Total inventory	28,304	31,122
Inventory
Inventory
Total inventory	27,278	$ 31,122
Other long-term assets
Inventory
Total inventory	$ 1,026

Product Revenue, Net (Details) - USD ($) $ in Thousands	3 Months Ended
Product Revenue, Net (Details) - USD ($) $ in Thousands	Mar. 31, 2024	Mar. 31, 2023
Product revenue
Revenue	$ 79,858	$ 48,345
Contractual Adjustments
Balance at beginning of period	2,022
Current provisions relating to sales in the current year	7,319
Payments/returns relating to sales in the current year	(5,034)
Payments/returns relating to sales in the prior years	(1,957)
Balance at end of period	2,350
Government Rebates
Balance at beginning of period	3,775
Current provisions relating to sales in the current year	3,916
Adjustments relating to prior years	(5)
Payments/returns relating to sales in current year	(887)
Payments/returns relating to sales in the prior years	(1,475)
Balance at end of period	5,324
Returns
Balance at beginning of period	341
Current provisions relating sales in the current year	258
Adjustments relating to prior years	836
Balance at end of period	1,435
Total
Balance at beginning of period	6,138
Current provisions relating to sales in the current year	11,493
Adjustments relating to prior years	831
Payments/returns relating to sales in the current year	(5,921)
Payments/returns relating to sales in the prior years	(3,432)
Balance at end of period	9,109
Product revenue, net
Product revenue
Revenue	$ 78,885	$ 42,659

Share-Based Compensation - Restricted Shares and RSUs (Details) - USD ($) $ / shares in Units, $ in Thousands	3 Months Ended
	Mar. 31, 2024	Mar. 31, 2023
Share-based compensation
Share-based compensation expense	$ 7,206	$ 6,115
Restricted Share Units (RSUs)
Share-based compensation
Share-based compensation expense	2,284	$ 1,529
Total unrecognized compensation cost	$ 25,376
Expenses expected to be recognized over a weighted average remaining period	2 years 8 months 23 days
Number of shares
Beginning of the period	2,396,888
Granted	41,410
Vested	(55,014)
Forfeited	(122,026)
End of the period	2,261,258
Weighted Average Fair Value at Issuance
Beginning of the period	$ 14.00
Granted	18.59
Vested	18.57
Forfeited	14.12
End of the period	$ 13.96
Time-based RSUs
Share-based compensation
Vesting percentage	25.00%

Income Taxes

3 Months Ended

Mar. 31, 2024

Income Taxes

Income Taxes

12. Income Taxes

As a company incorporated in Bermuda, the Company is principally subject to taxation in Bermuda. Under the current laws of Bermuda, tax on a company’s income is assessed at a zero percent tax rate. As a result, the Company has not recorded any income tax benefits from its losses incurred in Bermuda during each reporting period, and no net operating loss carryforwards will be available to the Company for those losses. The Company’s wholly owned U.S. subsidiaries, Kiniksa US and Primatope, are subject to federal and state income taxes in the United States. The Company’s wholly owned subsidiary Kiniksa UK, and its wholly owned subsidiaries, Kiniksa Germany, Kiniksa France, and Kiniksa Switzerland are subject to taxation in their respective countries. Certain of the Company’s subsidiaries, primarily Kiniksa US, operate under cost plus arrangements.

Although Bermuda has no corporate income tax, the Company’s income tax rate for the three months ended March 31, 2024 was due to Kiniksa UK’s, Kiniksa UK’s Swiss branch office’s and Kiniksa US’s income subject to taxation in each of their respective countries. Income tax provision for the three months ended March 31, 2024 was $3,428. The provision for income taxes is primarily driven by income earned in the UK, Switzerland and U.S. offset in part by tax benefits from Foreign Derived Intangible Income (“FDII”) deduction and U.S. federal and state research and development credits.

Management regularly assesses the need for a valuation allowance on the Company’s deferred income tax assets. Valuation allowances require an assessment of both positive and negative evidence when determining whether it is more likely than not that the Company will be able to recover its deferred tax assets. Such assessment is required on a

jurisdiction-by-jurisdiction basis. The ultimate realization of deferred tax assets is dependent upon the generation of future taxable income during the periods in which those temporary differences become deductible.

Since 2021, the Company has engaged in a series of intra-entity asset transfers and allocations to contribute assets to its wholly owned Switzerland subsidiary, UK subsidiary and its UK Swiss branch office.

In January 2021, in connection with its launch readiness activities, Kiniksa Bermuda contributed all of its rights, title and interest in, among other things, certain contracts (including the Regeneron Agreement), intellectual property rights, product filings and approvals and other information, plans and materials owned or controlled by Kiniksa Bermuda insofar as they related exclusively or primarily to ARCALYST to Kiniksa UK.

In February 2022, Kiniksa Bermuda contributed its exclusive rights to develop and commercialize mavrilimumab in the Huadong Territory to Kiniksa UK.

In July 2022, Kiniksa Bermuda contributed all of its rights, title and interest in, among other things, certain contracts (including the Biogen Agreement), intellectual property rights, product filings and approvals and other information, plans and materials owned or controlled by Kiniksa Bermuda insofar as they related exclusively or primarily to vixarelimab to Kiniksa UK.

The consolidated Company did not incur tax liabilities on any of these intra-entity transfers since the transferor, Kiniksa Bermuda, is exempt from income tax in Bermuda, its jurisdiction of incorporation. Kiniksa UK accounted for the 2021 and 2022 intra-entity transfers as transfers of assets between related parties and received stepped up tax bases in the contributed intellectual property assets, equal to the fair value of the assets at the time of transfer. The Company recorded UK deferred tax assets as a result of these contributions, which represent the difference between the stepped-up tax bases and the book bases for financial statement purposes. At the time of the 2021 and 2022 transfers of the relevant assets, the Company recorded a valuation allowance on the full amount of the recognized deferred tax assets.

The fair value of the January 2021 transfer of ARCALYST intellectual property assets was determined utilizing forecasted cash flows attributable to commercial operations and estimated probabilities of success of such cash flows, discounted to present value utilizing the discounted cash flow method. The fair values of the transferred mavrilimumab and vixarelimab intellectual property assets were determined utilizing future cash flows related to agreements with third parties for the use of the applicable intellectual property and estimated probabilities of success of such cash flows, discounted to present value utilizing the discounted cash flow method.

In December 2023, Kiniksa UK allocated all of its rights, title and interest in, among other things, certain contracts (including the Regeneron Agreement), intellectual property rights, product filings and approvals and other information, plans and inventory owned or controlled by the Company insofar as they related exclusively or primarily to ARCALYST to Kiniksa UK’s Swiss branch office.

The December 2023 allocation of the assets to the Swiss branch did not result in a taxable disposal for Kiniksa UK as the allocation was to a branch within the entity. The future results of Kiniksa UK’s Swiss branch office are subject to income taxes in Switzerland and the Company expects it will not be subject to tax in the UK. Kiniksa UK’s Swiss branch office received a step up in basis resulting in a Swiss deferred tax asset. The fair value of the allocated ARCALYST intellectual property assets was determined utilizing forecasted cash flows attributable to commercial operations and estimated probabilities of success of such cash flows, discounted to present value utilizing the discounted cash flow method. The fair value of the ARCALYST inventory was determined utilizing the average net selling price less estimated costs to sell.

In January 2024, Kiniksa Bermuda transferred to Kiniksa Switzerland all rights, title and interest in, among other things, certain contracts, intellectual property rights, product filings and approvals and other information, plans and materials owned insofar as they related exclusively or primarily to abiprubart, mavrilimumab and other preclinical assets, excluding certain rights necessary for the completion of Cohort 4 of the Company’s ongoing Phase 2 clinical trial of abiprubart in rheumatoid arthritis.

The consolidated Company did not incur tax liabilities on any of the January 2024 intra-entity transfers since the transferor, Kiniksa Bermuda, is exempt from income tax in Bermuda, its jurisdiction of incorporation. Kiniksa

Switzerland accounted for the intra-entity transfers as transfers of assets between related parties and received stepped up tax bases in the contributed intellectual property assets, equal to the fair value of the assets at the time of transfer. The fair values of the transferred assets were determined utilizing future cash flows of projected operations and estimated probabilities of success of such cash flows, discounted to present value utilizing the discounted cash flow method. The Company recorded deferred tax assets as a result of these contributions, which represent the difference between the stepped-up tax bases and the book bases for financial statement purposes. At the time of the transfers of the relevant assets, the Company recorded a valuation allowance on the full amount of the Switzerland deferred tax assets. There are no material deferred tax assets in the jurisdictions outside the United States, UK and Switzerland.

- Definition

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

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+ Details

CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE LOSS - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2024	Mar. 31, 2023
Revenue:
Revenue	$ 79,858	$ 48,345
Costs and operating expenses:
Cost of goods sold	10,583	7,036
Collaboration expenses	20,801	8,288
Research and development	26,334	15,172
Selling, general and administrative	38,682	29,045
Total operating expenses	96,400	59,541
Loss from operations	(16,542)	(11,196)
Other income	2,266	1,832
Loss before income taxes	(14,276)	(9,364)
Provision for income taxes	(3,428)	(2,906)
Net loss	$ (17,704)	$ (12,270)
Net loss per share attributable to common shareholders, basic	$ (0.25)	$ (0.18)
Net loss per share attributable to common shareholders, diluted	$ (0.25)	$ (0.18)
Weighted average common shares outstanding, basic	70,633,023	69,751,697
Weighted average common shares outstanding, diluted	70,633,023	69,751,697
Comprehensive loss:
Net loss	$ (17,704)	$ (12,270)
Other comprehensive income (loss):
Unrealized gain (loss) on short-term investments and currency translation adjustments, net of tax	(59)	11
Total other comprehensive income (loss)	(59)	11
Total comprehensive loss	(17,763)	(12,259)
Product revenue, net
Revenue:
Revenue	78,885	42,659
License and collaboration revenue
Revenue:
Revenue	$ 973	$ 5,686

Share-Based Compensation - Classification of Expense (Details) - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2024	Mar. 31, 2023
Share-based compensation
Share-based compensation expense	$ 7,206	$ 6,115
Cost of goods sold
Share-based compensation
Share-based compensation expense	359	286
Research and development expenses
Share-based compensation
Share-based compensation expense	1,453	1,444
Selling, general and administrative expenses
Share-based compensation
Share-based compensation expense	$ 5,394	$ 4,385

Pay vs Performance Disclosure - USD ($) $ in Thousands	3 Months Ended
Pay vs Performance Disclosure - USD ($) $ in Thousands	Mar. 31, 2024	Mar. 31, 2023
Pay vs Performance Disclosure
Net Income (Loss)	$ (17,704)	$ (12,270)

- Definition

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

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+ Details

Out-Licensing Agreements

3 Months Ended

Mar. 31, 2024

Out-Licensing Agreements

Out-Licensing Agreements

9. Out-Licensing Agreements

Genentech License Agreement

The Company entered into a license agreement (the “Genentech License Agreement”) with Genentech, Inc. and F. Hoffmann-La Roche Ltd (collectively, “Genentech”), effective in September 2022, pursuant to which the Company granted Genentech exclusive worldwide rights to develop, manufacture and commercialize vixarelimab and related antibodies (each, a “Genentech Licensed Product”).

Under the Genentech License Agreement, the Company received an upfront payment of $80,000 for the license. During the year ended December 31, 2023, the Company received cash payments of $20,000 following delivery of certain drug supplies to Genentech and $15,000 following Genentech’s achievement of a development milestone related to a new indication under the Genentech License Agreement. In the fourth quarter of 2023, following the achievement of a development milestone related to a second indication under the Genentech License Agreement, Genentech became obligated to make an additional cash payment of $10,000 which the Company received in the first quarter of 2024. Under the terms of the Genentech License Agreement, the Company is eligible to receive a total of approximately $600,000 in contingent payments, including specified development, regulatory and sales-based milestones, before fulfilling the Company’s upstream financial obligations, of which approximately $575,000 remain as of March 31, 2024. The Company will also be eligible to receive tiered percentage royalties on a Genentech Licensed Product-by-Genentech Licensed Product basis ranging from low-double digits to mid-teens on annual net sales of each Genentech Licensed Product, subject to certain customary reductions, with an aggregate minimum floor, before fulfilling the Company’s upstream financial obligations. Royalties will be payable on a Genentech Licensed Product-by-Genentech Licensed Product and country-by-country basis until the latest to occur of the expiration of certain patents that cover a Genentech

Licensed Product, the expiration of regulatory exclusivity for such Genentech Licensed Product, or the tenth anniversary of first commercial sale of such Genentech Licensed Product in such country.

Pursuant and subject to the terms of the Genentech License Agreement, Genentech has the exclusive worldwide right to conduct development and commercialization activities for Genentech Licensed Products at its sole cost. Notwithstanding the foregoing, the Company is responsible, at its sole cost, for finalizing its Phase 2b clinical trial assessing the efficacy, safety and tolerability of vixarelimab in reducing pruritis in prurigo nodularis. Both the Company and Genentech participate in a joint transition committee, which coordinates and oversees the Company’s finalization of its Phase 2b clinical trial.

Accounting for the Genentech License Agreement

As of the Genentech Effective Date, the Company identified the following performance obligations in the Genentech License Agreement: (i) the delivery of the exclusive license for vixarelimab; (ii) an initial drug supply delivery; (iii) a drug product resupply delivery; and (iv) completion of the Phase 2b clinical trial for vixarelimab.

The Company determined the transaction price of the Genentech License Agreement consisted of the $80,000 upfront payment and the $20,000 variable consideration related to the delivery of the initial drug supply and drug product resupply which was added to the transaction price in 2022. In 2023, the Company added $25,000 to the transaction price following Genentech’s achievement of two development milestones under the Genentech License Agreement.

As noted above, the Company identified four performance obligations in the Genentech License Agreement: (i) the delivery of the exclusive license for vixarelimab; (ii) an initial drug supply delivery; (iii) a drug product resupply delivery; and (iv) completion of the Phase 2b clinical trial for vixarelimab. The selling price of each performance obligation in the Genentech License Agreement was determined based on the Company’s standalone selling price with the objective of determining the price at which it would sell such an item if it were to be sold regularly on a standalone basis. The Company allocated the transaction price to each of the four performance obligations noted above.


Performance Obligation		Method of Recognition
Exclusive license for vixarelimab		Point in time; upon transfer of the license to Genentech, as control of the license was transferred on the Genentech Effective Date and Genentech could begin to use and benefit from the license on that date.
Initial drug supply delivery		Point in time upon delivery.
Drug product resupply delivery		Point in time upon delivery.
Completion of the phase 2b clinical trial for vixarelimab		Over time; using the cost-to-cost input method, which is believed to best depict the transfer of control to the customer. Under the cost-to-cost input method, the percent of completion is based on the ratio of actual costs incurred as of the period end to the total estimated costs. Revenue is recorded as a percentage of the allocated transaction price times the percent of completion.

The Company recognized $105 of collaboration revenue under the Genentech License Agreement during the three months ended March 31, 2024 related to the completed portion of the Phase 2b clinical trial for vixarelimab. The Company recognized $5,686 of collaboration revenue during three months ended March 31, 2023 under the Genentech License Agreement related to the license, completed portion of the Phase 2b clinical trial for vixarelimab, and materials delivered. The Company expects to recognize the remaining deferred revenue associated with the Genentech License Agreement over the remaining portion of the Phase 2b clinical trial for vixarelimab.

Huadong Collaboration Agreements

In February 2022 (the “Effective Date”), the Company entered into two collaboration and license agreements (each, a “Huadong Collaboration Agreement” and together, the “Huadong Collaboration Agreements”) with Hangzhou Zhongmei Huadong Pharmaceutical Co., Ltd. (“Huadong”), pursuant to which the Company granted Huadong exclusive rights to develop and commercialize rilonacept and develop, manufacture and commercialize mavrilimumab (each, a “Huadong Licensed Product” and together, the “Huadong Licensed Products”) in the following countries: People’s Republic of China, Hong Kong SAR, Macao SAR, Taiwan Region, South Korea, Indonesia, Singapore, The Philippines, Thailand, Australia, Bangladesh, Bhutan, Brunei, Burma, Cambodia, India, Laos, Malaysia, Maldives, Mongolia, Nepal, New Zealand, Sri Lanka, and Vietnam (collectively, the “Huadong Territory”). The Company otherwise retained its current rights to the Huadong Licensed Products outside the Huadong Territory.

Under the Huadong Collaboration Agreements, the Company received a total upfront cash payment of $22,000, which includes $12,000 for the Huadong Territory license of rilonacept and $10,000 for the Huadong Territory license of mavrilimumab. The Company will be eligible to receive up to approximately $70,000 in payments for rilonacept, and up to approximately $576,000 in payments for mavrilimumab, including specified development, regulatory and sales-based milestones. Huadong will also be obligated to pay the Company tiered percentage royalties on a Huadong Licensed Product-by-Huadong Licensed Product basis ranging from the low-teens to low-twenties on annual net sales of each Huadong Licensed Product in the Huadong Territory, subject to certain reductions tied to rilonacept manufacturing costs and certain other customary reductions, with an aggregate minimum floor. Royalties will be payable on a Huadong Licensed Product-by-Huadong Licensed Product and country-by-country or region-by-region basis until the later of (i) 12 years after the first commercial sale of the applicable Huadong Licensed Product in such country or region in the Huadong Territory, (ii) the date of expiration of the last valid patent claim of the Company’s patent rights or any joint collaboration patent rights that covers the applicable Huadong Licensed Product in such country or region in the Huadong Territory, and (iii) the expiration of the last regulatory exclusivity for the applicable Huadong Licensed Product in such country or region in the Huadong Territory.

The Company concluded that the Huadong Collaboration Agreements should not be combined and treated as a single arrangement for accounting purposes as the Huadong Collaboration Agreements were negotiated separately with separate and distinct commercial objectives, the amount of consideration in one Huadong Collaboration Agreement is not dependent on the price or performance of the other Huadong Collaboration Agreement, and the goods and services promised in the Huadong Collaboration Agreements are not a single performance obligation.

Accounting for the Mavrilimumab Huadong Collaboration Agreement

As of the Effective Date, the Company identified the following performance obligations in the mavrilimumab Huadong Collaboration Agreement: delivery of (i) exclusive license for mavrilimumab in the Huadong Territory and (ii) clinical manufacturing supply of certain materials for mavrilimumab products in the Huadong Territory.

The Company determined the transaction price at the inception of the mavrilimumab Huadong Collaboration Agreement which includes $10,000, consisting of the upfront payment. The Company also includes an estimate of variable consideration associated with the clinical manufacturing supply of certain materials when those materials are shipped. The Company determined that any variable consideration related to development and regulatory milestones is deemed fully constrained and therefore excluded from the transaction price due to the high degree of uncertainty and risk associated with these potential payments, as the Company determined that it could not assert that it was probable that a significant reversal in the amount of cumulative revenue recognized will not occur. The Company also determined that royalties and sales milestones relate solely to the licenses of intellectual property. Revenue related to these royalties and sales milestones will only be recognized when the associated sales occur, and relevant thresholds are met, under the sales or usage-based royalty exception of Topic 606.

The Company recognizes revenue for the license performance obligations at a point in time, that is upon transfer of the license to Huadong. As control of the license was transferred on the Effective Date and Huadong could begin to use and benefit from the license, the Company recognized $10,000 of collaboration revenue during the year ended December 31, 2022 under the mavrilimumab Huadong Collaboration Agreement. The Company will recognize

revenue for the clinical manufacturing supply obligations at a point in time, that is upon each delivery of the supply to Huadong.

Accounting for the Rilonacept Huadong Collaboration Agreement

As of the Effective Date, the Company identified one performance obligation in the rilonacept Huadong Collaboration Agreement: the exclusive license for rilonacept and clinical and commercial manufacturing obligations for rilonacept products in the Huadong Territory. Huadong cannot exploit the value of the exclusive license for rilonacept products in the Huadong Territory without receipt of supply as the exclusive license for rilonacept products in the Huadong Territory does not convey to Huadong the right to manufacture and therefore the Company has combined the exclusive license for rilonacept products in the Huadong Territory and the manufacturing obligations into one performance obligation.

The Company determined the transaction price at the inception of the rilonacept Huadong Collaboration Agreement which includes $12,000, consisting of the upfront payment. The Company also includes an estimate of variable consideration associated with the clinical and commercial manufacturing supply of certain materials when those materials are shipped. The Company determined that any variable consideration related to development and regulatory milestones, sales milestones and royalties are deemed fully constrained and therefore excluded from the transaction price due to the high degree of uncertainty and risk associated with these potential payments, as the Company determined that it could not assert that it was probable that a significant reversal in the amount of cumulative revenue recognized will not occur. Royalties and sales milestones will be recognized as the Company delivers the commercial manufactured product to Huadong. Any changes in estimates may result in a cumulative catch-up based on the number of units of manufactured product delivered.

The Company recognizes revenue for the single performance obligation in the rilonacept Huadong Collaboration Agreement consisting of the exclusive license for rilonacept and clinical and commercial manufacturing obligations for rilonacept products in the Huadong Territory at a point in time, upon which control of materials are transferred to Huadong for each delivery of the associated materials. The Company currently expects to recognize the revenue over the life of the agreement. This estimate considers the timing of development and commercial activities under the rilonacept Huadong Collaboration Agreement and may be reduced or increased based on changes in the various activities.

The Company recognized $189 of the upfront payment in collaboration revenue during the three months ended March 31, 2024 under the rilonacept Huadong Collaboration Agreement related to materials delivered. The Company did not recognize any revenue from the $12,000 upfront payment under the rilonacept Huadong Collaboration Agreement during the three month ended March 31, 2023. As of March 31, 2024, $11,811 of the transaction price is recorded in non-current deferred revenue, based upon timing of anticipated future shipments.

The following table summarizes the Company’s contract assets and contract liabilities in connection with license and collaboration agreements for the three months ended March 31, 2024:


	Balance at				Revenue				Balance at End
	Beginning of Period		Additions		Recognized		Reclassification		of Period
Three Months Ended March 31, 2024
Contract Liabilities:
Genentech vixarelimab	$	261	$	—	$	(105)	$	—	$	156
Huadong rilonacept		12,000		—		(189)		—		11,811
Total Contract Liabilities	$	12,261	$	—	$	(294)	$	—	$	11,967

Accrued Expenses (Details) - USD ($) $ in Thousands	Mar. 31, 2024	Dec. 31, 2023
Accrued Expenses
Accrued research and development expenses	$ 11,028	$ 7,895
Accrued employee compensation and benefits	7,317	15,954
Accrued collaboration expenses	20,123	16,939
Accrued legal, commercial and professional fees	5,840	3,553
Other	410	326
Total accrued expenses	$ 44,718	$ 44,667

Nature of the Business and Basis of Presentation

3 Months Ended

Mar. 31, 2024

Nature of the Business and Basis of Presentation

Nature of the Business and Basis of Presentation

1. Nature of the Business and Basis of Presentation

Kiniksa Pharmaceuticals, Ltd. (the “Company”) is a commercial-stage biopharmaceutical company focused on discovering, acquiring, developing and commercializing therapeutic medicines for patients suffering from debilitating diseases with significant unmet medical need. The Company’s portfolio of immune-modulating assets is based on strong biologic rationale or validated mechanisms, targets a spectrum of underserved cardiovascular and autoimmune conditions and offers the potential for differentiation.

The Company is subject to risks and uncertainties common to commercial-stage companies in the biopharmaceutical industry and global health, societal, economic and market conditions, including the Company’s dependence on third parties, including contract research organizations and contract manufacturing organizations, the Company’s limited experience obtaining regulatory approvals, the potential failure of the Company to successfully complete research and development of its current or future product candidates, the potential inability of the Company to adequately protect its technology, potential competition, the uncertainty that any current or future product candidates will obtain necessary government regulatory approval, that ARCALYST will continue to be commercially viable and whether any of the Company’s current or future product candidates, if approved, will be commercially viable. Such risks and uncertainties may be subject to substantial and uncertain changes, which may cause significant disruption to the Company’s business and operations, preclinical studies and clinical trials, the business and operations of the third parties with whom the Company conducts business and the national and global economies, all of which may have material impacts on the Company’s business, financial condition and results of operations.

Principles of Consolidation

The accompanying consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America (“GAAP”) and include the accounts of the Company and its wholly owned subsidiaries, Kiniksa Pharmaceuticals Corp. (“Kiniksa US”), Primatope Therapeutics, Inc. (“Primatope”) and Kiniksa Pharmaceuticals (UK), Ltd. (“Kiniksa UK”) as well as the subsidiaries of Kiniksa UK, Kiniksa Pharmaceuticals (Germany) GmbH (“Kiniksa Germany”), Kiniksa Pharmaceuticals (France) SARL (“Kiniksa France”), and Kiniksa Pharmaceuticals GmbH (“Kiniksa Switzerland”), after elimination of all significant intercompany accounts and transactions. Where the Kiniksa Pharmaceuticals, Ltd. entity is referred to in its single, unconsolidated form, it is referred to as “Kiniksa Bermuda”.

Use of Estimates

The preparation of the Company’s consolidated financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, the disclosure of contingent assets and liabilities at the date of the consolidated financial statements and the reported amounts of expenses during the reporting period. Significant estimates and assumptions reflected in these consolidated financial statements include, but are not limited to, the recognition of revenue, the accrual for research and development expenses, and the valuation of our deferred tax assets. Estimates are periodically reviewed in light of changes in circumstances, facts and experience. Changes in estimates are recorded in the period in which they become known. Actual results could differ from those estimates.

Unaudited Interim Consolidated Financial Information

The accompanying unaudited consolidated financial statements have been prepared in accordance with GAAP for interim financial information. The accompanying unaudited consolidated financial statements do not include all of the information and footnotes required by GAAP for complete consolidated financial statements. The information included in this Quarterly Report on Form 10-Q should be read in conjunction with the Company’s audited consolidated financial statements and the accompanying notes included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2023 (the “2023 Form 10-K”). The Company’s accounting policies are described in the Notes to Consolidated Financial Statements included in the Company’s 2023 Form 10-K and updated, as necessary, in this report. The accompanying year-end consolidated balance sheet was derived from audited financial statements but does not

include all disclosures required by GAAP. The unaudited interim consolidated financial statements have been prepared on the same basis as the audited annual consolidated financial statements and, in the opinion of management, reflect all adjustments, which include only normal recurring adjustments, necessary for the fair statement of the Company’s financial position as of March 31, 2024 and the results of its operations for the three months ended March 31, 2024 and 2023, the changes in its shareholders’ equity for the three months ended March 31, 2024 and 2023 and its cash flows for the three months ended March 31, 2024 and 2023. The results for the three months ended March 31, 2024 are not necessarily indicative of results to be expected for the year ending December 31, 2024, any other interim periods or any future year or period.

Liquidity

The Company has evaluated whether there are conditions and events, considered in the aggregate, that raise substantial doubt about the Company’s ability to continue as a going concern within one year after the date the consolidated financial statements are issued. As of March 31, 2024, the Company had an accumulated deficit of $495,654. During the three months ended March 31, 2024, the Company reported a net loss of $17,704 and had provided $3,987 cash from operating activities. As of March 31, 2024, the Company had cash, cash equivalents and short-term investments of $213,552. Based on its current operating plan, the Company expects that its cash, cash equivalents and short-term investments will be sufficient to fund its operations and capital expenditure requirements for at least twelve months from the issuance date of these consolidated financial statements.

Summary of Significant Accounting Policies

Inventory

Inventories are stated at the lower of cost or estimated net realizable value with cost based on the first-in first-out method. The Company classifies inventory as long-term when the inventory is expected to be utilized beyond the Company’s normal operating cycle and includes such amounts in other long-term assets in our consolidated balance sheets. Prior to the regulatory approval of its drug candidates, the Company incurs expenses for the manufacture of product candidate supplies to support clinical development that could potentially be available to support the commercial launch of those therapeutics. Until the date at which regulatory approval has been received or is otherwise considered probable, the Company records all such costs as research and development expenses. The Company performs an assessment of the recoverability of capitalized inventories during each reporting period and writes down any excess and obsolete inventory to its net realizable value in the period in which the impairment is first identified. Such impairment charges, should they occur, are recorded as a component of cost of sales in the Company’s consolidated statements of operations and comprehensive income (loss). The determination of whether inventory costs will be realizable requires the use of estimates by management. If actual market conditions are less favorable than projected by management, additional writedown of inventory may be required.

Finished goods that can be used in either the production of clinical or commercial products is expensed as research and development costs when identified and labeled for use in clinical trials as the products are required to be re-labeled for alternative uses. The finished goods inventory that will ultimately be distributed free of charge under our patient assistance program are recognized as selling expense when they are labeled as free goods.

The Company is conducting a technology transfer of ARCALYST drug substance manufacturing from Regeneron Pharmaceuticals, Inc. (“Regeneron”) to a new contract development and manufacturing organization (“CDMO”). Costs associated with the establishment of ARCALYST production at a new manufacturing site that do not meet the criteria for research and development or capitalization into inventory, including raw materials consumed, are included in cost of goods sold in the period incurred. During the three months ended March 31, 2024 the Company incurred $2,126 of expense related to the technology transfer of ARCALYST drug substance manufacturing in cost of goods sold. No expenses were incurred in the three months ended March 31, 2023.

There have been no other material changes to the significant accounting policies previously disclosed in the Company’s 2023 Form 10-K.

Recently Adopted Accounting Pronouncements

In November 2023, the FASB issued Accounting Standards Update No. 2023-07, Segment Reporting - Improvements to Reportable Segment Disclosures. The amendments require disclosure of incremental segment information on an annual and interim basis. The amendments also require companies with a single reportable segment to provide all disclosures required by this amendment and all existing segment disclosures in Accounting Standards Codification 280, Segment Reporting. The amendments are effective for fiscal years beginning after December 15, 2023, and interim periods beginning after December 15, 2024. The Company does not expect the adoption of the amendments to have a material impact on its financial statements.

In December 2023, the FASB issued Accounting Standards Update No. 2023-09, Income Taxes - Improvements to Income Tax Disclosures. The amendments require (i) enhanced disclosures in connection with an entity's effective tax rate reconciliation and (ii) income taxes paid disaggregated by jurisdiction. The amendments are effective for annual periods beginning after December 15, 2024. The Company does not expect the adoption of the amendments to have a material impact on its financial statements.

License and Acquisition Agreements - MedImmune License Agreement (Details) - USD ($) $ in Thousands	1 Months Ended		3 Months Ended
	Dec. 31, 2017	Sep. 30, 2017	Mar. 31, 2024	Mar. 31, 2023
License and Acquisition Agreements
Notice period to terminate the agreement by both parties for material breaches		90 days
Research and development			$ 26,334	$ 15,172
MedImmune \| License Agreement
License and Acquisition Agreements
Remaining milestone payments to be paid upon clinical and regulatory milestone achievement			$ 57,500
Milestone payment to be paid upon clinical and regulatory milestone achievement	$ 15,000
Additional specified annual net sales threshold for additional milestone payment.	1,000,000
Annual net sales excluded from calculation of specified annual net sales thresholds	1,000,000
Notice period to terminate the agreement by both parties for material breaches			90 days
Notice period to terminate the agreement			90 days
Research and development			$ 0	$ 0
Maximum \| MedImmune \| License Agreement
License and Acquisition Agreements
Milestone payment to be paid upon specified milestone achievements for first two indications	72,500
Milestone payment to be paid upon specified annual sales milestone achievements	85,000
Additional milestone payments payable after achievement of additional annual sales	$ 1,100,000
Maximum percentage of royalty payable on annual net sales of licensed products			20.00%

Product Revenue, Net (Tables)

3 Months Ended

Mar. 31, 2024

Product Revenue, Net

Schedule of product revenue, net

Schedule of balances and activity of the product revenue allowance and reserve categories


	Contractual		Government
	Adjustments		Rebates		Returns		Total
Balance at December 31, 2023	$	2,022	$	3,775	$	341	$	6,138
Current provisions relating to sales in the current year		7,319		3,916		258		11,493
Adjustments relating to prior years		—		(5)		836		831
Payments/returns relating to sales in the current year		(5,034)		(887)		—		(5,921)
Payments/returns relating to sales in the prior years		(1,957)		(1,475)		—		(3,432)
Balance at March 31, 2024	$	2,350	$	5,324	$	1,435	$	9,109


	March 31,		December 31,
	2024		2023
Components of accounts receivable	$	(411)	$	(459)
Components of other current liabilities		9,520		6,597
Total revenue-related reserves	$	9,109	$	6,138

Nature of the Business and Basis of Presentation (Details) - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2024	Mar. 31, 2023	Dec. 31, 2023
Liquidity
Accumulated deficit	$ (495,654)		$ (477,950)
Net Income (Loss)	(17,704)	$ (12,270)
Cash provided by operations	3,987	(4,267)
Cash, cash equivalents and short-term investments	213,552
Inventory
Cost of goods sold	10,583	7,036
Clinical Supply Agreement
Inventory
Cost of goods sold	$ 2,126	$ 0

- Definition

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

+ References

+ Details

- Definition

Amount of accumulated undistributed earnings (deficit).

+ References + Details

Summary of Significant Accounting Policies (Policies)	3 Months Ended
Summary of Significant Accounting Policies (Policies)	Mar. 31, 2024
Summary of Significant Accounting Policies
Principles of Consolidation	Principles of Consolidation The accompanying consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America (“GAAP”) and include the accounts of the Company and its wholly owned subsidiaries, Kiniksa Pharmaceuticals Corp. (“Kiniksa US”), Primatope Therapeutics, Inc. (“Primatope”) and Kiniksa Pharmaceuticals (UK), Ltd. (“Kiniksa UK”) as well as the subsidiaries of Kiniksa UK, Kiniksa Pharmaceuticals (Germany) GmbH (“Kiniksa Germany”), Kiniksa Pharmaceuticals (France) SARL (“Kiniksa France”), and Kiniksa Pharmaceuticals GmbH (“Kiniksa Switzerland”), after elimination of all significant intercompany accounts and transactions. Where the Kiniksa Pharmaceuticals, Ltd. entity is referred to in its single, unconsolidated form, it is referred to as “Kiniksa Bermuda”.
Use of Estimates	Use of Estimates The preparation of the Company’s consolidated financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, the disclosure of contingent assets and liabilities at the date of the consolidated financial statements and the reported amounts of expenses during the reporting period. Significant estimates and assumptions reflected in these consolidated financial statements include, but are not limited to, the recognition of revenue, the accrual for research and development expenses, and the valuation of our deferred tax assets. Estimates are periodically reviewed in light of changes in circumstances, facts and experience. Changes in estimates are recorded in the period in which they become known. Actual results could differ from those estimates.
Unaudited Interim Consolidated Financial Information	Unaudited Interim Consolidated Financial Information The accompanying unaudited consolidated financial statements have been prepared in accordance with GAAP for interim financial information. The accompanying unaudited consolidated financial statements do not include all of the information and footnotes required by GAAP for complete consolidated financial statements. The information included in this Quarterly Report on Form 10-Q should be read in conjunction with the Company’s audited consolidated financial statements and the accompanying notes included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2023 (the “2023 Form 10-K”). The Company’s accounting policies are described in the Notes to Consolidated Financial Statements included in the Company’s 2023 Form 10-K and updated, as necessary, in this report. The accompanying year-end consolidated balance sheet was derived from audited financial statements but does not include all disclosures required by GAAP. The unaudited interim consolidated financial statements have been prepared on the same basis as the audited annual consolidated financial statements and, in the opinion of management, reflect all adjustments, which include only normal recurring adjustments, necessary for the fair statement of the Company’s financial position as of March 31, 2024 and the results of its operations for the three months ended March 31, 2024 and 2023, the changes in its shareholders’ equity for the three months ended March 31, 2024 and 2023 and its cash flows for the three months ended March 31, 2024 and 2023. The results for the three months ended March 31, 2024 are not necessarily indicative of results to be expected for the year ending December 31, 2024, any other interim periods or any future year or period.
Liquidity	Liquidity The Company has evaluated whether there are conditions and events, considered in the aggregate, that raise substantial doubt about the Company’s ability to continue as a going concern within one year after the date the consolidated financial statements are issued. As of March 31, 2024, the Company had an accumulated deficit of $495,654. During the three months ended March 31, 2024, the Company reported a net loss of $17,704 and had provided $3,987 cash from operating activities. As of March 31, 2024, the Company had cash, cash equivalents and short-term investments of $213,552. Based on its current operating plan, the Company expects that its cash, cash equivalents and short-term investments will be sufficient to fund its operations and capital expenditure requirements for at least twelve months from the issuance date of these consolidated financial statements.
Inventory	Inventory Inventories are stated at the lower of cost or estimated net realizable value with cost based on the first-in first-out method. The Company classifies inventory as long-term when the inventory is expected to be utilized beyond the Company’s normal operating cycle and includes such amounts in other long-term assets in our consolidated balance sheets. Prior to the regulatory approval of its drug candidates, the Company incurs expenses for the manufacture of product candidate supplies to support clinical development that could potentially be available to support the commercial launch of those therapeutics. Until the date at which regulatory approval has been received or is otherwise considered probable, the Company records all such costs as research and development expenses. The Company performs an assessment of the recoverability of capitalized inventories during each reporting period and writes down any excess and obsolete inventory to its net realizable value in the period in which the impairment is first identified. Such impairment charges, should they occur, are recorded as a component of cost of sales in the Company’s consolidated statements of operations and comprehensive income (loss). The determination of whether inventory costs will be realizable requires the use of estimates by management. If actual market conditions are less favorable than projected by management, additional writedown of inventory may be required. Finished goods that can be used in either the production of clinical or commercial products is expensed as research and development costs when identified and labeled for use in clinical trials as the products are required to be re-labeled for alternative uses. The finished goods inventory that will ultimately be distributed free of charge under our patient assistance program are recognized as selling expense when they are labeled as free goods. The Company is conducting a technology transfer of ARCALYST drug substance manufacturing from Regeneron Pharmaceuticals, Inc. (“Regeneron”) to a new contract development and manufacturing organization (“CDMO”). Costs associated with the establishment of ARCALYST production at a new manufacturing site that do not meet the criteria for research and development or capitalization into inventory, including raw materials consumed, are included in cost of goods sold in the period incurred. During the three months ended March 31, 2024 the Company incurred $2,126 of expense related to the technology transfer of ARCALYST drug substance manufacturing in cost of goods sold. No expenses were incurred in the three months ended March 31, 2023. There have been no other material changes to the significant accounting policies previously disclosed in the Company’s 2023 Form 10-K.
Recently Adopted Accounting Pronouncements	Recently Adopted Accounting Pronouncements In November 2023, the FASB issued Accounting Standards Update No. 2023-07, Segment Reporting - Improvements to Reportable Segment Disclosures. The amendments require disclosure of incremental segment information on an annual and interim basis. The amendments also require companies with a single reportable segment to provide all disclosures required by this amendment and all existing segment disclosures in Accounting Standards Codification 280, Segment Reporting. The amendments are effective for fiscal years beginning after December 15, 2023, and interim periods beginning after December 15, 2024. The Company does not expect the adoption of the amendments to have a material impact on its financial statements. In December 2023, the FASB issued Accounting Standards Update No. 2023-09, Income Taxes - Improvements to Income Tax Disclosures. The amendments require (i) enhanced disclosures in connection with an entity's effective tax rate reconciliation and (ii) income taxes paid disaggregated by jurisdiction. The amendments are effective for annual periods beginning after December 15, 2024. The Company does not expect the adoption of the amendments to have a material impact on its financial statements.

- Definition

Disclosure of inventory accounting policy for inventory classes, including, but not limited to, basis for determining inventory amounts, methods by which amounts are added and removed from inventory classes, loss recognition on impairment of inventories, and situations in which inventories are stated above cost.

+ References + Details

Product Revenue, Net

3 Months Ended

Mar. 31, 2024

Product Revenue, Net

Product Revenue, Net

3. Product Revenue, Net

Product revenue, net, from sales of ARCALYST was as follows:

The following table summarizes balances and activity in each of the product revenue allowance and reserve categories for the three months ended March 31, 2024:


	Contractual		Government
	Adjustments		Rebates		Returns		Total
Balance at December 31, 2023	$	2,022	$	3,775	$	341	$	6,138
Current provisions relating to sales in the current year		7,319		3,916		258		11,493
Adjustments relating to prior years		—		(5)		836		831
Payments/returns relating to sales in the current year		(5,034)		(887)		—		(5,921)
Payments/returns relating to sales in the prior years		(1,957)		(1,475)		—		(3,432)
Balance at March 31, 2024	$	2,350	$	5,324	$	1,435	$	9,109

Total revenue-related reserves as of March 31, 2024 and December 31, 2023, included in our consolidated balance sheets, are summarized as follows:


	March 31,		December 31,
	2024		2023
Components of accounts receivable	$	(411)	$	(459)
Components of other current liabilities		9,520		6,597
Total revenue-related reserves	$	9,109	$	6,138

Primarily all of the Company’s trade accounts receivable arise from product revenue in the United States due from the Company’s third party logistics provider.

- Definition

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

+ References

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

Reference 3: http://www.xbrl.org/2003/role/disclosureRef
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Reference 4: http://www.xbrl.org/2003/role/disclosureRef
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Reference 10: http://www.xbrl.org/2003/role/disclosureRef
-Name Accounting Standards Codification
-Topic 606
-Publisher FASB
-URI https://asc.fasb.org//606/tableOfContent

+ Details

License and Acquisition Agreements

3 Months Ended

Mar. 31, 2024

License and Acquisition Agreements

License and Acquisition Agreements

10. License and Acquisition Agreements

Biogen Asset Purchase Agreement

In September 2016, the Company entered into an asset purchase agreement (the “Biogen Agreement”) with Biogen MA Inc. (“Biogen”) to acquire all of Biogen’s right, title and interest in and to certain assets used in or relating to vixarelimab and other antibodies covered by certain patent rights, including patents and other intellectual property rights, clinical data, know-how, and clinical drug supply. In addition, Biogen granted the Company a non-exclusive, sublicensable, worldwide license to certain background patent rights related to the vixarelimab program. The Company is obligated to use commercially reasonable efforts to develop and commercialize such acquired products.

Under the Biogen Agreement, the Company is obligated to make payments to Biogen of up to $179,000 upon the achievement of specified clinical and regulatory milestones in multiple indications in various territories, of which $165,000 remains as of March 31, 2024. Additionally, the Company could be obligated to make up to an aggregate of $150,000 of payments upon the achievement of specified annual net sales milestones and to pay tiered royalties on escalating tiers of annual net sales of licensed products starting in the high single-digit percentages and ending below the teens.

The Company also agreed to pay certain obligations under third party contracts retained by Biogen that relate to the vixarelimab program. Under these retained contracts, the Company paid a one-time upfront sublicense fee and is obligated to pay insignificant annual maintenance fees as well as clinical and regulatory milestone payments of up to an aggregate of $1,575.

The Biogen Agreement will terminate upon the expiration of all payment obligations with respect to the last product in all countries in the territory. The Company has the right to terminate the agreement with 90 days’ prior written notice. Both parties may terminate by mutual written consent or in the event of material breach of the agreement by the other party that remains uncured for 90 days (or 30 days for payment-related breaches).

In July 2017, the Company and Biogen entered into Amendment No. 1 to the Biogen Agreement, which clarified the scope of the antibodies subject to the Biogen Agreement.

In August 2022, the Company entered into Amendment No. 2 to the Biogen Agreement (the “Second Biogen Amendment”). Pursuant to the terms of the Second Biogen Amendment, commencing on the effective date of the Genentech License Agreement, certain defined terms in the Biogen Agreement were amended, including “Net Sales”, “Indication”, “Product”, “Combination Product” and “Valid Claim”. In addition, the tiered royalty rates to be paid by the Company to Biogen increased by an amount equal to less than one percent.

Upon the termination or expiration of the Genentech License Agreement, the amendments to the terms of the Biogen Agreement, as set forth in the Second Biogen Amendment, will terminate and all terms of the Biogen Agreement will revert to the version of such terms in effect as of immediately prior to the effective date of the Genentech License Agreement.

During the three months ended March 31, 2024, the Company recorded research and development expense of $61 related to a milestone and the annual maintenance in connection with the Biogen Agreement. During the three months ended March 31, 2023, the Company did not record any research and development expense in connection with the Biogen Agreement.

Beth Israel Deaconess Medical Center License Agreement

In 2019, the Company acquired all of the outstanding securities of Primatope Therapeutics, Inc. (“Primatope”), the company that owned or controlled the intellectual property related to abiprubart. In connection with the Company’s acquisition of Primatope, the Company acquired the rights to an exclusive license to certain intellectual property rights controlled by Beth Israel Deaconess Medical Center, Inc. (“BIDMC”) to make, use, develop and commercialize abiprubart (the “BIDMC Agreement”). Under the BIDMC Agreement, the Company is solely responsible for all

development, regulatory and commercial activities and costs. The Company is also responsible for costs related to filing, prosecuting and maintaining the licensed patent rights. Under the BIDMC Agreement, the Company is obligated to pay an insignificant annual maintenance fee as well as clinical and regulatory milestone payments of up to an aggregate of $1,200 to BIDMC. The Company is also obligated to pay a low single-digit royalty on annual net sales of products licensed under the agreement.

During the three months ended March 31, 2024 the Company recorded research and development expense of $27 in connection with the BIDMC Agreement. During the three months ended March 31, 2023, the Company did not record any research and development expense in connection with the BIDMC Agreement.

Regeneron License Agreement

In September 2017, the Company entered into a license agreement (the “Regeneron Agreement”) with Regeneron Pharmaceuticals, Inc. (“Regeneron”), pursuant to which the Company has been granted an exclusive license under certain intellectual property rights controlled by Regeneron to develop and commercialize ARCALYST worldwide, excluding the Middle East and North Africa, for all indications other than those in oncology and local administration to the eye or ear. Upon receiving positive data in RHAPSODY, the Company’s pivotal Phase 3 clinical trial of ARCALYST, Regeneron transferred the biologics license application (“BLA”) for ARCALYST to the Company. In March 2021, when the FDA granted approval of ARCALYST for the treatment of recurrent pericarditis and reduction in risk of recurrence in adults and children 12 years and older, the Company assumed the sales and distribution of ARCALYST for Cryopyrin-Associated Periodic Syndromes and Deficiency of Interleukin-1 Receptor Antagonist in the United States.

The Company evenly splits profits on sales of ARCALYST with Regeneron, where profits are determined after deducting from net sales of ARCALYST certain costs related to the manufacturing and commercialization of ARCALYST. Such costs include but are not limited to (i) the Company’s cost of goods sold for product used, sold or otherwise distributed for patient use by the Company; (ii) customary commercialization expenses, including the cost of the Company’s field force, and (iii) the Company’s cost to market, advertise and otherwise promote ARCALYST, with such costs identified in subsection (iii) subject to specified limits.  To the extent permitted in accordance with the Regeneron Agreement, the fully-burdened costs incurred by each of the Company and Regeneron in performing (or having performed) the technology transfer of the manufacturing process for ARCALYST drug substance will also be deducted from net sales of ARCALYST to determine profit. The Company also evenly splits with Regeneron any proceeds received by the Company from any licensees, sublicensees and distributors in consideration for the sale, license or other disposition of rights with respect to ARCALYST, including upfront payments, milestone payments and royalties. For the three months ended March 31, 2024 and 2023, the Company recognized $20,123 and $8,288 respectively, of expenses related to the profit sharing agreement presented within collaboration expenses.

The Company has a supply agreement with Regeneron pursuant to which the Company may order both clinical and commercial product. The supply agreement terminates upon the termination of the Regeneron Agreement or the date of completion of the transfer of technology related to the manufacture of ARCALYST. During the three months ended March 31, 2024 and 2023, the Company did not incur any research and development expense related to the purchase of drug materials under the supply agreement. The Company’s inventory balance as of March 31, 2024 and December 31, 2023, of $26,252 and $31,122 respectively, related to the purchase of commercial product under the supply agreement. As of March 31, 2024, the Company had non-cancelable purchase commitments under the supply agreement (see Note 14).

The Regeneron Agreement will expire when the Company is no longer developing or commercializing any licensed product under the Regeneron Agreement. Either party may terminate the agreement upon the other party’s insolvency or bankruptcy or for material breach of the agreement by the other party that remains uncured for 90 days (or 30 days for payment related breaches). Regeneron has the right to terminate the agreement if the Company suspends its development or commercialization activities for a consecutive 12 month period or does not grant a sublicense to a third party to perform such activities, or if the Company challenges any of the licensed patent rights. The Company may terminate the agreement at any time with one year’s written notice. The Company may also terminate the agreement with three months’ written notice if the licensed product is determined to have certain safety concerns.

MedImmune License Agreement

In December 2017, the Company entered into a license agreement (as amended from time to time, the “MedImmune Agreement”) with MedImmune, Limited (“MedImmune”), pursuant to which MedImmune granted the Company an exclusive, sublicensable, worldwide license to certain intellectual property rights to make, use, develop and commercialize mavrilimumab. Under the MedImmune Agreement, the Company also acquired reference rights to relevant manufacturing and regulatory documents and MedImmune’s existing supply of mavrilimumab drug substance and product. The Company is obligated to use commercially reasonable efforts to develop and commercialize the licensed products.

The Company is obligated to make clinical, regulatory and initial sales milestone payments of up to $72,500 in the aggregate for the first two indications, of which $57,500 remain as of March 31, 2024. In addition, the Company is obligated to make clinical and regulatory milestone payments of up to $15,000 in the aggregate for each subsequent indication. In July 2020, the Company entered into an amendment to the MedImmune Agreement to establish a new coronavirus field and defer the payment of certain development and regulatory milestones as applied to the new coronavirus field. The Company is obligated to make milestone payments to MedImmune of up to $85,000 upon the achievement of annual net sales thresholds up to, but excluding, $1,000,000 in annual net sales as well as additional milestone payments aggregating up to $1,100,000 upon the achievement of additional specified annual net sales thresholds starting at $1,000,000. The Company has also agreed to pay tiered royalties on escalating tiers of annual net sales of licensed products starting in the low double digit percentages and ending at twenty percent. Royalty rates are subject to reductions upon certain events.

The Company is solely responsible for all development, manufacturing, and commercial activities and costs of the licensed products, including clinical studies or other tests necessary to support the use of a licensed product. The Company is also responsible for costs related to the filing, prosecution and maintenance of the licensed patent rights.

The MedImmune Agreement will expire upon the expiration of the royalty term in the last country for the last indication, as defined in the agreement. Either party may terminate the agreement upon the other party’s insolvency or bankruptcy or for material breach of the agreement by the other party that remains uncured for 90 days. MedImmune has the right to terminate the agreement if the Company challenges any of the licensed patent rights. The Company may terminate the agreement at any time upon 90 days’ prior written notice.

During the three months ended March 31, 2024 and 2023, the Company did not record research and development expense in connection with milestone payments due under the MedImmune Agreement.

Inventory (Tables)

3 Months Ended

Mar. 31, 2024

Inventory

Schedule of inventory


	March 31,		December 31,
	2024		2023
Raw materials	$	2,052	$	—
Semi-finished goods		8,721		18,258
Finished goods		17,531		12,864
Total inventory	$	28,304	$	31,122
Balance Sheet Classification:
Inventory	$	27,278	$	31,122
Other long-term assets		1,026		—
Total inventory	$	28,304	$	31,122

Intangible Assets

3 Months Ended

Mar. 31, 2024

Intangible Assets

Intangible Assets

6. Intangible Assets

Intangible assets, net of accumulated amortization as of March 31, 2024 and December 31, 2023 are summarized in the following table.


		As of March 31, 2024						As of December 31, 2023
	Estimated			Accumulated						Accumulated
	life	Cost		Amortization		Net		Cost		Amortization		Net
Regulatory milestone	20 years	$	20,000	$	3,000	$	17,000	$	20,000	$	2,750	$	17,250

License and Acquisition Agreements - Biogen Asset Purchase Agreement (Details) - USD ($) $ in Thousands	1 Months Ended			3 Months Ended
	Sep. 30, 2022	Sep. 30, 2017	Sep. 30, 2016	Mar. 31, 2024	Mar. 31, 2023
License and Acquisition Agreements
Uncured period which causes termination of the agreement, due to insolvency or bankruptcy or for material breach of the agreement by the other party that remains uncured		90 days
Notice period to terminate the agreement under payment-related breaches		30 days
Research and development				$ 26,334	$ 15,172
Maximum
License and Acquisition Agreements
Royalty rate increase (percentage)	1.00%
Asset Purchase Agreement \| Biogen
License and Acquisition Agreements
Remaining milestone payments to be paid upon clinical and regulatory milestone achievement				165,000
Maximum aggregate obligation to pay insignificant annual maintenance fees as well as clinical and regulatory milestone payments			$ 1,575
Notice period to terminate the agreement			90 days
Uncured period which causes termination of the agreement, due to insolvency or bankruptcy or for material breach of the agreement by the other party that remains uncured			90 days
Notice period to terminate the agreement under payment-related breaches			30 days
Research and development				61	$ 0
Asset Purchase Agreement \| Biogen \| Maximum
License and Acquisition Agreements
Milestone payment to be paid upon clinical and regulatory milestone achievement				179,000
Milestone payment to be paid upon net sales milestone achievement				$ 150,000

Share Based Compensation (Details) - shares		3 Months Ended
Share Based Compensation (Details) - shares	Jan. 01, 2024	Mar. 31, 2024	Dec. 31, 2023
Restricted Share Units (RSUs)
Share-based compensation
RSUs Granted		41,410
Employee Stock Option [Member] \| Class A common shares
Share-based compensation
Shares outstanding (in shares)		11,238,965	11,599,089
Number of options granted		26,750
2018 Plan
Share-based compensation
Number of common shares available for future grant		4,207,733
2018 Plan \| Class A common shares \| Maximum
Share-based compensation
Additional shares authorized	2,818,425
2015 Plan \| Class A common shares
Share-based compensation
Shares outstanding (in shares)		1,814,958
2018 ESPP \| Class A common shares
Share-based compensation
Number of common shares available for future grant		702,707
2018 ESPP \| Class A common shares \| Maximum
Share-based compensation
Additional shares authorized	215,000

License and Acquisition Agreements - Regeneron License Agreement (Details) - USD ($) $ in Thousands	1 Months Ended	3 Months Ended
	Sep. 30, 2017	Mar. 31, 2024	Mar. 31, 2023	Dec. 31, 2023
License and Acquisition Agreements
Research and development		$ 26,334	$ 15,172
Uncured period which causes termination of the agreement, due to insolvency or bankruptcy or for material breach of the agreement by the other party that remains uncured	90 days
Notice period to terminate the agreement under payment-related breaches	30 days
Consecutive suspension of activities period for termination of agreement	12 months
Notice period to terminate the agreement	1 year
Notice period to terminate the agreement if products are having safety concerns	3 months
Commercial product inventory		27,278		$ 31,122
Regulatory milestone
License and Acquisition Agreements
Intangible asset - Regulatory milestone		20,000		20,000
Regeneron \| License Agreement
License and Acquisition Agreements
Profit sharing recognized		20,123	8,288
Regeneron \| Clinical Supply Agreement
License and Acquisition Agreements
Research and development		0	$ 0
Commercial product inventory		$ 26,252		$ 31,122

Net Loss per Share (Tables)

3 Months Ended

Mar. 31, 2024

Net Loss per Share

Schedule of basic and diluted net loss attributable to common shareholders


	Three Months Ended
	March 31,
	2024		2023
Numerator:
Net loss attributable to common shareholders	$	(17,704)	$	(12,270)
Denominator:
Weighted-average shares outstanding - basic and diluted		70,633,023		69,751,697
Basic and diluted net loss per share	$	(0.25)	$	(0.18)

Schedule of anti-dilutive securities excluded from the computation of diluted EPS per share attributable to common shareholders


	Three Months Ended
	March 31,
	2024		2023
Share options to purchase common shares		11,238,965		10,084,986
Unvested RSUs		2,261,258		1,656,077
Total anti-dilutive shares		13,500,223		11,741,063

Property and Equipment, Net (Tables)

3 Months Ended

Mar. 31, 2024

Property and Equipment, Net

Schedule of property and equipment, net


	March 31,		December 31,
	2024		2023
Furniture, fixtures and vehicles	$	224	$	224
Computer hardware and software		379		379
Leasehold improvements		3,931		3,931
Lab equipment		4,074		3,972
Construction in progress		43		13
Total property and equipment		8,651		8,519
Less: Accumulated depreciation		(7,939)		(7,785)
Total property and equipment, net	$	712	$	734

Fair Value of Financial Assets and Liabilities (Tables)

3 Months Ended

Mar. 31, 2024

Fair Value of Financial Assets and Liabilities

Schedule of financial assets and liabilities measured at fair value on a recurring basis


	Fair Value Measurements
	as of March 31, 2024 Using:
	Level 1		Level 2		Level 3		Total
Assets:
Cash equivalents — money market funds	$	114,419	$	—	$	—	$	114,419
Cash equivalents — U.S. Treasury notes		—		6,358		—		6,358
Short-term investments — U.S. Treasury notes		—		72,474		—		72,474
	$	114,419	$	78,832	$	—	$	193,251


	Fair Value Measurements
	as of December 31, 2023 Using:
	Level 1		Level 2		Level 3		Total
Assets:
Cash equivalents — money market funds	$	43,554	$	—	$	—	$	43,554
Cash equivalents — U.S. Treasury notes		—		1,995		—		1,995
Short-term investments — U.S. Treasury notes		—		98,417		—		98,417
	$	43,554	$	100,412	$	—	$	143,966

Schedule of short-term investments


			Gross		Gross
	Amortized		Unrealized		Unrealized		Credit		Fair
	Cost		Gains		Losses		Losses		Value
March 31, 2024
Cash equivalents — U.S. Treasury notes	$	6,358	$	—	$	—	$	—	$	6,358
Short-term investments — U.S. Treasury notes		72,482		1		(9)		—		72,474
	$	78,840	$	1	$	(9)	$	—	$	78,832


			Gross		Gross
	Amortized		Unrealized		Unrealized		Credit		Fair
	Cost		Gains		Losses		Losses		Value
December 31, 2023
Cash equivalents — U.S. Treasury notes	$	1,995	$	—	$	—	$	—	$	1,995
Short-term investments — U.S. Treasury notes		98,387		30		—		—		98,417
	$	100,382	$	30	$	—	$	—	$	100,412

- Definition

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

+ References

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

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

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

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

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

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

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

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

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

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

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

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

+ Details

Accrued Expenses

3 Months Ended

Mar. 31, 2024

Accrued Expenses

Accrued Expenses

7. Accrued Expenses

Accrued expenses consisted of the following:


	March 31,		December 31,
	2024		2023
Accrued research and development expenses	$	11,028	$	7,895
Accrued employee compensation and benefits		7,317		15,954
Accrued collaboration expenses		20,123		16,939
Accrued legal, commercial and professional fees		5,840		3,553
Other		410		326
	$	44,718	$	44,667

Out-Licensing Agreements (Details) $ in Thousands	1 Months Ended		3 Months Ended			12 Months Ended
Out-Licensing Agreements (Details) $ in Thousands	Sep. 30, 2022 USD ($) item	Feb. 28, 2022 USD ($) agreement item	Mar. 31, 2024 USD ($)	Mar. 31, 2023 USD ($)	Dec. 31, 2022 USD ($)	Dec. 31, 2023 USD ($)	Dec. 31, 2022 USD ($)
Collaborative agreements
Revenue			$ 79,858	$ 48,345
License and collaboration revenue
Collaborative agreements
Revenue			973	5,686
Collaboration Agreements
Collaborative agreements
Upfront payments received		$ 22,000
Number of agreements entered into \| agreement		2
Term of agreement for royalty payments		12 years
Territory License - Rilonacept
Collaborative agreements
Upfront payments received		$ 12,000		12,000
Transaction price		$ 12,000
Number of performance obligations in an agreement \| item		1
Payments to be received by the company upon the achievement of specified development, regulatory and sales milestones		$ 70,000
Territory License - Rilonacept \| Non-current deferred revenue
Collaborative agreements
Transaction price			11,811
Territory License - Rilonacept \| License and collaboration revenue
Collaborative agreements
Revenue			189	0
Territory License - Mavrilimumab
Collaborative agreements
Upfront payments received		10,000
Transaction price		10,000
Payments to be received by the company upon the achievement of specified development, regulatory and sales milestones		$ 576,000
Territory License - Mavrilimumab \| License and collaboration revenue
Collaborative agreements
Revenue							$ 10,000
Worldwide License - Vixarelimab
Collaborative agreements
Upfront payments received	$ 80,000
Payments received upon delivery of certain materials						$ 20,000
Milestone receipts						15,000
Transaction price	$ 80,000
Addition to transaction price			10,000		$ 20,000	$ 25,000
Number of performance obligations in an agreement \| item	4
Payments to be received by the company upon the achievement of specified development, regulatory and sales milestones			575,000
Worldwide License - Vixarelimab \| Maximum
Collaborative agreements
Payments to be received by the company upon the achievement of specified development, regulatory and sales milestones	$ 600,000
Worldwide License - Vixarelimab \| License and collaboration revenue
Collaborative agreements
Revenue			$ 105	$ 5,686

Product Revenue, Net - Revenue Related Reserves in Balance Sheet (Details) - USD ($) $ in Thousands	Mar. 31, 2024	Dec. 31, 2023
Revenue-related reserves
Revenue-related reserves	$ 9,109	$ 6,138
Accounts receivable, net
Revenue-related reserves
Revenue-related reserves	(411)	(459)
Other current liabilities
Revenue-related reserves
Revenue-related reserves	$ 9,520	$ 6,597

Fair Value of Financial Assets and Liabilities

3 Months Ended

Mar. 31, 2024

Fair Value of Financial Assets and Liabilities

Fair Value of Financial Assets and Liabilities

2. Fair Value of Financial Assets and Liabilities

Financial assets and liabilities carried at fair value are to be classified and disclosed in one of the following three levels of the fair value hierarchy, of which the first two are considered observable and the last is considered unobservable:

●

Level 1—Quoted prices in active markets for identical assets or liabilities.

●

Level 2—Observable inputs (other than Level 1 quoted prices), such as quoted prices in active markets for similar assets or liabilities, quoted prices in markets that are not active for identical or similar assets or liabilities, or other inputs that are observable or can be corroborated by observable market data.

●

Level 3—Unobservable inputs that are supported by little or no market activity that are significant to determining the fair value of the assets or liabilities, including pricing models, discounted cash flow methodologies and similar techniques.

The following tables present information about the Company’s financial instruments measured at fair value on a recurring basis and indicate the level of the fair value hierarchy used to determine such fair values:


	Fair Value Measurements
	as of March 31, 2024 Using:
	Level 1		Level 2		Level 3		Total
Assets:
Cash equivalents — money market funds	$	114,419	$	—	$	—	$	114,419
Cash equivalents — U.S. Treasury notes		—		6,358		—		6,358
Short-term investments — U.S. Treasury notes		—		72,474		—		72,474
	$	114,419	$	78,832	$	—	$	193,251


	Fair Value Measurements
	as of December 31, 2023 Using:
	Level 1		Level 2		Level 3		Total
Assets:
Cash equivalents — money market funds	$	43,554	$	—	$	—	$	43,554
Cash equivalents — U.S. Treasury notes		—		1,995		—		1,995
Short-term investments — U.S. Treasury notes		—		98,417		—		98,417
	$	43,554	$	100,412	$	—	$	143,966

During the three months ended March 31, 2024 and the year ended December 31, 2023, there were no transfers between Level 1, Level 2 and Level 3. The money market funds were valued using quoted prices in active markets, which represent a Level 1 measurement in the fair value hierarchy. The Company’s cash equivalents and short-term investments as of March 31, 2024 and December 31, 2023 included U.S. Treasury notes, which are not traded on a daily basis and, therefore, represent a Level 2 measurement in the fair value hierarchy at each period end.


			Gross		Gross
	Amortized		Unrealized		Unrealized		Credit		Fair
	Cost		Gains		Losses		Losses		Value
March 31, 2024
Cash equivalents — U.S. Treasury notes	$	6,358	$	—	$	—	$	—	$	6,358
Short-term investments — U.S. Treasury notes		72,482		1		(9)		—		72,474
	$	78,840	$	1	$	(9)	$	—	$	78,832


			Gross		Gross
	Amortized		Unrealized		Unrealized		Credit		Fair
	Cost		Gains		Losses		Losses		Value
December 31, 2023
Cash equivalents — U.S. Treasury notes	$	1,995	$	—	$	—	$	—	$	1,995
Short-term investments — U.S. Treasury notes		98,387		30		—		—		98,417
	$	100,382	$	30	$	—	$	—	$	100,412

As of March 31, 2024, we consider the unrealized losses in our investment portfolio to be temporary in nature and not due to credit losses. We have the ability to hold such investments until recovery of the fair value. We utilize the specific identification method in computing realized gains and losses. We had no realized gains and losses on our available-for-sale securities for the three and three months ended March 31, 2024 or 2023.

- Definition

The entire disclosure for the fair value of financial instruments (as defined), including financial assets and financial liabilities (collectively, as defined), and the measurements of those instruments as well as disclosures related to the fair value of non-financial assets and liabilities. Such disclosures about the financial instruments, assets, and liabilities would include: (1) the fair value of the required items together with their carrying amounts (as appropriate); (2) for items for which it is not practicable to estimate fair value, disclosure would include: (a) information pertinent to estimating fair value (including, carrying amount, effective interest rate, and maturity, and (b) the reasons why it is not practicable to estimate fair value; (3) significant concentrations of credit risk including: (a) information about the activity, region, or economic characteristics identifying a concentration, (b) the maximum amount of loss the entity is exposed to based on the gross fair value of the related item, (c) policy for requiring collateral or other security and information as to accessing such collateral or security, and (d) the nature and brief description of such collateral or security; (4) quantitative information about market risks and how such risks are managed; (5) for items measured on both a recurring and nonrecurring basis information regarding the inputs used to develop the fair value measurement; and (6) for items presented in the financial statement for which fair value measurement is elected: (a) information necessary to understand the reasons for the election, (b) discussion of the effect of fair value changes on earnings, (c) a description of [similar groups] items for which the election is made and the relation thereof to the balance sheet, the aggregate carrying value of items included in the balance sheet that are not eligible for the election; (7) all other required (as defined) and desired information.

+ References + Details

Property and Equipment, Net

3 Months Ended

Mar. 31, 2024

Property and Equipment, Net

Property and Equipment, Net

5. Property and Equipment, Net

Property and equipment, net consisted of the following:


	March 31,		December 31,
	2024		2023
Furniture, fixtures and vehicles	$	224	$	224
Computer hardware and software		379		379
Leasehold improvements		3,931		3,931
Lab equipment		4,074		3,972
Construction in progress		43		13
Total property and equipment		8,651		8,519
Less: Accumulated depreciation		(7,939)		(7,785)
Total property and equipment, net	$	712	$	734

Depreciation expense was $154 and $289 during the three months ended March 31, 2024 and 2023, respectively.

As of March 31, 2024 and December 31, 2023, $116 and $122, respectively, of our property and equipment, net was in the United Kingdom.

CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2024	Mar. 31, 2023
Cash flows from operating activities:
Net loss	$ (17,704)	$ (12,270)
Adjustments to reconcile net loss to net cash provided by operating activities:
Depreciation and amortization expense	466	596
Share-based compensation expense	7,206	6,115
Non-cash lease expense	779	841
Amortization of premiums and accretion of discounts on short-term investments	297	(1,061)
Loss on disposal of property and equipment		175
Deferred income taxes	4,365	1,077
Changes in operating assets and liabilities:
Prepaid expenses and other current assets	3,750	(2,634)
Accounts receivable, net	5,271	5,236
Inventory	3,844	(1,826)
Contract asset		7,656
Other long-term assets	(3,362)	3,268
Accounts payable	(2,662)	(6,508)
Accrued expenses and other current liabilities	3,285	(10,647)
Operating lease liabilities	(1,287)	(988)
Deferred revenue	(294)	6,658
Other long-term liabilities	33	45
Net cash provided by (used in) operating activities	3,987	(4,267)
Cash flows from investing activities:
Purchases of property and equipment	(84)	(24)
Purchases of short-term investments	(36,276)	(52,896)
Proceeds from the maturities of short-term investments	61,884	15,000
Net cash provided by (used in) investing activities	25,524	(37,920)
Cash flows from financing activities:
Proceeds from issuance of Class A common shares under incentive award plans and employee share purchase plan	3,994	510
Payments in connection with Common Stock tendered for employee tax obligations	(381)	(420)
Net cash provided by financing activities	3,613	90
Net increase (decrease) in cash and cash equivalents	33,124	(42,097)
Cash and cash equivalents at beginning of period	107,954	122,715
Cash and cash equivalents at end of period	141,078	80,618
Supplemental information:
Cash paid for income taxes		3,196
Supplemental disclosure of non-cash investing and financing activities:
Change in right-of-use asset as a result of new, modified, and terminated leases	1,172	$ 684
Additions to property and equipment included in accounts payable and accrued expenses and other liabilities	$ 102

Accrued Expenses (Tables)

3 Months Ended

Mar. 31, 2024

Accrued Expenses

Schedule of accrued expenses


	March 31,		December 31,
	2024		2023
Accrued research and development expenses	$	11,028	$	7,895
Accrued employee compensation and benefits		7,317		15,954
Accrued collaboration expenses		20,123		16,939
Accrued legal, commercial and professional fees		5,840		3,553
Other		410		326
	$	44,718	$	44,667

Share-Based Compensation (Tables)

3 Months Ended

Mar. 31, 2024

Share-Based Compensation

Schedule of share option activity under the Plans


		Weighted
	Number of	Average
	Shares	Exercise Price
Outstanding as of December 31, 2023	11,599,089	$	13.67
Granted	26,750	$	18.73
Exercised	(282,269)	$	12.38
Forfeited	(104,605)	$	14.21
Outstanding as of March 31, 2024	11,238,965	$	13.71
Share options exercisable as of March 31, 2024	7,489,111	$	13.67
Share options unvested as of March 31, 2024	3,749,854	$	13.71

Schedule of restricted share activity


		Weighted
		Average
	Number of	Grant Date
	Shares	Fair Value
Unvested RSUs as of December 31, 2023	2,396,888	$	14.00
Granted	41,410	$	18.59
Vested	(55,014)	$	18.57
Forfeited	(122,026)	$	14.12
Unvested RSUs as of March 31, 2024	2,261,258	$	13.96

Schedule of share-based compensation expense was classified in the consolidated statements of operations and comprehensive loss


	Three Months Ended
	March 31,
	2024		2023
Cost of goods sold	$	359	$	286
Research and development expenses		1,453		1,444
Selling, general and administrative expenses		5,394		4,385
	$	7,206	$	6,115

Intangible Assets - Finite-lived Intangible Assets (Details) - USD ($) $ in Thousands	Mar. 31, 2024	Dec. 31, 2023
Intangible Assets
Net	$ 17,000	$ 17,250
Regulatory milestone
Intangible Assets
Estimated life	20 years
Cost	$ 20,000	20,000
Accumulated Amortization	3,000	2,750
Net	$ 17,000	$ 17,250

Share-Based Compensation - Options (Details) - Employee Stock Option [Member] $ / shares in Units, $ in Thousands	3 Months Ended
	Mar. 31, 2024 USD ($) $ / shares shares
Weighted Average Grant Date Fair Value
Total unrecognized compensation cost \| $	$ 30,915
Expenses expected to be recognized over a weighted average remaining period	2 years 5 months 1 day
Class A common shares
Number of Shares
Outstanding, beginning of the period \| shares	11,599,089
Granted \| shares	26,750
Exercised \| shares	(282,269)
Forfeited \| shares	(104,605)
Outstanding, end of the period \| shares	11,238,965
Options exercisable \| shares	7,489,111
Options unvested \| shares	3,749,854
Weighted Average Grant Date Fair Value
Outstanding, beginning of the period \| $ / shares	$ 13.67
Granted \| $ / shares	18.73
Exercised \| $ / shares	12.38
Forfeited \| $ / shares	14.21
Outstanding, end of the period \| $ / shares	13.71
Options exercisable \| $ / shares	13.67
Options unvested \| $ / shares	$ 13.71

CONSOLIDATED STATEMENTS OF SHAREHOLDERS' EQUITY - USD ($) $ in Thousands	Common Shares	Additional Paid-In Capital	Accumulated Other Comprehensive Income (Loss)	Accumulated Deficit	Total
Balance at the beginning of the period at Dec. 31, 2022	$ 19	$ 888,120	$ 44	$ (492,034)	$ 396,149
Balance at the beginning of the period (in shares) at Dec. 31, 2022	69,697,503
Changes in equity
Issuance of Class A common shares under incentive award plans		90			90
Issuance of Class A common shares under incentive award plans (in shares)	135,576
Share-based compensation expense		6,115			6,115
Unrealized gain (loss) on short-term investments and currency translation adjustments			11		11
Net Income (Loss)				(12,270)	(12,270)
Balance at the end of the period at Mar. 31, 2023	$ 19	894,325	55	(504,304)	390,095
Balance at the end of the period (in shares) at Mar. 31, 2023	69,833,079
Balance at the beginning of the period at Dec. 31, 2023	$ 20	916,763	6	(477,950)	438,839
Balance at the beginning of the period (in shares) at Dec. 31, 2023	70,460,617
Changes in equity
Issuance of Class A common shares under incentive award plans		3,613			3,613
Issuance of Class A common shares under incentive award plans (in shares)	358,479
Share-based compensation expense		7,206			7,206
Unrealized gain (loss) on short-term investments and currency translation adjustments			(59)		(59)
Net Income (Loss)				(17,704)	(17,704)
Balance at the end of the period at Mar. 31, 2024	$ 20	$ 927,582	$ (53)	$ (495,654)	$ 431,895
Balance at the end of the period (in shares) at Mar. 31, 2024	70,819,096

- Definition

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

+ References

+ Details

- Definition

Amount of equity (deficit) attributable to parent. Excludes temporary equity and equity attributable to noncontrolling interest.

+ References

Reference 1: http://www.xbrl.org/2003/role/exampleRef
-Topic 852
-SubTopic 10
-Name Accounting Standards Codification
-Section 55
-Paragraph 10
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147481372/852-10-55-10

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+ Details

Fair Value of Financial Assets and Liabilities (Details) - USD ($) $ in Thousands	3 Months Ended	12 Months Ended
	Mar. 31, 2024	Dec. 31, 2023	Mar. 31, 2023
Assets:
Short-term investments	$ 78,832	$ 100,412
Short-term investments
Amortized Cost	78,840	100,382
Gross Unrealized Gains	1	30
Gross Unrealized Losses	(9)
Fair Value	78,832	100,412
Fair Value, Assets Transfers
Fair value of assets transferred from Level 1 to Level 2	0	0
Fair value of assets transferred from Level 2 to Level 1	0	0
Fair value of asset transfer into Level 3	0	0
Fair value of asset transfer out of Level 3	0	0
Securities in unrealized loss position	0		$ 0
U.S. Treasury Notes \| Cash equivalents
Assets:
Short-term investments	6,358	1,995
Short-term investments
Amortized Cost	6,358	1,995
Fair Value	6,358	1,995
U.S. Treasury Notes \| Short-term Investments
Assets:
Short-term investments	72,474	98,417
Short-term investments
Amortized Cost	72,482	98,387
Gross Unrealized Gains	1	30
Gross Unrealized Losses	(9)
Fair Value	72,474	98,417
Fair Value \| Recurring basis
Assets:
Assets	193,251	143,966
Fair Value \| Recurring basis \| Money Market Funds
Assets:
Cash equivalents	114,419	43,554
Fair Value \| Recurring basis \| U.S. Treasury Notes
Assets:
Cash equivalents	6,358	1,995
Short-term investments	72,474	98,417
Short-term investments
Fair Value	72,474	98,417
Fair Value \| Recurring basis \| Level 1
Assets:
Assets	114,419	43,554
Fair Value \| Recurring basis \| Level 1 \| Money Market Funds
Assets:
Cash equivalents	114,419	43,554
Fair Value \| Recurring basis \| Level 2
Assets:
Assets	78,832	100,412
Fair Value \| Recurring basis \| Level 2 \| U.S. Treasury Notes
Assets:
Cash equivalents	6,358	1,995
Short-term investments	72,474	98,417
Short-term investments
Fair Value	$ 72,474	$ 98,417

Net Loss per Share

3 Months Ended

Mar. 31, 2024

Net Loss per Share

Net Loss per Share

11. Net Loss per Share

The rights, including the liquidation and dividend rights, of the holders of Class A, Class B, Class A1 and Class B1 common shares are identical, except with respect to voting, transferability and conversion (see the Notes to Consolidated Financial Statements included in our Form 10-K). As the liquidation and dividend rights are identical, losses are allocated on a proportionate basis and the resulting net income (loss) per share attributed to common shareholders will, therefore, be the same for both Class A and Class B common shares on an individual or combined basis.

Basic and diluted net loss attributable to common shareholders was calculated as follows:


	Three Months Ended
	March 31,
	2024		2023
Numerator:
Net loss attributable to common shareholders	$	(17,704)	$	(12,270)
Denominator:
Weighted-average shares outstanding - basic and diluted		70,633,023		69,751,697
Basic and diluted net loss per share	$	(0.25)	$	(0.18)

The Company’s unvested RSUs have been excluded from the computation of basic net loss per share attributable to common shareholders.

The Company’s potentially dilutive securities, which include options and unvested RSUs, have been excluded from the computation of diluted net loss per share attributable to common shareholders as the effect would be to reduce the EPS attributable to common shareholders. Therefore, the weighted average number of common shares outstanding used to calculate both basic and diluted EPS attributable to common shareholders is the same. The Company excluded the following potential common shares, presented based on amounts outstanding at each period end, from the computation of diluted EPS attributable to common shareholders for the periods indicated because including them would have had an anti-dilutive effect:


	Three Months Ended
	March 31,
	2024		2023
Share options to purchase common shares		11,238,965		10,084,986
Unvested RSUs		2,261,258		1,656,077
Total anti-dilutive shares		13,500,223		11,741,063

Out-Licensing Agreements - Contract Assets and Liabilities (Details) $ in Thousands	3 Months Ended
	Mar. 31, 2024 USD ($)
Contract Liabilities:
Balance at Beginning of Period	$ 11,954
Balance at End of Period	11,811
Collaboration Agreements
Contract Liabilities:
Balance at Beginning of Period	12,261
Revenue Recognized	(294)
Balance at End of Period	11,967
Territory License - Rilonacept
Contract Liabilities:
Balance at Beginning of Period	12,000
Revenue Recognized	(189)
Balance at End of Period	11,811
Worldwide License - Vixarelimab
Contract Liabilities:
Balance at Beginning of Period	261
Revenue Recognized	(105)
Balance at End of Period	$ 156

Inventory

3 Months Ended

Mar. 31, 2024

Inventory

Inventory

4. Inventory

Inventory consisted of the following:


	March 31,		December 31,
	2024		2023
Raw materials	$	2,052	$	—
Semi-finished goods		8,721		18,258
Finished goods		17,531		12,864
Total inventory	$	28,304	$	31,122
Balance Sheet Classification:
Inventory	$	27,278	$	31,122
Other long-term assets		1,026		—
Total inventory	$	28,304	$	31,122

Intangible Assets (Tables)

3 Months Ended

Mar. 31, 2024

Intangible Assets

Schedule of intangible assets, net of accumulated amortization, impairment charges, and adjustments


		As of March 31, 2024						As of December 31, 2023
	Estimated			Accumulated						Accumulated
	life	Cost		Amortization		Net		Cost		Amortization		Net
Regulatory milestone	20 years	$	20,000	$	3,000	$	17,000	$	20,000	$	2,750	$	17,250

Document and Entity Information - shares	3 Months Ended
Document and Entity Information - shares	Mar. 31, 2024	Apr. 19, 2024
Document information
Document Type	10-Q
Document Quarterly Report	true
Document Transition Report	false
Document Period End Date	Mar. 31, 2024
Entity File Number	001-38492
Entity Registrant Name	Kiniksa Pharmaceuticals, Ltd.
Entity Incorporation, State or Country Code	D0
Entity Tax Identification Number	98-1327726
Entity Address, Address Line One	Clarendon House
Entity Address, Address Line Two	2 Church Street
Entity Address, City or Town	Hamilton
Entity Address, Country	BM
Entity Address, Postal Zip Code	HM11
City Area Code	808
Local Phone Number	451-3453
Title of 12(b) Security	Class A Common Shares
Trading Symbol	KNSA
Security Exchange Name	NASDAQ
Entity Current Reporting Status	Yes
Entity Interactive Data Current	Yes
Entity Filer Category	Accelerated Filer
Entity Small Business	false
Entity Emerging Growth Company	false
Entity Shell Company	false
Current Fiscal Year End Date	--12-31
Document Fiscal Year Focus	2024
Document Fiscal Period Focus	Q1
Entity Central Index Key	0001730430
Amendment Flag	false
Common Shares
Document information
Entity Common Stock, Shares Outstanding		70,940,145
Class A common shares
Document information
Entity Common Stock, Shares Outstanding		40,305,405
Class B common shares
Document information
Entity Common Stock, Shares Outstanding		1,795,158
Class A1 common shares
Document information
Entity Common Stock, Shares Outstanding		12,781,964
Class B1 common shares
Document information
Entity Common Stock, Shares Outstanding		16,057,618

Net Loss per Share - Anti-Dilutive Securities (Details) - shares	3 Months Ended
	Mar. 31, 2024	Mar. 31, 2023
Anti-dilutive securities excluded from computation of earnings per share
Total anti-dilutive shares	13,500,223	11,741,063
Employee Stock Option
Anti-dilutive securities excluded from computation of earnings per share
Total anti-dilutive shares	11,238,965	10,084,986
Unvested RSUs
Anti-dilutive securities excluded from computation of earnings per share
Total anti-dilutive shares	2,261,258	1,656,077

Income Taxes (Details) - USD ($) $ in Thousands	3 Months Ended
Income Taxes (Details) - USD ($) $ in Thousands	Mar. 31, 2024	Mar. 31, 2023
Bermuda statutory income tax rate	0.00%
Income tax benefits - Bermuda	$ 0
Net operating loss carryforwards - Bermuda	0
Provision for income taxes	3,428	$ 2,906
Non-cash deferred tax benefit	4,365	$ 1,077
Outside Kiniksa US, UK, and Switzerland
Material deferred tax assets	$ 0

- Definition

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

+ References + Details

Insider Trading Arrangements	3 Months Ended
Insider Trading Arrangements	Mar. 31, 2024
Trading Arrangements, by Individual
Rule 10b5-1 Arrangement Adopted	false
Non-Rule 10b5-1 Arrangement Adopted	false
Rule 10b5-1 Arrangement Terminated	false
Non-Rule 10b5-1 Arrangement Terminated	false

Net Loss per Share (Details) - USD ($) $ / shares in Units, $ in Thousands	3 Months Ended
	Mar. 31, 2024	Mar. 31, 2023
Numerator:
Net loss attributable to common shareholders	$ (17,704)	$ (12,270)
Denominator:
Weighted-average basic shares outstanding	70,633,023	69,751,697
Weighted-average diluted shares outstanding	70,633,023	69,751,697
Basic net loss per share	$ (0.25)	$ (0.18)
Diluted net loss per share	$ (0.25)	$ (0.18)

- Definition

The amount of net income (loss) for the period per each share of common stock or unit outstanding during the reporting period.

+ References

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- Definition

The amount of net income (loss) for the period available to each share of common stock or common unit outstanding during the reporting period and to each share or unit that would have been outstanding assuming the issuance of common shares or units for all dilutive potential common shares or units outstanding during the reporting period.

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+ Details

- Definition

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

+ References

+ Details

License and Acquisition Agreements - Beth Israel Deaconess Medical Center License Agreement (Details) - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2024	Mar. 31, 2023
License and Acquisition Agreements
Research and development	$ 26,334	$ 15,172
License Agreement \| BIDMC
License and Acquisition Agreements
Research and development	27	$ 0
License Agreement \| BIDMC \| Maximum
License and Acquisition Agreements
Milestone payment to be paid upon clinical and regulatory milestone achievement	$ 1,200

Property and Equipment, Net (Details) - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2024	Mar. 31, 2023	Dec. 31, 2023
Property and Equipment, Net
Total property and equipment	$ 8,651		$ 8,519
Less: Accumulated depreciation	(7,939)		(7,785)
Total property and equipment, net	712		734
Depreciation expense	154	$ 289
UK
Property and Equipment, Net
Total property and equipment, net	116		122
Furniture, fixtures, and vehicles
Property and Equipment, Net
Total property and equipment	224		224
Computer hardware and software
Property and Equipment, Net
Total property and equipment	379		379
Leasehold improvements
Property and Equipment, Net
Total property and equipment	3,931		3,931
Lab equipment
Property and Equipment, Net
Total property and equipment	4,074		3,972
Construction in progress
Property and Equipment, Net
Total property and equipment	$ 43		$ 13

Commitments and Contingencies (Details) $ in Thousands	Mar. 31, 2024 USD ($)
Manufacturing commitments
Non-cancelable purchase commitments	$ 148,039
Amount of purchase commitment obligation due within one year	$ 56,140

CONSOLIDATED BALANCE SHEETS - USD ($) $ in Thousands	Mar. 31, 2024	Dec. 31, 2023
Current assets:
Cash and cash equivalents	$ 141,078	$ 107,954
Short-term investments	72,474	98,417
Accounts receivable, net	15,995	21,266
Inventory	27,278	31,122
Prepaid expenses and other current assets	13,766	17,538
Total current assets	270,591	276,297
Property and equipment, net	712	734
Operating lease right-of-use assets	12,324	11,931
Other long-term assets	4,128	827
Intangible asset, net	17,000	17,250
Deferred tax assets	214,918	219,283
Total assets	519,673	526,322
Current liabilities:
Accounts payable	5,632	8,246
Accrued expenses	44,718	44,667
Deferred revenue	156	307
Operating lease liabilities	2,279	2,253
Other current liabilities	11,427	8,193
Total current liabilities	64,212	63,666
Non-current liabilities:
Non-current deferred revenue	11,811	11,954
Non-current operating lease liabilities	9,864	10,005
Other long-term liabilities	1,891	1,858
Total liabilities	87,778	87,483
Commitments and contingencies (Note 13)
Shareholders' equity:
Additional paid-in capital	927,582	916,763
Accumulated other comprehensive income (loss)	(53)	6
Accumulated deficit	(495,654)	(477,950)
Total shareholders' equity	431,895	438,839
Total liabilities and shareholders' equity	519,673	526,322
Class A common shares
Shareholders' equity:
Common stock value	11	10
Class B common shares
Shareholders' equity:
Common stock value	1	1
Class A1 common shares
Shareholders' equity:
Common stock value	4	5
Class B1 common shares
Shareholders' equity:
Common stock value	$ 4	$ 4