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ARGENX SE

ARGENX SEARGX決算レポート

Nasdaq · pharmaceutical industry

AbbVie Inc. is an American pharmaceutical company headquartered in North Chicago, Illinois. They have produced drugs to treat a wide range of medical issues.

What changed in ARGENX SE's 20-F — 2022 vs 2023

Top changes in ARGENX SE's 2023 20-F

1354 paragraphs added · 1791 removed · 375 edited across 6 sections

Item 2. Properties

Properties — owned and leased real estate

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ITEM 2. OFFER STATISTICS AND EXPECTED TIMETABLE 1 ITEM 3. KEY INFORMATION 1 3.A. [RESERVED] 1 3.B. CAPITALIZATION AND INDEBTEDNESS 1 3.C. REASONS FOR THE OFFER AND USE OF PROCEEDS 1 3.D. RISK FACTORS 1 ITEM 4. INFORMATION ON THE COMPANY 36 4.A. HISTORY AND DEVELOPMENT OF THE COMPANY 36 4.B. BUSINESS OVERVIEW 36 4.C. ORGANIZATIONAL STRUCTURE 97 4.D.
ITEM 2. OFFER STATISTICS AND EXPECTED TIMETABLE 1 ITEM 3. KEY INFORMATION 1 3.A. [RESERVED] 1 3.B. CAPITALIZATION AND INDEBTEDNESS 1 3.C. REASONS FOR THE OFFER AND USE OF PROCEEDS 1 3.D. RISK FACTORS 1 ITEM 4. INFORMATION ON THE COMPANY 39 4.A. HISTORY AND DEVELOPMENT OF THE COMPANY 39 4.B. BUSINESS OVERVIEW 40 4.C. ORGANIZATIONAL STRUCTURE 104 4.D.

Item 3. Legal Proceedings

Legal Proceedings — active lawsuits and investigations

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Our and our third-party manufacturers and suppliers operations, including research, development, testing and manufacturing activities, are subject to numerous environmental, health and safety laws and regulations. These laws and regulations govern, among other things, the controlled use, handling, release and disposal of and the maintenance of a registry for, hazardous materials and biological materials, laboratory procedures and exposure to pathogens.
Our third-party manufacturers and suppliers operations, including research, development, testing and manufacturing activities, are subject to numerous environmental, health and safety laws and regulations. These laws and regulations govern, among other things, the controlled use, handling, release and disposal of and the maintenance of a registry for, hazardous materials and biological materials, laboratory procedures and exposure to pathogens.
We collect, store and transmit sensitive information including intellectual property, proprietary business information, including highly sensitive clinical trial data, and personal information in connection with business operations. The secure maintenance of this information is critical to our operations and business strategy.
We collect, store and transmit sensitive information including intellectual property, proprietary business information, including highly sensitive clinical trial data, and personal data in connection with business operations. The secure maintenance of this information is critical to our operations and business strategy.
We face risks related to natural disasters and public health issues, such as the COVID-19 pandemic, that could negatively affect our business and financial condition. Our business could be adversely impacted by the effects of catastrophic global events including natural disasters such as an earthquake, fire, hurricane, tornado, flood or significant power outage and pandemics, such as the COVID-19 pandemic.
We face risks related to natural disasters and public health issues, that could negatively affect our business and financial condition. Our business could be adversely impacted by the effects of catastrophic global events including natural disasters such as an earthquake, fire, hurricane, tornado, flood or significant power outage and pandemics, such as the COVID-19 pandemic.
We are required to comply with various corporate governance and financial requirements under the Sarbanes-Oxley Act of 2002, the Dodd-Frank Wall Street Reform and Consumer Protection Act, the Nasdaq listing requirements, and other applicable securities rules and regulations.
We are required to comply with various corporate governance and financial requirements under the Sarbanes-Oxley Act of 2002, the Dodd-Frank Wall Street Reform and Consumer Protection Act, the Nasdaq listing rules and requirements ( Nasdaq Listing Rules ), and other applicable securities rules and regulations.
Additionally, the conflict between Russia and Ukraine and the sanctions imposed upon Russia by the U.S., the UK, and the EU, among others could disrupt: ● the recruitment and enrollment of eligible patients who may not be able to travel safely to clinical trial sites or may be forced to withdraw for a number of reasons; ● the closure or destruction of clinical sites or treatment facilities; ● the ability to compensate patients or staff living in sanctioned countries; ● the manufacturing process for our products or supply chain, which could increase the costs of raw material and production costs; ● the ability to transport, deliver, supply and collect necessary materials, products or services to clinical trial sites or deliver them to third-party central laboratories’ for analysis; ● the ability to collect data from clinical trial sites and ensure the integrity of any data collected; ● the destruction or disruption of our data centers or our critical business or information technology systems; or 29 Table of Contents ● the ability to submit data collected at Russian or Ukrainian sites due to the incompleteness or the fact that auditing by regulatory authorities was not fully possible.
Additionally, the conflict between Russia and Ukraine and the sanctions imposed upon Russia by the U.S., the UK, and the EU, among others could disrupt: ● the recruitment and enrollment of eligible patients who may not be able to travel safely to clinical trial sites or may be forced to withdraw for a number of reasons; ● the closure or destruction of clinical sites or treatment facilities; ● the ability to compensate patients or staff living in sanctioned countries; ● the manufacturing process for our products or supply chain, which could increase the costs of raw material and production costs; 32 Table of Contents ● the ability to transport, deliver, supply and collect necessary materials, products or services to clinical trial sites or deliver them to third-party central laboratories’ for analysis; ● the ability to collect data from clinical trial sites and ensure the integrity of any data collected; ● the destruction or disruption of our data centers or our critical business or information technology systems; or ● the ability to submit data collected at Russian or Ukrainian sites due to the incompleteness or the fact that auditing by regulatory authorities was not fully possible.
For instance, we have considerable material tax assets in Belgium and some of these tax assets may be forfeited in whole, or in part, as a result of various transactions, including corporate reorganizations or transactions relating to our shareholding structure, or their utilization may be restricted by statutory law in the relevant jurisdiction.
For instance, we have considerable material tax assets in Belgium and some of these tax assets may be forfeited in whole, or in part, as a result of various transactions, including corporate reorganizations or transactions relating to our shareholding structure, or their utilization may be restricted by statutory law or interpretation in the relevant jurisdiction.
To the extent that any disruption, security breach or unauthorized or inappropriate use or access to our systems were to result in a loss of or damage to our data, or inappropriate disclosure of confidential or proprietary information, including but not limited to patient, employee or vendor information, we could incur notification obligations to affected individuals and government agencies, liability, including potential lawsuits from patients, collaborators, employees, stockholders or other third parties and liability under foreign, federal and state laws that protect the privacy and security of personal information, and the development and potential commercialization of our product candidates could be delayed. 23 Table of Contents We are highly dependent on public perception of our products.
To the extent that any disruption, security breach or unauthorized or inappropriate use or access to our systems were to result in a loss of or damage to our data, or inappropriate disclosure of confidential or proprietary information, including but not limited to patient, employee or vendor information, we could incur notification obligations to affected individuals and government agencies, liability, including potential lawsuits from patients, collaborators, employees, stockholders or other third parties and liability under foreign, federal and state laws that protect the privacy and security of personal data, and the development and potential commercialization of our product candidates could be delayed. 26 Table of Contents We are highly dependent on public perception of our products.
We have relied upon and plan to continue to rely upon third parties, including independent clinical investigators, CROs, CMOs and other third-party service providers, to assist us in the conduct of certain of our research activities and clinical trials and to monitor and manage data for our ongoing preclinical studies and clinical trials.
We have relied upon and plan to continue to rely upon third parties, including independent clinical investigators, CROs, CMOs and other third-party service providers, to assist us in the conduct of certain of our research activities and clinical trials and to monitor and manage data for our ongoing preclinical trials and clinical trials.
Furthermore, if the Belgian legislator decides to eliminate, or change the conditions for claiming, such tax incentives, or reduce the scope or the rate of, such incentives, any of which it could decide to do at any time, our results of operations could be adversely affected.
Furthermore, if any legislator decides to eliminate, or change the conditions for claiming such tax incentives, or reduce the scope or the rate of such incentives, any of which it could decide to do at any time, our results of operations could be adversely affected.
The determination of our provision for income taxes and other tax liabilities requires significant judgment, including the adoption of certain accounting policies and our determination of whether our deferred tax assets are, and will remain, fully available in future periods.
The determination of our provision for income taxes and other tax liabilities requires judgment, including the adoption of certain accounting policies and our determination of whether our deferred tax assets are, and will remain, fully available in future periods.
If we are unable to obtain patent term extension or the term of any such extension is less than we request, the period during which we can enforce our patent rights for that product will be shortened and our competitors may obtain approval to market competing products sooner than we expect. 27 Table of Contents Changes in patent laws or patent jurisprudence could diminish the value of patents in general, thereby impairing our ability to protect our products.
If we are unable to obtain patent term extension or the term of any such extension is less than we request, the period during which we can enforce our patent rights for that product will be shortened and our competitors may obtain approval to market competing products sooner than we expect. 30 Table of Contents Changes in patent laws or patent jurisprudence could diminish the value of patents in general, thereby impairing our ability to protect our products.
Alternatively, if we were to challenge the validity of any issued U.S. patent in court, we would need to overcome a statutory presumption of validity that attaches to every U.S. patent.
If we were to challenge the validity of any issued U.S. patent in court, we would need to overcome a statutory presumption of validity that attaches to every U.S. patent.
We contract with Lonza Sales AG ( Lonza ) based in Slough, UK, Portsmouth, U.S. and Singapore and FUJIFILM Diosynth Biotechnologies Denmark ApS ( Fujifilm ) for activities relating to the development of cell banks, development of our manufacturing processes and the manufacturing of drug substance, and use additional contract manufacturers to fill, test, label, package, store and distribute our (investigational) drug products.
We contract with Lonza Sales AG ( Lonza ) based in Slough, UK, Portsmouth, U.S, Singapore and Visp, Switzerland and FUJIFILM Diosynth Biotechnologies Denmark ApS ( Fujifilm ) based in Denmark for activities relating to the development of cell banks, development of our manufacturing processes and the manufacturing of drug substance, and use additional contract manufacturers to fill, test, label, package, store and distribute our (investigational) drug products.
There is no guarantee we will be successful in defending such claims, which would result in us paying monetary damages, or lose valuable personnel or intellectual property rights. 25 Table of Contents Third-party intellectual property rights could adversely affect our ability to commercialize our products and product candidates.
There is no guarantee we will be successful in defending such claims, which would result in us paying monetary damages, or lose valuable personnel or intellectual property rights. 28 Table of Contents Third-party intellectual property rights could adversely affect our ability to commercialize our products and product candidates.
We are exposed to unanticipated changes in tax laws and regulations, adjustments to our tax provisions, exposure to additional tax liabilities, or forfeiture of our tax assets.
We are exposed globally to unanticipated changes in tax laws and regulations, adjustments to our tax provisions, exposure to additional tax liabilities, or forfeiture of our tax assets.
If a successful product liability 22 Table of Contents claim or series of claims is brought against us for uninsured liabilities or in excess of insured liabilities, our assets may not be sufficient to cover such claims and our business, financial condition and results of operations would be adversely affected.
If a successful product liability claim or series of claims is brought against us for uninsured liabilities or in excess of insured liabilities, our assets may 25 Table of Contents not be sufficient to cover such claims and our business, financial condition and results of operations would be adversely affected.
Our effective tax rates could be adversely affected by changes in tax laws, treaties and regulations or the interpretation thereof by the relevant tax authorities in countries where we have material operations, including changes to the Belgian innovation income deduction, to the corporate income tax base, or to other tax incentives and the implementation of new tax incentives.
Our effective tax rates could be adversely affected, now or in the future, by changes in tax laws, treaties and regulations or the interpretation thereof by the relevant tax authorities in countries where we have material operations, including changes to the Belgian innovation income deduction, to the corporate income tax base, or to other tax incentives and the implementation of new tax incentives.
Nevertheless, we are responsible for ensuring that each of our studies and clinical trials is conducted in accordance with the applicable protocol, legal and regulatory requirements and scientific standards, and our reliance on these third parties does not relieve us of our regulatory responsibilities.
Nevertheless, we are responsible for ensuring that each of our preclinical trials and clinical trials is conducted in accordance with the applicable protocol, legal and regulatory requirements and scientific standards, and our reliance on these third parties does not relieve us of our regulatory responsibilities.
To the extent our collaborators or the CROs or investigators fail to enroll participants for our clinical trials, fail to conduct the clinical trial to GCP standards or in full compliance with legal and regulatory requirements or are delayed for a significant time in the execution of 18 Table of Contents clinical trials, including achieving full enrollment, we may be affected by increased costs, program delays or both, which may harm our business.
To the extent our collaborators or the CROs or investigators fail to enroll participants for our clinical trials, fail to conduct the clinical trial to GCP standards or in full compliance with legal and regulatory requirements or are delayed for a significant time in the execution of clinical trials, including achieving full enrollment, we may be affected by increased costs, program delays or both, which may harm our business.
Except as described in this Annual Report or any deposit agreements, holders of ADSs are not treated as our shareholders unless they withdraw the ordinary shares underlying their ADSs. The depository, or its nominee, is the holder of the ordinary shares underlying the ADSs.
Except as described in this Annual Report or any deposit agreements, holders of ADSs are not treated as our shareholders unless they withdraw the ordinary shares underlying their ADSs. The depositary, or its nominee, is the holder of the ordinary shares underlying the ADSs.
Due to our international operations and the fact that we run clinical trials in a large number of jurisdictions, the eruption of global conflicts, such as the continuing conflict between Russia and Ukraine may negatively impact our ability to conduct or complete clinical trials in the affected regions, which could adversely affect our business and financial performance.
Due to our international operations and the fact that we run clinical trials in a large number of jurisdictions, the eruption of global conflicts, such as the continuing conflict between Russia and Ukraine and the ongoing Israel-Hamas conflict, may negatively impact our ability to conduct or complete clinical trials in the affected regions, which could adversely affect our business and financial performance.
Alternative production plans in place or disaster-recovery facilities available to us may not be sufficient. In case of a disruption, we may have to establish additional alternative manufacturing sources. This would require substantial investment on our part, which we may not be able to obtain on commercially acceptable terms or at all.
Alternative production plans in place or disaster-recovery facilities available to us may not be sufficient. In case of a disruption, we may have to establish 23 Table of Contents additional alternative manufacturing sources. This would require substantial investment on our part, which we may not be able to obtain on commercially acceptable terms or at all.
Pursuant to Section 404 of the Sarbanes-Oxley Act of 2002, we are 32 Table of Contents required to furnish a report by management on, among other things, the effectiveness of our internal control over financial reporting and an attestation report on internal control over financial reporting issued by our independent registered public accounting firm.
Pursuant to Section 404 of the Sarbanes-Oxley Act of 2002, we are required to furnish a report by management on, among other things, the effectiveness of our internal control over financial reporting and an attestation report on internal control over financial reporting issued by our independent registered public accounting firm.
The relevant Belgian authorities may challenge our eligibility for, or our calculation of, such tax incentives and, should such a challenge be successful, we may be liable for additional taxes, and penalties and interest related thereto, which could have a significant impact on our results of operations and future cash flows.
The relevant tax authorities may challenge our eligibility for, or our calculation of, such tax incentives and, should such a challenge be successful, we may be liable for additional taxes, and penalties and interest related thereto, which could have an impact on our results of operations and future cash flows.
In particular, holders of ordinary shares or ADSs located in the U.S. would not be able to participate in a pre-emptive rights offering unless we registered the securities to which the rights relate under the Securities Act or an exemption from the registration requirements.
In particular, holders of ordinary shares or ADSs located in the U.S. would not be able to participate in a pre-emptive rights offering unless we registered the securities to which the rights relate under the U.S. Securities Act of 1933, as amended ( Securities Act ) or an exemption from the registration requirements.
Such limitations may make it more difficult to successfully compete for key talent in a number of markets that have differing remuneration practices and policies as we are bound by more restrictive remuneration practices than our competitors.
Such limitations may make it more difficult to successfully compete for key talent in a number of markets that have differing remuneration practices and policies as we are bound by more restrictive remuneration practices than 31 Table of Contents our competitors.
The trading price of those securities depends on a number of factors, including those described in this “ Risk Factors ” section, many of which are beyond our control and may not be related to our operating performance, which may limit or prevent investors from readily selling their ADSs or ordinary shares and may otherwise negatively affect the liquidity of our ADSs and ordinary shares.
The trading price of those securities depends on a number of factors, including those described in this “Risk Factors” section, many of which are beyond our control and may not be related to our operating performance, which may limit or prevent investors from readily selling their ADSs or ordinary shares and may otherwise negatively affect the liquidity of our ADSs and ordinary shares.
To protect our competitive position, we may from time to time need to resort to litigation in order to enforce or defend any intellectual property rights owned by or licensed to us, or to determine or challenge the scope or validity of intellectual property rights of third parties.
To protect our competitive position, we may from time to time need to resort to adversarial proceedings in order to enforce or defend any intellectual property rights owned by or licensed to us, or to determine or challenge the scope or validity of intellectual property rights of third parties.
Compliance with these laws and regulations will be more challenging as we expand our international operations, 31 Table of Contents including in connection with potential approvals of our products and product candidates in Europe, the U.S. and elsewhere.
Compliance with these laws and regulations will be more challenging as we expand 34 Table of Contents our international operations, including in connection with potential approvals of our products and product candidates in Europe, Japan, the U.S. and elsewhere.
In case of a change of control of the Company, we could be exposed to the risk of losing the unused tax credit and innovation income deduction.
In case of a change of control, we could be exposed to the risk of losing any unused tax credit and innovation income deduction.
We face risks inherent in relying on limited CMOs, as any failure in their ability to successfully manufacture our products or product candidates as described above or any disruption, such as a fire, pandemic, natural hazards or 20 Table of Contents vandalism at the CMO could significantly interrupt our manufacturing capability.
We face risks inherent in relying on limited CMOs, as any failure in their ability to successfully manufacture our products or product candidates as described above or any disruption, such as a fire, pandemic, natural hazards or vandalism at the CMO could significantly interrupt our manufacturing capability.
Many geo- and socio-political threats and macro-economic uncertainties are outside of our control, including general economic and market conditions, consumer and commercial credit availability, inflation, interest rates, unemployment, consumer debt levels, political crises, such as terrorist attacks, war and other political instability, economic sanctions and other challenges affecting the global economy, including the Russia-Ukraine conflict, disruptions in supply chains, and changes in trade agreements which could adversely affect consumer confidence and disposable income levels, increase difficulty in forecasting our financial results and have other impacts on our business and financial performance.
Many geo- and socio-political threats and macro-economic uncertainties are outside of our control, including general economic and market conditions, consumer and commercial credit availability, inflation, interest rates, unemployment, consumer debt levels, political crises, such as terrorist attacks, war and other political instability, economic sanctions, outbound investment restrictions and other challenges affecting the global economy, including the Russia-Ukraine and the Israel-Hamas conflicts, disruptions in supply chains, and changes in trade agreements which could adversely affect consumer confidence and disposable income levels, increase difficulty in forecasting our financial results and have other impacts on our business and financial performance.
There are no treaties between the U.S. with either the Netherlands or Belgium providing for 34 Table of Contents the reciprocal recognition and enforcement of judgments, other than arbitration awards, in civil and commercial matters.
There are no treaties between the U.S. with either the Netherlands or Belgium providing for the reciprocal recognition and enforcement of judgments, other than arbitration awards, in civil and commercial matters.
We have so far not filed for patent protection in all national and 24 Table of Contents regional jurisdictions where such protection may be available. If we fail to timely file a patent application in any such country or major market, we may be precluded from doing so at a later date.
We have so far not filed for patent protection in all national and regional jurisdictions where such protection may be available. If we fail to timely file a patent application in any such country or major market, we may be precluded from doing so at a later date.
If one or more of the analysts who cover us downgrade our ADSs or ordinary shares or publish inaccurate or unfavorable research about our business, the price of our ADSs or ordinary shares would likely decline.
If one or more of the analysts who cover us 36 Table of Contents downgrade our ADSs or ordinary shares or publish inaccurate or unfavorable research about our business, the price of our ADSs or ordinary shares would likely decline.
Our program includes efforts such as risk assessment and monitoring, fostering a culture encouraging employees and third parties to raise good faith questions or concerns, and defined processes and systems for reviewing and remediating allegations and identified potential concerns.
Our program includes efforts such as risk assessment and monitoring, fostering a culture encouraging employees and third parties to raise good 24 Table of Contents faith questions or concerns, and defined processes and systems for reviewing and remediating allegations and identified potential concerns.
However, it is possible that we could lose multiple cell banks and have our manufacturing significantly impacted by the need to replace these cell banks, which could materially adversely affect our business, prospects, financial condition and results of operations. Public health issues could also negatively affect our business and financial condition.
However, it is possible that we could lose multiple cell banks and have our manufacturing significantly impacted by the need to replace these cell banks, which could materially adversely affect our business, prospects, financial condition and results of operations. Public health issues could also negatively affect our business and financial condition. We operate and conduct our clinical trials globally.
In such cases, we may not be in a position to develop or commercialize products or product candidates unless we successfully pursue costly and time-consuming litigation to nullify or invalidate the third-party intellectual property right concerned or enter into a license agreement with the intellectual property right holder.
In such cases, we may not be in a position to develop or commercialize products or product candidates unless we secure a license, design around, or successfully pursue costly and time-consuming proceedings to nullify or invalidate the third-party intellectual property right concerned or enter into a license agreement with the intellectual property right holder.
Employee misconduct could also involve the improper use of, including improper trading based upon, information obtained in the course of clinical studies, which could result in regulatory sanctions and serious harm to our reputation. We maintain a global 21 Table of Contents compliance program and remain focused on its evolution and enhancement.
Employee misconduct could also involve the improper use of material information, including improper trading based upon, information obtained in the course of clinical trials, which could result in regulatory sanctions and serious harm to our reputation. We maintain a global compliance program and remain focused on its evolution and enhancement.
For example, the loss of pre-clinical trial data or data from completed or ongoing clinical trials for our product candidates could result in delays in our regulatory filings and development efforts, as well as delays in the commercialization of our products, and significantly increase our costs.
Such events could cause interruption of our operations. For example, the loss of pre-clinical trial data or data from completed or ongoing clinical trials for our product candidates could result in delays in our regulatory filings and development efforts, as well as delays in the commercialization of our products, and significantly increase our costs.
However, we are permitted to rely on home country governance requirements and certain exemptions thereunder. Certain of our corporate governance practices may differ significantly from other corporate governance listing standards, as set forth in
However, we are permitted to rely on home country governance requirements and certain exemptions thereunder. Certain of our corporate governance practices may differ significantly from other corporate governance listing standards.
See the risk factors under the headers “— Global geo- and socio-political threats and macro-economic uncertainty and other unforeseen political crises could materially and adversely affect our business and financial performance ” and “— We face risks related to natural disasters and public health issues, such as the COVID-19 pandemic, that could negatively affect our business and financial condition .” Risk Factors Related to argenx’s Dependence on Third Parties We rely, and expect to continue to rely, on third parties to conduct some of our research activities and clinical trials and for parts of the development and commercialization of our existing and future research programs, products and product candidates.
“ Risk Factors — Risk Factors Related to argenx’s Organization and Operations —‘ Global geo- and socio-political threats and macro-economic uncertainty and other unforeseen political crises could materially and adversely affect our business and financial performance.’ and ‘ We face risks related to natural disasters and public health issues, that could negatively affect our business and financial condition.” Risk Factors Related to argenx’s Dependence on Third Parties We rely, and expect to continue to rely, on third parties to conduct some of our research activities and clinical trials and for parts of the development and commercialization of our existing and future research programs, products and product candidates.
Regardless of such option, we may be unable to negotiate a license 26 Table of Contents within the specified timeframe or under terms that are acceptable to us, in which case the institution may offer the intellectual property rights to other parties, potentially blocking our ability to pursue our applicable product candidate or program.
Regardless of such option, we may be unable to negotiate a license within the specified timeframe or under terms that are acceptable to us, in which case the institution may offer the intellectual property rights to other parties, potentially blocking our ability to pursue our applicable product candidate or program. 29 Table of Contents In addition, companies that perceive us to be a competitor may be unwilling to assign or license rights to us.
We may not be able to obtain protection under the Hatch-Waxman Act and similar non-U.S. legislation for extending the term of patents covering each of our products and product candidates.
We may not be able to obtain protection under the U.S. Drug Price Competition and Patent Term Restoration Act of 1984 (Hatch-Waxman Act) and similar non-U.S. legislation for extending the term of patents covering each of our products and product candidates.
As a foreign private issuer, we are exempt from certain rules under U.S. securities laws and are permitted to file less information with the SEC than a U.S. company. As a “foreign private issuer” defined in the SEC’s rules and regulations, we are exempt from certain provisions of the Exchange Act that are applicable to U.S. domestic public companies.
As a foreign private issuer, we are exempt from certain rules under U.S. securities laws and are permitted to file less information with the SEC than a U.S. company. As a “foreign private issuer” defined in the SEC’s rules and regulations, we are exempt from certain provisions of the U.S.
If we or any of the third parties with whom we engage, including the suppliers, contract manufacturers, clinical trial sites, regulators and other third parties, were to experience shutdowns, quarantines, or other business disruptions to stop the spread of a pandemic, it may impair our or our third-party partners’ ability to initiate clinical trials and recruit and retain patients, particularly if quarantine or travel restrictions impede healthcare provider or patient movement, impact the usability of the data due to treatment interruptions and require protocol amendments.
If we or any of the third parties with whom we engage, including the suppliers, contract manufacturers, clinical trial sites, regulators and other third parties, were to experience shutdowns, quarantines, or other business disruptions due to natural disasters or global public health issues, it may impair our or our third-party partners’ ability to initiate clinical trials and recruit and retain patients, particularly if quarantine or travel 33 Table of Contents restrictions impede healthcare provider or patient movement, impact the usability of the data due to treatment interruptions and require protocol amendments.
In addition, litigation involving our patents carries the risk that one or more of our patents will be held invalid or held unenforceable. Such an adverse court ruling could allow third parties to commercialize our products or use our platform technologies, and then compete directly with us, without payment to us.
In addition, adversarial proceedings involving our patents carries the risk that one or more of our patents will be held invalid or held unenforceable. Such an adverse ruling could allow third parties to commercialize our products immediately after the expiration of our regulatory protection or use our platform technologies, and then compete directly with us, without payment to us.
Our shareholders are only entitled to participate in, and vote at, a general meeting of our shareholders ( General Meeting ), provided that their shares are recorded in their name sat midnight (Central European Time) at the end of the twenty-eighth day preceding the date of such General Meeting.
Our shareholders are only entitled to participate in, and vote at, a general meeting of our shareholders ( General Meeting ), provided that their shares are recorded in their names at midnight (central European time) at the end of the 28 th day preceding the date of such General Meeting.
We currently have collaborative research relationships with various pharmaceutical companies such as AbbVie SARL ( AbbVie ), Zai Lab and with various academic and research institutions worldwide for the development of product candidates resulting from such collaborations. We also have distribution agreements with Medison and Genpharm for the distribution of VYVGART.
We currently have collaborative research relationships with various pharmaceutical companies such as 21 Table of Contents AbbVie, Zai Lab, Genmab A/S ( Genmab ) and with various academic and research institutions worldwide for the development of product candidates resulting from such collaborations. We also have distribution agreements with Medison, Genpharm and Handok for the distribution of VYVGART.
Issued patents could be found invalid or unenforceable if challenged in the applicable patent office or court. Once granted, patents may remain open to invalidity challenges for a given period after allowance or grant, during which time third parties can raise objections against such granted patent.
Issued patents could be found invalid or unenforceable if challenged in the applicable patent office or court. Once granted, patents may remain open to invalidity challenges after allowance or grant, where third parties can raise objections against such granted patent.
Risks Related to being a Foreign Private Issuer or a Dutch Company The risks in this subsection that relate to our status as a foreign private issuer will change if we lose our status as a foreign private issuer. 33 Table of Contents We are a Dutch European public company with limited liability (Societas Europaea or SE).
Risks Related to being a Foreign Private Issuer or a Dutch Company The risks in this subsection that relate to our status as a foreign private issuer will change if we lose our status as a foreign private issuer under U.S. law. We are a Dutch European public company with limited liability (Societas Europaea or SE).
The stock markets in general, and biopharmaceutical companies in particular, have experienced extreme price and volume fluctuations that have often been unrelated or disproportionate to the operating performance of these companies. During 2022, the closing sales price of our ADSs representing our ordinary shares on Nasdaq fluctuated greatly, ranging from $254.45 to $402.31.
The stock markets in general, and biopharmaceutical companies in particular, have experienced extreme price and volume fluctuations that have often been unrelated or disproportionate to the operating performance of these companies. During 2023, the closing sales price of our ADSs representing our ordinary shares on Nasdaq fluctuated greatly, ranging from $334.23 to $548.43.
Despite the implementation of security measures, our internal computer systems and those of our contractors and consultants are vulnerable to damage or interruption from computer viruses, unauthorized or inappropriate access or use, natural disasters, pandemics (including COVID-19), terrorism, war (including the ongoing conflict in Ukraine), and telecommunication and electrical failures. Such events could cause interruption of our operations.
Despite the implementation of security measures, our internal computer systems and those of our contractors and consultants are vulnerable to damage or interruption from computer viruses, unauthorized or inappropriate access or use, natural disasters, pandemics, terrorism, war (including the ongoing conflict in Ukraine and the ongoing conflict in Israel and the Gaza Strip), and telecommunication and electrical failures.
We are subject to Dutch laws and regulations with regard to such matters. While we furnish quarterly unaudited financial information to the SEC on Form 6-K, the information we furnish to the SEC is less extensive and less timely compared to that required to be filed with the SEC by U.S. domestic issuers.
While we furnish quarterly unaudited financial information to the SEC on Form 6-K, the information we furnish to the SEC is less extensive and less timely compared to that required to be filed with the SEC by U.S. domestic issuers.
Risk Factors Related to argenx’s Intellectual Property Failure to adequately enforce or protect our intellectual property rights in products, product candidates and platform technologies could adversely affect our ability to develop and market our products and product candidates.
Risk Factors Related to argenx’s Intellectual Property Failure to adequately enforce or protect our intellectual property rights in products, product candidates and platform technologies could adversely affect our ability to maximize the value for patients in our marketed products and product candidates.
We and our current or future licensors, licensees or collaboration partners may not be able to prepare, file and prosecute all necessary or desirable patent applications at a reasonable cost or in a timely manner.
If that would happen, then there is a risk of decreasing our market potential. We and our current or future licensors, licensees or collaboration partners may not be able to prepare, file and prosecute all necessary or desirable patent applications at a reasonable cost or in a timely manner.
Claims of U.S. civil liabilities may not be enforceable against us or the members of our management and our Board of Directors. Substantially all of our assets are located outside the U.S. The majority of the members of our senior management team and our directors are not U.S. residents and we do not have significant assets in the U.S.
Substantially all of our assets are located outside the U.S. The majority of the members of our senior management team and our directors are not U.S. residents and we do not have significant assets in the U.S.
Any adverse outcome of such a review or change in law may lead to adjustments in the amounts recorded in our financial statements and could have a materially adverse effect on our operating results and financial condition.
Any adverse outcome of such a review or change in law may lead to adjustments in the amounts recorded in our financial statements and could have a materially adverse effect on our operating results and financial condition. Dealings between group companies are subject to transfer pricing regulations, which may be subject to change and could have a material impact.
For example, the DCGC places certain limitations on the ability to grant equity incentives to non-executive directors, while Belgian law requires non-executive directors to receive part of their remuneration in the forms 28 Table of Contents of shares, but not stock options. The DCGC also places limitations on amount of severance payment permitted in the event of dismissal.
For example, the Dutch Corporate Governance Code 2022 ( DCGC ) places certain limitations on the ability to grant equity incentives to non-executive directors, while Belgian law requires non-executive directors to receive part of their remuneration in the forms of shares, but not stock options.
Any of the aforementioned situations could cause harm to our ability to protect our intellectual property, which in turn would allow competitors to market comparable products which could materially adversely affect our competitive position and as such our business, financial condition and results of operation.
Any of the aforementioned situations could cause harm to our ability to protect our intellectual property, which in turn would allow competitors to market comparable products which could materially adversely affect our competitive position and as such our business, financial condition and results of operation. 27 Table of Contents We enjoy only limited geographical protection with respect to certain patents and may face difficulties in certain jurisdictions.
In addition, we may not be able to use, or changes in tax regulations may affect the use of, certain unrecognized tax assets or credits that we have built over the years.
The Group is currently in the process of determining the impact, if any, for 2025 and onwards. In addition, we may not be able to use, or changes in tax regulations may affect the use of, certain unrecognized tax assets or credits that we have built over the years.
However, current or former employees, consultants, advisors and potential collaborators may unintentionally or willfully disclose our confidential information to competitors despite these procedures or in violation of our confidentiality agreements.
We require our employees, consultants, advisors and potential collaborators to enter into confidentiality agreements. Moreover, we put in place appropriate procedures to identify confidential material and restrict access to documentation. However, current or former employees, consultants, advisors and potential collaborators may unintentionally or willfully disclose our confidential information to competitors despite these procedures or in violation of our confidentiality agreements.
We cannot be certain that patents will be issued or granted with respect to applications that are currently pending. The scope of patent protection that the European Patent Office and the U.S. Patent and Trademark Office ( USPTO ) will grant with respect to the antibodies in our product pipeline is uncertain and may vary by jurisdiction.
We cannot be certain that patents will be issued or granted with respect to applications that are currently pending. The scope of patent protection that the European Patent Office and the U.S. Patent and the U.S.
We enjoy only limited geographical protection with respect to certain patents and may face difficulties in certain jurisdictions. We often file our first patent application (i.e., priority filing) at the UK Intellectual Property Office, the European Patent Office or the USPTO. International applications under the Patent Cooperation Treaty are usually filed within twelve months after the priority filing.
We often file our first patent application (i.e., priority filing) at the UK Intellectual Property Office, the European Patent Office or the USPTO. International applications under the Patent Cooperation Treaty are usually filed within 12 months after the priority filing.
We do not have the ability to internally source the raw materials necessary to produce our product or product candidates, and do not currently have, nor do we plan to acquire, the infrastructure or capability internally to manufacture our products or product candidates and depend on a worldwide supply chain and third parties for both. 19 Table of Contents Disruptions caused by our reliance on such third-party suppliers, service providers and manufacturers may delay or disrupt our business, product development and commercialization efforts.
We do not have the ability to internally source the raw materials necessary to produce our products or product candidates, and do not currently have, nor do we plan to acquire, the infrastructure or capability internally to manufacture our products or product candidates and depend on a worldwide supply chain and third parties for both.
In addition, the U.S. has proposed legislation that imposes restrictions on our ability to prevent departing employees from competing with us following their departure. If finalized, such legislation could also adversely affect our ability to retain employees who may go to competitors with more resources than us and who are not bound by similar remuneration policies.
If finalized, such legislation could also adversely affect our ability to retain employees who may go to competitors with more resources than us and who are not bound by similar remuneration policies.
Department of the Treasury’s Office of Foreign Assets Control has issued General License 6B, which authorizes “ongoing clinical trials and medical research activities”. Following a risk assessment relating to the conflict between Russia and Ukraine, we increased target enrollment, which delayed expected topline data of SC efgartigimod for PV and PF to the second half of 2023.
Following a risk assessment relating to the conflict between Russia and Ukraine, we increased target enrollment, which delayed expected topline data of SC efgartigimod for PV and PF to the second half of 2023.
We may be unable to protect the confidentiality of our trade secrets and know-how. In addition to patent protection, we rely on trade secret protection for our proprietary information, including, for example, certain aspects of our llama immunization and antibody affinity maturation approaches.
In addition to patent protection, we rely on trade secret protection for our proprietary information, including, for example, certain aspects of our llama immunization and antibody affinity maturation approaches. However, trade secrets are difficult to protect, and we have limited control over the protection of trade secrets used by our numerous licensors, collaborators and suppliers.
Reliance on Third-Party Suppliers and Service Providers For some of our raw materials, we rely on a single source of supply and there are limited supplies of the raw materials.
Disruptions caused by our reliance on such third-party suppliers, service providers and manufacturers may delay or disrupt our business, product development and commercialization efforts. 22 Table of Contents Reliance on Third-Party Suppliers and Service Providers For some of our raw materials, we rely on a single source of supply and there are limited supplies of the raw materials.
If we do not comply with the provisions of the DCGC (for example, because of a conflicting Nasdaq requirement or otherwise), we must list the reasons for any deviation from the DCGC in our annual report filed in the Netherlands.
If we do not comply with the provisions of the DCGC (for example, because of a conflicting Nasdaq Listing Rule or otherwise), we must list the reasons for any deviation from the DCGC in our annual report filed in the Netherlands. 37 Table of Contents Claims of U.S. civil liabilities may not be enforceable against us or the members of our management and our Board of Directors.
Any inability to manage growth could delay the execution of our strategic objectives or disrupt our operations, which in turn could materially harm our business and prospects. We have benefited from certain research and development incentives in Belgium, which may be re-evaluated if our shareholder base changes significantly.
Any inability to manage growth could delay the execution of our strategic objectives or disrupt our operations, which in turn could materially harm our business and prospects. We have benefitted from certain research and development incentives. These could be impacted by changes in law (or interpretation), changes of fact (such as a change in ownership), or challenge by tax authorities.
If we fail to maintain an effective system of disclosure controls and internal control over financial reporting, our ability to comply with applicable regulations could be impaired, and the trading price of our ADSs may be negatively impacted.
Further, fluctuations in exchange rates may also impact the price of our ADSs and ordinary shares which may result in heavy trading by investors seeking to exploit such differences, or impact the proceeds holders receive. 35 Table of Contents If we fail to maintain an effective system of disclosure controls and internal control over financial reporting, our ability to comply with applicable regulations could be impaired, and the trading price of our ADSs may be negatively impacted.
We may be required to seek a license to any such technology that we are found to infringe, which license may not be available on commercially reasonable terms, or at all.
We might, if possible, also be forced to redesign products and product candidates so that we no longer infringe the third-party intellectual property rights. We may be required to seek a license to any such technology that we are found to infringe, which license may not be available on commercially reasonable terms, or at all.
Based on current information, we expect that the Group could become subject to the Pillar Two Directive and implementing domestic laws as early as 2025. However, whether the Pillar Two Directive will have an impact on the Group’s tax liabilities and operations cannot be determined accurately and remains uncertain.
Based on current information, management expects that the Group could become subject to the Pillar Two Directive and domestic laws as early as 2025. Management does not expect the Pillar Two Directive and implementing domestic laws to have an impact on the Group in 2024.
If we fail in any such dispute, we or our licensees may be temporarily or permanently prohibited from commercializing any of our products and product candidates that are held to be infringing. We might, if possible, also be forced to redesign products and product candidates so that we no longer infringe the third-party intellectual property rights.
If we fail in any such dispute, we or our licensees may be prohibited from commercializing any of our products and product candidates that are held to be infringing for the remaining term of any valid and enforceable patents.
It is possible that the European Patent Office and the USPTO will not allow broad antibody claims that cover antibodies closely related to our products and product candidates as well as the specific antibody. As a result, upon receipt of EMA or FDA approval, competitors may be free to market antibodies almost identical to ours thereby decreasing our market potential.
Patent and Trademark Office ( USPTO ) will grant with respect to the antibodies in our product pipeline is uncertain and may vary by jurisdiction. It is possible that the European Patent Office and the USPTO will not allow broad antibody claims that cover antibodies closely related to our products and product candidates as well as the specific antibody.
The Belgian authorities may challenge our eligibility for or our calculation of such incentives. As a company active in research and development in Belgium, we have benefited from certain research and development tax incentives, in particular a tax credit and a payroll withholding tax exemption.
As a company active in research and development, we have benefited from certain research and development tax incentives including tax credits and a payroll withholding tax exemption. We also expect to benefit from the Belgian innovation income deduction.
We operate and conduct our clinical trials globally, including in areas impacted by COVID-19 in North America, Europe, the PRC and Japan. We cannot presently predict the scope and severity of any potential future business shutdowns or disruptions as a result of COVID-19.
We cannot presently predict the scope and severity of any potential future business shutdowns or disruptions as a result of public health issues.
Supreme Court has ruled on several patent cases in recent years, either narrowing the scope of patent protection available in certain circumstances or weakening the rights of patent owners in certain situations. Such changes may materially affect our patents or patent applications and our ability to obtain additional patent protection in the future.
Supreme Court has ruled on several patent cases in recent years, either narrowing the scope of patent protection available in certain circumstances or weakening the rights of patent owners in certain situations. Relatedly, U.S. congressional representatives have introduced multiple draft bills this year that, if passed, may have a significant impact on U.S. patent laws. Such changes by the U.S.
If we fail to comply with our obligations under these agreements, the licensor may have the right to terminate the license. Several of our existing license agreements are sub-licenses from third parties who are not the original licensors of the intellectual property at issue.
Moreover, we could incur significant costs and/or disruption to our business and distraction of our management defending against any breach alleged by the licensor. Several of our existing license agreements are sub-licenses from third parties who are not the original licensors of the intellectual property at issue.

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Item 4. Mine Safety Disclosures

Mine Safety Disclosures — required of mining issuers

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TREND INFORMATION Other than as disclosed elsewhere in this Annual Report, we are not aware of any trends, uncertainties, demands, commitments or events for the current financial period that are reasonably likely to have a material effect on our net revenues, income, profitability, liquidity, capital resources or propsects, or that caused the disclosed financial information to be not necessarily indicative of future operating results or financial conditions.
TREND INFORMATION Other than as disclosed elsewhere in this Annual Report, we are not aware of any trends, uncertainties, demands, commitments or events for the current financial period that are reasonably likely to have a material effect on our net revenues, income, profitability, liquidity, capital resources or prospects, or that caused the disclosed financial information to be not necessarily indicative of future operating results or financial conditions.
On the basis of current assumptions, we expect that our existing cash and cash equivalents and current financial assets will enable us to fund our operating expenses and capital expenditure requirements through at least the next twelve months. Our future equity capital will depend on many factors.
On the basis of current assumptions, we expect that our existing cash and cash equivalents and current financial assets will enable us to fund our operating expenses and capital expenditure requirements through at least the next twelve months. Our future equity capital will depend on multiple factors.
The increase in our selling, general and administrative expenses for the year ended December 31, 2022 was principally due to an increase of personnel expense and professional and marketing fees, resulting from: ● increased costs of the salary and wages and benefits to our selling, general and administrative employees due to planned increase in the headcount; ● increased costs associated with additional employees recruited to strengthen our selling, general and administrative activities, for the commercial launch of VYVGART; ● increased professional and marketing fees, including promotional and marketing costs primarily due to the commercial launch of VYVGART; and ● continued investment in our IT infrastructure.
The increase in our Selling, general and administrative expenses for the year ended December 31, 2023 was principally resulting from: ● increased professional and marketing fees, including promotional and marketing costs primarily due to the commercial launch of VYVGART and VYVGART SC; ● increased costs of the salary and wages and benefits to our selling, general and administrative employees due to planned increase in the headcount; ● increased costs associated with additional employees recruited to strengthen our selling, general and administrative activities, for the commercial launch of VYVGART and VYVGART SC; and ● continued investment in our IT infrastructure.
Our future capital requirements for efgartigimod and our other product candidates and discovery stage programs will depend on many factors, including: ● the progress, timing and completion of preclinical testing and clinical trials for our current or any future product candidates; ● the number of potential new product candidates we identify and decide to develop; 112 Table of Contents ● the time and costs involved in obtaining regulatory approval for our product candidates and any delays we may encounter as a result of evolving regulatory requirements or adverse results with respect to any of our product candidates; ● selling and marketing activities undertaken in connection with the commercialization of VYVGART or potential commercialization of any of our current or any future product candidates, if approved, and costs involved in the creation of an effective sales and marketing organization; ● manufacturing activities undertaken for VYVGART and potential commercialization of any of our current or any future product candidates, if approved, and costs involved in the creation of an effective supply chain; ● the costs involved in growing our organization to the size needed to allow for the research, development and potential commercialization of our current or any future product candidates; ● the costs involved in filing patent applications and maintaining and enforcing patents or defending against claims or infringements raised by third parties; ● the maintenance of our existing collaboration agreements and entry into new collaboration agreements; ● developments related to COVID-19 and its impact on the costs and timing associated with the conduct of our clinical trials, preclinical programs, manufacturing activities and other related activities; and ● developments related to the global economic uncertainties and political instability resulting from the conflict between Russia and the Ukraine.
Our future capital requirements for efgartigimod and our other product candidates and discovery stage programs will depend on many factors, including: ● the progress, timing and completion of preclinical testing and clinical trials for our current or any future product candidates; ● the number of potential new product candidates we identify and decide to develop; ● the time and costs involved in obtaining regulatory approval for our product candidates and any delays we may encounter as a result of evolving regulatory requirements or adverse results with respect to any of our product candidates; ● selling and marketing activities undertaken in connection with the commercialization of VYVGART, VYVGART SC or potential commercialization of any of our current or any future product candidates, if approved, and costs involved in the creation of an effective sales and marketing organization; ● manufacturing activities undertaken for VYVGART, VYVGART SC and potential commercialization of any of our current or any future product candidates, if approved, and costs involved in the creation of an effective supply chain; ● the costs involved in growing our organization to the size needed to allow for the research, development and potential commercialization of our current or any future product candidates; ● the costs involved in filing patent applications and maintaining and enforcing patents or defending against claims or infringements raised by third parties; ● the maintenance of our existing collaboration agreements and entry into new collaboration agreements; ● developments related to the global economic uncertainties and political instability.
The decrease was mainly attributable to unrealized exchange rate losses on the cash, cash equivalents and current financial assets position in euro during the year ended December 31, 2022 as compared to unrealized exchange rate losses on the cash, cash equivalents and current financial assets position during the year ended December 31, 2021. 110 Table of Contents B.
The decrease was mainly attributable to unrealized exchange rate gains on the cash, cash equivalents and current financial assets position in euro during the year ended December 31, 2023 as compared to unrealized exchange rate losses on the cash, cash equivalents and current financial assets position during the year ended December 31, 2022. B.
We currently have only one approved product and as of the year ended December 31, 2022, net product sales also started to contribute to the funding of our operations.
We currently have 2 products approved by the FDA and as of the year ended December 31, 2022, net product sales also started to contribute to the funding of our operations.
We have no ongoing material financing commitments, such as lines of credit or guarantees, that are expected to affect our liquidity over the next five years, other than leases and our commitments to Lonza and Fujifilm which are detailed in “ Note 29—Commitments ” in our consolidated financial statements which are appended to our Annual Report for the period ended December 31, 2022.
We have no ongoing material financing commitments, such as lines of credit or guarantees, that are expected to affect our liquidity over the next five years, other than a line of credit totalling to $7.2 million, leases and our commitments to Halozyme, Lonza and Fujifilm which are detailed in “ Note 29—Commitments ” in our consolidated financial statements which are appended to our Annual Report for the period ended December 31, 2023 and which are incorporated herein by reference.
Through December 31, 2022, we have raised gross proceeds of $4,318.5 million from private and public offerings of equity securities. We have made net product sales of $400.7 million during the twelve months ended December 31, 2022. Our cash flows may fluctuate and are difficult to forecast and will depend on many factors.
Through December 31, 2023, we have raised gross proceeds of $5.6 billion from private and public offerings of equity securities. We have made product net sales of $1.2 billion during the twelve months ended December 31, 2023. Our cash flows may fluctuate, are difficult to forecast and will depend on many factors.
We employed on average 442.4 full-time equivalents in our selling, general and administrative functions in the year ended December 31, 2022, compared to 264.4 in the year ended December 31, 2021. Financial Income (and Expense) For the year ended December 31, 2022, financial income amounted to $27.7 million compared to $3.6 million for the year ended December 31, 2021.
We employed on average 681 full-time equivalents in our selling, general and administrative functions in the year ended December 31, 2023, compared to 442 in the year ended December 31, 2022. Financial income and (expense) For the year ended December 31, 2023, financial income amounted to $107 million compared to $28 million for the year ended December 31, 2022.
The net cash inflow from financing activities was $843.8 million for the year ended December 31, 2022, compared to a net cash inflow of $1,121.3 million for the year ended December 31, 2021.
The net cash inflow from financing activities was $1,337 million for the year ended December 31, 2023, compared to a net cash inflow of $844 million for the year ended December 31, 2022.
Personnel expense primarily relates to internal and external personnel. The expense also includes share-based compensation expenses related to the grant of stock options and RSUs to our research and development employees.
The increase of $196 million in fiscal year 2023 as compared to fiscal 2022 is primarily driven by Personnel expense and External research and development expenses. Personnel expense primarily relates to internal and external personnel. The expense also includes share-based compensation expenses related to the grant of stock options and RSUs to our research and development employees.
On December 31, 2022, we had cash, cash equivalents and current financial assets of $2,192.5 million, compared to $2,336.7 million on December 31, 2021.
On December 31, 2023, we had cash, cash equivalents and current financial assets of $3,180 million, compared to $2,193 million on December 31, 2022.
We employed on average 474.8 full-time equivalents in our research and development functions in the year ended December 31, 2022, compared to 349.7 in the year ended December 31, 2021. 108 Table of Contents Our external research and development expenses for the year ended December 31, 2022 totaled approximately $367.0 million, compared to approximately $382.9 million for the year ended December 31, 2021.
We employed on average 607 full-time equivalents in our research and development functions in the year ended December 31, 2023, compared to 475 in the year ended December 31, 2022. Our External research and development expenses for the year ended December 31, 2023 totaled to $483 million, compared to $367 million for the year ended December 31, 2022.
“ Risk Factors— Risk Factors Related to argenx’s Financial Position and Need for Additional Capital .” For more information as to our financial instruments, please see “ Note 26—Financial instruments and financial risk management ” in our consolidated financial statements which are appended to our Annual Report for the period ended December 31, 2022.
For more information as to our treasury policy and liquidity, please see “ Note 26—Financial risk management ” in our consolidated financial statements which are appended to this Annual Report for the period ended December 31, 2023 and which are incorporated herein by reference.
The table below provides additional detail on our external research and development expenses by program: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Year ended ​ ​ December 31, ​ 2022 2021 % Change ​ ​ ​ (In thousands) efgartigimod $ 280,572 ​ $ 311,038 ​ (10) % cusatuzumab 13,554 ​ 24,630 ​ (45) % ARGX-117 ​ ​ 32,384 ​ ​ 22,759 ​ 42 % Other programs (*) 40,445 ​ 24,475 ​ 65 % Total $ 366,955 ​ $ 382,902 ​ (4) % (*) Other programs include general expenses not allocated to specific program of $22.7 million in 2022 and $6.6 million in 2021. ​ External research and development expenses for our lead product candidate efgartigimod totaled $280.6 million for the year ended December 31, 2022, compared to $311.0 million for the year ended December 31, 2021.
The table below provides additional detail on our External research and development expenses by program: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Year ended ​ ​ December 31, ​ 2023 2022 % Change ​ ​ ​ (In thousands) efgartigimod $ 361,676 ​ $ 280,572 ​ 29 % cusatuzumab 14,298 ​ 13,554 ​ 5 % empasiprubart ​ ​ 47,636 ​ ​ 32,384 ​ 47 % Other programs (*) 59,582 ​ 40,445 ​ 47 % Total $ 483,192 ​ $ 366,955 ​ 32 % (*) Other programs include general expenses not allocated to specific program of $27 million in 2023 and $23 million in 2022. ​ External research and development expenses for our lead product candidate efgartigimod totaled $362 million for the year ended December 31, 2023, compared to $281 million for the year ended December 31, 2022.
The net cash outflow from operating activities for the year ended December 31, 2022 resulted primarily from (i) the research and development expenses incurred in relation to the manufacturing and clinical development activities of efgartigimod and the advancement of other clinical, preclinical and discovery-stage product candidate, (ii) the personnel 111 Table of Contents expenses and consulting expenses incurred for the commercial launch of efgartigimod in the U.S., Japan, and Europe and (iii) the increase in working capital, primarily due to increase in accounts receivables related to product net sales and the increase in inventory levels.
The decrease in net cash outflow used in operating activities results primarily from an increase in net product sales related to VYVGART and VYVGART SC, partly offset by: (i) the increase in Research and development expenses incurred in relation to the manufacturing and clinical development activities of efgartigimod and the advancement of other clinical, preclinical and discovery-stage product candidate; (ii) the increase in personnel expenses, marketing expenses and consulting expenses incurred for the commercial expansion of VYVGART and VYVGART SC; and (iii) the further increase in working capital as a result of our inventory levels, including prepaid inventory.
Exchange Gains (Losses) Exchange losses totaled $32.7 million for the year ended December 31, 2022, compared to exchange losses of $50.1 million for the year ended December 31, 2021.
For the year ended December 31, 2023, financial expense amounted to $1 million compared to $4 million for the year ended December 31, 2022. 117 Table of Contents Exchange gains (losses) Exchange gains totaled $14 million for the year ended December 31, 2023, compared to exchange losses of $33 million for the year ended December 31, 2022.
“ Business Overview — Healthcare Law and Regulation . ” Research and Development Expenses ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Year ended ​ ​ December 31, ​ 2022 2021 % Change ​ ​ ​ (In thousands) Personnel expense $ 162,010 ​ $ 160,464 ​ 1 % External research and development expenses 366,955 ​ 382,902 ​ (4) % Materials and consumables 2,396 ​ 2,735 ​ (12) % Depreciation and amortization 102,132 ​ 3,742 ​ 2,629 % Other expenses 29,872 ​ 30,677 ​ (3) % Total $ 663,366 ​ $ 580,520 ​ 14 % ​ Our research and development expenses totaled $663.4 million and $580.5 million for the years ended December 31, 2022 and 2021, respectively.
“ Business Overview — Healthcare Law and Regulation . ” 115 Table of Contents Research and development expenses ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Year ended ​ ​ December 31, ​ 2023 2022 % Change ​ ​ ​ (In thousands) Personnel expense $ 226,344 ​ $ 162,010 ​ 40 % External research and development expenses 483,192 ​ 366,955 ​ 32 % Materials and consumables 4,057 ​ 2,396 ​ 69 % Depreciation and amortization 105,546 ​ 102,132 ​ 3 % IT expenses ​ ​ 19,935 ​ ​ 12,678 ​ 57 % Other expenses 20,418 ​ 17,194 ​ 19 % Total $ 859,492 ​ $ 663,366 ​ 30 % ​ Our Research and development expenses totaled $859 million and $663 million for the years ended December 31, 2023 and 2022, respectively.
“ Liquidity and Capital Resources .” Following the approval of VYVGART™ for the treatment of gMG in the U.S. by the FDA on December 17, 2021, we transitioned from a clinical-stage to a commercial-stage biotechnology company, have commercialized VYVGART™ in the VYVGART Approved countries and are working to expand commercialization in other jurisdictions, and to launch new products and product candidates, including new indications.
Following the approval of VYVGART and VYVGART SC for the treatment of gMG in the U.S. by the FDA in 2021 and 2023 respectively, we transitioned from a clinical-stage to a commercial-stage biotechnology company.
The net cash inflows were attributed to (i) $760.6 million net cash proceeds from our global offering in February 2022, compared to $1,091.7 million net cash proceeds from our global offering and concurrent private placement in February 2021 and (ii) $93.2 million proceeds received from the exercise of stock options in 2022, compared to $33.4 million for the year ended 2021.
The net cash inflows were attributed to (i) $1.2 billion net cash proceeds from our global offering in July 2023, compared to $0.8 billion net cash proceeds from our global offering in February 2022 and (ii) $158 million proceeds received from the exercise of stock options in 2023, compared to $93 million for the year ended 2022. 119 Table of Contents Operating and Capital Expenditure Requirements We have never achieved profitability and, as of December 31, 2023, we had accumulated losses of $2,405 million.
For more information as to the risks associated with our future funding needs, see Item 3.D. “ Risk Factors — Risk Factors Related to argenx’s Financial Position and Need for Additional Capital .” C. RESEARCH AND DEVELOPMENT, PATENTS AND LICENSES For a discussion of our research and development policies, see the Item 4.B. “ Business Overview ” and Item 5.A.
C. RESEARCH AND DEVELOPMENT, PATENTS AND LICENSES For a discussion of our research and development policies, see Item 4 “ Information on the Company ” and Item 5 “ Operating and Financial Review and Prospects ” . D.
Of the total research and development expense, $22.7 million relates to general allocation of expenses. 109 Table of Contents Selling, General and Administrative Expenses ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Year ended ​ ​ December 31, ​ 2022 2021 % Change ​ ​ ​ (In thousands) Personnel expenses $ 234,740 ​ $ 164,646 ​ 43 % Professional and marketing fees 178,570 ​ 102,674 ​ 74 % Supervisory board 6,912 ​ 12,958 ​ (47) % Depreciation and amortization 2,211 ​ 2,126 ​ 4 % IT expenses ​ ​ 17,431 ​ ​ 8,977 ​ 94 % Other expenses ​ ​ 32,268 ​ ​ 16,263 ​ 98 % Total Selling, general and administrative expenses $ 472,132 ​ $ 307,644 ​ 53 % ​ ​ Our selling, general and administrative expenses totaled $472.1 million and $307.6 million for the years ended December 31, 2022 and 2021, respectively.
Selling, general and administrative expenses \ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Year ended ​ ​ December 31, ​ 2023 2022 % Change ​ ​ ​ (In thousands) Personnel expenses $ 303,033 ​ $ 234,740 ​ 29 % Marketing services 202,146 ​ 115,950 ​ 74 % Professional fees ​ ​ 108,820 ​ ​ 62,620 ​ 74 % Supervisory board 8,362 ​ 6,912 ​ 21 % Depreciation and amortization 2,366 ​ 2,211 ​ 7 % IT expenses ​ ​ 20,408 ​ ​ 17,431 ​ 17 % Other expenses ​ ​ 66,770 ​ ​ 32,268 ​ 107 % Total Selling, general and administrative expenses $ 711,905 ​ $ 472,132 ​ 51 % ​ Our Selling, general and administrative expenses totaled $712 million and $472 million for the years ended December 31, 2023 and 2022, respectively.
Net Cash Used in / from Investing Activities Investing activities for the year ended December 31, 2022, consist primarily of the purchases of current financial assets and intangible assets.
Investing activities for the year ended December 31, 2022, consists primarily of net investment of $369 million in current financial assets, and purchase of a priority review voucher for $102 million, partly offset by interests received, resulting in a cash outflow of $461 million.
External research and development expenses on other programs increased by $16.0 million to $40.4 million for the year ended December 31, 2022, compared to $24.5 million for the year ended December 31, 2021.
This increase of $15 million was due to the ramp up of Ph2 clinical trials in MMN, DGF and DM and futher investments in Discovery activities. External research and development expenses on other programs increased by $19 million to $60 million for the year ended December 31, 2023, compared to $40 million for the year ended December 31, 2022.
There has been no significant change in the financial performance or the financial position of the Group since the balance sheet date of December 31, 2022. E. CRITICAL ACCOUNTING ESTIMATES Not applicable. 113 Table of Contents
There has been no significant change in the financial performance or the financial position of the Group since the balance sheet date of December 31, 2023. For more information, please refer to Item 4.B. “ Business Overview ” , Item 5.A. “ Operating Results ” , Item 5.B.
Operating and Capital Expenditure Requirements We have never achieved profitability and, as of December 31, 2022, we had accumulated losses of $2,109.8 million.
As of December 31, 2023, we had accumulated losses of $2,405 million.
Cash Flows Comparison for the Years Ended December 31, 2022 and 2021 The table below summarizes our cash flows for the years ended December 31, 2022 and 2021. ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Year ended ​ ​ December 31, ​ 2022 2021 Variance ​ ​ (In thousands) Cash and cash equivalents at beginning of the period ​ $ 1,334,676 ​ $ 1,216,803 ​ $ 117,873 Net cash flows (used in) / from operating activities (862,807) ​ (606,812) ​ (255,995) Net cash flows (used in) / from investing activities (461,184) ​ (347,070) ​ (114,114) Net cash flows (used in) / from financing activities 843,757 ​ 1,121,342 ​ (277,585) Effect of exchange rate differences on cash and cash equivalents (53,702) ​ (49,587) ​ (4,115) Cash and cash equivalents at end of the period ​ $ 800,740 ​ $ 1,334,676 ​ $ (533,936) ​ Net Cash Used in Operating Activities Net cash outflow from our operating activities increased by $256.0 million to a net outflow of $862.8 million for the year ended December 31, 2022, compared to a net outflow of $606.8 million for the year ended December 31, 2021.
“ Risk Factors — Risk Factors Related to argenx’s Financial Position and Need for Additional Capital .” For more information as to our financial instruments, please see “ Note 26—Financial risk management ” in our consolidated financial statements which are appended to our Annual Report for the period ended December 31, 2023 and which are incorporated herein by reference. 118 Table of Contents Cash Flows Comparison for the Years Ended December 31, 2023 and 2022 The table below summarizes our cash flows for the years ended December 31, 2023 and 2022. ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Year ended ​ ​ December 31, ​ 2023 2022 Variance ​ ​ (In thousands) Cash and cash equivalents at beginning of the period ​ $ 800,740 ​ $ 1,334,676 ​ $ (533,936) Net cash flows (used in) / from operating activities (420,327) ​ (862,807) ​ 442,480 Net cash flows from / (used in) investing activities 308,210 ​ (461,184) ​ 769,394 Net cash flows from / (used in) financing activities 1,336,727 ​ 843,757 ​ 492,970 Exchange gains/(losses) on cash and cash equivalents 23,494 ​ (53,702) ​ 77,196 Cash and cash equivalents at end of the period ​ $ 2,048,844 ​ $ 800,740 ​ $ 1,248,104 ​ Net cash used in operating activities Net cash outflow used in our operating activities decreased by $442 million to a net outflow of $420 million for the year ended December 31, 2023, compared to a net outflow of $863 million for the year ended December 31, 2022.
This decrease corresponds primarily to manufacturing and clinical development activities in relation to: ● the execution of the bridging study for ENHANZE® efgartigimod in MG; ● the execution of two Phase 3 clinical trials in CIDP; ● the execution of two Phase 3 clinical trials in ITP; ● the execution of the Phase 3 clinical trial in PV and PF; ● the execution of Phase 2 clinical trial in BP; ● the execution of Phase 1 clinical trial in Myositis; and ● the execution of pre-clinical and Phase 1 trials in new indications identified.
This increase corresponds primarily to manufacturing and clinical development activities in relation to: ● the execution of two Phase 3 clinical trials in MG Ph3b and Pediatric ● the execution of two Phase 3 clinical trials in CIDP; ● the execution of two Phase 3 clinical trial in PV and PF; ● the execution of Phase 2 and 3 clinical trials in BP, Myositis, LN, MN, AMR, PC-POTS SjD, TED and AAV; ● the execution of multiple Phase 2 clinical trials in empasiprubart in MMN, DGF and DM ● the execution of one HV clinical trial in ARGX-119 116 Table of Contents ● the execution of pre-clinical activities External research and development expenses for empasiprubart totaled $48 million for the year ended December 31, 2023 compared to $32 million for the year ended December 31, 2022.
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The increase of $82.8 million for fiscal year 2022 as compared to fiscal year 2021 was primarily from the derecognition of the PRV submitted with the BLA filing for SC efgartigimod for the treatment of gMG, which resulted in a research and development expense of $99.1 million recorded under depreciation and amortization in the table above.
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Item 4.B. “ Business Overview — Regulation — Licensure and Regulation of Biologics in the U.S. ” Similar provisions are available in the EU and in certain other jurisdictions to extend the term of a patent that covers an approved drug.
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External research and development expenses for cusatuzumab totaled $13.6 million for the year ended December 31, 2022 compared to $24.6 million for the year ended December 31, 2021. This decrease of $11.1 million is the result of the termination of the collaboration agreement with Janssen.
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It is possible that issued U.S. patents covering each of our product candidates may be entitled to patent term extensions. If our product candidates receive FDA approval, we intend to apply for patent term extensions, if available, to extend the term of patents that cover the approved product candidates.
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External research and development expenses for ARGX-117 totaled $32.4 million for the year ended December 31, 2022 compared to $22.8 million for the year ended December 31, 2021. This increase of $9.6 million was due to increased research and development expenses in relation to the advancement of our ARGX-117 program, a complement-targeting antibody against C2.
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We also intend to seek patent term extensions in any jurisdictions where they are available, however, there is no guarantee that the applicable authorities, including the FDA, will agree with our assessment of whether such extensions should be granted, and if granted, the length of such extensions.
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The increase of $24.0 million in 2022 related primarily to higher interest on term accounts. For the year ended December 31, 2022, financial expense amounted to $3.9 million compared to $4.6 million for the year ended December 31, 2021.
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Platform Technologies With regard to our platform technologies, we own or have intellectual property rights directed to our SIMPLE ANTIBODY™ discovery platform, the ABDEG™ and NHANCE™ technologies. 70 Table of Contents With regard to our SIMPLE ANTIBODY™ discovery platform, we have a broad patent portfolio providing exclusivity on the SIMPLE ANTIBODY™ platform.
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The net cash outflow of $606.8 million for the year ended December 31, 2021 was primarily influenced by (i) the research and development expenses incurred in relation to the manufacturing and clinical development activities of efgartigimod and the advancement of other clinical, preclinical and discovery-stage product candidate, (ii) the personnel expenses and consulting expenses incurred in preparation of the commercial launch of efgartigimod in the U.S. and Japan and (iii) the manufacturing of inventory ahead of the commercial launch of efgartigimod in the U.S.
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We expect to enjoy exclusivity under this patent portfolio until between 2029 and 2033. With regard to the ABDEG™ platform, we co-own the technology with UT Southwestern and enjoy certain exclusive license rights. We have a broad patent portfolio covering the composition of matter and uses of certain FcRn antagonists to achieve certain biological effects.
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Cash flow from investing activities represented a net outflow of $461.2 million for the year ended December 31, 2022, compared to a net outflow of $347.1 million for the year ended December 31, 2021.
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The composition of matter and other relevant patents in the U.S. expire in 2036 whereas in many other countries the base expiry date is 2034.
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The net outflow for the year ended December 31, 2022 related primarily to (i) the net investment of $368.5 million in current financial assets, including money market funds and term deposit accounts, compared to a net investment of $228.2 million for the year ended December 31, 2021 and (ii) the cash outflow of $102.0 million during 2022 in relation to the purchase of a PRV compared to a cash outflow of $98.0 million for a PRV which was acquired in 2020, however paid in 2021.
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With regard to the NHANCE™ platform, we exclusively licensed two U.S. patents from UT Southwestern with composition of matter claims directed to an IgG molecule comprising a variant human Fc domain, and method of use claims directed to a method of blocking FcRn function in a subject by providing to the subject such an IgG molecule.
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We expect to continue to incur significant operating losses for the foreseeable future as we continue our research and development efforts, incur higher costs for continued commercialization of VYVGART, and seek to obtain regulatory approval and commercialization of other pipeline candidates.
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The U.S. patents are expected to expire earliest in 2027 to 2028. The patent family also includes a granted European patent. Our Internal Programs Efgartigimod Efgartigimod incorporates the ABDEG™ platform technology. We anticipate several more patient innovations to evolve during development for which we will seek additional patent protection.
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For a discussion of trends, see the sections of this Annual Report titled Item 4.B. “ Business Overview ,” Item 5.A. “ Operating Results ” and Item 5.B.
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Our ARGX-109 Product Candidate With regard to our wholly-owned ARGX-109 product candidate, we have one patent family with composition of matter claims directed to ARGX-109. The patent family has a basic expiry date in 2033. We anticipate several more patient innovations to evolve during development for which we will seek additional patent protection.
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Furthermore, ARGX-109 incorporates or employs the SIMPLE ANTIBODY™ platform technology and the NHANCE™ platform technology.
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Empasiprubart Product Candidate With regard to the empasiprubart product candidate, we own or have rights to multiple patent families (including one in-licensed patent family from Broteio) with several granted patents and pending patent applications in multiple jurisdictions in North America, South America, the EU and Asia, directed to composition of matter claims and method of treatment claims.
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The in-licensed patent family from Broteio has granted patents in several countries/regions and has a basic expiry date in 2034. Additional patent families have granted patents with basic expiry dates in 2039 and 2040. We anticipate several more patient innovations to evolve during development for which we will seek additional patent protection.
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Empasiprubart product candidate incorporates or employs the NHANCE™ platform technology. Our ARGX-119 Product Candidate With regard to the ARGX-119 product candidate, we in-licensed patent families from/with NYU Langone Health, a U.S. medical center based in New York, and additional patent families from/with the LUMC, with a U.S. granted patent and several pending applications in multiple jurisdictions.
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We anticipate several more patient innovations to evolve during development for which we will seek additional patent protection.
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Our ARGX-118 Product Candidate With regard to the ARGX-118 product candidate, we co-own a patent portfolio with VIB vzw ( VIB ), an inflammation research center in Ghent, Brussels, and Ghent University, with one U.S. granted patent and pending patent applications in multiple jurisdictions in North America, South America, the EU and Asia.
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The patent family has a basic expiry date in 2039. 71 Table of Contents Our Partnered Programs Our Cusatuzumab (ARGX-110) Product Candidate With regard to the cusatuzumab product candidate, we have a broad patent portfolio that include claims to the composition of matter, uses of the molecule, and other important inventions.
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The issued U.S. patents expire in 2032 and 2033, without taking a potential patent term extension into account. Cusatuzumab incorporates or employs the SIMPLE ANTIBODY™ and POTELLIGENT ® platform technologies.
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Our ARGX-115 (ABBV-151) Product Candidate With regard to the ARGX-115 (ABBV-151) product candidate that we co-own with, and exclusively license from, the Ludwig Institute for Cancer Research and UCL, we have a patent portfolio that includes a U.S. patent with a basic expiry date in 2034, without taking a potential patent term extension into account.
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There is a second family with meaningful patent coverage to the composition of matter and epitope claims that are expected to expire in 2036 and 2038. Furthermore, ARGX-115 (ABBV-151) incorporates or employs the SIMPLE ANTIBODY™ platform technology.
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Our ARGX-112 (LP-0145) Product Candidate With regard to the ARGX-112 (LP-0145) product candidate, we have one patent family with composition of matter claims directed to an antibody that binds human IL-22R. The patent family has a basic expiry date in 2037. Furthermore, ARGX-112 (LP-0145) incorporates the SIMPLE ANTIBODY TM platform technology.
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Collaboration and Licenses We follow a disciplined strategy to maximize the value of our pipeline. We plan to retain all development and commercialization rights to those products and product candidates that we believe we can commercialize successfully, if approved.
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We have partnered, and plan to continue to partner, to develop products and product candidates that we believe have promising utility in disease areas or have patient populations that may benefit from resources of other biopharmaceutical companies. We expect to continue to collaborate selectively with pharmaceutical and biotechnology companies to leverage our platform technology and accelerate product candidate development.
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We are also party to several license agreements under which we license patents, patent applications and other intellectual property to third parties. We have also entered into several license agreements under which we license patents, patent applications and other intellectual property from third parties.
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License agreements can relate to research and development and/or commercialization of the relevant product candidates (and technologies) or products. The licensed intellectual property covers some of our product candidates and some of the antibody engineering technologies that we use. Some of these licenses impose various diligence and financial payment obligations on us.
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We expect to continue to enter into these types of license agreements in the future. We have entered into multiple collaboration agreements with pharmaceutical partners and license agreements, as described below.
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Our Strategic Collaboration with Shire In February 2012, we entered into a collaboration agreement with Shire AG ( Shire , now known as Shire International GmbH) to discover, develop and commercialize novel human therapeutic antibodies against up to three targets to address diverse, rare and unmet diseases ( Shire Collaboration Agreement ).
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Pursuant to the Shire Collaboration Agreement, up through a specified period, we have granted Shire an exclusive option, against payment of a one-time option fee, to obtain all right, title and interest in any antibodies discovered under the collaboration.
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If Shire does not exercise its option with respect to any discovered antibody within a specified period, we are free to research, 72 Table of Contents develop and commercialize antibodies in relation to the applicable clinical trial target, subject to negotiation of a license from Shire.
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OncoVerity for cusatuzumab In 2022, we, the University of Colorado Anschutz Medical Campus and the University of Colorado Health ( UCHealth ) created an asset-centric spin-off, OncoVerity, Inc ( OncoVerity ), focused on optimizing and advancing the development of cusatuzumab, a novel anti-CD70 antibody, in AML. OncoVerity is an entity of co-creation, combining the extensive translational biology insights from Dr.
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Clayton Smith, M.D. from the University of Colorado with our experience on the CD70/CD27 pathway. In 2023, we granted an exclusive license for cusatuzumab to OncoVerity and provided, together with a joint venture of UCHealth and University License Equity Holdings, Inc. on the University of Colorado Anschutz Medical Campus, $26.0 million in funding for ongoing clinical development of cusatuzumab.
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Our Strategic Partnership with LEO Pharma for ARGX-112 (LP0145) In May 2015, we entered into a collaboration agreement with LEO Pharma A/S ( LEO Pharma ) to develop and commercialize ARGX-112 (LP0145) for the treatment of dermatologic indications involving inflammation ( LEO Pharma Collaboration Agreement ).
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ARGX-112 (LP0145) employs our SIMPLE ANTIBODY™ technology and blocks the IL-22R in order to neutralize the signaling of cytokines implicated in autoimmune diseases of the skin.
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LEO Pharma funded more than half of all product development costs up to CTA approval of a first product in a Phase 1 clinical trial, with our share of such costs capped, which was achieved in April 2018. Since then, LEO Pharma has been solely responsible for funding the clinical development of the program.
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In May 2021, CTA approval of a Phase 2a clinical trial for LP0145 was received. In September 2022, LEO Pharma, exercised its option to obtain, and was granted an exclusive, worldwide license to further develop and commercialize ARGX-112 against payment of a €5.0 million option fee to us.
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LEO Pharma assumed full responsibility for the continued development, manufacture and commercialization of such product and is subject to diligence obligations in respect of continuation of development and commercialization of such product.
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We are eligible to receive additional development, regulatory and commercial milestone payments in aggregate amount of up to €120.0 million, as well as tiered royalties on product sales at percentages ranging from the low single digits to the low teens, subject to customary reductions.
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Unless earlier terminated, the term of the LEO Pharma Collaboration Agreement ends upon the later of (i) the expiration of the last license granted under the agreement, and (ii) the fulfilment of all payment obligations under the agreement. LEO Pharma may terminate the LEO Pharma Collaboration Agreement for any reason upon prior written notice to us.
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LEO Pharma’s royalty payment obligations expire, on a product-by-product and country-by-country basis, upon the later of (i) a time when no valid claims covering such product, and (ii) (a) in major market countries with no composition of matter patent covering such product, the expiration of the data exclusivity period or (b) in countries that are not major market countries, a double-digit number of years after the first commercial sale of such product sold in that country.
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Our Strategic Partnership with Zai Lab for efgartigimod Pursuant to the Zai Lab Agreement, Zai Lab obtained the exclusive right to develop and commercialize efgartigimod in Greater China. Zai Lab will also contribute patients to our global Phase 3 clinical trials of efgartigimod.
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Additionally, the collaboration with Zai Lab is expected to accelerate efgartigimod global development by initiating multiple Phase 2 POC clinical trials in new autoimmune indications under our supervision; first indications for such POC clinical trials are kidney conditions LN and MN. Pursuant to the Zai Lab Agreement, we have received value worth $175.0 million from the Zai Lab Payments.
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We are also eligible to receive tiered royalties (mid-teen to low-twenties on a percentage basis) based on annual net sales of efgartigimod in Greater China. 73 Table of Contents Our Strategic Partnership with AbbVie for ARGX-115 (ABBV-151) In April 2016, we entered into a collaboration agreement with AbbVie to develop and commercialize ARGX-115 (ABBV-151) as a cancer immunotherapy against the novel target glycoprotein A repetitions predominant ( GARP ) (the AbbVie Collaboration Agreement ).
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ARGX-115 (ABBV-151) employs our SIMPLE ANTIBODY™ technology and works by stimulating a patient’s immune system after a tumor has suppressed the immune system by co-opting immunosuppressive cells such as regulatory T cells.
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Under the terms of the AbbVie Collaboration Agreement, we were responsible for conducting and funding all ARGX-115 (ABBV-151) research and development activities up to completion of IND enabling clinical trials.

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Item 5. Market for Registrant's Common Equity

Market for Common Equity — stock, dividends, buybacks

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In addition, a clinical trial of efgartigimod IV in pediatric gMG patients is ongoing. In 2022, a Phase 1 clinical trial evaluating the effect of efgartigimod or placebo on immune response to the polyvalent pneumococcal vaccine (PNEUMOVAX 23) was completed.
In addition, a clinical trial of IV efgartigimod in pediatric gMG patients is ongoing. In 2022, a Phase 1 clinical trial evaluating the effect of efgartigimod or placebo on immune response to the polyvalent pneumococcal vaccine (PNEUMOVAX 23) was completed.
Our SIMPLE Antibody platform allows us to access and explore a broad target universe while potentially minimizing the long timelines associated with generating antibody candidates using traditional methods. ● NHance , ABDEG , POTELLIGENT ® , and dehydrated hereditary stomatocytosis ( DHS) mutations focus on engineering the Fc region of antibodies in order to augment their intrinsic therapeutic properties.
Our SIMPLE ANTIBODY™ platform technology allows us to access and explore a broad target universe while potentially minimizing the long timelines associated with generating antibody candidates using traditional methods. ● NHANCE™ , ABDEG™ , POTELLIGENT ® , and dehydrated hereditary stomatocytosis ( DHS ) mutations focus on engineering the Fc region of antibodies in order to augment their intrinsic therapeutic properties.
In addition to patent protection, we also rely on trademarks and trade secrets to protect aspects of our business that are not amenable to, or that we do not consider appropriate for, patent protection, including certain aspects of our llama immunization and antibody affinity maturation approaches.
In addition to patent protection, we rely on trademarks and trade secrets to protect aspects of our business that are not amenable to, or that we do not consider appropriate for, patent protection, including certain aspects of our llama immunization and antibody affinity maturation approaches.
An illustration of the FcRn-mediated antibody recycling mechanism is shown in figure 6. [1] Serum proteins, including IgG antibodies, are routinely removed from the circulation by cell uptake. [2] Antibodies can bind to FcRn, which serves as a dedicated recycling receptor in the endosomes, which have an acidic environment, and then [3A] return to the circulation by binding with their Fc region to FcRn. [3B] Unbound antibodies end up in the lysosomes and are degraded by enzymes.
An illustration of the FcRn-mediated antibody recycling mechanism is shown in Figure 4. [1] Serum proteins, including IgG antibodies, are routinely removed from the circulation by cell uptake. [2] Antibodies can bind to FcRn, which serves as a dedicated recycling receptor in the endosomes, which have an acidic environment, and then [3A] return to the circulation by binding with their Fc region to FcRn. [3B] Unbound antibodies end up in the lysosomes and are degraded by enzymes.
As shown in figure 7, [1] NHance antibodies bind to FcRn with higher affinity, specifically under acidic pH conditions. [2] Due to these tighter bonds, NHance FcRn-mediated antibody recycling is strongly favored over lysosomal degradation, although some degradation does occur. [3] NHance allows a greater proportion of antibodies to return to the circulation potentially resulting in increased bioavailability and reduced dosing frequency.
As shown in Figure 5, [1] NHANCE™ antibodies bind to FcRn with higher affinity, specifically under acidic pH conditions. [2] Due to these tighter bonds, NHANCE™ FcRn-mediated antibody recycling is strongly favored over lysosomal degradation, although some degradation does occur. [3] NHANCE™ allows a greater proportion of antibodies to return to the circulation potentially resulting in increased bioavailability and reduced dosing frequency.
In the MAD part of the Phase 1 clinical trial, repeat administration of both 10 mg/kg and 25 mg/kg of efgartigimod every seven days, four doses in total, and 10 mg/kg every four days, six doses in total, was associated with a gradual reduction in levels of all four classes of IgG antibodies by 60% to 85%, with 10 mg/kg dose results shown in figure 4.
In the MAD part of the Phase 1 clinical trial, repeat administration of both 10 mg/kg and 25 mg/kg of efgartigimod every seven days, four doses in total, and 10 mg/kg every four days, six doses in total, was associated with a gradual reduction in levels of all four classes of IgG antibodies by 60% to 85%, with 10 mg/kg dose results shown in Figure 2.
We compete with a wide range of biopharmaceutical companies, who are developing products for the treatment of gMG and other autoimmune diseases, including products that are in the same class as VYVGART, as well as products that are similar to some of our product candidates. We are aware of several FcRn inhibitors that are in clinical development.
We compete with a wide range of biopharmaceutical companies, who are developing products for the treatment of gMG and other autoimmune diseases, including products that are in the same class as VYVGART, as well as products that are similar to some of our product candidates. We are aware of several FcRn inhibitors that are in clinical development or marketed.
This ranges from published literature, clinical trials with currently used therapies such as IV Ig ( IVIg ), PLEX, or Rituximab, and other experiments, such as passive transfer models. ● We also look at indications where a significant clinical or commercial opportunity exists.
This ranges from published literature, clinical trials with currently used therapies such as IVIg , PLEX, or Rituximab, and other experiments, such as passive transfer models. ● We also look at indications where a significant clinical or commercial opportunity exists.
IVIg (Octagam 10%) was approved by the FDA for the treatment of DM in July 2021. Myositis patients are most often treated with high-dose steroids. ALKIVIA Clinical Trial We initiated the registrational ALKIVIA clinical trial of SC efgartigimod for the treatment of Myositis in the third quarter of 2022.
IVIg (Octagam 10%) was approved by the FDA for the treatment of DM in July 2021. Myositis patients are most often treated with high-dose steroids. ALKIVIA Clinical Trial We initiated the registrational ALKIVIA clinical trial of SC efgartigimod for the treatment of Myositis in 2022.
The muscle weakness can be severe and lead to difficulty in completing daily tasks. Characteristic autoantibodies of IMNM, include anti-signal recognition particle and anti-3-hydroxy-3-methylglutaryl-coenzyme A reductase autoantibodies. ● ASyS is characterized by muscle inflammation, inflammatory arthritis, interstitial lung disease, thickening and cracking of the hands (“mechanic’s hands”) and Raynaud phenomenon.
The muscle weakness can be severe and lead to difficulty in completing daily tasks. 55 Table of Contents Characteristic autoantibodies of IMNM, include anti-signal recognition particle and anti-3-hydroxy-3-methylglutaryl-coenzyme A reductase autoantibodies. ● ASyS is characterized by muscle inflammation, inflammatory arthritis, interstitial lung disease, thickening and cracking of the hands (“mechanic’s hands”) and Raynaud phenomenon.
This rodent cross-reactivity enables more efficient 58 Table of Contents preclinical development of our product candidates because most animal efficacy models are rodent-based. By contrast, most other antibody discovery platforms start with antibodies generated in inbred mice or synthetic antibody libraries, approaches that we believe are limited by insufficient antibody repertoires and limited diversity, respectively.
This rodent cross-reactivity enables more efficient preclinical development of our product candidates because most animal efficacy models are rodent-based. By contrast, most other antibody discovery platforms start with antibodies generated in inbred mice or synthetic antibody libraries, approaches that we believe are limited by insufficient antibody repertoires and limited diversity, respectively.
In 2020, we also entered into a non-exclusive research agreement with the Clayton Foundation under which we may access the Clayton Foundation’s proprietary DHS mutations to extend the serum half-life of therapeutic antibodies. ● Halozyme’s ENHANZE SC drug delivery technology: We have exclusive access to ENHANZE for the FcRn and C2 targets and four additional targets.
In 2020, we also entered into a non-exclusive research agreement with the Clayton Foundation under which we may access the Clayton Foundation’s proprietary DHS mutations to extend the serum half-life of therapeutic antibodies. ● Halozyme’s ENHANZE ® SC drug delivery technology: we have exclusive access to ENHANZE ® for FcRn, C2 and four additional target nominations.
Because this Fc/FcRn interaction is highly pH-dependent, antibodies tightly bind to FcRn at acidic pH (pH 6.0) in the endosomes but release again at neutral pH (pH 7. 4) in the circulation. Figure 6: The FcRn-mediated recycling mechanism NHANCE NHance refers to two mutations that we introduce into the Fc region of an IgG antibody.
Because this Fc/FcRn interaction is highly pH-dependent, antibodies tightly bind to FcRn at acidic pH (pH 6.0) in the endosomes but release again at neutral pH (pH 7. 4) in the circulation. Figure 4: The FcRn-mediated recycling mechanism 65 Table of Contents NHANCE™ NHANCE™ refers to two mutations that we introduce into the Fc region of an IgG antibody.
On June 6, 2022 we announced an exclusive multi-regional agreement with Medison to commercialize efgartigimod in 14 countries, including Poland, 43 Table of Contents Hungary, Slovenia, Czech Republic, Romania, Bulgaria, Lithuania, Croatia, Slovakia, Estonia, Latvia, Greece, and Cyprus, for the treatment of adult patients with gMG ( Medison Multi-Regional Agreement ).
On June 6, 2022 we announced an exclusive multi-regional agreement with Medison to commercialize efgartigimod in 14 countries, including Poland, Hungary, Slovenia, Czech Republic, Romania, Bulgaria, Lithuania, Croatia, Slovakia, Estonia, Latvia, Greece, and Cyprus, for the treatment of adult patients with gMG ( Medison Multi-Regional Agreement ).
Similarly, the POTELLIGENT engineering technology modulates the interaction of the antibody Fc region with receptors located on specialized immune cells known as natural killer ( NK ) cells. These NK cells can destroy the target cell, resulting in enhanced antibody-dependent cell-mediated cytotoxicity ( ADCC ). NHance and ABDEG: Modulation of Fc Interaction with FcRn.
Similarly, the POTELLIGENT engineering technology modulates the interaction of the antibody Fc region with receptors located on specialized immune cells known as natural killer ( NK ) cells. These NK cells can destroy the target cell, resulting in enhanced antibody-dependent cell-mediated cytotoxicity ( ADCC ). 64 Table of Contents NHANCE™ and ABDEG™: Modulation of Fc Interaction with FcRn.
Being able to test many different epitopes with our antibodies enables us to search for an optimized combination of safety, potency and species cross-reactivity with the potential for maximum therapeutic effect on disease. These antibodies are often cross-reactive with the rodent version of chosen disease targets.
With this breadth of antibodies, we are able to test many different epitopes. Being able to test many different epitopes with our antibodies enables us to search for an optimized combination of safety, potency and species cross-reactivity with the potential for maximum therapeutic effect on disease. These antibodies are often cross-reactive with the rodent version of chosen disease targets.
The platform sources antibody variable regions ( V-regions ) from the immune system of outbred llamas, each of which has a different genetic background. The llama produces highly diverse panels of antibodies with a high human homology, or similarity, in their V-regions when immunized with targets of human disease.
The platform sources antibody variable regions ( V-regions ) from the immune system of outbred llamas, each of which has a different genetic background. The llama produces highly diverse panels of antibodies with a high 45 Table of Contents human homology, or similarity, in their V-regions when immunized with targets of human disease.
NHance is designed to extend antibody serum half-life and increase tissue penetration. In certain cases, it is advantageous to engineer antibodies that remain in the circulation longer, allowing them to potentially exert a greater therapeutic effect or be dosed less 59 Table of Contents frequently.
NHANCE™ is designed to extend antibody serum half-life and increase tissue penetration. In certain cases, it is advantageous to engineer antibodies that remain in the circulation longer, allowing them to potentially exert a greater therapeutic effect or be dosed less frequently.
FcRn is foundational to the immune system and functions to recycle IgG, extending its serum half-life over other Igs that are not recycled by FcRn. IgGs that bind to FcRn are rescued from lysosomal degradation. By binding to FcRn, efgartigimod can reduce IgG recycling and increase IgG degradation.
FcRn is foundational to the immune system and functions to recycle IgG, 48 Table of Contents extending its serum half-life over other Igs that are not recycled by FcRn. IgGs that bind to FcRn are rescued from lysosomal degradation. By binding to FcRn, efgartigimod can reduce IgG recycling and increase IgG degradation.
The clinical trial met its primary endpoint demonstrating that a significantly higher proportion of patients with chronic ITP receiving VYVGART (17/78; 21.8%) compared to placebo (2/40; 5%) achieved a sustained platelet 48 Table of Contents response (p=0.0316), defined as having platelet counts greater than or equal to 50x109/L on at least four of the last six scheduled visits between weeks 19 and 24 of treatment.
Primary endpoint was met, demonstrating that a significantly higher proportion of patients with chronic ITP receiving VYVGART (17/78; 21.8%) compared to placebo (2/40; 5%) achieved a sustained platelet response (p=0.0316), defined as having platelet counts greater than or equal to 50x109/L on at least four of the last six scheduled visits between weeks 19 and 24 of treatment.
In 2022, we contracted with Fujifilm based in Hillerød, Denmark, for activities relating to the large-scale manufacturing of efgartigimod drug substance. We use additional contract manufacturers to fill, label, package, store and distribute (investigational) drug products.
In 2022, we started our collaboration with Fujifilm based in Hillerød, Denmark, for activities relating to the large-scale manufacturing of efgartigimod drug substance. We use additional contract manufacturers to fill, label, package, store and distribute (investigational) drug products.
Figure 3: Efgartigimod’s mechanism of action blocks the recycling of IgG antibodies and removes them from circulation Based on its mechanism of action in targeting FcRn to selectively reducing IgGs, efgartigimod has the potential to address a multitude of severe autoimmune diseases where pathogenic IgGs are believed to be mediators of disease.
Figure 1 : Efgartigimod’s mechanism of action blocks the recycling of IgG antibodies and removes them from circulation. 49 Table of Contents Based on its mechanism of action in targeting FcRn to selectively reducing IgGs, efgartigimod has the potential to address a multitude of severe autoimmune diseases where pathogenic IgGs are believed to be mediators of disease.
For example: ● Efgartigimod emerged from a collaboration with Professor Sally Ward and the University of Texas Southwestern Medical Center ( UT Southwestern ) that later became one of the blueprints for our IIP collaborations. Professor Ward’s research identified the crucial role that FcRn plays in maintaining and distributing IgGs throughout the body.
Examples of our IIP programs include: ● Efgartigimod emerged from a collaboration with Professor Sally Ward at the University of Texas Southwestern Medical Center ( UT Southwestern ) and later became one of the blueprints for our IIP collaborations. Professor Ward’s research identified the crucial role that FcRn plays in maintaining and distributing IgGs throughout the body.
It mainly affects hands and forearms, mainly in males, and the median age of diagnosis is around 40 years. Diagnosis takes about a year and a half and is usually misdiagnosed as amyotrophic lateral sclerosis ( ALS ). There are estimated to be around 13,000 patients with MMN in the U.S. and this number is increasing.
It mainly affects hands and forearms, mainly in males, and the median age of diagnosis is around 40 years. Diagnosis takes about a year and a half and is often misdiagnosed as ALS . There are estimated to be around 13,000 patients with MMN in the U.S. and this number is increasing.
His understanding of the mild phenotype associated with a natural component 2 ( C2 ) deficiency and C2’s unique positioning at the junction of the classical and lectin pathways led to our interest in engineering ARGX-117, which is equipped with our proprietary NHANCE® mutations and LALA mutations. ● ARGX-119 was built in collaboration with the Leiden University Medical Center ( LUMC ) and New York University ( NYU ) with support from the teams led by Professor Verschuuren and Professor Steve Burden, respectively.
His understanding of the mild phenotype associated with a natural C2 deficiency and C2’s unique positioning at the junction of the classical and lectin pathways led to our interest in engineering empasiprubart, with our proprietary NHANCE™ mutations and LALA mutations. ● ARGX-119 was built in collaboration with the Leiden University Medical Center ( LUMC ) and New York University ( NYU ) with support from teams led by Professor Verschuuren and Professor Steve Burden, respectively.
Their insights guide us as we develop our investigational therapies and motivate us to advance the understanding of rare diseases. We implemented a PAA on February 21, 2022 through which investigational therapies are made available in certain circumstances to treat gMG patients who are unable to participate in an ongoing clinical trial.
Their insights guide us as we develop our investigational therapies and motivate us to advance the understanding of rare diseases. We implemented a pre-approval access program ( PAA ) on February 21, 2021 through which investigational therapies are made available in certain circumstances to treat gMG patients who are unable to participate in an ongoing clinical trial.
Instead, they are returned to the circulation where they can bind new targets. We believe this is especially useful in 60 Table of Contents situations where high levels of the target are circulating or where the target needs to be cleared very quickly from the system. Figure 8: SIMPLE Antibody and ABDEG technologies work in concert to sweep diseases targets.
Instead, they are returned to the circulation where they can bind new targets. We believe this is especially useful in situations where high levels of the target are circulating or where the target needs to be cleared very quickly from the system. Figure 6: SIMPLE ANTIBODY™ and ABDEG™ platform technologies work in concert to sweep diseases targets.
In addition, our competitors compete with us to recruit and retain qualified scientific and management personnel, establish clinical trial sites and patient registration for clinical trials, as well as in acquiring technologies complementary to, or necessary for, the development of our products.
In addition, our competitors compete with us to recruit and retain qualified scientific and management personnel, establish clinical trial sites and patient registration for clinical trials, as well as in acquiring technologies complementary to, or necessary for, the development of our products. Please refer to Item 3.D.
We contract with Lonza based in Slough, UK, Portsmouth, U.S. and Singapore for activities relating to the development of cell banks, development of our manufacturing processes and the manufacturing of drug substance, thereby using validated and scalable systems broadly accepted in our industry.
We work with Lonza teams based in Slough, UK, Portsmouth, U.S., Singapore and Visp, Switzerland for activities relating to the development of cell banks, development of our manufacturing processes and the manufacturing of drug substance, thereby using validated and scalable systems broadly accepted in our industry.
We bring to the collaboration our unique suite of antibody engineering technologies and experience in clinical development and our partners bring a wealth of disease and target biology expertise. ● SIMPLE Antibody platform: Our proprietary SIMPLE Antibody platform, based on the powerful llama immune system, allows us to exploit novel and complex disease biology targets.
We bring to the collaboration our unique suite of antibody engineering technologies and experience in clinical development to complement our partners’ expertise in disease and target biology. ● SIMPLE ANTIBODY™ platform technology: Our proprietary SIMPLE ANTIBODY™ platform technology, based on the powerful llama immune system, allows us to exploit novel and complex disease biology targets.
Under the expansion, we gained the ability to access Halozyme’s ENHANZE® drug delivery technology 46 Table of Contents for three additional exclusive targets upon nomination bringing the total to six potential targets under the collaboration. To date, two targets have been nominated including the human FcRn and C2.
Under the expansion, we gained the ability to access Halozyme’s ENHANZE ® SC drug delivery technology for three additional exclusive targets upon nomination bringing the total to six potential targets under the collaboration. To date, two targets have been nominated including FcRn and C2.
Manufacturing and Supply We utilize third-party contract manufacturers who act in accordance with the FDA’s good laboratory practices ( GLPs ) and current good manufacturing practices for the manufacture of drug substance and drug product. We continue to build our global network of contract manufacturers to support the development and commercialization of our products.
Manufacturing and Supply We utilize third-party contract manufacturers who act in accordance with the FDA’s cGMPs for the manufacture of drug substance and drug product. We continue to build our global network of contract manufacturers to support the development and commercialization of our products.
In the U.S., the term of a patent covering an FDA-approved drug may be eligible for a limited patent term extension under the Hatch-Waxman Act as compensation for the loss of patent term during the FDA regulatory review process as described in “— Licensure and Regulation of Biologics in the U.S. ” below.
In the U.S., the term of a patent covering an FDA-approved drug may be eligible for a limited patent term extension under the Hatch-Waxman Act as compensation for the loss of patent term during the FDA regulatory review process as described in
The strength of this interaction is a key factor in determining the killing potential of NK cells. An independent publication reported that the exclusion of this sugar unit of the Fc region increases the ADCC-mediated cell-killing potential of antibodies by 10- to 1000-fold. Cusatuzumab and ARGX-111 utilize POTELLIGENT (source: Expert Opin Biol Ther 2006; 6:1161-1173; http://www.tandfonline.com/doi/full/10.1517/14712598.6.11.1161%20).
An independent publication reported that the exclusion of this sugar unit of the Fc region increases the ADCC-mediated cell-killing potential of antibodies by 10- to 1000-fold. Cusatuzumab and ARGX-111 utilize POTELLIGENT ® (source: Expert Opin Biol Ther 2006; 6:1161-1173; http://www.tandfonline.com/doi/full/10.1517/14712598.6.11.1161%20).
Phase 3 ADDRESS Clinical Trial In the fourth quarter of 2020, the registrational ADDRESS clinical trial was initiated of SC efgartigimod for the treatment of PV and PF. This is a randomized, double-blinded, placebo-controlled study, where the objective is to assess efficacy, safety and tolerability in up to 150 newly diagnosed or relapsing patients with moderate to severe pemphigus.
Phase 3 ADDRESS Clinical Trial In 2020, the registrational ADDRESS clinical trial was initiated of SC efgartigimod for the treatment of PV and PF. This was a randomized, double-blinded, placebo-controlled clinical trial, where the objective was to assess efficacy, safety and tolerability in newly diagnosed or relapsing patients with moderate to severe pemphigus (total of 222 enrolled).
Primary ITP Overview Primary ITP is an acquired autoimmune bleeding disorder, characterized by a low platelet count ( Phase 3 ADVANCE Clinical Trials In the fourth quarter of 2019, the first of two registrational clinical trials, the ADVANCE Phase 3 clinical trial, was initiated to evaluate 10 mg/kg IV efgartigimod (VYVGART) for the treatment of primary ITP.
Primary ITP Overview Primary ITP is an acquired autoimmune bleeding disorder, characterized by a low platelet count ( 53 Table of Contents Phase 3 ADVANCE Clinical Trials In 2019, the first of two registrational clinical trials, the ADVANCE clinical trial, was initiated to evaluate IV efgartigimod (VYVGART) for the treatment of primary ITP.
Formulations Overview We are developing two formulations of efgartigimod to address the needs of patients, physicians, and payors across indications and geographies, including IV efgartigimod (VYVGART) and the ENHANZE® (licensed from Halozyme) SC formulation.
Formulations Overview We are developing two formulations of efgartigimod to address the needs of patients, physicians, and payors across indications and geographies, including IV efgartigimod (VYVGART) and SC efgartigimod (VYVGART SC).
To enable and encourage fast and innovative delivery of the services by IQVIA, the Asset Development Agreement contains an innovative earn-back and bonus plan based upon the performance of IQVIA. Primary SjS and PC-POTS are the first indications we identified to be further developed under the Asset Development Agreement.
To enable and encourage fast and innovative delivery of the services by IQVIA, the Asset Development Agreement contains an innovative earn-back and bonus plan based upon the performance of IQVIA. 59 Table of Contents SjD, PC- POTS and AAV are the indications we identified to be further developed under the Asset Development Agreement.
We also established argenx UK in August 2022 in preparation for potential MHRA approval. Development and commercialization may also be done through collaborations with third parties. In January 2021, we entered into an exclusive out-license agreement with Zai Lab, a commercial-stage biopharmaceutical company, for the development and commercialization of efgartigimod in Greater China ( Zai Lab Agreement ).
Development and commercialization may also be done through collaborations with third parties. In January 2021, we entered into an exclusive out-license agreement with Zai Lab ( Zai Lab Agreement ), a commercial-stage biopharmaceutical company, for the development and commercialization of efgartigimod in Greater China.
Our IIP also serves as our discovery engine to identify novel targets and together, in collaboration with our scientific and academic partners, to build potential new pipeline candidates. Every current pipeline candidate from both our wholly-owned and partnered pipeline emerged from an IIP collaboration. As part of our long-term strategy, we continue to invest in our IIP.
The IIP also serves as our discovery engine to identify novel targets and together, in collaboration with our scientific and academic partners, to build potential new pipeline candidates. Every current pipeline candidate from both our wholly-owned and partnered pipeline emerged from an IIP collaboration.
ARGX-109, ARGX-111, ARGX-117 and a number of our discovery-stage programs utilize NHance. Figure 7 ABDEG ABDEG refers to five mutations that we introduce in the Fc region that increase its affinity for FcRn at both neutral and acidic pH.
ARGX-109, empasiprubart and a number of our discovery-stage programs utilize NHANCE™ . Figure 5: NHANCE ™ mutations favor the FcRn-mediated recycling of IgG antibodies. ABDEG™ ABDEG™ refers to five mutations that we introduce in the Fc region that increase its affinity for FcRn at both neutral and acidic pH.
ENHANZE® has demonstrated across multiple FDA-approved products the ability to remove traditional limitations on the volume of biologics that can be delivered subcutaneously, potentially shortening drug administration time, reducing healthcare practitioner time, and offering additional flexibility and convenience for patients.
ENHANZE ® has demonstrated across multiple FDA-approved products the ability to remove traditional limitations on the volume of biologics that can be delivered subcutaneously, potentially shortening drug administration time, reducing healthcare practitioner time, and offering additional flexibility and convenience for patients. In 2020, we expanded the existing global collaboration and license agreement with Halozyme.
The ENHANZE® has the potential to shorten drug administration time, reduce healthcare practitioner time, and offer additional flexibility and convenience for patients. In addition, in April 2021, we entered into a collaboration and license agreement with Elektrofi to explore new SC formulations utilizing Elektrofi’s small volume injection technology for efgartigimod, and up to one additional target.
The ENHANZE ® technology has the potential to shorten drug administration time, reduce healthcare practitioner time and offer additional flexibility and convenience for patients. ● In April 2021, we entered into a collaboration and license agreement with Elektrofi, Inc. ( Elektrofi ) to explore Elektrofi’s high concentration technology for efgartigimod, and up to one additional target ( Elektrofi Agreement ).
Professor Hack has done renowned research in the role of inflammation in disease, specifically in the complement system, and has contributed research and expertise to the approval of two complement inhibitors.
Professor Hack is a renowned researcher in the role of inflammation in disease, specifically in the complement system, and has contributed research and expertise to the approval of 2 complement inhibitors.
In July 2019, we evaluated an SC formulation of efgartigimod that incorporates Halozyme’s ENHANZE® drug delivery technology in a Phase 1 clinical trial in healthy volunteers, which demonstrated retained PD profile of IV-formulated efgartigimod.
SC (VYVGART SC) - Partnership with Halozyme In July 2019, we evaluated a first generation of SC efgartigimod that incorporates Halozyme’s ENHANZE ® SC drug delivery technology in a Phase 1 clinical trial in healthy volunteers, which demonstrated retained PD profile of IV efgartigimod.
We obtained the rights to ARGX-117 as part of our IIP. argenx and Broteio launched a collaboration in 2017 to conduct research, with support from the University of Utrecht, to demonstrate preclinical proof-of-concept of the mechanism of ARGX-117.
We obtained the rights to empasiprubart as part of our IIP. argenx and Broteio launched a collaboration in 2017 to conduct research, with support from the University of Utrecht, to demonstrate preclinical POC of the mechanism of 60 Table of Contents empasiprubart.
Demyelination and axonal damage in CIDP lead to loss of sensory and/or motor neuron function, which can lead to weakness, sensory loss, imbalance and/or pain. CIDP affects approximately 16,000 patients in the U.S. Most CIDP patients require treatment and IVIg which is the preferred first-line therapy.
Demyelination and axonal damage in CIDP lead to loss of sensory and/or motor neuron function, which can lead to weakness, sensory loss, imbalance and/or pain. CIDP affects approximately 24,000 patients in the U.S. Most CIDP patients require treatment, the majority currently with IVIg.
Myositis can be very severe and disabling and have a material impact on quality of life. Initially these Myositis were classified as either DM or polymyositis, but as the underlying pathophysiology of Myositis has become better understood, including through the identification of characteristic autoantibodies, new polymyositis subgroups have emerged. Two of these subtypes are IMNM and ASyS.
Initially these Myositis were classified as either DM or polymyositis, but as the underlying pathophysiology of Myositis has become better understood, including through the identification of characteristic autoantibodies, new polymyositis subgroups have emerged. Two of these subtypes are IMNM and ASyS.
In March 2022, we announced our Phase 3 ADAPT-SC clinical trial evaluating SC efgartigimod achieved the primary endpoint of total IgG reduction from baseline at day 29, demonstrating statistical non-inferiority to VYVGART (efgartigimod alfa-fcab) IV formulation in gMG patients. Based on these results, we submitted a BLA to the FDA on September 21, 2022.
In March 2022, we announced our Phase 3 ADAPT-SC clinical trial evaluating SC efgartigimod achieved the primary endpoint of total IgG reduction from baseline at day 29, demonstrating statistical non-inferiority to VYVGART IV formulation in gMG patients.
Our SIMPLE Antibody platform allows us to access and explore a broad target universe, including novel and complex targets, while minimizing the long timelines associated with generating antibody candidates using traditional methods.
Our SIMPLE ANTIBODY™ platform technology allows us to access and explore a broad target universe, including novel and complex targets, while minimizing the long timelines associated with generating antibody candidates using traditional methods. Our Antibody Engineering Technologies Through licensing we have obtained access to a broad range of antibody engineering technologies.
In the second part of the clinical trial, 32 subjects were randomized to receive multiple ascending doses ( MADs ) of efgartigimod or placebo up to a maximum of 25 mg/kg.
In the first part of the clinical trial, 30 subjects were randomized to receive a single dose of efgartigimod or placebo ranging from 0.2 mg/kg to 50 mg/kg. In the second part of the clinical trial, 32 subjects were randomized to receive multiple ascending doses ( MADs ) of efgartigimod or placebo up to a maximum of 25 mg/kg.
We expand the use of our products and product candidates in existing indications by developing new formulations, such as a SC version of efgartigimod, that may reach more patient groups by capturing different patient preferences and providing additional optionality with regards to dosing.
We expand the use of our products and product candidates in existing indications by developing new formulations and product generations, that may reach more patient groups by capturing different patient preferences and providing additional optionality with regards to dosing. ● Advance our pipeline of assets. In addition to new indications for efgartigimod, we plan to advance additional product candidates.
In January 2022, we entered into a partnership agreement with Genpharm, under which Genpharm shall purchase VYVGART from us for the resale in the GCC on an exclusive basis for Genpharm’s own account and own name ( Genpharm Agreement ). We intend to sign additional distribution partnerships for other territories.
In January 2022, we entered into a partnership agreement with Genpharm, under which Genpharm shall purchase VYVGART from us for the resale in the GCC on an exclusive basis for Genpharm’s own account and own name ( Genpharm Agreement ). In 2023, we entered into the Handok Agreement with Handok for the distribution of VYVGART in South Korea.
The second registrational ADVANCE-SC clinical trial of 1000mg SC efgartigimod for the treatment of primary ITP was initiated in the fourth quarter of 2020. Positive phase 3 topline data for the ADVANCE clinical trial were announced on May 5, 2022.
The second registrational ADVANCE-SC clinical trial of SC efgartigimod for the treatment of primary ITP was initiated in 2020. In May 2022, we announced positive Phase 3 data from the ADVANCE clinical trial.
“ Platform Technologies ”) on increasing the intracellular recycling of efgartigimod. In both the single and MAD portions, no significant reductions in IgM, IgA or serum albumin were observed.
“ Business Overview — Intellectual Property — Platform Technologies ” ) on increasing the intracellular recycling of efgartigimod. In 50 Table of Contents both the single and MAD portions, no significant reductions in immunoglobulin M ( IgM ), immunoglobulin A ( IgA ) or serum albumin were observed.
We are driven to discover new treatment approaches in autoimmunity and fueled by the resilience of patients to urgently deliver them. We aim to do this in partnership; we listen to patients, supporters and advocacy communities, and we hear their stories.
Pre-Approval Access Program We are committed to improving the lives of people suffering from rare diseases. We are driven to discover new treatment approaches in autoimmunity and fueled by the resilience of patients to urgently deliver them. We aim to do this in partnership; we listen to patients, supporters and advocacy communities, and we hear their stories.
In addition, we obtained a non-exclusive research license and option from Chugai Pharmaceutical Co., Ltd. ( Chugai ) for the SMART-Ig® and ACT-Ig® technologies.
In addition, we obtained a non-exclusive research license and option from Chugai Pharmaceutical Co., Ltd. ( Chugai ) for the SMART-Ig ® (‘Recycling Antibody’ and part of ‘Sweeping Antibody’) and ACT-Ig ® (Antibody half-life extending) technologies.
We use our ABDEG technology to reduce the level of these pathogenic autoantibodies in the circulation by increasing the rate at which they are cleared by the lysosomes. ABDEG is a component in a number of our products and product candidates, including efgartigimod.
We use our ABDEG™ technology to reduce the level of these pathogenic autoantibodies in the circulation by increasing the rate at which they are cleared by the lysosomes.
In addition, we obtained a non-exclusive research license and option for the SMART-Ig and ACT-Ig technologies. For example, our NHance and ABDEG engineering technologies enable us to modulate the interaction of the Fc region with FcRn, which is responsible for regulating half-life, tissue distribution and PD properties of IgG antibodies.
For example, our NHANCE™ and ABDEG™ engineering technologies enable us to modulate the interaction of the Fc region with FcRn, which is responsible for regulating half-life, tissue distribution and PD properties of IgG antibodies.
Patients are randomized to receive either SC efgartigimod or placebo for 30 weeks. Patients start on concomitant steroids based on what we determine to be the optimized dosing regimen from the Phase 2 study. The primary endpoint will assess the proportion of patients who achieve complete remission on a minimal steroid dose at 30 weeks.
Patients were randomized to receive either SC efgartigimod or placebo for 30 weeks. Patients started on concomitant steroids based on what we determined to be the optimized dosing regimen from the Phase 2 POC clinical trial. The primary endpoint assessed the proportion of patients who achieve sustained complete remission on a minimal steroid dose within 30 weeks.
Other Partnered Programs See “— Collaboration Agreements ” and “— License Agreements ” for a description of collaboration and license agreements that we have entered into to further leverage our IIP.
“ Business Overview—License Agreements . ” Partnered Programs For a description of collaboration and license agreements that we have entered into to further leverage our IIP, please refer to Item 4.B. “ Business Overview—Collaboration Agreements ” and to Item 4.B.
The primary endpoint is the percent change from baseline of total IgG levels measured at day 29. On March 22, 2022, we announced positive topline results from the Phase 3 ADAPT-SC study. SC efgartigimod achieved the primary endpoint of total IgG reduction from baseline at day 29, demonstrating statistical noninferiority to VYVGART IV formulation in gMG patients.
On March 22, 2022, we announced positive topline results from the Phase 3 ADAPT-SC s clinical trial, a registrational non-inferiority bridging clinical trial of SC efgartigimod for the treatment of gMG. SC efgartigimod achieved the primary endpoint of total IgG reduction from baseline at day 29, demonstrating statistical noninferiority to VYVGART IV formulation in gMG patients.
Our Fc Engineering Technologies Our antibody engineering technologies – NHance, ABDEG, POTELLIGENT and DHS mutations – focus on engineering the Fc region of antibodies in order to augment their interactions with components of the immune system, thereby potentially expanding the therapeutic index of our product candidates by modifying their half-life, tissue penetration, rate of disease target clearance and potency.
Fc engineering can augment antibodies interactions with components of the immune system, thereby potentially expanding the therapeutic index of our product candidates by modifying their half-life, tissue penetration, rate of disease target clearance and potency.
Our goal is to maximize the commercial potential of our existing products and product candidates by exploring additional indications, as well as formulations that may expand the target patient populations within existing indications.
Our goal is to maximize the commercial potential of our existing products and product candidates by exploring additional indications, as well as formulations that may expand the target patient populations within existing indications. We are further developing our lead product, efgartigimod, for the treatment of more than 10 serious autoimmune indications.
( Broteio ) which was launched in 2017 with support from Professor Erik Hack and the University of Utrecht, to conduct research to demonstrate preclinical proof-of-concept of the mechanism of ARGX-117.
( Broteio ). Broteio was launched in 2017 with support from Professor Erik Hack and the University of Utrecht, to conduct research demonstrating preclinical POC of the mechanism of action of empasiprubart.
Our Strategic Partnership with Zai Lab for efgartigimod Pursuant to the Zai Lab Agreement, Zai Lab obtains the exclusive right to develop and commercialize efgartigimod in the aforementioned countries. Zai Lab will also contribute patients to our global Phase 3 clinical trials of efgartigimod.
Partnerships for efgartigimod indications Zai Lab Limited Pursuant to the Zai Lab Agreement, Zai Lab obtained the exclusive right to develop and commercialize efgartigimod in Greater China. Zai Lab will also contribute patients to our global Phase 3 clinical trials of efgartigimod.
Our Non-exclusive License with the Clayton Foundation for DHS mutations In October 2020, we entered into a non-exclusive research agreement with the Clayton Foundation relating to the non-exclusive in-license for the Clayton Foundation’s proprietary DHS mutations to extend the serum half-life of therapeutic candidates.
In 2020, we also entered into a non-exclusive research agreement with the Clayton Foundation under which we may access the Clayton Foundation’s proprietary DHS mutations to extend the serum half-life of therapeutic antibodies.
POTELLIGENT POTELLIGENT modulates the interaction of the Fc region with the Fc gamma receptor IIIa located on specialized immune cells, known as NK cells. These NK cells can destroy the target cell, resulting in enhanced ADCC. POTELLIGENT changes the Fc structure by excluding a particular sugar unit such that it enables a tighter fit with the Fc gamma receptor IIIa.
POTELLIGENT ® POTELLIGENT ® modulates the interaction of the Fc region with the Fc gamma receptor IIIa located on specialized immune cells, known as NK cells. These NK cells can destroy the target cell, resulting in enhanced ADCC.
These proprietary mutations modified efgartigimod to increase its affinity for FcRn while retaining the pH-dependent binding that is characteristic of FcRn interactions with its natural ligand, endogenous IgG. 39 Table of Contents ● ARGX-117 was built in collaboration with Broteio Pharma B.V.
Efgartigimod is a human IgG1 Fc fragment that is equipped with ABDEG ™ mutations, which we in-licensed from UT Southwestern. These proprietary mutations modified efgartigimod to increase its affinity for FcRn while retaining the pH-dependent binding that is characteristic of FcRn interactions with its natural ligand, endogenous IgG. ● Empasiprubart was built in collaboration with Broteio Pharma B.V.
We plan to collaborate on product candidates that we believe have promising utility in disease areas or patient populations but fall outside our commercial franchises or are better served by the resources of larger biopharmaceutical companies.
We plan to collaborate on product candidates that we believe have promising utility in disease areas or patient populations but fall outside our 68 Table of Contents commercial franchises or are better served with the focus of a dedicated team in a spin-off company.
Following analysis of Phase 1 data, and the observed favorable safety and tolerability profile and consistent PK/PD profile, we launched a Phase 2 proof-of-concept clinical trial in multifocal motor neuropathy and current treatment ( MMN ) in the fourth quarter of 2021 within our neuromuscular franchise.
Following analysis of Phase 1 data, and the observed favorable safety and tolerability profile and consistent PK/PD profile, we launched a Phase 2 POC clinical trial in MMN in 2021.
Chugai and Clayton In 2020, we entered into a research license and option agreement with Chugai under which we may access Chugai’s SMART-Ig (“Recycling Antibody” and part of “Sweeping Antibody” technology) and ACT-Ig (Antibody half-life extending technology).
SMART-Ig ® , ACT-Ig ® and DHS In 2020, we entered into a research license and option agreement with Chugai under which we may access Chugai’s SMART-Ig ® and ACT-Ig ® .
Specific pathophysiologic characteristics of MMN include the presence of IgM autoantibodies against the ganglioside GM1 and conduction block, i.e., impaired propagation of action potentials along the axon.
Specific pathophysiologic characteristics of MMN include the presence of IgM autoantibodies against the ganglioside GM1 and conduction block, i.e., impaired propagation of action potentials along the axon. GM1 is widely expressed in the nervous system by neurons, particularly around the nodes of Ranvier, and Schwann cells.
Efgartigimod (formerly ARGX-113) Development Mechanism of Action As shown in figure 3, efgartigimod is a human IgG1 Fc fragment equipped with our ABDEG mutations that is designed to target the FcRn and reduce IgG. FcRn is foundational to the immune system and functions to recycle IgG, extending its serum half-life over other Igs that are not recycled by FcRn.
Efgartigimod (formerly ARGX-113) Development Mechanism of Action As shown in Figure 1, efgartigimod is a human IgG1 Fc fragment equipped with our ABDEG™ mutations that is designed to target the FcRn and reduce IgG.
Figure 4: Reduction in the levels of four IgG antibody classes and total IgG levels in the MAD part of our Phase 1 clinical trial of efgartigimod in healthy volunteers at a dose of 10 mg/kg every seven days. ​ SC - Partnership with Halozyme In 2020, we and Halozyme expanded the existing global collaboration and license agreement that was signed in February 2019.
Figure 2: Reduction in the levels of four IgG antibody classes and total IgG levels in the MAD part of our Phase 1 clinical trial of efgartigimod in healthy volunteers at a dose of 10 mg/kg every seven days.
SC – Partnership with Elektrofi In April 2021, we entered into a collaboration and license agreement with Elektrofi to explore Elektrofi’s high-concentration, low-volume delivery technology for efgartigimod, and up to one additional target. See “—Our Exclusive License with Elektrofi for efgartigimod ” below for more information.
SC – Partnership with Elektrofi In April 2021, we entered into a collaboration and license agreement with Elektrofi to explore a high concentration technology for efgartigimod and up to one additional target. Please refer to Item 4.B.
We cannot predict whether the patent applications we are currently pursuing will issue as patents in any particular jurisdiction or whether the claims of any issued patents will provide sufficient proprietary protection from competitors. Any patents that we hold may be challenged, circumvented or invalidated by third parties.
As a result, we cannot guarantee that any of our platform technologies and product candidates will be protectable or remain protected by enforceable patents. We cannot predict whether the patent applications we are currently pursuing will issue as patents in any particular jurisdiction or whether the claims of any issued patents will provide sufficient proprietary protection from competitors.
Intellectual Property Introduction We strive to protect the proprietary technologies that we believe are important to our business, including pursuing and maintaining patent protection intended to cover the platform technologies incorporated into, or used to produce, our product candidates, the compositions of matter of our product candidates and their methods of use, as well as other inventions that are important to our business.
Intellectual Property Introduction We strive to protect and maintain exclusivity for the proprietary technologies that we believe are important to our business, patients and shareholders. We are focused on pursuing and maintaining patent protection intended to cover core platform technologies incorporated into, or used to produce, our product candidates and commercial products.
Efgartigimod (formerly ARGX-113) Indications gMG Overview gMG is a rare and chronic autoimmune disease where IgG autoantibodies disrupt communication between nerves and muscles, causing debilitating and potentially life-threatening muscle weakness.
“ Business Overview —License Agreements— Our Exclusive License with Elektrofi for efgartigimod ” for more information. 51 Table of Contents Efgartigimod Indications gMG Overview gMG is a rare and chronic autoimmune disease where IgG autoantibodies disrupt communication between nerves and muscles, causing debilitating and potentially life-threatening muscle weakness.
We have also advanced ARGX-119 into a Phase 1 clinical trial in healthy volunteers and plan to advance early-stage pipeline candidates as well as expand our pipeline of future product candidates through our IIP. 56 Table of Contents ● Leverage our suite of technologies to seek strategic collaborations and maximize the value of our pipeline .
We are also advancing ARGX-119 into Phase 1b/2a clinical trials in CMS and ALS and beyond and plan to advance early-stage pipeline candidates towards IND filing by the end of 2025, as well as expand our pipeline of future product candidates through the IIP. ● Leverage our suite of technologies to seek strategic collaborations and maximize the value of our pipeline.

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Item 6. [Reserved]

Selected Financial Data — reserved (removed by SEC in 2021)

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Due to the overall higher compensation level in our business segment in the U.S. and Japan compared to the EU, there is a significant difference in the pay ratio when the CEO’s compensation is compared to the median compensation of all our employees (the majority of which are EU citizens), as set out above, or compared to employees in the U.S. and Japan.
Due to the overall higher compensation level in our business segment in the U.S. and Japan compared to the EU, there is a significant difference in the pay ratio when the CEO’s compensation is compared to the median compensation of all employees (the majority of which are EU citizens), as set out above, or compared to employees in the U.S. and Japan.
Acknowledging and benefiting from different perspectives promotes diversity of thought and empowers innovation. It also contributes to our commitment to improve lives of patients, wherefore we need teams with a healthy mix of contrasting perspectives and backgrounds that reflect the diverse communities we serve. We recognize that our people are our greatest strength.
Acknowledging and benefiting from different perspectives promotes diversity of thought and empowers innovation. It also contributes to our commitment to improve the quality of lives of patients, wherefore we need teams with a healthy mix of contrasting perspectives and backgrounds that reflect the diverse communities we serve. We recognize that our people are our greatest strength.
Our remuneration and nomination committee is responsible for, among other things: ● regularly reviewing the remuneration policy and practices in light of all relevant circumstances and benchmarks, and recommending to the non-executive directors the remuneration of the individual executive directors; 148 Table of Contents ● advising our Board of Directors in respect of the remuneration for the non-executive directors; ● preparing the remuneration report to be included in our annual report; ● drawing up selection criteria and appointment procedures for directors and making proposals for appointment and re-appointment of the directors; ● periodically assessing the size and composition of our Board of Directors and making a proposal for a composition profile of the non-executive directors; ● periodically assessing the diversity (including gender diversity) on our Board of Directors and leadership teams, and taking into account any gaps between our then current diversity metrics and the goals specified in our diversity, equity and inclusion policy when making recommendations to the Board of Directors; ● periodically assessing the functioning of individual directors and reporting on this to the non-executive directors; and ● supervising the policy of the executive directors on the selection criteria and appointment procedures for senior management.
Our remuneration and nomination committee is responsible for, among other things: ● regularly reviewing the remuneration policy and practices in light of all relevant circumstances and benchmarks, and recommending to the non-executive directors the remuneration of the individual executive directors; ● advising our Board of Directors in respect of the remuneration for the non-executive directors; ● preparing the remuneration report to be included in our annual report; ● drawing up selection criteria and appointment procedures for directors and making proposals for appointment and re-appointment of the directors; ● periodically assessing the size and composition of our Board of Directors and making a proposal for a composition profile of the non-executive directors; 157 Table of Contents ● periodically assessing the diversity (including gender diversity) on our Board of Directors and leadership teams, and taking into account any gaps between our then current diversity metrics and the goals specified in our diversity, equity and inclusion policy when making recommendations to the Board of Directors; ● periodically assessing the functioning of individual directors and reporting on this to the non-executive directors; and ● supervising the policy of the executive directors on the selection criteria and appointment procedures for senior management.
The non-executive directors shall appoint and dismiss the members of the commercial committee. All members of the commercial committee shall have adequate industrial, academic and/or practical experience with the commercialization of (bio)pharmaceuticals. Our commercial committee meets as often as is required for its proper functioning and in practice meets at least once per quarter.
The non-executive directors shall appoint and dismiss the members of the commercialization committee. All members of the commercialization committee shall have adequate industrial, academic and/or practical experience with the commercialization of (bio)pharmaceuticals. Our commercialization committee meets as often as is required for its proper functioning and in practice meets at least once per quarter.
Our audit and compliance committee is also responsible for monitoring the status of, and compliance with, our global ethics and compliance program and meets with our head of ethics and compliance at least quarterly to discuss the status and overall effectiveness of the program as well as any issues or incidents that occurred and remedial actions needed (if applicable).
Our audit and compliance committee is also responsible for monitoring the status of, and compliance with, our global ethics and compliance program and meets with the head of our ethics and compliance function at least quarterly to discuss the status and overall effectiveness of the program as well as any issues or incidents that occurred and remedial actions needed (if applicable).
Johnson has the sole power to vote or direct the voting of the shares owned directly by the various investment companies registered under the Investment Company Act ( Fidelity Funds ) advised by Fidelity Management & Research Company ( FMR Co. ), a wholly owned subsidiary of FMR LLC, which power resides with the Fidelity Funds’ Boards of Trustees.
Johnson has the sole power to vote or direct the voting of the shares owned directly by the various investment companies registered under the Investment Company Act advised by Fidelity Management & Research Company ( FMR Co. ), a wholly owned subsidiary of FMR LLC, which power resides with the Fidelity Funds’ Boards of Trustees.
However, our Board of Directors has determined that, taking into account any applicable committee independence standards, all of our non-executive directors, including the members of our audit and compliance committee, are “independent directors” under Rule 10A-3 of the Exchange Act and the applicable rules of Nasdaq and of the DCGC.
However, our Board of Directors has determined that, taking into account any applicable committee independence standards, all of our non-executive directors, including the members of our audit and compliance committee, are “independent directors” under Rule 10A-3 of the Exchange Act, the Nasdaq Listing Rules and the DCGC.
Stock options are exercisable when vested, and in any case not after the stock option expiration date included in each individual stock option grant, which is 10 years or, in the case of Belgian tax resident employees, at their election either five years or ten years from the date of grant.
Stock options are exercisable when vested, and in any case not after the stock option expiration date included in each individual stock option grant, which is 10 years or in the case of Belgian tax resident employees, at their election either five years or 10 years from the date of grant.
BOARD PRACTICES Director Independence As a foreign private issuer, under the listing requirements and rules of Nasdaq, we are not required to have a majority independent directors on our Board of Directors, except that our audit and compliance committee is required to consist fully of independent directors.
BOARD PRACTICES Director Independence As a foreign private issuer, under the Nasdaq Listing Rules, we are not required to have a majority independent directors on our Board of Directors, except that our audit and compliance committee is required to consist fully of independent directors.
Once hired, employees are encouraged to participate in a personal development program aimed at building on their individual strengths 145 Table of Contents to benefit the broader team and taking into account their individual career aspirations.
Once hired, employees are encouraged to participate in a personal development program aimed at building on their individual 153 Table of Contents strengths to benefit the broader team and taking into account their individual career aspirations.
We have not had, and do not anticipate having, disputes on any of these subjects. CBAs may, however, change the employment conditions of our employees in the future and hence adversely affect our employment relationships. E. SHARE OWNERSHIP For information regarding the share ownership of our directors and members of our executive committee, see Item 6.B.
We have not had, and do not anticipate having, disputes on any of these subjects. CBAs may, however, change the employment conditions of our employees in the future and hence adversely affect our employment relationships. 162 Table of Contents E. SHARE OWNERSHIP For information regarding the share ownership of our directors and members of our executive committee, see Item 6.B.
Each stock option shall be granted with an exercise price equal to the fair market value upon the date of grant and shall have a term equal to five or ten years from the date of grant.
Each stock option shall be granted with an exercise price equal to the fair market value upon the date of grant and shall have a term equal to five or 10 years from the date of grant.
In 2022, we adopted our new diversity, equity and inclusion policy, which sets out the basis for our inclusion, equity and diversity management throughout our organization in a way that we believe best supports our business objectives and our people.
In 2022, we adopted our current diversity, equity and inclusion policy, which sets out the basis for our inclusion, equity and diversity management throughout our organization in a way that we believe best supports our business objectives and our people.
In accordance with our Articles of Association, our Board of Directors meets at least once every three months to discuss the state of affairs within the Company and the expected developments. 150 Table of Contents Under our Board By-Laws, the members of our Board of Directors must endeavor, insofar as is possible, to ensure that resolutions are adopted unanimously.
In accordance with our Articles of Association, our Board of Directors meets at least once every three months to discuss the state of affairs within the Company and the expected developments. Under our Board By-Laws, the members of our Board of Directors must endeavor, insofar as is possible, to ensure that resolutions are adopted unanimously.
It informs our Board of Directors about all areas in which action or improvement is necessary in its opinion and produces recommendations concerning the necessary steps or resolutions that need to be taken. The audit review and the reporting on that review cover us and our subsidiaries as a whole.
It informs our Board of Directors about all areas in which action or improvement is necessary in its opinion and produces recommendations concerning the necessary steps that need to be taken. The audit review and the reporting on that review cover the Company and its subsidiaries as a whole.
Our Board of Directors has incorporated a research and development committee and a commercial committee. Audit and Compliance Committee Our audit and compliance committee consists of four members: Steve Krognes (chairperson), effective February 27, 2023, Peter K. M. Verhaeghe, Anthony A. Rosenberg and James M. Daly. Mr. Lanthaler was chairperson until February 27, 2023.
Our Board of Directors has incorporated a research and development committee and a commercialization committee. Audit and Compliance Committee Our audit and compliance committee consists of four members: Steve Krognes (chairperson), effective February 27, 2023, Peter K. M. Verhaeghe, Anthony A. Rosenberg and James M. Daly. Mr. Lanthaler was a committee member and chairperson until February 27, 2023.
“ Compensation ” and Item 7.A. “ Major Shareholders .” F. DISCLOSURE OF A REGISTRANT’S ACTION TO RECOVER ERRONEOUSLY AWARDED COMPENSATION Not required. ITEM 7. MAJOR SHAREHOLDERS AND RELATED PARTY TRANSACTIONS A.
“ Compensation ” and Item 7.A. “ Major Shareholders ” . F. DISCLOSURE OF A REGISTRANT’S ACTION TO RECOVER ERRONEOUSLY AWARDED COMPENSATION Not applicable. ITEM 7. MAJOR SHAREHOLDERS AND RELATED PARTY TRANSACTIONS A.
The Johnson family group and all other Series B shareholders have entered into a shareholders’ voting agreement under which all Series B voting common shares will be voted in accordance with the majority vote of Series 153 Table of Contents B voting common shares.
The Johnson family group and all other Series B shareholders have entered into a shareholders’ voting agreement under which all Series B voting common shares will be voted in accordance with the majority vote of Series B voting common shares.
Optionees may prefer to elect the five-year period as this may limit their personal tax obligations in respect of the option in respect to the jurisdiction where options are taxed at grant, compared to a ten-year option.
Optionees may prefer to elect the five-year period as this may limit their personal tax obligations in respect of the stock option in respect to the jurisdiction where stock options are taxed at grant, compared to a 10-year stock option.
Our Board of Directors, upon approval of a majority of the non-executive directors, may amend or terminate the Equity Incentive Plan or may amend the terms of the Equity Incentive Plan, or any outstanding stock options or RSUs, provided that we will compensate any affected individual for any direct negative impact of such amendment.
The Board of Directors, upon approval of a majority of the non-executive directors, may amend or terminate the Equity Incentive Plan or may amend the terms of the Equity Incentive Plan, or any outstanding stock options or RSUs, provided that the Company will compensate any affected individual for any direct negative impact of such amendment. C.
(3) Based solely on the most recent transparency notification filed with the Dutch Authority for the Financial Markets ( Stichting Autoriteit Financiële Markten ) ( AFM ) as of February 15, 2023. Consists of 0 ordinary shares and voting rights on 2,966,216 ordinary shares.
(3) Based solely on the most recent transparency notification filed with the Dutch Authority for the Financial Markets ( Stichting Autoriteit Financiële Markten ) ( AFM ) as of February 20, 2024. Consists of 0 ordinary shares and voting rights on 2,966,216 ordinary shares.
Daly is also a non-executive member of the board of directors of Halozyme. Mr. Daly did not participate in any discussions and decision making relating to the ENHANZE License Agreement. Agreements with Our Senior Management.
Our non-executive 166 Table of Contents director Mr. Daly is also a non-executive member of the board of directors of Halozyme. Mr. Daly did not participate in any discussions and decision making relating to the ENHANZE License Agreement. Agreements with Our Senior Management.
Our audit and compliance committee assists our Board of Directors in overseeing the accuracy and integrity of our accounting and financial reporting processes and audits and reviews of our consolidated financial statements, the implementation and effectiveness of an internal control system and our compliance with legal and regulatory requirements, the independent auditors’ qualifications and independence and the performance of the independent auditors.
Our audit and compliance committee assists our Board of Directors in overseeing the accuracy and integrity of our accounting and financial reporting processes and audits and reviews of our consolidated financial statements as well as non-financial statements (including ESG reporting), the implementation and effectiveness of an internal control system and our compliance with legal and regulatory requirements, the independent auditors’ qualifications and independence and the performance of the independent auditors.
We have opted to compare non-equity salaries, because whereas the number of options granted is linked to the overall size of remuneration packages granted, the value of equity components depends on the evolution of our share price, volatility and the risk-free rate, which is unknown at granting and as such the forward-looking valuation methods for options normally do not provide an accurate representation of actual economic value granted.
The Company has opted to compare non-equity salaries, because whereas the number of stock options granted is linked to the overall size of remuneration packages granted, the value of equity components depends on the evolution of the Company’s share price, volatility and the risk-free rate, which is unknown at granting and as such the forward-looking valuation methods for stock options normally do not provide an accurate representation of actual economic value granted.
The costs of these services are negotiated on an at arm’s length basis and none of these arrangements are material to us. Related Party Transactions Policy In connection with our initial U.S. public offering, we entered into a related party transaction policy. C. INTERESTS OF EXPERTS AND COUNSEL Not applicable.
The costs of these services are negotiated on an at arm’s length basis and none of these arrangements are material to us. Related Party Transactions Policy In connection with our initial U.S. public offering, we entered into a related party transaction policy.
Other than as set forth in this Annual Report, there are no arrangements or understandings in place with major shareholders, customers, suppliers or others pursuant to which any member of our Board of Directors or senior management team has been appointed. We have entered into a management agreement with Tim Van Hauwermeiren as our CEO, our sole executive director.
There are no arrangements or understandings in place with major shareholders, customers, suppliers or others pursuant to which any member of our Board of Directors or senior management team has been appointed. We have entered into a management agreement with Tim Van Hauwermeiren as our CEO, our sole executive director.
Informal subcommittees Research and development committee The research and development committee consists of members of our Board of Directors and other persons, which composition may vary from time to time. Currently, the research and development committee consists of two members who are also members of our Board of Directors: J. Donald deBethizy and Pamela Klein.
Donald deBethizy (chairperson) ​ 5 ​ 100% ​ Informal subcommittees Research and development committee The research and development committee consists of members of our Board of Directors and other persons, which composition may vary from time to time. Currently, the research and development committee consists of two members who are also members of our Board of Directors: J.
Based on the self-evaluation performed, the non-executive directors concluded that the Board of Directors and its committees had properly discharged their responsibilities during 2022. The Board of Directors identified certain strengths and weaknesses and adopted a plan for further board development and succession in 2023. 151 Table of Contents D.
Based on the self-evaluation performed, the non-executive directors concluded that the Board of Directors and its committees had properly discharged their responsibilities during 2023. The Board of Directors identified certain strengths and weaknesses and adopted a plan for further board development and succession in 2024.
We have entered into such agreements with each new non-executive director or member of our senior management when they have joined us since our initial U.S. public offering.
Indemnification Agreements In connection with our initial U.S. public offering, we entered into indemnification agreements with each of our non-executive directors and each member of our senior management. We have entered into such agreements with each new non-executive director or member of our senior management when they have joined us since our initial U.S. public offering.
The written questionnaire is then followed up by one-to-one interviews with each member of the Board of Directors, followed by a debrief to the entire Board of Directors both in writing (in form of a report) and in the form of a live discussion of the evaluation report aimed at distilling specific learnings and conclusions.
The written questionnaire is then followed up by one-to-one interviews with the representative of Nasdaq Governance Solutions with each member of the Board of Directors, followed by a debrief and discussion held with the external evaluator and the entire Board of Directors both in writing (in form of a report) and in the form of a live discussion of the evaluation report aimed at distilling specific learnings and conclusions.
Other information regarding this shareholder’s beneficial ownership of our shares is not known to us or, to our knowledge, ascertainable from public filings. (4) Based on the most recently available Schedule 13G/A filed with the SEC on February 1, 2023.
Other information regarding this shareholder’s beneficial ownership of our shares is not known to us or, to our knowledge, ascertainable from public filings. (4) Based on the most recently available Schedule 13G filed with the SEC on February 14, 2024. According to its Schedule 13G, T.
Rowe Price Associates, Inc. reported having sole voting power over 1,185,402 ADSs and sole dispositive power over 3,959,686 ADSs. The Schedule 13G/A contained information as of December 31, 2022 and may not reflect current holdings of the Company’s stock. The address for T. Rowe Price Associates, Inc. is 100 E. Pratt Street, Baltimore, MD 21202.
Rowe Price Associates, Inc. reported having sole voting power over 1,051,051 ADSs and sole dispositive power over 3,673,589 ADSs. The Schedule 13G contained information as of December 31, 2023 and may not reflect current holdings of the Company’s stock. The address for T. Rowe Price Associates, Inc. is 100 E. Pratt Street, Baltimore, MD 21202.
(6) Based on the most recently available Schedule 13G/A filed with the SEC on February 10, 2023. According to its Schedule 13G/A, Artisan Partners Limited Partnership ( APLP ), Artisan Investments GP LLC ( Artisan Investments ), Artisan Partners Holdings LP ( Artisan Holdings ), and Artisan Partners Asset Management Inc.
(5) Based on the most recently available Schedule 13G filed with the SEC on February 12, 2024. According to its Schedule 13G, Artisan Partners Limited Partnership ( APLP ), Artisan Investments GP LLC ( Artisan Investments ), Artisan Partners Holdings LP ( Artisan Holdings ), and Artisan Partners Asset Management Inc.
Arjen Lemmen, our vice president corporate development and strategy, has an employment contract with our subsidiary, argenx BV, for an indefinite term. We may terminate his employment contract at any time, subject to a notice period and a severance payment of at least twelve months.
Arjen Lemmen, our vice president corporate development and strategy, has an employment contract with our subsidiary, argenx BV, for an indefinite term. We may terminate his employment contract at any time, subject to a notice period and a severance payment of at least 12 months. Mr. Lemmen entered into a secondment agreement with argenx BV, under which Mr.
MAJOR SHAREHOLDERS The following table sets forth information with respect to the beneficial ownership of our ordinary shares as of February 15, 2023 for: ● each person who is known by us to own beneficially more than 3% of our total outstanding ordinary shares; ● each member of our Board of Directors and our senior management; ● all members of our Board of Directors and our senior management as a group. 152 Table of Contents Beneficial ownership is determined in accordance with the rules of the SEC.
MAJOR SHAREHOLDERS The following table sets forth information with respect to the beneficial ownership of our ordinary shares as of February 20, 2024 for: ● each person who is known by us to own beneficially more than 3% of our total outstanding ordinary shares; ● each member of our Board of Directors and our senior management; and ● all members of our Board of Directors and our senior management as a group.
We aim to foster an inclusive work environment in support of our strategic plan and priorities. We continue to raise the bar in this regard, and to commit to measures and goals designed to support our maturing company culture. We have set ourselves the goal of gender balance across all levels at argenx, including our Board of Directors.
We continue to raise the bar in this regard, and to commit to measures and goals designed to support our maturing company culture. We have set ourselves the goal of gender balance across all levels at argenx, including our Board of Directors.
( APAM ) reported having shared voting power over 2,226,549 ordinary shares and shared dispositive power over 2,615,415 shares. APLP is an investment adviser registered under section 203 of the Investment Advisers Act of 1940. Artisan Holdings is the sole limited partner of APLP and the sole member of Artisan Investments. Artisan Investments is the general partner of APLP.
( APAM ) reported having shared voting power over 2,705,482 ordinary shares and shared dispositive power over 3,174,477 ordinary shares. APLP is an investment adviser registered under section 203 of the Investment Advisers Act of 1940. Artisan Holdings is the sole limited partner of APLP and the sole member of Artisan Investments. Artisan Investments is the general partner of APLP.
The research and development committee is responsible for, among other things: ● monitoring and overseeing our research and development goals, strategies and measures; ● serving as a sounding board to our research and development management, general management and Board of Directors; ● performing strategic reviews of our key research and development programs; ● reporting to our Board of Directors on the outcome of the strategic reviews; ● reviewing our scientific publication and communications plan; ● evaluating and challenging the effectiveness and competitiveness of our research and development endeavors; ● reviewing and discussing emerging scientific trends and activities critical to the success of our research and development; 149 Table of Contents ● reviewing our clinical and preclinical product pipeline; and ● engaging in attracting, retaining and developing our senior research and development personnel.
Ad-hoc participants to the committee meetings include a variety of employees and/or external advisors, depending on the needs of the committee and the topics under discussion. 158 Table of Contents The research and development committee is responsible for, among other things: ● monitoring and overseeing our research and development goals, strategies and measures; ● serving as a sounding board to our research and development management, general management and Board of Directors; ● performing strategic reviews of our key research and development programs; ● reporting to our Board of Directors on the outcome of the strategic reviews; ● reviewing our scientific publication and communications plan; ● evaluating and challenging the effectiveness and competitiveness of our research and development endeavors; ● reviewing and discussing emerging scientific trends and activities critical to the success of our research and development; ● reviewing our clinical and preclinical product pipeline; and ● engaging in attracting, retaining and developing our senior research and development personnel.
“ Related Party Transactions — A greements with Our Senior Management ” there are no arrangements or understanding between us and any of the executive directors providing for benefits upon termination of their employment, other than as required by applicable law.
“ Related Party Transactions — Agreements with Our Senior Management ” , there are no arrangements or understanding between us and any of the executive directors providing for benefits upon termination of their employment, other than as required by applicable law. In addition, the contracts between us and our non-executive directors do not provide for any benefits upon termination.
The comparison of non-equity compensation above is made between the compensation paid to our single executive director, and the median compensation paid to our employees.
The comparison of non-equity compensation above is made between the compensation paid to the CEO, the Company’s sole executive director, and the median compensation paid to employees.
In fiscal year 2022, no (personal) loans were granted to our senior management and non-executive directors and no guarantees or the like have been granted in favor of any of the senior management and the non-executive directors.
No loans or guarantees In fiscal year 2023, no loans were granted to members of senior management and non-executive directors and no guarantees or the like have been granted in favor of any member of senior management or Board of Directors.
Of the directors who chose to disclose their gender, the Board of Directors contained 5 male directors and 3 female directors (non-executive directors), translating into a 55.55% male / 33 1/3 % female balance for our full Board of Directors (compared to 6 males and 2 females (75% / 25%) as of December 31, 2021) and a 62.5% male / 37.5% female balance for our non-executive directors (compared to 5 males and 2 females (71.4% / 28.6%) as of December 31, 2021).
Of the directors who chose to disclose their gender, the Board of Directors contained five male directors and three female directors (non-executive directors), translating into a 55.55% male / 33 1/3 % female balance for our full Board of Directors (compared to five males and three females (non-executive directors) (55.55%/33 1/3 %) as of December 31, 2022) and a 62.5% male / 37.5% female balance for our non-executive directors (compared to 62.5% male/37.5% female as of December 31, 2022).
The key terms of his agreement are as follows: 155 Table of Contents ​ ​ ​ ​ ​ Tim Van Hauwermeiren Base salary ​ $ 638,901 Cash bonus ​ ​ maximum 60% of base salary based ​ ​ ​ on previously determined bonus ​ ​ ​ targets established by the ​ ​ ​ non‑executive directors Pension contributions(1) ​ $ 23,384 Duration ​ ​ Indefinite (1) Amounts shown represent pension contributions paid during the year-ended December 31, 2021.
The key terms of his agreement are as follows: ​ ​ ​ ​ ​ Tim Van Hauwermeiren Base salary ​ $ 655,787 Cash bonus ​ ​ maximum 60% of base salary based on previously determined bonus targets established by the non‑executive directors Pension contributions(1) ​ $ 22,821 Duration ​ ​ Indefinite (1) Amounts shown represent pension contributions paid during the year-ended December 31, 2023.
Except as otherwise indicated, all of the shares reflected in the table are ordinary shares and all persons listed below have sole voting and investment power with respect to the shares beneficially owned by them, subject to applicable community property laws. The information is not necessarily indicative of beneficial ownership for any other purpose.
Except as otherwise indicated, all of the shares reflected in the table are ordinary shares and all persons listed below have sole voting and investment power with respect to the shares beneficially owned by them, subject to applicable community property laws.
Everyone has a voice and is encouraged to contribute to the benefit of our common goals, irrespective of race, ethnicity, age, gender or cultural background. Good ideas as well as real concerns are taken seriously, regardless of who brings them forward.
Everyone has a voice and is encouraged to contribute to the benefit of our common goals, irrespective of race, ethnicity, age, gender or cultural background. Good ideas as well as real concerns are taken seriously, regardless of who brings them forward. We aim to foster an inclusive work environment in support of our strategic plan and priorities.
As of February 1, 2023, assuming that all of our ordinary shares represented by ADSs are held by residents of the U.S., we estimate that approximately 53.62% of our outstanding ordinary shares were held in the U.S. by approximately 1 institutional holders of record.
As of February 20, 2024, assuming that all of our ordinary shares represented by ADSs are held by residents of the U.S., we estimate that approximately 53.61% of our outstanding ordinary shares were held in the U.S. by approximately one institutional holder of record.
We believe this division of responsibilities is the most effective approach for addressing the risks we face. Composition, Appointment and Dismissal Our Articles of Association provide that our Board of Directors will consist of our executive director(s) and non-executive directors. The number of executive directors must at all times be less than the number of non-executive directors.
We believe this division of responsibilities is the most effective approach for addressing the risks we face. 154 Table of Contents Composition, Appointment and Dismissal The Articles of Association provide that our Board of Directors will consist of our executive director(s) and non-executive directors.
FMR Co. carries out the voting of the shares under written guidelines established by the Fidelity Funds’ Boards of Trustees. FMR LLC’s principal business office is located 245 Summer Street, Boston, Massachusetts 02210. (2) Based on the most recently available Schedule 13G/A filed with the SEC on February 14, 2023. According to its Schedule 13G/A, T.
FMR Co. carries out the voting of the shares under written guidelines established by the Fidelity Funds’ Boards of Trustees. FMR LLC’s principal business office is located 245 Summer Street, Boston, MA 02210. 164 Table of Contents (2) Based on the most recently available Schedule 13G filed with the SEC on February 1, 2024.
The information in the table below is based on information known to us or ascertained by us from public filings made by the shareholders. ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Shares beneficially owned ​ Name of beneficial owner Number Percentage ​ 3% or Greater Shareholders: FMR LLC (1) ​ 5,532,356 ​ 10.0 % T.
The information in the table below is based on information known to us or ascertained by us from public filings made by the shareholders. ​ ​ ​ ​ ​ ​ ​ ​ Shares beneficially owned ​ Name of beneficial owner Number Percentage ​ 3% or Greater Shareholders: FMR LLC (1) ​ 4,173,842 ​ 7.1 % Blackrock, Inc.
Corporate Governance Practices Our Board By-Laws, that describe, inter alia , the procedure for holding meetings of the Board of Directors, for the decision-making by the Board of Directors and the Board of Directors’ operating procedures.
Rosenberg ​ 5 ​ 100% James M. Daly (chairperson) ​ 5 ​ 100% Camilla Sylvest ​ 5 ​ 100% ​ Corporate Governance Practices Our Board By-Laws, that describe, inter alia, the procedure for holding meetings of the Board of Directors, for the decision-making by the Board of Directors and the Board of Directors’ operating procedures.
“ Business Overview — Our Exclusive License with Halozyme for ENHANZE®, ” we are party to the ENHANZE License Agreement pursuant and may be required to make certain payments to Halozyme. In fiscal year 2022, we made $2.1 million in payments to Halozyme pursuant to the ENHANZE License Agreement. Our non-executive director Mr.
RELATED PARTY TRANSACTIONS As described under Item 4.B. “ Business Overview — Our Exclusive License with Halozyme for ENHANZE®, ” we are party to the ENHANZE License Agreement and may be required to make certain payments to Halozyme. In fiscal year 2022, we made $2.1 million in payments to Halozyme pursuant to the ENHANZE License Agreement.
To our knowledge, and other than changes in percentage ownership as a result of the shares issued in connection with our initial and follow-on U.S. public offerings, there has been no significant change in the percentage ownership held by the major shareholders listed above. B. RELATED PARTY TRANSACTIONS As described under Item 4.B.
To our knowledge, and other than changes in percentage ownership as a result of the shares issued in connection with our initial and follow-on U.S. public offerings or publicly disclosed in AFM filings and any amendments thereof, there has been no significant change in the percentage ownership held by the major shareholders listed above. B.
EMPLOYEES As of December 31, 2022, we had 843 employees and 216 consultants, which we refer to as “contingent workers.” At each date shown below, we had the following number of employees, broken out by department and geography: ​ ​ ​ ​ ​ ​ ​ ​ ​ At December 31, ​ 2022 2021 2020 Function: Research and development 367 289 193 Selling, general and administrative 476 361 143 Total 843 650 336 Geography: ​ ​ ​ Belgium 363 296 213 U.S. ​ 340 ​ 276 ​ 108 Japan ​ 75 ​ 57 ​ 13 The Netherlands — — — Switzerland ​ 15 9 2 France ​ 11 ​ 3 ​ — Germany ​ 11 ​ 9 ​ — Canada ​ 5 ​ — ​ — Other EU - remote ​ 23 ​ — ​ — Total 843 650 336 ​ Collective bargaining agreements ( CBAs ) can be entered into in Belgium at the national, industry, or company levels.
EMPLOYEES As of December 31, 2023, we had 1,148 employees and 309 consultants, which we refer to as “contingent workers.” At each date shown below, we had the following number of employees, broken out by department and geography: ​ ​ ​ ​ ​ ​ ​ ​ ​ At December 31, ​ 2023 2022 2021 Function: Research and development 653 367 289 Selling, general and administrative 495 476 361 Total 1,148 843 650 Geography: ​ ​ ​ Belgium 355 363 296 U.S. ​ 454 ​ 340 ​ 276 Japan ​ 116 ​ 75 ​ 57 The Netherlands 22 — — Switzerland ​ 28 15 9 France ​ 40 ​ 11 ​ 3 Germany ​ 25 ​ 11 ​ 9 Canada ​ 16 ​ 5 ​ — UK ​ 37 ​ — ​ — Italy ​ 27 ​ — ​ — Spain ​ 20 ​ — ​ — Other - remote ​ 8 ​ 23 ​ — Total 1,148 843 650 ​ Collective bargaining agreements ( CBAs ) can be entered into in Belgium at the national, industry, or company levels.
The table below shows the evolution over the past five years of CEO compensation, the performance of our stock price and the median remuneration on a full-time equivalent basis (annualized for the employees who joined or left us during the year) of our employees, other than the executive director: (in USD thousands, unless otherwise indicated) Financial year ended December 31, 2018 2019 2020 2021 2022 Base salary of our CEO (EUR) (1) 500,000 525,000 525,000 551,250 606,368 Base salary of our CEO (USD) 526,825 553,167 553,167 580,825 638,901 Non-equity remuneration of our CEO (base salary, short-term cash incentive, pension contributions and other compensation elements) (2) 996,215 1,001,891 1,144,301 1,285,136 1,443,925 Non-equity median salary paid to our employees 110,196 121,603 163,062 157,349 153,193 Ratio employee/CEO 11% 12% 14% 12% 11% Average compensation paid to non-executive director 59,891 60,372 57,925 54,484 48,587 Number of employees at end of year 105 188 336 650 843 Share price at end of year Euronext EUR. 85.20 143.60 242 315.30 348.3 Share price at end of year Euronext USD 97.55 161.32 296.96 357.11 371.50 (1) Shown in USD, using a fixed exchange rate of 1.05 USD / 1 EUR, taking into account that our CEO’s salary is paid in EUR but our functional and reporting currency is in USD.
The table below shows the evolution over the past five years of CEO compensation, the performance of the Company’s stock price and the median remuneration on a full-time equivalent basis (annualized for the employees who joined or left us during the year) of employees, other than the CEO: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Year ended December 31, ​ 2019 2020 2021 2022 2023 Base salary of our CEO (EUR) € 525,000 ​ 525,000 ​ 551,250 ​ 606,368 ​ 606,368 Base salary of our CEO (USD) $ 526,825 ​ 553,167 ​ 580,825 ​ 638,901 ​ 655,787 Non-equity remuneration of our CEO (USD) (base salary, short-term cash incentive, pension contributions and other compensation elements) $ 1,001,891 ​ 1,144,301 ​ 1,285,136 ​ 1,443,925 ​ 1,285,056 Non-equity median salary paid to our employees (USD) $ 121,603 ​ 163,062 ​ 157,349 ​ 153,193 ​ 159,500 Ratio employee/CEO 12% ​ 14% ​ 12% ​ 11% ​ 12% Average compensation paid to non-executive director (USD) $ 60,372 ​ 57,925 ​ 54,484 ​ 48,587 ​ 59,230 Number of employees on December 31 ​ 188 ​ 336 ​ 650 ​ 843 ​ 1,148 Share price at end of year Euronext (EUR) on December 31 € 143.60 ​ 242.00 ​ 315.30 ​ 348.30 ​ 343.50 Share price at end of year Euronext (USD) on December 31 $ 161.32 ​ 296.96 ​ 357.11 ​ 371.50 ​ 379.57 ​ The increase in the remuneration ratio between the CEO and other employees between 2022 and 2023 is caused by the increase in salary of employees when base salary of the CEO has been unchanged.
The executive director(s) are required to be asked their vision on their own remuneration in accordance with best practice provision 3.2.2 but may not participate in the adoption of resolutions (including any deliberations in respect of such resolutions) relating to their remuneration.
The executive director(s) are required to be asked their vision on their own remuneration in accordance with best practice provision 3.2.2 but may not participate in the adoption of resolutions (including any deliberations in respect of such resolutions) relating to their remuneration. 161 Table of Contents Board Evaluation The Board of Directors evaluates its functioning and the functioning of its committees and of each individual director annually.
(5) Based solely on the most recent transparency notification filed with the AFM as of February 15, 2023. Consists of 0 ordinary shares and voting rights on 1,545,652 ordinary shares, 729,479 ADSs and 1,230 equity swaps. Other information regarding this shareholder’s beneficial ownership of our shares is not known to us or, to our knowledge, ascertainable from public filings.
Other information regarding this shareholder’s beneficial ownership of our shares is not known to us or, to our knowledge, ascertainable from public filings. (9) Based solely on the most recent transparency notification filed with the AFM as of February 20, 2024. Consists of 0 ordinary shares and voting rights on 1,520,216 ordinary shares and 257,347 ADSs.
As of the date of this Annual Report, the commercial committee consists of three permanent members: James M. Daly (chairperson), Anthony A. Rosenberg and Camilla Sylvest.
As of the date of this Annual Report, the commercialization committee consists of three permanent members: James M. Daly (chairperson), Anthony A. Rosenberg and Camilla Sylvest. Keith Woods serves as a non-board member advisor of the committee.
The audit and compliance committee and the remuneration and nomination committee may not be chaired by the chairperson of the Board of Directors or by a former executive director of the Company. 147 Table of Contents In addition to the aforementioned legally required subcommittees, our Board of Directors may also opt to incorporate informal committees consisting of non-executive directors and other internal and external persons in argenx, in order to facilitate discussions and act as a sounding board on specific projects, as well as on a more permanent basis.
In addition to the aforementioned legally required subcommittees, our Board of Directors may also opt to incorporate informal committees consisting of non-executive directors and other internal and external persons in argenx, in order to facilitate discussions and act as a sounding board on specific projects, as well as on a more permanent basis.
Directors may be suspended or removed by the shareholders at a General Meeting at any time, with or without cause, by means of a resolution passed by a simple majority of the votes cast. Under Dutch law (Section 2:134 paragraph 1 of the DCC), executive directors may also be suspended by the board of directors.
Directors may be suspended or removed by the shareholders at a General Meeting at any time, with or without cause, by means of a resolution passed by a simple majority of the votes cast. Pursuant to the Dutch Civil Code ( Burgerlijk Wetboek ) ( DCC ), executive directors may also be suspended by the board of directors.
The chairperson of our research and development committee reports to our Board of Directors on the research and development committee’s discussions and strategic advice after each meeting on all matters within its duties and responsibilities. Commercial committee Our commercial committee consists of members of our Board of Directors and other persons, which composition may vary from time to time.
The chairperson of our research and development committee reports to our Board of Directors on the research and development committee’s discussions and strategic advice after each meeting on all matters within its duties and responsibilities.
Stock options granted to non-executive directors vest at once on the third anniversary of the date of grant. 143 Table of Contents RSUs granted under the Equity Incentive Plan shall vest over a period of four years with respect to one fourth of the shares upon each anniversary of the date of grant.
RSUs granted under the Equity Incentive Plan shall vest over a period of four years with respect to one fourth of the shares upon each anniversary of the date of grant.
Van Hauwermeiren may be dismissed immediately as an executive director. Karl Gubitz, our chief financial officer, has an employment contract with our subsidiary, argenx US Inc., for an indefinite term. Keith Woods, our chief operating officer, has an employment contract with our subsidiary, argenx US Inc., for an indefinite term.
Van Hauwermeiren may be dismissed immediately as an executive director. Karl Gubitz, our CFO, has an employment contract with our subsidiary, argenx US Inc., for an indefinite term. Keith Woods, our COO, had an employment contract with our subsidiary, argenx US Inc., for an indefinite term. His employment contract ended in March 2023.
Other information regarding this shareholder’s beneficial ownership of our shares is not known to us or, to our knowledge, ascertainable from public filings. The address for The Vanguard Group, Inc. is the Vanguard Group, 100 Vanguard Blvd., Malvern, PA 19355.
Other information regarding this shareholder’s beneficial ownership of our shares is not known to us or, to our knowledge, ascertainable from public filings. The address for The Vanguard Group, Inc. is the Vanguard Group, 100 Vanguard Blvd., Malvern, PA 19355. (7) Based solely on the most recent transparency notification filed with the AFM as of February 20, 2024.
(14) Consists of 150 ordinary shares and 41,618 shares issuable upon the exercise of stock options that are immediately exercisable or exercisable within 60 days of February 15, 2023.
(14) Consists of 450 ordinary shares and 42,000 shares issuable upon the exercise of stock options that are immediately exercisable or exercisable within 60 days of February 20, 2024.
(21) Consists of 1,350 ordinary shares and 12,000 shares issuable upon the exercise of stock options that are immediately exercisable or exercisable within 60 days of February 15, 2023.
(20) Consists of 450 ordinary shares and 21,500 shares issuable upon the exercise of stock options that are immediately exercisable or exercisable within 60 days of February 20, 2024.
Daly ​ Equity incentive plan ​ 28/06/2018 - 28/06/2021 ​ 28/06/2018 ​ Please refer to footnote ​ N/A ​ 28/06/2019 - 28/06/2028 ​ € 80.82 ​ 5,000 ​ — ​ (5,000) ​ — ​ — ​ — ​ — ​ N/A ​ ​ ​ ​ 21/12/2018 - 21/12/2021 ​ 21/12/2018 ​ ​ ​ N/A ​ 21/12/2019 - 21/12/2028 ​ € 86.32 ​ 10,000 ​ — ​ (10,000) ​ — ​ — ​ — ​ — ​ N/A ​ ​ ​ ​ 20/12/2019 - 20/12/2022 ​ 20/12/2019 ​ ​ ​ N/A ​ 20/12/2020 - 20/12/2029 ​ € 135.75 ​ 10,000 ​ — ​ — ​ 3,333 ​ — ​ — ​ 10,000 ​ N/A ​ ​ ​ ​ 21/12/2020 - 21/12/2023 ​ 21/12/2020 ​ ​ ​ N/A ​ 21/12/2021 - 21/12/2030 ​ € 247.60 ​ 10,000 ​ — ​ — ​ 3,334 ​ 3,333 ​ 3,333 ​ 10,000 ​ N/A ​ ​ ​ ​ 24/12/2021 - 24/12/2024 ​ 24/12/2021 ​ Upon third anniversary of the grant ​ 24/12/2024 ​ 24/12/2024 - 24/12/2031 ​ € 309.20 ​ 2,700 ​ — ​ — ​ — ​ 2,700 ​ 2,700 ​ 2,700 ​ 2,700 ​ ​ ​ ​ 23/12/2022 - 23/12/2025 ​ 23/12/2022 ​ Upon third anniversary of the grant ​ 23/12/2025 ​ 23/12/2025 - 23/12/2032 ​ € 359.60 ​ — ​ 2,700 ​ — ​ — ​ 2,700 ​ 2,700 ​ 2,700 ​ 2,700 Total ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ 37,700 ​ 2,700 ​ (15,000) ​ 6,667 ​ 8,733 ​ 8,733 ​ 25,400 ​ 5,400 ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Camilla Sylvest ​ Equity incentive plan ​ 03/10/2022 - 03/10/2025 ​ 03/10/2022 ​ Upon third anniversary of the grant ​ 03/10/2025 ​ 03/10/2025 - 03/10/2032 ​ € 368.50 ​ — ​ 4,050 ​ — ​ — ​ 4,050 ​ 4,050 ​ 4,050 ​ 4,050 Total ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ — ​ 4,050 ​ — ​ — ​ 4,050 ​ 4,050 ​ 4,050 ​ 4,050 ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Ana Cespedes ​ Equity incentive plan ​ 23/12/2022 - 23/12/2025 ​ 23/12/2022 ​ Upon third anniversary of the grant ​ 23/12/2025 ​ 23/12/2025 - 23/12/2032 ​ € 359.60 ​ — ​ 4,050 ​ — ​ — ​ 4,050 ​ 4,050 ​ 4,050 ​ 4,050 Total ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ — ​ 4,050 ​ — ​ — ​ 4,050 ​ 4,050 ​ 4,050 ​ 4,050 (1) 1/3 of the option vests on the first anniversary of the award date and the remaining 2/3 rd vest during the following two years in equal parts of 1/24 th , each time upon the 1 st day of each month. ​ 140 Table of Contents The table below shows (i) the RSUs held at January 1, 2022, (ii) the RSUs granted to the non-executive directors which have vested during the year ended December 31, 2022 and (iii) the number of RSUs held at December 31, 2022: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Information regarding the reported financial year ​ ​ The main conditions of RSU plan ​ Opening balance ​ During the Year ​ Closing balance Name of Directors ​ Specification of plan ​ Performance period ​ Award date ​ Vesting date ​ End of retention period ​ RSU’s held at the beginning of the year ​ RSU’s awarded ​ RSU’s vested ​ RSU’s subject to a performance condition ​ RSU’s awarded and unvested ​ RSU’s held at the closing of the year ​ RSU’s subject to a retention period Peter Verhaeghe ​ Equity incentive plan ​ 24/12/2021 - 24/12/2025 ​ 24/12/2021 ​ Please refer to footnote ​ N/A ​ 600 ​ — ​ (150) ​ 450 ​ 450 ​ 450 ​ N/A ​ ​ ​ ​ 23/12/2022 - 23/12/2026 ​ 23/12/2022 ​ ​ ​ N/A ​ — ​ 600 ​ — ​ 600 ​ 600 ​ 600 ​ N/A Total ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ 600 ​ 600 ​ (150) ​ 1,050 ​ 1,050 ​ 1,050 ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Yvonne Greenstreet ​ Equity incentive plan ​ 01/07/2021 – 03/03/2022 ​ 01/07/2021 ​ Please refer to footnote ​ N/A ​ 225 ​ — ​ (225) ​ — ​ — ​ — ​ N/A Total ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ 225 ​ — ​ (225) ​ — ​ — ​ — ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Werner Lanthaler ​ Equity incentive plan ​ 24/12/2021 - 24/12/2025 ​ 24/12/2021 ​ Please refer to footnote ​ N/A ​ 600 ​ 0 ​ (150) ​ 450 ​ 450 ​ 450 ​ N/A Total ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ 600 ​ — ​ (150) ​ 450 ​ 450 ​ 450 ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ J.
Daly ​ ​ 28/06/2018 - 28/06/2021 ​ 28/06/2018 ​ (1) ​ n.a. ​ 28/06/2019 - 28/06/2028 ​ 80.82 ​ — ​ — ​ — ​ — ​ — ​ — ​ — ​ — ​ ​ 21/12/2018 - 21/12/2021 ​ 21/12/2018 ​ (1) ​ n.a. ​ 21/12/2019 - 21/12/2028 ​ 86.32 ​ — ​ — ​ — ​ — ​ — ​ — ​ — ​ — ​ ​ 20/12/2019 - 20/12/2022 ​ 20/12/2019 ​ (1) ​ n.a. ​ 20/12/2020 - 20/12/2029 ​ 135.75 ​ 10,000 ​ — ​ 10,000 ​ — ​ — ​ — ​ — ​ — ​ ​ 21/12/2020 - 21/12/2023 ​ 21/12/2020 ​ (1) ​ n.a. ​ 21/12/2021 - 21/12/2030 ​ 247.60 ​ 10,000 ​ — ​ — ​ 3,333 ​ — ​ — ​ 10,000 ​ — ​ ​ 24/12/2021 - 24/12/2024 ​ 24/12/2021 ​ (2) ​ 31/12/2024 ​ 24/12/2022 - 24/12/2031 ​ 309.20 ​ 2,700 ​ — ​ — ​ — ​ — ​ 2,700 ​ 2,700 ​ 2,700 ​ ​ 23/12/2022 - 23/12/2025 ​ 23/12/2022 ​ (2) ​ 31/12/2025 ​ 23/12/2023 - 23/12/2032 ​ 359.60 ​ 2,700 ​ — ​ — ​ — ​ — ​ 2,700 ​ 2,700 ​ 2,700 ​ ​ 03/07/2023 - 03/07/2026 ​ 03/07/2023 ​ (2) ​ 31/12/2026 ​ 03/07/2024 - 03/07/2033 ​ 355.40 ​ — ​ 1,600 ​ — ​ — ​ — ​ 1,600 ​ 1,600 ​ 1,600 Total ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ 25,400 ​ 1,600 ​ 10,000 ​ 3,333 ​ — ​ 7,000 ​ 17,000 ​ 7,000 Camilla Sylvest ​ ​ 03/10/2022 - 03/10/2025 ​ 03/10/2022 ​ (2) ​ 31/12/2025 ​ 03/10/2023 - 03/10/2032 ​ 368.50 ​ 4,050 ​ — ​ — ​ — ​ — ​ 4,050 ​ 4,050 ​ 4,050 ​ ​ 03/07/2023 - 03/07/2026 ​ 03/07/2023 ​ (2) ​ 31/12/2026 ​ 03/07/2024 - 03/07/2033 ​ 355.40 ​ — ​ 1,200 ​ — ​ — ​ — ​ 1,200 ​ 1,200 ​ 1,200 Total ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ 4,050 ​ 1,200 ​ — ​ — ​ — ​ 5,250 ​ 5,250 ​ 5,250 Ana Cespedes ​ ​ 23/12/2022 - 23/12/2025 ​ 23/12/2022 ​ (2) ​ 31/12/2025 ​ 23/12/2023 - 23/12/2032 ​ 359.60 ​ 4,050 ​ — ​ — ​ — ​ — ​ 4,050 ​ 4,050 ​ 4,050 ​ ​ 03/07/2023 - 03/07/2026 ​ 03/07/2023 ​ (2) ​ 31/12/2026 ​ 03/07/2024 - 03/07/2033 ​ 355.40 ​ — ​ 800 ​ — ​ — ​ — ​ 800 ​ 800 ​ 800 Total ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ 4,050 ​ 800 ​ — ​ — ​ — ​ 4,850 ​ 4,850 ​ 4,850 (1) 1/3rd of the stock options vests on the first anniversary of the date of grant and the remaining 2/3rd vests in equal monthly instalments (24 in total) over the next two years, each time upon the 1st day of each next month (2) stock options vests upon third anniversary of the grant ​ ​ 148 Table of Contents The table below shows (i) the RSUs held at January 1, 2023, (ii) the RSUs granted to the non-executive directors which have vested during the year ended December 31, 2023 and (iii) RSUs scheduled to vest in the years ending December 31, 2024, December 31, 2025, December 31, 2026 and December 31, 2027 (in number of RSUs): ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Information regarding the reported financial year ​ ​ ​ ​ Opening balance ​ During the Year ​ Closing balance Name of Directors ​ Performance period ​ Award date ​ Vesting date ​ End of retention period ​ RSU’s held at the beginning of the year ​ RSUs awarded ​ RSUs vested ​ RSUs subject to a service condition ​ RSU’s awarded and unvested ​ RSU’s held at the closing of the year ​ RSU’s subject to a retention period Peter K.M.
The Board of Directors is required to make one or more proposals for each seat on our Board of Directors to be filled. A resolution to nominate a director by our Board of Directors (with support from the remuneration and nomination committee) may be adopted by a simple majority of the votes cast.
A resolution to nominate a director by our Board of Directors (with support from the remuneration and nomination committee) may be adopted by a simple majority of the votes cast.
(19) Consists of 150 ordinary shares and 17,778 shares issuable upon the exercise of stock options that are immediately exercisable or exercisable within 60 days of February 15, 2023. (20) Consists of 1,850 ordinary shares and 14,000 shares issuable upon the exercise of stock options that are immediately exercisable or exercisable within 60 days of February 15, 2023.
(17) Consists of 1,631 ordinary shares and 27,111 shares issuable upon the exercise of stock options that are immediately exercisable or exercisable within 60 days of February 20, 2024.
As of the date of this Annual Report (or in any period before), none of the members of our Board of Directors and senior management has or has had a family relationship with any other member of our Board of Directors or senior management.
Our Board of Directors has consequently also determined that all members of our committees are independent under the applicable rules of the DCGC. 152 Table of Contents As of the date of this Annual Report (or in any period before), none of the members of our Board of Directors and senior management has or has had a family relationship with any other member of our Board of Directors or senior management.
In computing the number of ordinary shares beneficially owned by a person and the percentage ownership of that person, we deemed outstanding ordinary shares subject to options held by that person that are immediately exercisable or exercisable within 60 days of February 15, 2023.
The information is not necessarily indicative of beneficial ownership for any other purpose. 163 Table of Contents In computing the number of ordinary shares beneficially owned by a person and the percentage ownership of that person, we deemed outstanding ordinary shares subject to options held by that person that are immediately exercisable or exercisable within 60 days of February 20, 2024.
Stock options granted to Belgian tax resident beneficiaries (including our CEO) are not exercisable prior to the fourth year following the year of the grant.
Stock options granted to Belgian tax resident beneficiaries (including the CEO) are not exercisable prior to the fourth year following the year of the grant. Stock options granted to non-executive directors vest at once on the third anniversary of the date of grant.
The non-executive directors determine the terms of reference of each committee with respect to the organization, procedures, policies and activities of the committee. Our non-executive directors have established and appointed: ● an audit and compliance committee; and ● a remuneration and nomination committee.
The non-executive directors determine the terms of reference of each committee with respect to the organization, procedures, policies and activities of the committee.
(15) Consists of 150 ordinary shares and 37,778 shares issuable upon the exercise of stock options that are immediately exercisable or exercisable within 60 days of February 15, 2023. 154 Table of Contents (16) Consists of 190 ordinary shares and 28,590 shares issuable upon the exercise of stock options that are immediately exercisable or exercisable within 60 days of February 15, 2023.
(15) Consists of 450 ordinary shares and 40,000 shares issuable upon the exercise of stock options that are immediately exercisable or exercisable within 60 days of February 20, 2024. 165 Table of Contents (16) Consists of 450 ordinary shares and 37,480 shares issuable upon the exercise of stock options that are immediately exercisable or exercisable within 60 days of February 20, 2024.
The commercial committee reports regularly to our Board of Directors on the outcome of its strategic reviews and any recommendations to the Board of Directors or senior management team.
The commercialization committee reports regularly to our Board of Directors on the outcome of its strategic reviews and any recommendations to the Board of Directors or senior management team. Report Commercialization Committee The commercialization committee functions as a sounding board on branded and unbranded strategic marketing plans for the Board of Directors.
These rules generally attribute beneficial ownership of securities to persons who possess sole or shared voting power or investment power with respect to those securities and include ordinary shares that can be acquired within 60 days of February 15, 2023. The percentage ownership information shown in the table is based upon 55,570,534 ordinary shares outstanding as of February 15, 2023.
The SEC rules generally attribute beneficial ownership of securities to persons who possess sole or shared voting power or investment power with respect to those securities and include ordinary shares that can be acquired within 60 days of February 20, 2024.
According to its Schedule 13G/A, BlackRock, Inc. reported having sole voting power over 3,208,899 ordinary shares and sole dispositive power over 3,445,779 ordinary shares. The Schedule 13G/A contained information as of December 31, 2022 and may not reflect current holdings of the Company’s stock. The address for BlackRock, Inc. is 55 East 52nd Street, New York, New York 10055.
According to its Schedule 13G, BlackRock, Inc. reported having sole voting power over 3,767,146 ordinary shares and sole dispositive power over 4,036,853 ordinary shares. The Schedule 13G contained information as of December 31, 2023 and may not reflect current holdings of the Company’s stock. The address for BlackRock, Inc. is 50 Hudson Yards, New York, NY 10001.
Our directors are appointed as either executive directors or as non-executive directors by the shareholders at a General Meeting. Our Board of Directors designates one executive director as CEO. In addition, the Board of Directors may grant other titles to executive directors.
Our Board of Directors designates one executive director as CEO. In addition, the Board of Directors may grant other titles to executive directors. Our Board of Directors also designates a non-executive director as chairperson of the Board of Directors and a non-executive director as vice chairperson of the Board of Directors.
Our Board of Directors also designates a non-executive director as chairperson of the Board of Directors and a non-executive director as vice chairperson of the Board of Directors. The legal relationship between an executive member of the Board of Directors and argenx will not be considered as an employment agreement.
The legal relationship between an executive member of the Board of Directors and argenx will not be considered as an employment agreement. Employment agreements between an executive director and a Group company (other than argenx SE) are permitted.
In accordance with best practice principle 2.2.1 of the DCGC, executive directors may be re-appointed for periods of not more than four years at a time. In accordance with best practice principle 2.2.2 of the DCGC, non-executive directors are appointed for a 146 Table of Contents period of four years and may subsequently be re-appointed for another four-year period.
Our directors are appointed by the shareholders at a General Meeting for a period of four years as either executive directors or as non-executive directors. In accordance with best practice provision 2.2.1 of the DCGC, executive directors may be reappointed for periods not more than four years at a time.
The number of directors, as well as the number of executive directors and non-executive directors, is determined by our Board of Directors, provided that the Board of Directors must consist of at least three members. Our directors are appointed by the shareholders at a General Meeting for a period of four years.
The number of executive directors must at all times be less than the number of non-executive directors. The number of directors, as well as the number of executive directors and non-executive directors, is determined by our Board of Directors, provided that the Board of Directors must consist of at least three members.

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Item 7. Management's Discussion & Analysis

Management's Discussion & Analysis (MD&A) — revenue / margin commentary

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Item 7.B. “ Related Party Transactions .” D. EXCHANGE CONTROLS Under Dutch law, subject to the 1977 Sanction Act ( Sanctiewet 1977 ) or otherwise by international sanctions, there are no exchange control restrictions on investments in, or payments on, shares (except as to cash amounts).
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Item 7.B. “ Related Party Transactions — Agreements with Our Senior Management ”. B. COMPENSATION Remuneration Report and Compensation Statement SAY-ON-PAY AND PROPOSED AMENDMENTS TO THE REMUNERATION POLICY Introduction In response to dissent expressed by shareholders on the 'say-on-pay’vote at the Company’s 2022 and 2023 annual General Meetings, we have engaged extensively with stakeholders, shareholders and proxy advisors.
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There are no special restrictions in our Articles of Association or Dutch law that limit the right of Shareholders who are not citizens or residents of the Netherlands to hold or vote shares. 178 Table of Contents E. TAXATION Certain Material U.S. Federal Income Tax Considerations for U.S.
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This group of stakeholders represented over 60% of the Company’s issued share capital.
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Holders The following discussion is a summary under present law of certain material U.S. federal income tax considerations relating to the ownership and disposition of ADSs by a U.S. holder (as defined below).
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This has led to a proposal for a revised remuneration policy, which is expected to be published in draft form on or around March 21, 2024 ( Draft 2024 Remuneration Policy ), which requires approval at the Company’s annual General Meeting that will take place on May 7, 2024 ( 2024 General Meeting ).
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This summary addresses only the U.S. federal income tax considerations for U.S. holders that hold ADSs as capital assets (generally, property held for investment) and use the U.S. dollar as their functional currency.
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Readers of this report are encouraged to read the Draft 2024 Remuneration Policy and corresponding explanatory notes, both of which will be made available on the Company’s website at https://www.argenx.com/investors/shareholder-meetings.
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This summary does not address all U.S. federal income tax matters that may be relevant to a particular U.S. holder and is not a substitute for tax advice.
Added
Although the following is not an exhaustive summary of the proposed changes to the Company’s current 2021 remuneration policy (the 2021 Remuneration Policy ), which you are encouraged to read in full including the accompanying explanatory notes, the Company deems it relevant to bring to your attention the following key changes that will be proposed in the Draft 2024 Remuneration Policy. 3.4.1.1 Non-executive pay ● Stock options will no longer be granted to non-executive directors ● Non-executive pay will take the form of cash remuneration and equity remuneration in the form of RSUs 130 Table of Contents ● Non-executive RSU grants will have a vesting period of one year and a holding period of three years after vest and as such underlying shares cannot be sold until after four years from the grant date ● Non-executive RSUs will be awarded based on a benchmarked target cash value, awarded in shares subject to the aforementioned holding requirements ● Minimum holding requirements extending at least two years beyond term of service will continue to apply Executive equity incentives ● Performance share units ( PSUs ) will be introduced in the executive compensation plan, attaching financial and non-financial performance conditions to the vesting of the PSUs ● At least 50% of target executive equity pay-out will be performance based ● PSU performance conditions will link for at least 50% of their target value to financial targets ● Non-financial targets will relate to measurable sustainable long term value creating outcomes linked to the Company’s key value drivers: ‘innovation and pipeline development’ and ‘people and culture’ ● PSUs will not vest prior to the third anniversary of the grant date and only to the extent applicable performance conditions are met ● The target equity pay opportunities for the CEO, chief financial officer ( CFO ) and COO (together, NEOs ) will continue to be set between the 50th percentile and 75th percentile of the reference group and will in any case not exceed 15x base cash compensation ● All equity grants will be subject to multi-year (at least three years) vesting periods and/or holding requirements ● Minimum holding requirements extending at least two years beyond term of service will continue to apply Executive short-term cash incentive ● Short-term cash incentives will be linked to multiple strategically relevant targets, which, in turn, will be linked to clearly measurable outcomes ● At least 50% of short-term variable pay will be linked to financial targets ● The target cash pay opportunity (target and maximum), measurement and evaluation and pay-out will be disclosed ● Considering the rapid growth and development of the Company and the environment in which it operates, discretionary adjustment of the total variable pay within the set limits by the Board of Directors will be possible, but in the event this happens, a clear and detailed explanation of the use of such discretion will be included in the Company’s remuneration report The principles above will be applicable for remuneration granted and targets set after the approval of the Draft 2024 Remuneration Policy, which requires a majority vote of more than 75% at the 2024 General Meeting.
Removed
This summary does not address tax considerations applicable to a holder of ADSs that may be subject to special tax rules including, without limitation, banks, financial institutions or insurance companies, brokers, dealers or traders in securities, currencies, commodities, or notional principal contracts, traders in securities that elect to mark-to-market, tax-exempt entities or organizations, including “individual retirement accounts” or “Roth IRAs”, real estate investment trusts, regulated investment companies, persons that hold the ADSs as part of a “hedging,” “integrated” or “conversion” transaction or as a position in a “straddle”, partnerships (including entities or arrangements classified as partnerships for U.S. federal income tax purposes) or other pass-through entities (including S-corporations), or persons that will hold the ADSs through such an entity, certain former citizens or long-term residents of the U.S., persons that received the ADSs as compensation for the performance of services, persons subject to special tax accounting rules as a result of any item of gross income with respect to the shares being taken into account in an applicable financial statement, and holders that own directly, indirectly, or through attribution 10% or more of the voting power or value of our ordinary shares and ADSs.
Added
If such majority is not achieved, the Company will, in accordance with Dutch law, be obliged to continue to apply the 2021 Remuneration Policy until a new policy gets approved at the 2024 General Meeting.
Removed
This summary does not address U.S. federal taxes other than the income tax (such as the Medicare surtax on net investment income, the estate, gift, or alternative minimum tax), any election to apply Section 1400Z-2 of the U.S.
Added
You are encouraged to read this 2023 remuneration report in conjunction with the Draft 2024 Remuneration Policy and the accompanying explanatory notes. 131 Table of Contents It is noted that this 2023 remuneration report describes the application of the Company’s 2021 Remuneration Policy for the fiscal year 2023. 2023 Remuneration The 2021 Remuneration Policy rewards contributions to achieving Company objectives and generating stakeholder value.
Removed
Internal Revenue Code of 1986, as amended (the Code ) to gains recognized with respect to ADSs, or any U.S. state, local, or non-U.S. tax considerations of the ownership and disposition of ADSs. This summary does not consider your particular circumstances.
Added
The aim is to provide competitive remuneration packages that align with market practices in the key markets where the Company competes for talent. The Company conducts regular reviews (at least once every three years) of director and senior management members’ total remuneration (both in quantum and in program design) and makes comparisons against the Company’s reference companies.
Removed
We urge you to consult your own independent tax advisors about the income, capital gains and/or transfer tax consequences to you in light of your particular circumstances of purchasing, holding and disposing of ordinary shares or ADSs.
Added
The 2021 Remuneration Policy and total compensation aligns or slightly exceeds the market median for fixed compensation, benefits, and short-term variable compensation. The long-term incentive component consists of equity grants, the size of which is positioned between the 50th and the 75th percentile of the global reference group.
Removed
For the purposes of this summary, a “U.S. holder” is a beneficial owner of ADSs that is (or is treated as), for U.S. federal income tax purposes, (i) an individual who is a citizen or resident of the U.S., (ii) a corporation, or any other entity treated as a corporation for U.S. federal income tax purposes, created or organized in or under the laws of the U.S., any state thereof, or the District of Columbia, (iii) an estate, the income of which is subject to U.S. federal income taxation regardless of its source, or a trust, if a court within the U.S. is able to exercise primary supervision over its administration and one or more U.S. persons have the authority to control all of the substantial decisions of such trust.
Added
The 2021 Remuneration Policy was adopted at the 2021 General Meeting with a 76% majority vote and is available on the Company’s website at https://www.argenx.com/investors/governance/remuneration-policy. Reference group - general For the 2023 remuneration which was set following a benchmark exercise conducted in the August – September 2022 timeframe, the Company worked with an independent third party compensation advisor, AON Radford.
Removed
If a partnership (or other entity or arrangement treated as a partnership for U.S. federal income tax purposes) holds ADSs, the U.S. federal income tax consequences relating to an investment in those ADSs will depend in part upon the status of the partner and the activities of the partnership.
Added
The Company continued to benchmark against both US and European peer groups to account for being a global company competing for talent against European based and US based companies. The aim is to deliver globally competitive compensation supporting the execution of Company’s business strategy and aligning with long-term sustainable value creation for its stakeholders.
Removed
A partnership that holds ADSs should consult its tax advisor regarding the U.S. federal income tax considerations for it and for its partners of owning and disposing of ADSs in its and their particular circumstances.
Added
The following criteria were used to select the reference group for the 2023 remuneration as part of the Company’s benchmark performed in the third quarter of 2022, ahead of setting the long term incentive schemes for 2023 in December 2023 and the annual cash compensation for 2023 in first quarter of 2023: ● Sector: Biotech and Pharmaceuticals ● Stage of development: Market ● Market Capitalization: primary ~1/3x – 3x argenx’s 30 ‐ day average market value as of 5/20/22, secondary $5 ‐ 50 billion ● Headcount: primary ~1/3x – 3x the midpoint of argenx’s projected financial years ended 31 December, 2022 and 2023 headcounts, secondary 300 ‐ 2500 employees ● Revenue: less than $1 billion revenues ● Years public: less than 10 years since IPO With the goal of arriving at a sufficiently sized U.S. and EU peer group of companies disclosing detailed compensation information, a number of companies were added to the European peer group following a qualitative review by AON Radford to identify companies with relevant similarities in business model and therapeutic focus.
Removed
In general, a U.S. holder that owns ADSs will be treated as the beneficial owner of the underlying shares represented by those ADSs for U.S. federal income tax purposes. Accordingly, no gain or loss will generally be recognized if a U.S. holder exchanges ADSs for the underlying shares represented by those ADSs.
Added
This leads to the following selection of peer groups used by us in the 2022 benchmark for the 2023 compensation plans: Note: for completeness’ sake, this is not the peer group the Company used in 2023 for its 2024 remuneration.
Removed
Persons considering an investment in the ADSs should consult their own tax advisors as to the particular tax consequences applicable to them relating to the ownership and disposition of ADSs, including the applicability of U.S. federal, state and local tax laws and non-U.S. tax laws. Distributions .
Added
The 2023 benchmark takes into account ongoing discussions and insight on the development of the 2021 Remuneration Policy and plans, as well as stakeholder feedback received.
Removed
Although we do not currently plan to pay dividends, and subject to the discussion under “— Passive Foreign Investment Company Considerations ” below, the gross amount of distributions paid with respect to our ordinary shares 179 Table of Contents including Dutch or Belgian tax withheld therefrom, if any (other than pro rata distribution), generally will be included in a U.S. holder’s gross income as foreign source ordinary dividend income when actually or constructively received to the extent such distribution is paid out of our current and accumulated earnings and profits as determined under U.S. federal income tax principles.
Added
On or around the date of this report, the peer group for the 132 Table of Contents 2024 remuneration will be reported on the Company’s website at https://www.argenx.com/investors/governance/remuneration-policy. ​ Company Name Company Ticker Country of Trade Abcam Plc ​ ABC ​ GBR Acadia Healthcare Company, Inc. ​ ACHC ​ USA ALK‐Abelló A/S ​ ALK.B ​ DNK Alnylam Pharmaceuticals, Inc. ​ ALNY ​ USA Amicus Therapeutics, Inc. ​ FOLD ​ USA Ascendis Pharma A/S ​ ASND ​ USA BeiGene, Ltd. ​ 6160 ​ USA Biohaven Pharmaceutical Holding Company Ltd. ​ BHVN ​ USA BioMarin Pharmaceutical Inc. ​ BMRN ​ USA BioNTech SE ​ BNTX ​ USA Blueprint Medicines Corp ​ BPMC ​ USA CRISPR Therapeutics AG ​ CRSP ​ USA Denali Therapeutics Inc ​ DNLI ​ USA Evotec SE ​ EVT ​ DEU Galapagos NV ​ GLPG ​ NLD Genmab A/S ​ GMAB ​ DNK Hikma Pharmaceuticals Plc ​ HIK ​ GBR Horizon Therapeutics Public Limited Company ​ HZNP ​ USA Idorsia Ltd ​ IDIA ​ CHE Incyte Corporation ​ INCY ​ USA Intellia Therapeutics, Inc. ​ NTLA ​ USA Intra‐Cellular Therapies, Inc. ​ ITCI ​ USA Ionis Pharmaceuticals, Inc. ​ IONS ​ USA Mirati Therapeutics, Inc. ​ MRTX ​ USA Neurocrine Biosciences, Inc. ​ NBIX ​ USA Recordati SpA ​ REC ​ ITA Sarepta Therapeutics, Inc. ​ SRPT ​ USA Seagen Inc. ​ SGEN ​ USA Swedish Orphan Biovitrum AB ​ SOBI ​ SWE UCB SA ​ UCB ​ BEL uniQure N.V. ​ QURE ​ USA Vifor Pharma AG ​ VIFN ​ CHE ​ Award levels Our Board of Directors sets award levels based on the outcome of our benchmarking exercise.
Removed
Distributions in excess of our current and accumulated earnings and profits will be treated as a non-taxable return of capital and will be applied against and reduce, the U.S. holder’s adjusted tax basis in ADSs (but not below zero) and distributions in excess of earnings and profits and a U.S. holder’s adjusted tax basis will generally be taxable to the U.S. holder as either long-term or short-term capital gain depending upon whether the U.S. holder has held the ADSs for more than one year as of the time such distribution is received.
Added
Our remuneration policy, contains the following framework in this respect: ​ ​ ​ ​ Non-executive directors Senior management team (including the CEO) Cash-based compensation ​ 50 th percentile of the companies in the global reference group ​ 50 th percentile of U.S. companies in the reference group for U.S.-based executives, and at or around the 75 th percentile of EU companies in the reference group for EU-based executives Equity-based compensation ​ 50 th percentile of the U.S. companies in the reference group ​ 50 th to 75 th percentile of the U.S. companies in the reference group ​ 133 Table of Contents NEO remuneration This chapter contains a detailed overview of the remuneration paid for the year 2023 to the following NEOs: the CEO, the CFO and the COO.
Removed
However, since we do not calculate our earnings and profits under U.S. federal income tax principles, it is expected that any distribution will be reported as a dividend, even if that distribution would otherwise be treated as a non-taxable return of capital or as capital gain.
Added
Of these NEOs, only the CEO is a statutory director of argenx. The remuneration of the NEOs in 2023 consisted of base salary, variable cash remuneration, company equity and benefits.
Removed
Our dividends will not be eligible for the dividends-received deduction generally allowed to U.S. corporations.
Added
Executive Remuneration Policy The majority of executive compensation is provided in the form of variable remuneration, which is a combination of performance dependent (short-term cash incentives, stock options) and service dependent (RSUs) compensation. Variable (short-term) compensation allows the Board of Directors to set challenging annual objectives aligning the priorities of the NEOs with the short-term strategic objectives of the Company.
Removed
Dividends paid to non-corporate U.S. holders that satisfy a minimum holding period (during which they are not protected from the risk of loss) and certain other requirements may qualify for the preferential favorable tax rates applicable to qualified dividend income, provided that we are a “qualified foreign corporation” and we are not a PFIC as to the non-corporate U.S. holder in the taxable year of the dividend or the preceding taxable year.
Added
Company equity in the form of stock options provides an incentive to the NEOs to contribute to Company (stock price) value increase over the long-term (three years) vesting period of the stock options. Company equity in the form of RSUs also provides an incentive for value creation over the long-term (four years) vesting period of the RSUs.
Removed
A qualified foreign corporation includes a non-U.S. corporation that is eligible for the benefits of a comprehensive income tax treaties with the U.S. A non-U.S. corporation also will be considered to be a qualified foreign corporation with respect to any dividend it pays on shares which are readily tradable on an established securities market in the U.S.
Added
The combination of variable pay, stock options and RSUs ensures a balanced incentive for short term focus on and performance of near term strategic targets, while contributing to sustainable long-term value creation and ensuring long-term commitment (retention) of the executive.
Removed
Our ADSs are listed on Nasdaq, which is an established securities market in the U.S., and we expect our ADSs to be readily tradable on Nasdaq. However, there can be no assurance that the ADSs will be considered readily tradable on an established securities market in the U.S. in any taxable year.
Added
In addition, the Company provides market standard severance arrangements and pension and fringe benefits, including a corporate bonus of maximally €3,948 ($4,266) in accordance with Belgian practice.
Removed
U.S. holders should consult their own tax advisors regarding the application of these rules given their particular circumstances. If dividends are subject to Dutch or Belgian withholding tax, a U.S. holder may be entitled, subject to generally applicable limitations, to claim a U.S. foreign tax credit for Dutch or Belgian withholding tax imposed at the appropriate rate.
Added
Moreover, in accordance with the DCGC, when determining the remuneration package of the executives, scenario analyses are performed annually and taken into account in setting the total remuneration levels and target and maximum awards under the short- and long-term incentive plans.
Removed
U.S. holders who do not elect to claim a credit for any foreign income taxes paid or accrued during the taxable year may instead claim a deduction of such taxes.
Added
Total executive remuneration The following table sets forth the total value of the remuneration paid to the NEOs for the last three years: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ (in USD) ​ Base salary (1) ​ Base salary in % change vs the prior year (1) ​ Sign on bonus ​ Corporate bonus ​ Variable short-term incentive ​ Variable cash as % of maximum opportunity ​ Compensation in the form of stock options (2) ​ Compensation in the form of RSUs ​ Other benefits (3) ​ % fixed (of total) (4) ​ Total CEO - Tim Van Hauwermeiren 2023 ​ 655,787 ​ 0% ​ — ​ — ​ 590,215 ​ 60% ​ 8,084,605 (5) 2,575,174 ​ 39,054 ​ 6% ​ 11,944,835 2022 ​ 638,901 ​ 10% ​ — ​ — ​ 766,682 ​ 60% ​ 4,174,684 ​ 2,159,689 ​ 38,342 ​ 9% ​ 7,778,298 2021 ​ 651,986 ​ 5% ​ — ​ 1,186 ​ 586,787 ​ 60% ​ 3,895,370 ​ 2,084,509 ​ 45,177 ​ 10% ​ 7,265,014 CFO - Karl Gubitz 2023 ​ 516,043 ​ 6% ​ — ​ 3,556 ​ 260,866 ​ 40% ​ 2,626,062 ​ 1,287,587 ​ 62,798 ​ 12% ​ 4,756,913 2022 ​ 487,600 ​ 79% ​ — ​ 3,745 ​ 243,800 ​ 40% ​ 2,623,633 ​ 1,356,048 ​ 91,203 ​ 12% ​ 4,806,030 2021 ​ 271,646 ​ n.a.
Removed
The rules relating to the foreign tax credit are complex and recent changes to the foreign tax credit rules that apply to foreign taxes paid or accrued in taxable years beginning after December 27, 2021 introduced additional requirements and limitations. Each U.S. holder should consult its own tax advisors regarding the foreign tax credit rules.
Added
(6) — ​ 2,235 ​ 108,659 ​ 40% ​ 3,181,721 ​ 1,629,272 ​ 31,809 ​ 6% ​ 5,225,342 COO - Karen Massey (7) 2023 ​ 481,471 ​ n.a. ​ 338,000 (8) 2,921 ​ 467,662 ​ 50% ​ 3,939,093 ​ 2,296,517 ​ 127,393 ​ 8% ​ 7,653,057 COO - Keith Woods (9) 2023 ​ 305,022 ​ (48)% ​ — ​ — ​ — ​ — ​ — ​ — ​ 46,034 ​ 100% ​ 351,056 2022 ​ 583,774 ​ 5% ​ — ​ 3,745 ​ 583,774 ​ 50% ​ 2,601,982 ​ 1,364,014 ​ 205,032 ​ 15% ​ 5,342,321 2021 ​ 555,975 ​ 5% ​ — ​ 4,095 ​ 347,484 ​ 50% ​ 2,430,402 ​ 1,316,532 ​ 116,041 ​ 14% ​ 4,770,529 (1) The base salary of the CEO is paid in EUR (for 2023 base salary the exchange rate 1.0815 EUR/$ used in this table), the base salary of the COO is paid in CHF (for 2023 base salary exchange rate of 1.1135 EUR/CHF used in this table).
Removed
In general, the amount of a distribution paid to a U.S. holder in a foreign currency will be the dollar value of the foreign currency calculated by reference to the applicable exchange rate on the day the U.S. holder receives the distribution, regardless of whether the foreign currency is converted into USDs at that time.
Added
The percentage presenting the change in salary is calculated using the currency of payment. (2) Amounts shown represent the expenses with respect to stock options measured using the Black Scholes formula.
Removed
Any foreign currency gain or loss a U.S. holder realizes on a subsequent conversion of foreign currency into USDs will be U.S. source ordinary income or loss.
Added
For a description of the assumptions used in valuing these awards, see “ Note 13 —Share-based payments ” in our consolidated financial statements which are appended to our Annual Report for the period ended December 31, 2023 and which are incorporated herein by reference.
Removed
If dividends received in a foreign currency are converted into USDs on the day they are received, a U.S. holder should not be required to recognize foreign currency gain or loss in respect of the dividend. Sale, Exchange or Other Taxable Disposition of ADSs.
Added
(3) Other benefits consists of the lease of a company car, employer-paid medical insurance premiums, pension contributions, social security costs and other allowances. (4) Fixed compensation is considered as Base salary and Other benefits.
Removed
Subject to the discussion under “— Passive Foreign Investment Company Considerations ” below, a U.S. holder will generally recognize capital gain or loss on the same, exchange or other taxable disposition of ADSs in an amount equal to the difference between the amount realized from such sale or exchange and the U.S. holder’s adjusted basis in the ADSs, each amount determined in USD.
Added
(5) Target pay level set in number of options and RSUs as part of benchmark performed in September of the prior year (target value $6,986,986, grant occurred on the first business day of July 2023.
Removed
The adjusted tax basis in ADSs generally will be equal to the USD cost of such ADSs. Any such capital gain or loss generally will be long-term capital gain or loss if the U.S. holder’s holding period for such ADSs exceeds one year as of the date of sale or other disposition.
Added
Share price increase between setting the grant using argenx’s 30-day average stock price of 134 Table of Contents $366.58 as of July 22, 2022 and the share price of $389.73 at the date of grant) explains variation between target compensation level and the final calculation displayed in the table above.
Removed
Long-term capital realized by a non-corporate U.S. holder is generally eligible for a preferential reduced rates. The deductibility of capital losses for U.S. federal income tax purposes is subject to certain limitations.
Added
These amounts do not reflect the actual economic value realized by the beneficiary. Amounts shown represent the expenses with respect to the Stock Options awards granted in 2023 measured using the Black Scholes formula with unobservable assumptions. The assumptions used in the fair valuation differ between Belgian beneficiary versus non-Belgian beneficiary.
Removed
Any such gain or loss that a U.S. holder recognizes generally will be treated as U.S. source income or loss for foreign tax credit limitation purposes. 180 Table of Contents Passive Foreign Investment Company Considerations.
Added
The fair value of equity granted to Belgian beneficiaries was higher than that of non-Belgian beneficiaries resulting in Mr. Van Hauwermeiren’s stock based compensation expense to be higher than other beneficiaries.
Removed
In general, a non-U.S. corporation will be classified as a PFIC for any taxable year in which, after applying certain look-through rules with respect to certain dividends, rents, interest or royalties received from its affiliates and taking into account its proportionate share of the income and assets of its 25% or more owned subsidiaries, either: (i) at least 75% of its gross income is “passive income” or (ii) at least 50% of the average quarterly value of its total gross assets is attributable to cash in excess of working capital requirements or assets that produce “passive income” or are held for the production of “passive income”.
Added
For a description of the assumptions used in valuing these awards, see “ Note 13 —Share-based payments ” in our consolidated financial statements which are appended to our Annual Report for the period ended December 31, 2023 and which are incorporated herein by reference.
Removed
Passive income for this purpose generally includes dividends, interest, royalties, rents, gains from commodities and securities transactions, the excess of gains over losses from the disposition of assets which produce passive income.
Added
(5) Karl Gubitz joined as CFO in June 2021, and consequently no comparison for base salary 2021 to 2020 is possible, as well as comparison for base salary 2022 to 2021 being distorted. (6) Karen Massey joined as COO in March 2023, and consequently no comparisons to 2022 and before were possible, and Ms.
Removed
While we are treated as a publicly traded company for these purposes, the value of our assets, including goodwill and other intangibles, will be based on their fair market value, which will depend on the market value of our ordinary shares and ADSs, which are subject to change.
Added
Massey’s remuneration shows the remuneration paid for the period March 13, 2023 through December 31, 2023. Her variable pay pay-out has been pro-rated to reflect this as well.
Removed
Based on our historic and anticipated operations, the composition of our income and the projected composition and estimated fair market values of our assets, including goodwill, we do not believe that we were a PFIC for our most recent taxable year and do not expect to be classified as a PFIC for the foreseeable future.
Added
(7) In 2023, the Company paid a sign-on bonus to Karen Massey to allow the Company to make an overall competitive offer of employment and in recognition of lost corporate benefits as a result of early departure at Ms. Massey’s previous employer. Ensuring a competitive offer in this way and securing Ms.
Removed
However, our possible status as a PFIC is a factual determination made annually after the close of each taxable year and, therefore, may be subject to change. Accordingly, there can be no assurance that we will not be a PFIC for any year in which a U.S. holder holds ADSs.
Added
Massey as the Company’s new COO was deemed by the Board of Directors to be in the best interest of the Company and its stakeholders. (8) Keith Woods resigned as COO March 2023 and his employment relationship ended on June 30, 2023 and consequently the remuneration numbers show his remuneration for the period January 1, 2023 through June 30, 2023.
Removed
The Company does not intend to provide any annual assessments of its PFIC status. If we were to be classified as a PFIC for any taxable year during which a U.S. holder owns ADSs, gain recognized on a sale or other disposition (including certain pledges) of such U.S. holder’s ADSs would be allocated ratably over such U.S. holder’s holding period.
Added
No equity award or variable pay was paid to Mr. Woods in the year ended December 31, 2023. ​ Base salary In 2023, compared to 2022, the base salary of the NEOs was increased in line with the total argenx employee population merit increase guidelines (CEO +0%, CFO +6%, COO joined in 2023).
Removed
Amounts allocated to the taxable year of the sale or disposition and to any year before we became a PFIC would be taxed as ordinary income and the amount allocated to each other taxable year would be subject to tax at the highest rate in effect for individuals or corporations, as appropriate, for that taxable year, and an interest charge will be imposed on the resulting tax liability for each such year.
Added
These increases followed a review of the individual’s performance over the preceding year(s), in light of comprehensive analysis of benchmark data showing the relative positioning of base salaries compared to the relevant external and internal peers. This process ensures that the Company’s compensation packages are a fair reflection of individual performance while also remaining competitive and aligned with the market.
Removed
In addition, to the extent that distributions received by a U.S. holder on its ADSs in any taxable year exceed 125% of the average of the annual distributions on such holder’s ADSs received during the preceding three taxable years (or, if shorter, the U.S. holder’s holding period), such excess distributions will be subject to taxation in the same manner.
Added
The merit principles and base pay increase framework applied are identical to those applicable to all employees in the organization and are based on the individuals’ performance and contributions over the preceding period. From 2022 to 2023, our CEO declined to receive a base pay increase.
Removed
Furthermore, dividends that are not excess distributions would not be eligible for the preferential tax rate applicable to qualified dividend income received by individuals and certain other non-corporate persons.
Added
With respect to the CFO, the Board of Directors recognized outstanding performance in 2022, including the achievement and overachievement of short-term targets, and established that the CFO’s pay was below the midpoint of peer reviewed base pay for CFOs in the reference group.

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