10-Q: ImmunityBio Q2 Revenue Soars on ANKTIVA Sales, UK Approval

ImmunityBio reports significant Q2 2025 revenue growth driven by ANKTIVA sales and secures UK marketing authorization, while navigating ongoing regulatory and financial challenges.

Summary

• Product revenue, net, increased significantly to $42.9 million for the six months ended June 30, 2025, up from $0.99 million in the same period of 2024, following the April 2024 FDA approval of ANKTIVA.
• Total revenue for the six months ended June 30, 2025, was $42.94 million, a substantial increase from $1.09 million in the prior year period.
• Net loss attributable to common stockholders decreased to $222.2 million for the six months ended June 30, 2025, compared to $268.7 million for the same period in 2024.
• Operating loss improved to $135.7 million for the six months ended June 30, 2025, from $194.5 million in the prior year period.
• Selling, general and administrative expenses decreased by $16.1 million for the six months ended June 30, 2025, primarily due to lower legal expenses and consulting costs.
• Cash and cash equivalents, and marketable securities totaled $153.7 million as of June 30, 2025.
• The UK's MHRA granted marketing authorization for ANKTIVA in combination with BCG for BCG-unresponsive NMIBC with CIS in July 2025, marking the first approval outside the U.S.
• The company received a Refuse to File (RTF) letter from the FDA in May 2025 for its sBLA for papillary-only NMIBC, with the FDA requiring a randomized controlled trial against chemotherapy.
• Full enrollment of 186 patients was achieved in the randomized NCI cancer prevention clinical trial using ANKTIVA in combination with adenovirus vaccine in Lynch Syndrome patients.
• An Expanded Access Program (EAP) for lymphopenia in solid tumor patients who failed first-line treatment has been activated.
• A securities class action lawsuit was fully resolved with a $10.5 million settlement, of which the company paid the remaining $4.5 million in Q2 2025.
• Shareholder derivative actions were preliminarily approved for settlement, involving corporate governance reforms and attorneys' fees, with a final approval hearing set for November 4, 2025.
• A new derivative action was filed in November 2024, alleging unfairness in September 2023 financing transactions with Dr. Soon-Shiong and affiliates, with a motion to dismiss filed in July 2025.
• The company has an accumulated deficit of $3.6 billion as of June 30, 2025, and negative cash flows from operations of $165.7 million for the six months ended June 30, 2025.
• Substantial doubt exists regarding the company's ability to continue as a going concern without additional funding or financial support, though management believes existing resources and potential affiliated entity support will suffice for at least the next 12 months.

Sentiment

Score: 4

Explanation: While there's strong revenue growth from ANKTIVA and a key UK approval, the significant accumulated deficit, ongoing negative cash flow, and the FDA's RTF for a key indication requiring a randomized trial introduce substantial uncertainty and financial risk. The reliance on related-party funding and manufacturing facility issues also weigh on the sentiment.

Positives

• Product revenue, net, increased significantly to $42.9 million for the six months ended June 30, 2025, from $0.99 million in the prior year, demonstrating strong commercialization progress for ANKTIVA.
• Total revenue for Q2 2025 grew by 60% from Q1 2025, reaching $26.4 million, indicating positive sales momentum.
• ANKTIVA unit sales volume increased by 246% in the first half of 2025 compared to the second half of 2024, following the J-code implementation.
• Net loss attributable to common stockholders decreased by $46.47 million for the six months ended June 30, 2025, compared to the same period in 2024, reflecting improved financial performance.
• Operating loss decreased by $58.8 million for the six months ended June 30, 2025, indicating better operational efficiency.
• Selling, general and administrative expenses decreased by $16.1 million for the six months ended June 30, 2025, primarily due to lower legal expenses and insourcing of consulting activities.
• The UK's MHRA granted marketing authorization for ANKTIVA in combination with BCG for BCG-unresponsive NMIBC with CIS in July 2025, expanding market access outside the U.S.
• Full enrollment was achieved in the NCI cancer prevention clinical trial for Lynch Syndrome, a significant milestone for this program.
• The FDA's Division of Non-Malignant Hematology expressed support for the lymphopenia program findings and a desire for an efficient path to approval.
• An EAP for lymphopenia in solid tumor patients with low absolute lymphocyte counts has been activated.
• The securities class action lawsuit was fully resolved with a $10.5 million settlement, with a significant portion covered by insurers.
• Shareholder derivative actions were preliminarily approved for settlement, including corporate governance reforms, which could enhance investor confidence.

Negatives

• The company had an accumulated deficit of $3.6 billion as of June 30, 2025, indicating substantial historical losses.
• Negative cash flows from operations amounted to $165.7 million for the six months ended June 30, 2025, highlighting continued cash burn.
• Substantial doubt exists regarding the company's ability to continue as a going concern without additional funding or financial support.
• The FDA issued a Refuse to File (RTF) letter in May 2025 for the sBLA for papillary-only NMIBC, requiring a randomized controlled trial against chemotherapy, which could significantly delay approval and increase costs.
• The company is re-evaluating its regulatory strategy for papillary NMIBC, including potentially withdrawing and resubmitting the sBLA or amending the initial filing, indicating uncertainty and potential further delays.
• Total liabilities increased to $971.9 million as of June 30, 2025, from $871.1 million as of December 31, 2024.
• The related-party convertible note payable increased to $492.1 million as of June 30, 2025, from $461.9 million as of December 31, 2024.
• The revenue interest liability increased to $307.0 million as of June 30, 2025, from $284.4 million as of December 31, 2024.
• Warrant liabilities significantly increased to $67.0 million as of June 30, 2025, from $8.6 million as of December 31, 2024, due to new warrant issuances.
• The Dunkirk Facility, a key manufacturing asset, has ongoing construction needs (estimated 12-18 months to complete) and is subject to a dispute with the general contractor and Athenex's bankruptcy proceedings.
• The company received a written notice of non-compliance with the initial employee headcount requirement for the Dunkirk Facility, risking loss of access to the facility.
• The ongoing shortage of TICE BCG in the U.S. may adversely impact market uptake of ANKTIVA and delay clinical trials, as ANKTIVA is administered in combination with BCG.
• The Carlson derivative action alleges unfairness in related-party financing transactions with Dr. Soon-Shiong, potentially impacting corporate governance and investor perception.
• The Washington State Attorney General is investigating the company's relationship with Access to Advanced Health Institute (AAHI), which could lead to further legal or reputational issues.

Risks

• The company has a history of operating losses and expects to continue incurring losses, making future profitability uncertain.
• Additional financing is needed to fund operations, commercialization of ANKTIVA, and development of other product candidates, with no assurance of timely or favorable terms.
• The Revenue Interest Purchase Agreement (RIPA) imposes significant payment obligations and restrictive covenants, which could adversely affect financial position and limit flexibility.
• The substantial debt and revenue interest liability could adversely affect cash flows and limit the ability to raise additional capital.
• The value of outstanding warrants and the revenue interest liability are subject to material fluctuations based on stock price or projected sales, impacting financial results and stock price.
• The company has limited experience as a commercial company, and sales, marketing, and distribution efforts for ANKTIVA may be unsuccessful or less successful than anticipated.
• Development of product candidates in combination with other therapies exposes the company to risks related to the availability, safety, and regulatory status of those combination agents (e.g., BCG shortage).
• Clinical trials may fail to adequately demonstrate safety and efficacy, leading to delays or prevention of regulatory approval.
• Projections regarding market opportunities for ANKTIVA and other product candidates may be inaccurate, leading to smaller than estimated markets.
• Interim or preliminary clinical trial data may change as more patient data becomes available, potentially harming business prospects.
• Clinical trials may be delayed, take longer, or cost more than projected, potentially shortening patent protection and allowing competitors to enter the market sooner.
• Approved products may cause undesirable side effects or have other safety risks, leading to halted development, delayed approval, or limited commercial potential.
• Manufacturing of products is complex, and difficulties in production, quality control, or cGMP compliance could delay supply or increase costs.
• Reliance on sole or limited source vendors for reagents and specialized equipment could impair manufacturing and supply.
• Novel approaches to treatment (immunotherapy) face uncertainties regarding development, market acceptance, public opinion, and third-party reimbursement.
• Product liability lawsuits could result in substantial liabilities and limit commercialization.
• Intense competition from other biotechnology and pharmaceutical companies, many with greater resources, could adversely affect market share and pricing.
• Failure to obtain or maintain patent protection and other proprietary rights could impair competitive ability and profitability.
• Third-party claims of intellectual property infringement could prevent or delay development and commercialization.
• Changes in U.S. patent law could diminish the value of patents.
• Failure to comply with obligations in license agreements could lead to loss of important license rights.
• Limited foreign intellectual property rights may hinder protection in international markets.
• Claims that employees or consultants wrongfully used trade secrets could harm business.
• Inability to license or acquire new intellectual property rights could impede product development.
• Failure to obtain patent term extension or data exclusivity could materially harm the business.
• The Dunkirk Facility, a public-private partnership, faces construction delays, an ongoing dispute with the general contractor, and a notice of non-compliance with employee headcount, risking loss of access and potential recoupment of grant funding.
• The company is subject to U.S. and foreign export/import controls, sanctions, anti-corruption, and data export laws, with non-compliance leading to significant penalties.
• Changes in tariff and trade policies, particularly with China, could increase costs, disrupt supply chains, or decrease demand.
• Non-compliance with state, national, and international privacy and security laws could lead to enforcement actions and penalties.
• Compliance with environmental, health, and safety laws is required, with failure leading to significant costs or liabilities.
• Coverage and reimbursement for products may be limited or unavailable, making profitable sales difficult.
• Changes in healthcare legislation and regulations, including drug pricing reforms (e.g., IRA), could adversely affect revenues and profitability.
• Employees, contractors, and partners may engage in misconduct, leading to non-compliance with regulatory standards and potential legal actions.
• Personnel changes and disruptions at regulatory agencies (FDA, SEC) could delay product development and approvals.
• Dr. Soon-Shiong's significant interests in other companies may conflict with ImmunityBio's interests.
• Dr. Soon-Shiong's voting control limits other stockholders' influence over corporate matters.
• Conversion of related-party promissory notes, exercise of warrants and options, and CVRs could dilute existing stockholders and depress stock price.
• The market price of common stock has been and may continue to be volatile, making it difficult for investors to sell shares.
• Securities class action and derivative litigation require significant management time and resources and may result in unfavorable outcomes.
• Operating as a public company incurs significant costs and requires substantial management time for compliance.
• The company is not subject to Section 203 of the DGCL, potentially making it more vulnerable to unapproved takeovers.
• Provisions in charter documents and Delaware law may have anti-takeover effects.
• Claims for indemnification by directors and officers may reduce available funds.
• Bylaws provide exclusive forum for disputes, potentially limiting stockholders' ability to choose a favorable judicial forum.

Future Outlook

ImmunityBio anticipates continued significant increases in operating expenses due to ongoing commercialization of ANKTIVA, expanded research and development, and efforts to secure additional regulatory approvals for new indications and product candidates. The company expects to need substantial additional funding, potentially through equity offerings or affiliated entity loans, to support future operations and commercialization efforts. Regulatory pathways for new indications, such as papillary NMIBC, may require additional randomized controlled trials, impacting timelines and costs. The company is also evaluating its go-to-market strategy for the UK following MHRA approval, considering the U.S. Most-Favored-Nation Prescription Drug Pricing policy.

Management Comments

• We believe our existing cash and cash equivalents, and investments in marketable securities; sales of our approved product; capital to be raised through equity offerings; and our potential ability to borrow from affiliated entities will be sufficient to fund our operations through at least the next 12 months following the issuance date of the condensed consolidated financial statements based primarily upon our Founder, Executive Chairman and Global Chief Scientific and Medical Officer's intent and ability to support our operations with additional funds, including loans from affiliated entities, as required, which we believe alleviates such doubt.
• We expect our research and development expense to increase significantly for the foreseeable future as we continue to invest in research and development activities related to expanding our product into new indications and markets, developing our other product candidates, and conducting our ongoing and planned clinical trials.
• We expect that our selling, general and administrative expense will increase for the foreseeable future as we commercialize our approved product and expand operations, build out information systems and increase our headcount to support continued research activities and the development of our clinical programs.
• We are actively evaluating our go-to-market strategy for the UK in light of the U.S. Most-Favored-Nation Prescription Drug Pricing policy implemented on May 12, 2025.

Industry Context

ImmunityBio operates in the highly competitive and rapidly evolving biotechnology industry, specifically focusing on oncology and infectious diseases with novel immunotherapy and cell therapy platforms. The approval of ANKTIVA in the U.S. and now the UK positions the company as a commercial-stage entity, but it faces significant challenges common to the industry, including high R&D costs, lengthy regulatory processes, and intense competition from established pharmaceutical giants and specialized biotech firms. The ongoing BCG shortage highlights supply chain vulnerabilities in combination therapies. The FDA's stance on requiring randomized controlled trials for new indications, as seen with papillary NMIBC, underscores the rigorous regulatory environment, potentially increasing development timelines and costs across the industry. The company's reliance on related-party financing and its vertically integrated manufacturing strategy are notable aspects within this context.

Comparison to Industry Standards

• ImmunityBio's ANKTIVA, as a first-in-class IL-15 receptor superagonist, offers a novel mechanism of action compared to traditional checkpoint inhibitors (CPIs) like pembrolizumab (Keytruda), aiming to activate NK cells and T cells for a long-duration response, potentially turning 'cold' tumors 'hot'.
• The company's reported 36-month progression-free survival and bladder sparing data for ANKTIVA in papillary-only NMIBC from the QUILT-3.032 trial, along with real-world data comparing favorably to chemotherapy, suggests a potentially differentiated outcome in a challenging indication, though the FDA is requiring a randomized controlled trial for approval in this specific indication.
• The company's strategy of developing combination therapies (e.g., ANKTIVA with BCG, or with hAd5 PSA, hAd5 TriAd, PD-L1 t-haNK, rituximab) is consistent with a broader industry trend towards multi-modal approaches to overcome resistance and enhance efficacy in cancer treatment, as seen with combinations involving CPIs and other targeted agents.
• ImmunityBio's accumulated deficit of $3.6 billion and continued negative operating cash flows are typical for a biotechnology company in the commercialization and late-stage development phase, where significant upfront investments are required before substantial revenue generation.
• The company's reliance on related-party financing and the significant influence of its Founder, Executive Chairman, and Global Chief Scientific and Medical Officer, Dr. Soon-Shiong, is a less common structure compared to many publicly traded biotech firms, which typically rely more heavily on diversified institutional funding and independent governance.

Management Changes

Corporate Governance

Legal Proceedings

• Shenzhen Beike Biotechnology Co. Ltd. Arbitration: Ongoing arbitration initiated in 2020 alleging breach of contract related to a license agreement for ANKTIVA in China. Hearing held June 9-13, 2025, with post-hearing briefing continuing through November 2025. Outcome is uncertain.
• Securities Class Action (Salzman v. ImmunityBio, Inc. et al.): A putative securities class action filed June 30, 2023, alleging violations of the Exchange Act related to disclosures about third-party CMO deficiencies and BLA approval prospects. The lawsuit was fully resolved on June 16, 2025, with final court approval of a $10.5 million settlement. The company paid the remaining $4.5 million in Q2 2025, with insurers covering $6.0 million in Q1 2025.
• Altor BioScience, LLC, and NantCell, Inc. Matters Against Dr. Hing Wong and HCW Biologics, Inc.: Arbitration and related court actions filed December 2022 alleging breach of contract, trade secret misappropriation, and other claims. Settled on July 13, 2024, with HCW transferring certain molecules and granting licenses to ImmunityBio, and mutual releases. Consolidated arbitration claims and a related Delaware action were dismissed in December 2024.
• Van Luven, Barbieri and Shin Derivative Actions: Three shareholder derivative actions filed October 2024 and February 2025, consolidated in May 2025. Allegations are substantially similar to the Salzman securities class action, asserting breach of fiduciary duty and other claims related to the FDA CRL. A Stipulation and Settlement Agreement for corporate governance reforms and attorneys' fees was preliminarily approved on July 29, 2025, with a final approval hearing set for November 4, 2025.
• Carlson Derivative Action: A shareholder derivative action filed November 20, 2024, in Delaware, alleging that September 2023 financing transactions with Dr. Soon-Shiong and affiliates were unfair to the company. A motion to dismiss the amended complaint was filed by defendants on July 16, 2025.
• Washington State Attorney General Investigation: In June 2025, the company received a request for information and documents from the Washington State Attorney General relating to its relationship with Access to Advanced Health Institute (AAHI). The company is cooperating with the investigation.

Related Party Transactions

• The company has a $505.0 million convertible promissory note payable to Nant Capital, an entity affiliated with Dr. Soon-Shiong, due December 31, 2027. This note is subordinated to the RIPA payment obligations.
• ImmunityBio entered into the Revenue Interest Purchase Agreement (RIPA) with Infinity and Oberland, where Oberland acquired Revenue Interests. Dr. Soon-Shiong and his related party hold approximately $139.8 million of the $304.0 million contingent value rights (CVRs) from the Altor acquisition, and they have irrevocably agreed to receive shares of the company's common stock in satisfaction of their CVRs.
• The company has a shared services agreement with NantWorks, an entity controlled by Dr. Soon-Shiong, for corporate, general and administrative, and certain research and development support services. Expenses incurred under this agreement were $0.3 million (Q2 2025) and $0.8 million (6 months 2025) for SG&A, and $0.1 million (Q2 2025) and $0.5 million (6 months 2025) for R&D.
• ImmunityBio has multiple agreements with Immuno-Oncology Clinic, Inc. (the Clinic), a related party owned by an officer of the company and managed by NantWorks, to conduct clinical trials. Expenses were $0.7 million (Q2 2025) and $1.2 million (6 months 2025) for R&D.
• The company leases multiple facilities from related parties, including 605 Doug St, LLC, Duley Road, LLC, and 605 Nash, LLC, all indirectly controlled by Dr. Soon-Shiong. Rent expenses for these leases are recorded in R&D related parties expense.
• A total of 1,638,000 warrants were issued to an affiliate of Dr. Soon-Shiong with an exercise price of $3.24 per share, vesting upon achievement of a performance-based manufacturing capacity condition.
• The Carlson derivative action alleges that September 2023 financing transactions between the company and Dr. Soon-Shiong and his affiliates were not fair to the company, claiming they benefited Dr. Soon-Shiong during a temporary stock price decline.

Stakeholder Impact

• **Shareholders**: Experience dilution from recent and potential future equity offerings and warrant exercises. The significant accumulated deficit and ongoing need for capital pose financial risk. The resolution of securities litigation and derivative actions may reduce future legal liabilities but highlight past governance concerns. Dr. Soon-Shiong's controlling interest limits influence of other shareholders.
• **Employees**: The company is expanding its headcount for commercialization and R&D, indicating job growth opportunities. However, past reduction-in-force at the Dunkirk Facility and ongoing non-compliance issues there create uncertainty for employees at that site. Stock-based compensation is a key incentive.
• **Customers (Healthcare Institutions/Patients)**: Benefit from the commercial availability of ANKTIVA for BCG-unresponsive NMIBC. The UK approval expands access. However, the ongoing TICE BCG shortage could limit ANKTIVA's availability. Delays in approval for new indications (e.g., papillary NMIBC) mean slower access to potential new treatments.
• **Suppliers/CMOs**: The company relies heavily on third-party CMOs and suppliers for manufacturing and distribution. Issues with cGMP compliance or supply chain disruptions could impact these relationships and the company's ability to meet demand.
• **Creditors (Oberland, Nant Capital)**: The company has substantial debt and revenue interest liabilities. While the company believes it can fund operations for the next 12 months, the 'substantial doubt' about going concern without additional funding indicates potential risk for creditors, especially if sales targets for ANKTIVA are not met or if additional capital cannot be raised.

Next Steps

• Continue commercial distribution of ANKTIVA in the U.S.
• Evaluate go-to-market strategy for ANKTIVA in the UK following MHRA approval.
• Re-evaluate approach for papillary-only NMIBC sBLA, potentially amending the initial filing with new data and committing to initiate a randomized controlled trial against chemotherapy.
• Seek a new meeting request with the FDA regarding papillary-only NMIBC with new data.
• NCCN is expected to review the submission for expansion of BCG-unresponsive NMIBC guidelines to include papillary-only disease at its August 2025 meeting.
• Continue clinical development of ANKTIVA in multiple oncology indications (e.g., lung, colorectal, prostate, ovarian cancers, GBM, NHL) and infectious diseases (HIV, Long COVID).
• Launch ResQ201A, a randomized controlled trial for NSCLC in the U.S., and submit clinical trial applications in EU, UK, Canada (early Q3 2025), and Asia.
• Finalize the appropriate development plan with the FDA for the lymphopenia program.
• Continue to obtain additional financing to fund future operations, including through equity offerings and potential borrowing from affiliated entities.
• Address construction needs and resolve the employee headcount non-compliance issue at the Dunkirk Facility.
• Continue post-hearing briefing for the Shenzhen Beike Biotechnology Co. Ltd. arbitration through November 2025.
• Attend the final approval hearing for the consolidated derivative action settlement on November 4, 2025.
• Defend against the Carlson derivative action, with a motion to dismiss filed in July 2025.
• Cooperate with the Washington State Attorney General's investigation regarding the relationship with AAHI.

Key Dates

Recommendation

ImmunityBio presents a mixed bag of significant progress and substantial challenges. The strong revenue growth from ANKTIVA's commercialization and the recent UK marketing authorization are clear positives, demonstrating successful market entry and product validation. However, the company continues to incur significant net losses and negative operating cash flows, leading to 'substantial doubt' about its going concern status without further capital. The FDA's Refuse to File letter for the papillary NMIBC sBLA, requiring a randomized trial, is a notable setback that delays a key expansion opportunity and increases R&D costs. The ongoing issues with the Dunkirk manufacturing facility and the heavy reliance on related-party financing also introduce considerable risk and uncertainty. While the long-term potential of ANKTIVA and the broad pipeline are attractive, the immediate financial pressures and regulatory hurdles warrant a cautious 'hold' stance for investors, awaiting clearer signs of sustained profitability and resolution of key operational and regulatory challenges.

Keywords

Biotechnology, Oncology, Immunotherapy, ANKTIVA, NMIBC, Bladder Cancer, FDA Approval, Clinical Trials, Drug Development, Commercialization, Financial Results, SEC Filing, Biologics, Cancer Vaccines, Cell Therapy, Risk Factors, Capital Raise, Regulatory Approval, Pharmaceuticals, Healthcare