XML 24 R12.htm IDEA: XBRL DOCUMENT v3.24.2.u1
Collaboration Agreements and Research and Development Funding Arrangement
6 Months Ended
Jun. 30, 2024
Research and Development [Abstract]  
Collaboration Agreements and Research and Development Funding Arrangement
5. Collaboration Agreements and Research and Development Funding Arrangement

Merck

In June 2016, we entered into a Collaboration and License Agreement for the development and commercialization of personalized mRNA cancer vaccines (also known as individualized neoantigen therapy, or INT) with Merck. This agreement was subsequently amended and restated in 2018. Our role in this strategic alliance involves identifying genetic mutations in a particular patient’s tumor cells, synthesizing mRNA for these mutations, encapsulating the mRNA in one of our proprietary lipid nanoparticles (LNPs), and administering a unique mRNA INT to each patient. Each INT is designed to specifically activate the patient’s immune system against her or his own cancer cells.

In September 2022, Merck exercised its option for INT, including mRNA-4157, pursuant to the terms of the agreement and in October 2022 paid us an option exercise fee of $250 million. Following this exercise, the Merck Participation Term commenced. Pursuant to the agreement, we and Merck have agreed to collaborate on further development and commercialization of INT, with costs and any profits or losses to be shared equally on a worldwide basis.

For the three and six months ended June 30, 2024, we recognized expenses, net of Merck's reimbursements, of $95 million and $171 million, respectively, related to the INT collaboration under the Merck Participation Term. For the three and six months ended June 30, 2023, these expenses were $50 million and $69 million, respectively.

Additionally, for the three and six months ended June 30, 2024, the net cost recovery for capital expenditures was $33 million and $57 million, respectively. For the three and six months ended June 30, 2023, the net cost recovery for capital expenditures was $12 million and $18 million, respectively. These amounts were applied to reduce the capitalized cost of the assets.

We have other collaborative and licensing arrangements that we do not consider to be individually significant to our business at this time. Pursuant to these agreements, we may be required to make upfront payments and payments upon achievement of various development, regulatory and commercial milestones, which in the aggregate could be significant. Future milestone payments, if any, will be reflected in our consolidated financial statements when the corresponding events have occurred. In addition, we may be required to pay significant royalties on future sales if products related to these arrangements are commercialized.

Development and Commercialization Funding Arrangement with Blackstone Life Sciences (Blackstone)

In March 2024, we entered into a development and commercialization funding arrangement with Blackstone, under which Blackstone has committed to providing up to $750 million in funding to us. This funding supports the development of our investigational mRNA-based influenza vaccine. Contingent upon regulatory approval in the U.S. and only if the approval is dependent on data from the funded activities, Blackstone will be entitled to receive low single-digit percentage royalties and up to $750 million in sales milestone payments. These payments are based on net sales of our future influenza and combination vaccines, with sales milestone payments contingent upon achieving specified cumulative net sales targets.
Given the substantive transfer of financial risk to Blackstone, we account for this arrangement as an obligation to conduct research and development activities. The funding is recognized as a reduction to the expenses of our mRNA-based influenza program. This reduction is recognized proportionally as the related costs are incurred, based on an input method. We recorded immaterial research and development expense reductions for the three and six months ended June 30, 2024.