Company: ARWR
Filing Date: 2025-05-12
Form Type: 10-Q
Source: 0001628280-25-024666
Chunk: 43

Company: ARROWHEAD PHARMACEUTICALS, INC.
Filing Date: 2025-05-12
Form: 10-Q
Item: Part I, Item 1
Chunk 43
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 certain that it will exercise this option to renew and therefore it is not included in right-of-use assets and liabilities as of March 31, 2025.San Diego, California: The Company leases 144,000 square feet of office and research and development laboratory space located at 10102 Hoyt Park from 11404 & 11408 Sorrento Valley Owner, LLC, which lease expires on April 30, 2038. Pursuant to the lease, within twelve months of the expiration of the initial 15-year term, the Company has the option to extend the lease for up to one additional ten-year term, with certain annual increases in base rent. The Company is not reasonably certain that it will exercise this option to renew and therefore it is not included in right-of-use assets and liabilities as of March 31, 2025.The lease agreement, as amended, granted the Company the right to receive an Additional Tenant Improvement Allowance (“ATIA”) funded by the lessor. The Company received $30.8 million in ATIA, including a final payment of $3.1 million during the first quarter of fiscal 2024. As a result, the Company remeasured its lease liability and right-of-use assets to reflect these additional allowances and the related increased lease payments. The Company has further concluded that these ATIAs have no effects on the classification of the lease.Madison, Wisconsin: The Company leases 107,000 square feet space located at 502 South Rosa Road for its office and laboratory facilities, which lease expires on September 30, 2031. The lease contains options to renew for two terms of five years. The Company is not reasonably certain that it will exercise this option and therefore it is not included in right-of-use assets and liabilities as of March 31, 2025.The components of lease assets and liabilities along with their classification on the Company’s consolidated balance sheets were as follows:Lease Assets and LiabilitiesClassificationMarch 31, 2025September 30, 2024(in thousands)Operating lease assetsRight-of-use assets$44,452 $45,255 Current operating lease liabilitiesLease liabilities6,782 6,342 Non-current operating lease liabilitiesLease liabilities, net of current portion107,529 111,027 

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Three Months Ended March 31,Six Months Ended March 31,Lease CostClassification2025202420252024(in thousands)Operating lease costResearch and development$2,709 $