Company: HURA
Filing Date: 2025-05-06
Form Type: S-4/A
Source: 0001193125-25-113920
Chunk: 624

Company: TuHURA Biosciences, Inc./NV
Filing Date: 2025-05-06
Form: S-4/A
Chunk 624
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-based milestones and royalties on net sales of licensed products. Each of these payments results in license revenues, except for revenues from royalties, which are classified as other revenues.

In determining the appropriate amount of revenue to be recognized as Kineta fulfills its obligations under each of its agreements, Kineta performs the following five steps: (i) identification of the contract(s) with a customer, (ii) determination of whether the promised goods or services are performance obligations, including whether they are distinct in the context of the contract, (iii) measurement of the transaction price, including the constraint on any variable consideration, (iv) allocation of the transaction price to the performance obligations in the contract, and (v) recognition of revenue when (or as) Kineta satisfies each performance obligation.

As part of the accounting for these arrangements containing multiple performance obligations, Kineta must develop assumptions that require judgment to determine the stand-alone selling price for each performance obligation identified in the contract. Kineta uses key assumptions to determine the stand-alone selling price, which may include forecasted revenues, development timelines, reimbursement rates for personnel costs, discount rates and probabilities of technical and regulatory success. Kineta expects to recognize revenue for variable consideration being constrained when it is probable that a significant revenue reversal will not occur. For performance obligations satisfied over time, Kineta estimates the efforts needed to complete the performance obligation and recognizes revenue by measuring the progress towards complete satisfaction of the performance obligation using an input measure.**

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For arrangements that include development and regulatory milestones, Kineta evaluates whether the milestones are considered probable of being reached and estimate the amount to be included in the transaction price using the most likely amount method. If it is probable that a significant revenue reversal would not occur, the associated milestone value is included in the transaction price. Milestone payments that are not within Kineta’s control or the licensee’s control, such as regulatory approvals, are generally not considered probable of being achieved until those approvals are received.

Kineta’s management may be required to exercise considerable judgment in estimating revenue to be recognized. Judgment is required in identifying performance obligations, estimating the transaction price, estimating the standalone selling price of identified performance obligations, and estimating the progress towards satisfaction of performance obligations.

Collaboration Revenues

Kineta recognizes collaboration revenue using the cost-to-cost method, which Kineta believes best depicts the transfer of control to the customer. Under the cost-to-cost method, the extent of progress towards completion is measured based on the ratio of actual costs incurred to the total estimated