Company: ABUS
Filing Date: 2025-05-14
Form Type: 10-Q
Source: 0001447028-25-000099
Chunk: 54

Company: Arbutus Biopharma Corp
Filing Date: 2025-05-14
Form: 10-Q
Item: Part I, Item 1
Chunk 54
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-101. In connection with our cessation of all discovery efforts in August 2024 and an additional 57% reduction in our workforce in the first quarter of 2025, we expect our research expenses to continue to be reduced in future periods. 

A significant portion of our research and development expenses are not tracked by project as they benefit multiple projects or our technology platform and because our most-advanced programs are not yet in late-stage clinical development.

General and administrative

General and administrative expenses increased $0.5 million for the three months ended March 31, 2025, as compared to the same period in 2024, due primarily to an increase in litigation-related legal fees, partially offset by a decrease in employee compensation-related expenses.   

30

Change in fair value of contingent consideration

Contingent consideration is a liability related to our acquisition of Enantigen Therapeutics, Inc. in October 2014. In general, as time passes and assuming no changes to the assumptions related to the contingency, the fair value of the contingent consideration increases as the progress of our programs get closer to triggering contingent payments based on certain sales milestones of our first commercial product for cHBV.  As imdusiran continues to progress through clinical trials, we will adjust our assumptions regarding probability of success commensurate with the progression of the program, which will increase the fair value of the liability.  

Restructuring

In March 2025, our Board took action to reduce our workforce by 57%, resulting in a total workforce after reductions of 19 employees. The Board also decided to exit our corporate headquarters in Warminster, Pennsylvania and to discontinue in-house scientific research. In connection with these actions, we incurred a one-time restructuring charge in the first quarter of 2025 of $12.4 million, which includes approximately $6.0 million of cash severance and continued benefits paid, $2.3 million of non-cash expense related to the modification of equity awards, non-cash impairment charges for leasehold improvements and laboratory equipment of $1.9 million and $0.9 million, respectively, $0.9 million related to impairment of the right-of-use asset associated with the lease of our corporate headquarters and a $0.4 million accrual of lease-related operating expenses. 

As of March 31, 2025, there was $5.6 million of accrued restructuring costs for severance payments and a $0.4 million accrual of lease-related operating expenses included in accounts payable