NOTE 4 - INVENTORY

The following table presents the Company’s inventory as of March 31, 2026 and  December 31, 2025 (in thousands):

Inventory is stated at the lower of cost or net realizable value and consists of raw materials, work-in-process and finished goods. Cost is determined using a standard cost method, which approximates actual cost, and assumes a FIFO flow of goods. Inventory that is used for clinical development purposes is expensed to research and development in the period in which it is consumed.

On  March 31, 2026, the Company’s inventory was solely related to BRIUMVI. The work in process materials consist primarily of bulk drug substance, which has a multi-year shelf life. When the bulk drug substance is manufactured into BRIUMVI finished goods, those finished goods have a shelf life of three years from the date of manufacture. The Company expects to sell finished goods at least twelve months prior to expiration. A portion of inventory will be utilized beyond our normal operating cycle. Therefore, at March 31, 2026, $26.3 million of inventory comprised predominantly of raw materials and work in process drug substance is classified as Non-current Inventory.

On a quarterly basis, the Company analyzes its inventory levels for excess quantities and obsolescence (expiration) by considering factors such as historical and anticipated future sales relative to quantities on hand and the remaining shelf-life. On  March 31, 2026, the Company determined that a reserve related to BRIUMVI inventory for excess quantities and obsolescence was not required. In addition, since FDA approval of BRIUMVI, the Company has not recognized any inventory write downs.

The inventory reserve on  March 31, 2026 and  December 31, 2025 was $6.2 million. This reserve relates to a potential manufacturing deviation affecting one batch of bulk drug substance identified by the Company. During the quarter ended  December 31, 2025, the Company recorded the inventory reserve related to this matter in accordance with ASC 450-20 as management had determined that a loss was both probable and could be reasonably estimated.

The United States and other countries have recently imposed, and may continue to impose, new tariffs. Tariffs are an inventoriable cost, and the Company’s sole supplier of bulk drug substance is located outside of the U.S. While the tariffs imposed to date have not had a material effect on the Company’s business or results of operations, the Company continues to evaluate their potential impact on its business and results of operations going forward.