The Company prepared its consolidated financial statements in compliance with generally accepted accounting principles in the United States (“U.S. GAAP”). Any reference in these notes to applicable guidance is meant to refer to authoritative U.S. GAAP as found in the Accounting Standards Codification (“ASC”) and Accounting Standards Update (“ASU”) of the Financial Accounting Standards Board (“FASB”).

The consolidated financial statements have been prepared under the historical cost convention, except for derivative financial instruments and contingent consideration, which are recorded at fair value through profit or loss.

The consolidated financial statements are presented in United States (“U.S.”) dollars ($), except where otherwise indicated. Transactions denominated in currencies other than U.S. dollars are presented in the transaction currency with the U.S. dollar amount included in parenthesis, converted at the foreign exchange rate as of the transaction date.

The consolidated financial statements presented have been prepared on a going concern basis based on the Company’s cash and cash equivalents as of December 31, 2022 and the Company’s budgeted cash flows for the twelve months following the issuance date.

The preparation of consolidated financial statements, in conformity with U.S. GAAP and Securities and Exchange Commission (“SEC”) rules and regulations, requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, disclosure of contingent assets and liabilities at the date of the consolidated financial statements and reported amounts of revenues and expenses during the reporting period. Estimates and assumptions are primarily made in relation to contingent consideration related to the acquisition of Corlieve Therapeutics SAS (“Corlieve”), the treatment of revenue to be recognized under the commercialization and license agreement entered into (“CSL Behring Agreement”) between the Company and CSL Behring LLC (“CSL Behring”), and the assessment of a valuation allowance on the Company’s deferred tax assets in the Netherlands and the U.S. If actual results differ from the Company’s estimates, or to the extent these estimates are adjusted in future periods, the Company’s results of operations could either benefit from, or be adversely affected by, any such change in estimate.

The principal accounting policies applied in the preparation of these consolidated financial statements are set out below. These policies have been consistently applied to all the years presented, unless otherwise stated.

The consolidated financial statements comprise the financial statements of the Company and its subsidiaries. Subsidiaries are all entities over which the Company has a controlling financial interest either through variable interest or through voting interest. Currently, the Company has no involvement with variable interest entities.

Inter-company transactions, balances, income, and expenses on transactions between uniQure entities are eliminated in consolidation. Profits and losses resulting from inter-company transactions that are recognized in assets are also eliminated. Accounting policies of subsidiaries have been changed where necessary to ensure consistency with the policies adopted by the Company.

The Company presents assets and liabilities in the consolidated balance sheets based on current and non-current classification.

The term current assets is used to designate cash and other assets, or resources commonly identified as those that are reasonably expected to be realized in cash or sold or consumed during the normal operating cycle of the business. The Company’s normal operating cycle is twelve months. All other assets are classified as non-current.

The term current liabilities is used principally to designate obligations whose liquidation is reasonably expected to require the use of existing resources properly classifiable as current assets, or the creation of other current liabilities. Current liabilities are expected to be settled in the normal operating cycle. The Company classifies all other liabilities as non-current.

Deferred tax assets and liabilities are classified as non-current assets and liabilities, if any.

The functional currency of the Company and each of its entities (except for uniQure Inc. and Corlieve AG) is the euro (€). This represents the currency of the primary economic environment in which the entities operate. The functional currency of uniQure Inc. is the U.S. dollar ($) and the functional currency of Corlieve AG is the Swiss Franc (CHF). The consolidated financial statements are presented in U.S. dollars.

Foreign currency transactions are measured and recorded in the functional currency using the exchange rates prevailing at the dates of the transactions. Foreign exchange gains and losses resulting from the settlement of such transactions and from the re-measurement of monetary assets and liabilities denominated in foreign currencies at exchange rates prevailing at balance sheet date are recognized in profit and loss.

Upon consolidation, the assets and liabilities of foreign operations are translated into the functional currency of the shareholding entity at the exchange rates prevailing at the balance sheet date; items of income and expense are translated at monthly average exchange rates. The consolidated assets and liabilities are translated from uniQure N.V.’s functional currency, euro, into the reporting currency U.S. dollar at the exchange rates prevailing at the balance sheet date; items of income and expense are translated at monthly average exchange rates. Issued capital and additional paid-in capital are translated at historical rates with differences to the balance sheet date rate recorded as translation adjustments in other comprehensive income / loss. The exchange differences arising on translation for consolidation are recognized in “accumulated other comprehensive income / loss”. On disposal of a foreign operation, the component of other comprehensive income / loss relating to that foreign operation is recognized in profit or loss.

The Company measures certain assets and liabilities at fair value, either upon initial recognition or for subsequent accounting or reporting. ASC 820, Fair Value Measurements and Disclosures requires disclosure of methodologies used in determining the reported fair values and establishes a hierarchy of inputs used when available. The three levels of the fair value hierarchy are described below:

To the extent that valuation is based on models or inputs that are less observable or unobservable in the market, the determination of fair value requires more judgment. Accordingly, the degree of judgment exercised by the Company in determining fair value is greatest for instruments categorized as Level 3. A financial instrument’s level within the fair value hierarchy is based on the lowest level of any input that is significant to the fair value measurement.

Items measured at fair value on a recurring basis include financial instruments and contingent consideration (Note 7, “Fair value measurement”). The carrying amount of cash and cash equivalents, accounts receivable from collaborators, prepaid expenses, other assets, accounts payable, accrued expenses and other current liabilities reflected in the consolidated balance sheets approximate their fair values due to their short-term maturities.

On June 21, 2021, we entered into a share and purchase agreement (“SPA”) to acquire all of outstanding ordinary shares of Corlieve, a privately held French gene therapy company (“Corlieve Transaction”). On July 30, 2021 (“Acquisition Date”), the Company acquired Corlieve. The Company evaluated the Corlieve transaction as to whether or not the transaction should be accounted for as a business combination or asset acquisition. Refer to Note 3 “Corlieve transaction” for further detail.

Goodwill represents the excess of the fair value of the consideration transferred over the fair value of the net assets assumed in a business combination. Goodwill is not amortized but is evaluated for impairment on an annual basis and between annual tests if we become aware of any events occurring or changes in circumstances that would more likely than not reduce the fair value of the reporting unit below its carrying amount. As of December 31, 2022 and 2021, the Company has not recognized any impairment charges related to goodwill.

The Company identified various licenses that combined with the results of the research and development activities conducted in relation to its target candidate for the treatment of temporal lobe epilepsy (“AMT-260”) since incorporation of Corlieve in 2019 constitute an In-process research and development intangible asset (“IPR&D Intangible Asset”). The IPR&D Intangible Asset is considered to be indefinite-lived until the completion or abandonment of the associated research and development efforts and is not amortized. If and when development is completed, which generally occurs when regulatory approval to market a product is obtained, the associated asset would be deemed finite-lived and would then be amortized based on its respective useful life at that point in time. As of December 31, 2022 and 2021, the Company has not recognized any impairment charges related to the IPR&D Intangible Asset.

In case of abandonment, the IPR&D Intangible Asset will be written-off. In accordance with ASC 350, Intangibles – Goodwill and Other, the Company tests indefinite-lived intangible assets for impairment on an annual basis and between annual tests if the Company becomes aware of any events occurring or changes in circumstances that would indicate the fair value of the IPR&D Intangible Asset is below its carrying amount.

Each reporting period, the Company revalues the contingent consideration obligations associated with the Corlieve transaction to their fair value and records changes in the fair value within research and development expenses. Changes in contingent consideration result from changes in assumptions regarding the probabilities of achieving the relevant milestones, or probability of success (“POS”), the estimated timing of achieving such milestones, and the interest rate to discount the payments. Payments made soon after the acquisition date are recorded as cash flows from financing activities, and payments, or the portion of the payments, not made soon after the acquisition date are recorded as cash flows from operating activities.

The consolidated statements of cash flows have been prepared using the indirect method. The cash disclosed in the consolidated statements of cash flows is comprised of cash and cash equivalents. Cash and cash equivalents include bank balances, demand deposits and other short-term highly liquid investments (with maturities of less than three months at the time of purchase) that are readily convertible into a known amount of cash and are subject to an insignificant risk of fluctuation in value.

Cash flows denominated in foreign currencies have been translated at the average exchange rates. Exchange differences, if any, affecting cash and cash equivalents are shown separately in the consolidated statements of cash flows. Interest paid and received, and income taxes are included in net cash (used in) provided by operating activities.

Operating segments are identified as a component of an enterprise for which separate discrete financial information is available for evaluation by the chief operating decision maker, or decision-making group, in making decisions on how to allocate resources and assess performance. The Company views its operations and manages its business as one operating segment, which comprises the discovery, development, and commercialization of innovative gene therapies.

The Company follows the provisions of ASC 260, Earnings Per Share. In accordance with these provisions, net (loss) / income per share is calculated by dividing net (loss) / income by the weighted average number of ordinary shares outstanding during the period.

Diluted net (loss) / income per share reflects the dilution that would occur if share options or warrants to issue ordinary shares were exercised, performance or restricted share units were distributed, or shares under the employee share purchase plan were issued. However, potential ordinary shares are excluded if their effect is anti-dilutive.

Refer to Note 18 “Basic and diluted earnings per share” for further information.

Long-lived assets, which include property, plant, and equipment and finite-lived intangible assets, are reviewed for impairment whenever events or changes in circumstances indicate that the carrying value of an asset or asset group may not be recoverable. Right-of-use assets are also reviewed for impairment in accordance with ASC 360, Property, Plant, and Equipment. The recoverability of the carrying value of an asset or asset group depends on the successful execution of the Company’s business initiatives and its ability to earn sufficient returns on approved products and product candidates. When such events or changes in circumstances occur, the Company assesses recoverability by determining whether the carrying value of such assets will be recovered through the undiscounted expected future cash flows. If the future undiscounted cash flows are less than the carrying amount of these assets, the Company recognizes an impairment loss based on the excess of the carrying value over the fair value of the assets. Fair value is determined through various valuation techniques, including discounted cash flow models, quoted market values, and third-party independent appraisals, as considered necessary.

Refer to Note 2.3.5 “Corlieve transaction” for information on impairment testing related to goodwill and acquired research and development intangible assets.

Investment securities consist of sovereign debt with residual maturities of less than 12 months (presented as current) and beyond (presented as non-current). The Company classifies these securities as held-to-maturity. Held-to-maturity securities are those securities in which the Company has the ability and intent to hold the security until maturity. Held-to-maturity securities are recorded at amortized cost, adjusted for the amortization or accretion of premiums or discounts. Premiums and discounts are amortized or accreted over the term of the related held-to-maturity security as an adjustment to yield using the effective interest rate method.

Investments securities with original maturities of less than three months when purchased are presented within cash and cash equivalents (December 13, 2022: $21.2 million, December 31, 2021: nil).

A decline in the market value of any investment security below cost that is deemed to be other than temporary results in a reduction in the carrying amount to fair value. The impairment is charged to operations and a new cost base for the security is established. Other-than-temporary impairment charges are included in interest and other income (expense), net. Interest income is recognized when earned.

Accounts receivables include amounts due from services provided to the Company’s licensing and collaboration partners as well as unconditional rights to consideration from its licensing and collaboration partners.

The Company started producing commercial materials in April 2022 to supply CSL Behring with the Product in accordance with the June 2020 Development and Commercial Supply Agreement between the Company and CSL Behring. From this date onwards, the Company presents the costs associated with the aforementioned activities as cost of contract manufacturing. Refer to Note 4, “Collaboration arrangements and concentration of credit risk” for further detail.

Per ASC 330, Inventory, inventory is stated at the lower of cost or estimated net realizable value, on a first-in, first-out basis. The Company capitalizes raw materials to the extent these can be used in the manufacturing of the Product. The Company uses standard costs, approximating average costs to determine its cost basis for work in progress and finished goods. The Company’s assessment of recoverability value requires the use of estimates regarding the net realizable value of its inventory balances, including an assessment of excess or obsolete inventory. As applicable, write-downs resulting from adjustments to net realizable value will be recorded to cost of contract manufacturing.

Prepaid expenses are amounts paid in the period, for which the benefit has not been realized, and include payments made for insurance and research and clinical contracts. The related expense will be recognized in the subsequent period as incurred.

Deposits paid are either presented as other current assets or as other non-current assets based on duration of the underlying contractual arrangement. Deposits are classified as restricted cash and primarily relate to facility leases.

Contract assets are presented in current assets or as non-current assets based on the timing of the right to consideration.

Property, plant, and equipment is comprised mainly of laboratory equipment, leasehold improvements, construction-in-progress (“CIP”) and office equipment. All property, plant and equipment is stated at cost less accumulated depreciation. CIP consists of capitalized expenses associated with construction of assets not yet placed into service. Depreciation commences on CIP once the asset is placed into service based on its useful life determined at that time.

Maintenance and repairs that do not improve or extend the lives of the respective assets are expensed as incurred. Upon disposal, the related cost and accumulated depreciation is removed from the accounts and any resulting gain or loss on the transaction is recognized in the consolidated statements of operations and comprehensive loss.

Depreciation is calculated using the straight-line method over the estimated useful lives of the assets (or in the case of leasehold improvements a shorter lease term), which are as follows:

The Company records leases in accordance with ASC 842, Leases and determines if an arrangement is a lease at inception. Operating lease right-of-use assets and lease liabilities are initially recognized based on the present value of future minimum lease payments over the lease term at commencement date calculated using an incremental borrowing rate applicable to the lease asset, unless the implicit rate is readily available. Lease terms may include options to extend or terminate the lease when it is reasonably certain that the Company will exercise that option. Leases with a term of twelve months or less are not recognized on the consolidated balance sheets.

The Company recognizes lease cost on a straight-line basis and presents these costs as operating expenses within the Consolidated statements of operations and comprehensive loss. The Company presents lease payments within cash flows from operations within the Consolidated statements of cash flows.

Accounts payables are invoiced amounts related to obligations to pay for goods or services that have been acquired in the ordinary course of business from suppliers. Accounts payables are recognized at the amounts invoiced by suppliers.

Accrued expenses are recognized for goods or services that have been acquired in the ordinary course of business.

Long-term debt is initially recognized at cost and presented net of original issue discount or premium and debt issuance costs on the consolidated balance sheets. Amortization of debt discount and debt issuance costs is recognized as interest expense in profit and loss over the period of the debt, using the effective interest rate method.

The Company has a defined contribution pension plan for all employees at its Amsterdam facility in the Netherlands, which is funded by the Company through payments to an insurance company, with individual accounts for each participants’ assets. The Company has no legal or constructive obligation to pay further contributions if the plan does not hold sufficient assets to pay all employees the benefits relating to services rendered in the current and prior periods. The contributions are expensed as incurred. Prepaid contributions are recognized as an asset to the extent that a cash refund or a reduction in the future payments is available.

In 2016, the Company adopted a qualified 401(k) Plan for all employees located in the United States. The 401(k) Plan offers both a pre-tax and post-tax (Roth) component. Employees may contribute up to the IRS statutory limit each calendar year. The Company matches $0.50 for every $1.00 contributed to the plan by participants up to 6% of base compensation. Employer contributions are recognized as they are contributed, as long as the employee is rendering services in that period. If employer contributions are made in periods after an individual retires or terminates, the estimated cost is accrued during the employee’s service period.

The Company accounts for its share-based compensation awards in accordance with ASC 718, Compensation-Stock Compensation.

All the Company’s share-based compensation plans for employees are equity-classified. ASC 718 requires all share-based compensation to employees, including grants of employee options, restricted share units, performance share units and modifications to existing instruments, to be recognized in the consolidated statements of operations and comprehensive loss based on their grant-date fair values, net of an estimated forfeiture rate, over the requisite service period. Forfeitures of employee options are recognized as they occur. Compensation expense related to Performance Share Units is recognized when the Company considers achievement of the milestones to be probable. The requirements of ASC 718 are also applied to nonemployee share-based payment transactions except for specific guidance on certain inputs to an option-pricing model and the attribution of cost.

The Company uses a Hull & White option model to determine the fair value of option awards. The model captures early exercises by assuming that the likelihood of exercises will increase when the share-price reaches defined multiples of the strike price. This analysis is performed over the full contractual term.

The Company primarily generates revenue from its commercialization and license agreement with CSL Behring and its collaboration, research, and license agreements with BMS for the development and commercialization of product candidates.

On June 24, 2020 (“Signing Date”), the Company entered into a commercialization and license agreement pursuant to which CSL Behring received exclusive global rights to etranacogene dezaparvovec (“Product”). The Company concluded that CSL Behring is a customer in accordance with ASC 606, Revenue from Contracts with Customers and identified two material performance obligations related to the CSL Behring Agreement:

These performance obligations are considered distinct from one another, as CSL Behring can benefit from the identified service either on its own or together with other resources that are readily available to CSL Behring, and as the performance obligations are separately identifiable from other performance obligations in the CSL Behring Agreement.

Refer to Note 4 “Collaboration arrangements and concentration of credit risk” for further detail.

Bristol-Myers Squib collaboration

The Company initially entered into collaboration, research, and license agreements with Bristol-Myers Squibb (“BMS”) in 2015 (“BMS CLA”) and amended them in 2020 (“amended BMS CLA”). The agreement terminated on February 21, 2023 (“Termination Date”).

The Company evaluated the initial BMS CLA and determined that its performance obligations were as follows as of the amended BMS CLA:

●

Providing pre-clinical research activities (“Collaboration Revenue”);

●

Providing clinical and commercial manufacturing services for products (“Manufacturing Revenue”); and

●

Providing access to its technology and know-how in the field of gene therapy as well as actively contributing to the target selection, the collaboration as a whole, the development during the target selection, the pre-clinical and the clinical phase through participating in joint steering committee and other governing bodies (“License Revenue”).

As further discussed in Note 4, “Collaboration arrangements and concentration of credit risk”, as a result of the December 2020 amended BMS CLA, the Company’s performance obligation related to License Revenues was materially completed as of the date of the amendment effective date of December 1, 2020.

License Revenue

Until the December 2020 amendment of the BMS CLA the Company recognized License Revenue over the expected performance period based on its measure of progress towards the completion of certain activities related to its services. Following the December 2020 amendment of the BMS CLA the Company’s performance was materially completed and it had satisfied its performance obligation (see Note 4, “Collaboration arrangements and concentration of credit risk”, for a detailed discussion).

Collaboration and Manufacturing Revenue

The Company recognized Collaboration Revenue associated with optional work orders it received from BMS to provide analytical development and process development activities that were reimbursable by BMS in accordance with the BMS CLA as well as the amended BMS CLA.

2.3.22 Other income, other expense

The Company receives certain government and regional grants, which support its research efforts in defined projects, and include contributions towards the cost of research and development. These grants generally provide for reimbursement of approved costs incurred as defined in the respective grants and are deferred and recognized in the statements of operations and comprehensive loss over the period necessary to match them with the costs they are intended to compensate, when it is probable that the Company has complied with any conditions attached to the grant and will receive the reimbursement.

The Company’s other income also consists of employee retention credits received under the U.S. Coronavirus Aid, Relief, and Economic Security Act, income related to a settlement agreement that the Company and VectorY B.V. entered into in April 2021, as well as income from subleasing part of the Company’s Amsterdam facility. Other expense consists of expenses incurred in relation to the subleasing income.

2.3.23 Research and development expenses

Research and development costs are expensed as incurred. Research and development expenses generally consist of laboratory research, clinical trials, statistical analysis, and report writing, regulatory compliance costs incurred with clinical research organizations and other third-party vendors (including post-approval commitments to conduct consistency and comparability studies). In addition, research and development expenses consist of start-up and validation costs related to the Company’s Lexington facility and the development and improvement of the Company’s manufacturing processes and methods. Furthermore, research and development costs include costs of materials and costs of intangible assets purchased from others for use in research and development activities. The costs of intangibles that are purchased from others for a particular research and development project and that have no alternative future uses (in other research and development projects or otherwise) are expensed as research and development costs at the time the costs are incurred or at the time when no alternative future use is identified.

2.3.24 Income taxes

Income taxes are recorded in accordance with ASC 740, Income Taxes, which provides for deferred taxes using an asset and liability approach. The Company recognizes deferred tax assets and liabilities for the expected future tax consequences of events that have been included in the financial statements or tax returns. Deferred tax assets and liabilities are determined based on the difference between the financial statement carrying amount and the tax bases of assets and liabilities using enacted tax rates in effect for the year in which the differences are expected to reverse. Valuation allowances are provided, if based upon the weight of available evidence, it is more-likely-than-not that some or all the deferred tax assets will not be realized.

The benefits of tax positions are recognized only if those positions are more likely than not, based on the technical merits, to be sustained upon examination. Recognized tax positions are measured at the largest amount of tax benefit that is greater than 50 percent likely of being realized upon settlement. The determination as to whether the tax benefit will more-likely-than-not be realized is based upon the technical merits of the tax position as well as consideration of the available facts and circumstances. As of December 31, 2022, and 2021, the Company did not have any significant unrecognized tax benefits.

2.3.25 Recently Adopted Accounting Pronouncements

ASU 2021-10: Government Assistance

In November 2018, the FASB issued ASU 2021-10, Government Assistance (Topic 832) which discussed the requirements for disclosures, to be applied prospectively or retrospectively, related to transactions with a government. ASU 2021-10 is effective for fiscal years beginning after December 15, 2021. The new disclosure requirements required disclosures around 1) information about the nature of the transactions and the related accounting policy used to account for the transactions, 2) the line items on the balance sheet and income statement that are affected by the transactions, and the amounts applicable to each financial statement line item, and 3) significant terms and conditions of the transactions, including commitments and contingencies. The Company currently includes information on government grants and the adoption of ASU 2021-10 on January 1, 2022 has not had a material impact on the Company’s consolidated financial statements.

Recent Accounting Pronouncements Not Yet Effective

None.