Company: DVAX
Filing Date: 2025-08-07
Form Type: 10-Q
Source: 0001029142-25-000117
Chunk: 244

Company: DYNAVAX TECHNOLOGIES CORP
Filing Date: 2025-08-07
Form: 10-Q
Item: Part I, Item 1
Chunk 244
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aceuticals (Hong Kong) Co., Limited (collectively, “Clover”) for the commercial supply of CpG 1018 adjuvant for use with its protein-based COVID-19 vaccine candidate, SCB-2019. During the six months ended June 30, 2025, we recorded an allowance for doubtful accounts of approximately $11.0 million relating to the contract asset recognized for Clover. This determination was based on our evaluation of credit risk associated with Clover, driven by the formal termination by the Global Alliance for Vaccines and Immunization (“GAVI”) of its advanced purchase agreement option with Clover on April 24, 2025, Clover’s recent write-down of the carrying value of its CpG 1018 Materials, and Clover's liquidity position, as reflected by cash and cash equivalents reported in Clover’s audited consolidated statement of financial position as of December 31, 2024.

The $11.0 million allowance for doubtful accounts represents the portion of Clover's contract asset that is incremental to the amounts which were directly funded using the Advance Payments from CEPI of approximately $60.3 million to manufacture the corresponding CpG 1018 Materials.

Accordingly, the contract asset balance associated with Clover was $60.3 million as of June 30, 2025, compared to $71.3 million as of December 31, 2024. The contract asset was included in other assets (non-current) and represents amounts due from Clover that we expect to become payable more than twelve months after June 30, 2025.

Advance Payments from CEPI of $60.3 million are recorded in CEPI accrual long-term in our condensed consolidated balance sheets as of June 30, 2025. We are only obligated to repay these Advance Payments to CEPI if, and to the extent, of our receipt from Clover of their payment for the corresponding CpG 1018 Materials. Advance Payments may be forgiven in accordance with the CEPI Agreement in the event we do not collect corresponding amounts from Clover. Pursuant to the terms of the Clover Supply Agreement, we intend to continue to pursue full collection of the $71.3 million due from Clover, of which $60.3 million will be payable to CEPI upon the occurrence of the applicable payment trigger events described above, whichever occurs first.

In April 2023, we entered into a third amendment to our supply agreement with Biological E. Limited (“Bio E”) and a related waiver and amendment to the CEPI Agreement