ImmunityBio, Inc.

ImmunityBio, Inc. is a commercial-stage biotechnology company headquartered in Culver City, California. It has one approved product: ANKTIVA, a protein that activates the IL-15 receptor and recruits immune cells (NK cells and T cells) against the tumor. The drug is given inside the bladder, together with the established BCG vaccine.

The approved indication is non-muscle-invasive bladder cancer that did not respond to BCG, in the form called CIS (with or without papillary tumors). The U.S. Food and Drug Administration approved it in April 2024, and sales began in May 2024. Approvals followed in the UK, the European Union (conditional, February 2026), Saudi Arabia and the United Arab Emirates — five regulators and 34 countries according to the company.

In Saudi Arabia and the UAE, ANKTIVA also holds a second label: metastatic non-small cell lung cancer (NSCLC), in combination with checkpoint-inhibitor immunotherapy after failure of standard therapy. In the latest quarter almost all revenue came from the United States ($50.7 million); Europe contributed $0.5 million.

The founder, Dr. Patrick Soon-Shiong, serves as Executive Chairman and Global Chief Scientific and Medical Officer and, together with affiliated entities, holds about 62.2% of the shares. An entity he controls is also the company's main lender.

Revenue: up every quarter, by a steady dollar increment

ANKTIVA revenue has risen every quarter since launch: from about $1 million in Q2 2024 to $50.7 million in Q2 2026. First-half 2026 revenue reached $94.8 million, up 121%. Full-year 2025: $113.0 million.

Since Q3 2025 each quarter has added about $5.4–6.5 million of revenue. The dollar increment is stable, so the sequential growth rate is gradually declining (from 20% to 15%). According to the company's release, units sold in Q1 2026 rose 168% — in line with revenue, meaning the growth came from volume rather than price. Gross-to-net deductions (discounts, returns, co-pay assistance) rose from 15.6% to 17.4% of gross sales.

Expenses, loss and cash flow

Operating expenses in the quarter were $112.9 million — 2.2 times revenue: R&D $60.8 million, SG&A $51.8 million. The operating loss narrowed to $61.7 million from $71.3 million in the prior-year quarter. Operating cash outflow was $66.5 million in the quarter ($75.4 million in the prior quarter).

On cost of sales: cost of sales in the quarter was only $0.3 million. The reason is accounting: all manufacturing costs incurred before approval were expensed as R&D, so the inventory being sold now carries almost no cost in the financial statements. According to management, cost of sales will rise as this inventory is used up. The reported gross margin does not represent a normalized gross margin, which has not been disclosed.

Net loss and remeasurement

The net loss for the quarter was $230.4 million. $140.8 million of it is accounting remeasurement of the convertible note, the warrants and derivatives — items that grow when the share price rises and are not cash. In the first half: $671.8 million of remeasurement within a $863.2 million loss. In addition, the company recorded $17.2 million of interest on the revenue interest agreement and $14.0 million of interest on the loan from the controlling holder.

Q1 2025, Q4 2025 and Q1 2026 were calculated as the difference between reported cumulative periods. The Q1 2026 net loss includes $530.9 million of remeasurement.

On June 30, 2026 the company held $357.4 million of cash and marketable securities, and in July another $21.1 million came in from warrant exercises. Against this stand total liabilities of $1,674 million and a stockholders' deficit of $1,046 million. Accumulated deficit since inception: $4.59 billion.

Three financing layers shape the capital structure:

• Revenue Interest Purchase Agreement (RIPA) with Oberland: the company received $375 million (in three payments, the last — $75 million in March 2026). In return it pays 12.5% of annual net sales up to $600 million, and 5.625% above that, up to a cap of 195% of the amount received. The obligation is secured by substantially all of the company's assets. Through June 30, 2026 about $22.8 million had been paid. If cumulative payments do not reach $375 million by December 31, 2029, the company must pay the difference in a one-time payment, and the rate steps up. Balance-sheet amount: $415.1 million.
• Convertible note held by Nant Capital (an entity controlled by Dr. Soon-Shiong): $480 million principal, floating interest of 11.73% at June 30, maturing December 31, 2027. The holder may, at its sole discretion, convert principal into shares at $5.427 per share (88.4 million shares). The note is subordinated to the Oberland agreement. In March 2026, $25 million was converted. On the balance sheet the note is carried at a value remeasured every quarter: $774.4 million.
• Warrants: 47.9 million at June 30, of which 6.4 million were exercised in July. The remainder (41.5 million) carries exercise prices of $3.10–3.24. The balance-sheet liability ($352.4 million) is not a cash debt: on exercise it moves to equity and the company receives the exercise price. In the first half all exercises, $53.5 million, were in cash.

Going concern: in the notes, management writes that "substantial doubt exists" about the ability to continue without additional funding, and that the doubt is alleviated by cash, product sales, equity raises, and the Executive Chairman's "intent and ability" to support the company, including loans from affiliated entities. The auditor's opinion on the 2025 annual report (Deloitte) does not include an emphasis paragraph on this matter. The company has an at-the-market (ATM) facility with $349.2 million remaining.

The company reports one segment. All product revenue comes from ANKTIVA. Geographic split in Q2 2026: United States $50.7 million, Europe $0.5 million (the first revenue outside the U.S.). No revenue has yet been recorded in Saudi Arabia or the UAE.

Concentrated distribution channel: in 2025, 96% of gross revenue came from four customers — distributors and wholesalers — split 42%, 19%, 18% and 17%. Accounts receivable at June 30, 2026 were $53.5 million, about 96 days of sales at the quarterly run-rate.

ANKTIVA works by activating the IL-15 receptor, and in its indication it is given in the bladder together with BCG. According to company data from the QUILT-3.032 trial, a complete response was recorded in 71% of 100 CIS patients, with duration of response exceeding 54 months. The company has had a dedicated Medicare billing code (J-code) since January 2025, which simplifies reimbursement for physicians.

The BCG-unresponsive bladder cancer market also includes treatments from other companies, among them gene therapies and intravesical drug-release systems. The company's filing does not disclose market shares, so the products cannot be compared on the basis of the filings in hand.

Dependence on BCG: ANKTIVA is given only together with BCG, and the U.S. has an ongoing shortage of the TICE strain, made by a single supplier. The company states that the shortage may constrain the number of patients. In response it runs an expanded-access program for recombinant BCG from the Serum Institute of India, and in May 2026 signed an exclusive agreement to develop and import the Tokyo-172 strain into the U.S.

This is a one-product company in the launch phase. Almost everything at ImmunityBio is measured through ANKTIVA: revenue, payments to the financing partner, and even the value of liabilities on the balance sheet. To understand the company, the first number to read is quarterly product revenue, and the second is its rate of change.

Growth is consistent, and its shape is linear. Eight consecutive quarters of growth is an uncommon run for an oncology drug launch. But since mid-2025 each quarter has added a similar dollar amount. Growth of this kind shows a high annual rate while the sequential rate declines. Distinguishing between the two numbers matters for reading every subsequent report.

What limits the pace — demand or supply? The filing allows two readings. One: adoption among urologists is advancing at a steady pace. The other: the BCG shortage is capping the number of patients. The company does not disclose patient or treatment-site counts, so the two readings cannot be separated. If alternative BCG sources come into use, the quarterly numbers will show which reading fits.

The net loss is not a measure of the business. Remeasurement of the convertible note and the warrants grows when the share price rises. So in a quarter in which the stock rose, the net loss grew. A closer measure of operations is the operating loss ($61.7 million) and operating cash flow (negative $66.5 million). The company's own adjusted net loss ($81.0 million) also includes interest, so it is close to cash.

The reported gross margin is temporary. Cost of sales below one percent of revenue stems from the accounting for inventory produced before approval. Anyone assessing the distance to breakeven needs to account for cost of sales rising. By how much — the company has not disclosed.

The capital structure determines who benefits from each sales dollar. Of every sales dollar (up to $600 million a year), 12.5 cents go to Oberland. The loan from the controlling holder carries interest of about $56 million a year. And two fixed dates sit on the calendar: note maturity at the end of 2027, and the Oberland repayment test at the end of 2029. As a conditional calculation only: if sales keep rising by about $6 million a quarter, cumulative payments to Oberland through the end of 2029 would reach about $190 million, and the difference payable in a one-time payment would be about $185 million.

The note's conversion price is a watershed. When the share price is above $5.427, the holder has an economic reason to convert — and the debt becomes shares. Below that price, the note remains $480 million of debt due at the end of 2027. Conversion is the holder's right, and in the meantime the holder receives cash interest.

Dilution is part of the funding model. The average share count rose from 508.6 million in 2023 to 1,050 million in the latest quarter — more than double. In the first half of 2026 shares were added through market sales, warrant exercises and debt conversion. Counting all potential shares gives about 1,221 million shares.

The controlling holder sits on every side of the balance sheet. Dr. Soon-Shiong is the largest shareholder, the lender, a holder of contingent rights from a past merger, and companies he controls lease facilities and provide services to the company. Management relies on his intent to support the company to alleviate the going-concern doubt. Anyone reading the company should examine every financing transaction from the holder's point of view as well.

The calendar is crowded in early 2027. PDUFA target date for the FDA decision on the papillary indication: January 6, 2027. Hearing in the arbitration brought by former Altor shareholders (a claim of $164.2 million plus interest): January 25, 2027. And per management, the submission for BCG-naïve patients is planned for 2026. These are three binary events within a few months.

Risks arising from the reports

• Single product: all product revenue comes from ANKTIVA, in one indication in the United States.
• Regulation: in May 2025 the FDA refused to file the papillary-indication application and required a randomized trial; it was resubmitted and accepted only after further meetings. In March 2026 the company received a warning letter from the FDA's Office of Prescription Drug Promotion over a television ad (never aired) and a podcast interview.
• Legal proceedings: a securities class action following the warning letter (lead plaintiff appointed July 2026), two derivative suits, and an arbitration by former Altor shareholders. An arbitration with a former Chinese partner ended in July 2026 with all claims denied.
• Funding: operating cash outflow of $66.5 million in the quarter, a $480 million note maturing at the end of 2027 if not converted, and an Oberland repayment test at the end of 2029 with a lien on the assets.
• BCG supply: a shortage of BCG from a single supplier may constrain the number of patients.
• Distribution concentration: 96% of 2025 gross revenue from four distributors.
• Dilution: ATM sales, warrants, the convertible note and stock-based compensation (16.6% of revenue in the quarter).

Items to monitor in the Q3 report (November 2026)