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SEC Filings

20-F
AC IMMUNE SA filed this Form 20-F on 03/21/2019
Entire Document
 

 

·periodically confirming the accuracy of our estimates with selected providers and making adjustments, if necessary.

 

Examples of estimated research and development expenses that we accrue include:

 

·fees paid to CROs in connection with preclinical and toxicology studies and clinical studies;

 

·fees paid to investigative sites in connection with clinical studies;

 

·fees paid to contract manufacturing organizations in connection with the production of our product candidates prior to qualifying for capitalization as inventory; and

 

·professional service fees for consulting and related services.

 

We base our expense accruals related to clinical studies on our estimates of the services received and efforts expended pursuant to contracts with multiple research institutions and clinical research organizations that conduct and manage clinical studies on our behalf. The financial terms of these agreements vary from contract to contract and may result in uneven payment flows. Payments under some of these contracts depend on factors, such as the successful enrollment of patients and the completion of clinical study milestones. Our service providers invoice us monthly in arrears for services performed. In accruing service fees, we estimate the time period over which services will be performed and the level of effort to be expended in each period. If we do not identify costs that we have begun to incur or if we underestimate or overestimate the level of services performed or the costs of these services, our actual expenses could differ from our estimates.

 

To date, we have not experienced significant changes in our estimates of accrued research and development expenses after a reporting period. However, due to the nature of estimates, we may be required to make changes to our estimates in the future as we become aware of additional information about the status or conduct of our clinical studies and other research activities.

 

Share-Based Compensation

 

Options

 

The Company operates an equity-settled, share-based compensation plan. We account for awards of equity instruments issued to employees and directors under the fair value method of accounting and recognize such amounts in our statements of loss. The total amount to be expensed over the vesting period is determined by reference to the fair value of the instruments granted, excluding the impact of any non-market vesting conditions. Non-market vesting conditions are included in assumptions about the number of instruments that are expected to become exercisable. At each balance sheet date, the Company revises its estimates of the number of instruments that are expected to become exercisable. It recognizes the impact of the revision of original estimates, if any, in the statements of loss, and a corresponding adjustment to equity over the remaining vesting period.

 

We estimate the fair value of all time-vested options as of the date of grant using the Black-Scholes option pricing model. Key assumptions in determining the fair value of share options granted utilizing the Black-Scholes valuation method include the following:

 

 

Assumption

 

Method of estimation

       
Estimated expected term of options Simplified method
Expected volatility Estimate based on average historical volatilities of common shares of comparable publicly traded companies. We will continue to apply this process to grants made as a public company until a sufficient amount of historical information regarding volatility of our own stock price becomes available
Risk-free interest rate Yields of long dated Swiss government zero coupon bond issues
Forfeiture rates Historical and expected forfeiture data
Expected dividends Zero percent as dividends have not been paid

 

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© AC Immune 2015