SEGMENT INFORMATION

6 Months Ended

Jun. 30, 2025

NOTE 11. SEGMENT INFORMATION

The Company operates in one segment, focusing on innovating, developing, and commercializing therapies using its autologous TIL cell therapies for patients with solid tumor cancers. The Company is executing the U.S. launch of Amtagvi^®, the first product within its autologous TIL cell therapy platform, while also marketing and distributing its Proleukin^® product used in the Amtagvi^® treatment regimen.

The Company’s Chief Operating Decision Maker (“CODM”) is the Chief Executive Officer, who uses net loss as measurement of segment loss and monitors results against budget to evaluate and assess performance of the Company and resource allocation within the Company. The measure of segment assets is reported on the balance sheet as total consolidated assets.

The table below highlights the Company’s revenue, expenses and net loss for the segment and is reconciled to net loss on a consolidated basis for the three and six months ended June 30, 2025 and 2024.


	Three Months Ended				Six Months Ended
	June 30,					June 30,
(in thousands)	2025		2024		2025		2024
Net sales	$	59,952	$	31,106	$	109,276	$	31,821

Direct cost of goods sold (a)	$	49,798	$	21,726	$	92,861	$	24,407
Acquisition related cost of sales (b)	$	5,637	$	5,432	$	10,989	$	10,012
Royalties	$	1,229	$	4,210	$	2,555	$	4,210

Total cost of sales	$	56,664	$	31,368	$	106,405	$	38,629

Expenses

Research and development	$	71,314	$	45,448	$	135,802	$	115,734
General and administrative	$	21,275	$	17,600	$	43,532	$	35,562
Sales and marketing	$	9,990	$	6,774	$	21,080	$	11,929
Other segment items (c)	$	12,367	$	27,017	$	30,278	$	40,044

Total expenses	$	114,946	$	96,839	$	230,692	$	203,269

Net loss	$	(111,658)	$	(97,101)	$	(227,821)	$	(210,077)


a)	Direct cost of goods sold represents inventory and period costs related to overhead and manufacturing costs of Amtagvi^® as well as costs associated with the purchases and sales of Proleukin^®. Also included are manufacturing and period costs incurred for Amtagvi^® that do not meet specifications or a patient is unable to receive the infusion (i.e., scrap) unless they can be administered as part of a clinical trial in an expanded or early access program, or single-patient IND, in which cases related costs are recorded as research and development expenses based on the fact the Company receives clinical data related to these infusions. This category is provided to the CODM on a quarterly basis in comparison to that of previous quarters for review as these costs are controllable costs that indicate operating performance of the Company.
b)	Acquisition related cost of sales represents amortization expenses for the developed technology intangible assets and the milestone payment recorded as part of the acquisition of Proleukin^® and the fair value step-up of acquired Proleukin^® inventory which is recognized as the acquired inventory units are sold. This category is provided to the CODM on a quarterly basis as costs in this category are often reviewed separately in evaluating the performance of the Company because these costs are fixed and uncontrollable costs in nature, and do not affect cashflows of the Company.
c)	Other segment items include costs that are not considered significant expense segments nor reviewed by the CODM on a regular basis. Such amount includes stock-based compensation expenses, interest income, other income and expenses, and income tax benefits.

- Definition

The entire disclosure for reporting segments including data and tables. Reportable segments include those that meet any of the following quantitative thresholds a) it's reported revenue, including sales to external customers and intersegment sales or transfers is 10 percent or more of the combined revenue, internal and external, of all operating segments b) the absolute amount of its reported profit or loss is 10 percent or more of the greater, in absolute amount of 1) the combined reported profit of all operating segments that did not report a loss or 2) the combined reported loss of all operating segments that did report a loss c) its assets are 10 percent or more of the combined assets of all operating segments.

+ References

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+ Details

IOVANCE BIOTHERAPEUTICS, INC. 10-Q