Research and Development Funding Expense

6 Months Ended

Jun. 30, 2026

Research and Development Funding Expense

We enter into R&D funding agreements with counterparties to acquire royalties or milestones on product candidates. R&D funding expense consists of development-stage funding costs recognized under these agreements, which may be made upfront, as milestones upon achievement of certain predefined criteria, or over time as the related product candidates undergo clinical trials.

In the second quarter and first six months of 2026, R&D funding expense of $97.9 million and $137.6 million, respectively, primarily related to the R&D funding agreements for JNJ-4804, litifilimab and TEV-’408. In the second quarter and first six months of 2025, R&D funding expense of $300.5 million and $351.0 million, respectively, primarily related to an upfront payment of $250.0 million to acquire royalties on daraxonrasib and the R&D funding agreement for litifilimab.

Below summarizes our R&D funding agreements as of June 30, 2026 (in thousands):


Product Candidates	Counterparties	Total Commitments		Funding Timing	Unfunded Commitments
JNJ‑4804	Johnson & Johnson	$	500,000	Eight fixed quarterly payments commencing in the second quarter of 2026	$	437,500
TEV-’408(1)	Teva Pharmaceuticals	75,000		Variable quarterly payments commencing in second quarter of 2026	65,149
Litifilimab	Biogen	250,000		Six fixed quarterly payments commencing in first quarter of 2025	—
Total		$	825,000		$	502,649

(1)In the first quarter of 2026, we entered into an R&D funding agreement with Teva Pharmaceuticals, a U.S. affiliate of Teva Pharmaceutical Industries Ltd, for TEV-’408 for up to $500 million. Under the agreement, we agreed to co-fund a Phase 2b study for vitiligo for up to $75 million and have the option to provide up to an additional $425 million to co-fund the Phase 3 development program based on the results of the Phase 2b study. In the second quarter of 2026, we accrued $14.3 million of R&D funding expense for our portion of estimated costs incurred for the Phase 2b study, which is recorded within Other current liabilities on the condensed consolidated balance sheet and is expected to be paid in the third quarter of 2026.