36474483 2022-01-01 2022-12-31 36474483 2022-01-01 2022-12-31 2 36474483 2021-01-01 2021-12-31 36474483 2022-12-31 36474483 2021-12-31 36474483 2021-12-31 fsa:ContributedCapitalMember 36474483 2022-01-01 2022-12-31 fsa:ContributedCapitalMember 36474483 2022-12-31 fsa:ContributedCapitalMember 36474483 2021-12-31 fsa:OtherReservesMember 36474483 2022-01-01 2022-12-31 fsa:OtherReservesMember 36474483 2022-12-31 fsa:OtherReservesMember 36474483 2021-12-31 fsa:RetainedEarningsMember 36474483 2022-01-01 2022-12-31 fsa:RetainedEarningsMember 36474483 2022-12-31 fsa:RetainedEarningsMember 36474483 2020-12-31 fsa:ContributedCapitalMember 36474483 2021-01-01 2021-12-31 fsa:ContributedCapitalMember 36474483 2020-12-31 fsa:OtherReservesMember 36474483 2021-01-01 2021-12-31 fsa:OtherReservesMember 36474483 2020-12-31 fsa:RetainedEarningsMember 36474483 2021-01-01 2021-12-31 fsa:RetainedEarningsMember 36474483 2020-12-31 36474483 2022-01-01 2022-12-31 1 36474483 2022-01-01 2022-12-31 1 iso4217:DKK xbrli:pure Mai-Britt Zocca IO Biotech ApS Ole Maaløes Vej 3 2200 København N 36474483 København Mai-Britt Zocca EY Godkendt Revisionspartnerselskab Dirch Passers Allé 36 2000 Frederiksberg 30700228 The Executive Board have today considered and approved the annual report of IO Biotech ApS for the financial year 01.01.2022 – 31.12.2022. The annual report is presented in accordance with the Danish Financial Statements Act. In our opinion, the financial statements give a true and fair view of the Entity’s financial position at 31.12.2022 and of the results of its operations for the financial year 01.01.2022 – 31.12.2022. Further, in our opinion, the Management’s review gives a fair review of the matters discussed in the Management’s review. We recommend the annual report for adoption at the Annual General Meeting Copenhagen, To the shareholder of IO Biotech ApS We have audited the financial statements of IO Biotech ApS for the financial year 01.01.2022 – 31.12.2022, which comprise the income statement, balance sheet, statement of changes in equity and notes, including accounting policies. The financial statements are prepared in accordance with the Danish Financial Statements Act. In our opinion, the financial statements give a true and fair view of the financial position of the Company at 31 December 2022 and of the results of the Company's operations for the financial year 01.01.2022 – 31.12.2022 in accordance with the Danish Financial Statements Act. We conducted our audit in accordance with International Standards on Auditing (ISAs) and additional requirements applicable in Denmark. Our responsibilities under those standards and requirements are further described in the "Auditor's responsibilities for the audit of the financial statements" section of our report. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion. Independence We are independent of the Company in accordance with the International Ethics Standards Board for Accountants' International Code of Ethics for Professional Accountants (IESBA Code) and the additional ethical requirements applicable in Denmark, and we have fulfilled our other ethical responsibilities in accordance with these requirements and the IESBA Code. Management is responsible for the preparation of financial statements that give a true and fair view in accordance with the Danish Financial Statements Act and for such internal control as Management determines is necessary to enable the preparation of financial statements that are free from material misstatement, whether due to fraud or error. In preparing the financial statements, Management is responsible for assessing the Company's ability to continue as a going concern, disclosing, as applicable, matters related to going concern and using the going concern basis of accounting in preparing the financial statements unless Management either intends to liquidate the Company or to cease operations, or has no realistic alternative but to do so. Our objectives are to obtain reasonable assurance as to whether the financial statements as a whole are free from material misstatement, whether due to fraud or error, and to issue an auditor's report that includes our opinion. Reasonable assurance is a high level of assurance, but is not a guarantee that an audit conducted in accordance with ISAs and additional requirements applicable in Denmark will always detect a material misstatement when it exists. Misstatements can arise from fraud or error and are considered material if, individually or in the aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of the financial statements. As part of an audit conducted in accordance with ISAs and additional requirements applicable in Denmark, we exercise professional judgement and maintain professional scepticism throughout the audit. We also: • Identify and assess the risks of material misstatement of the financial statements, whether due to fraud or error, design and perform audit procedures responsive to those risks and obtain audit evidence that is sufficient and appropriate to provide a basis for our opinion. The risk of not detecting a material misstatement resulting from fraud is higher than for one resulting from error, as fraud may involve collusion, forgery, intentional omissions, misrepresentations or the override of internal control. • Obtain an understanding of internal control relevant to the audit in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the Company's internal control. • Evaluate the appropriateness of accounting policies used and the reasonableness of accounting estimates and related disclosures made by Management. • Conclude on the appropriateness of Management's use of the going concern basis of accounting in preparing the financial statements and, based on the audit evidence obtained, whether a material uncertainty exists related to events or conditions that may cast significant doubt on the Company's ability to continue as a going concern. If we conclude that a material uncertainty exists, we are required to draw attention in our auditor's report to the related disclosures in the financial statements or, if such disclosures are inadequate, to modify our opinion. Our conclusions are based on the audit evidence obtained up to the date of our auditor's report. However, future events or conditions may cause the Company to cease to continue as a going concern. • Evaluate the overall presentation, structure and contents of the financial statements, including the note disclosures, and whether the financial statements represent the underlying transactions and events in a manner that gives a true and fair view. We communicate with those charged with governance regarding, among other matters, the planned scope and timing of the audit and significant audit findings, including any significant deficiencies in internal control that we identify during our audit. Management is responsible for the Management's review. Our opinion on the financial statements does not cover the Management's review, and we do not express any form of assurance conclusion thereon. In connection with our audit of the financial statements, our responsibility is to read the Management's review and, in doing so, consider whether the Management's review is materially inconsistent with the financial statements or our knowledge obtained during the audit, or otherwise appears to be materially misstated. Moreover, it is our responsibility to consider whether the Management's review provides the information required under the Danish Financial Statements Act. Based on the work we have performed, we conclude that the Management's review is in accordance with the financial statements and has been prepared in accordance with the requirements of the Danish Financial Statements Act. We did not identify any material misstatement of the Management's review. Christian Schwenn Johansen Rasmus Bloch Jespersen State Authorised Public Accountant State Authorised Public Accountant mne33234 mne35503 Primary activities IO Biotech is a clinical stage biotech company developing disruptive immune therapies for the treatment of cancer. IO Biotech has a pipeline of first-in-class immune modulating anti-cancer therapies based on a unique platform technology enabling the activation of T cells that are specific for immune inhibitory molecules. IO Biotech has achieved a proven track record of progressing compounds to the clinic and has compounds in clinical development and late-stage preclinical phase. IO Biotech has an experienced management team within immuno-oncology fields and a world-class scientific and clinical advisory board. Development in activities and finances Our product candidates are designed to induce the immune system to simultaneously target and disrupt multiple pathways that regulate tumor-induced immunosuppression. We believe this represents a paradigm shift in the management of cancer and that our product candidates have the potential to become cornerstones of the treatment regimens of multiple solid tumors. Our lead product candidate, IO102-IO103, is designed to target the immunosuppressive mechanisms mediated by key immunosuppressive proteins such as Indoleamine 2,3-dioxygenase (IDO) and programmed death ligand (PD-L1). In a singlearm Phase 1/2 clinical trial of 30 patients with metastatic melanoma with the primary objective of investigating safety and tolerability, the secondary objective of investigating immunogenicity, and the tertiary objective of investigating clinical efficacy, IO102-IO103, in combination with nivolumab, demonstrated an ability to induce meaningful tumor regression and establish durable antitumor response while achieving a manageable tolerability profile for patients. The clinical efficacy endpoints in this trial included objective response (OR), progression free survival (PFS) and overall survival (OS). In this trial, we observed a confirmed overall response rate (ORR) of 73% and a complete response rate (CRR) of 50%. Based on the results from this trial, IO102- IO103, in combination with pembrolizumab, was granted BTD by the FDA for treatment of unresectable/metastatic melanoma. Financial review The income statement for 2022 shows a loss of DKK 463,037,029 against a loss of DKK 240,410,969 last year, and the balance sheet on 31 December 2022 shows an equity of DKK 259,741,482. There is an increase in cost as there has been an increase in the activities due to moving into phase 3. Management considers the Company's financial performance in the year satisfactory and in line with the strategic directions. In 2021, the parent company, IO Biotech, Inc., became a listed company on Nasdaq US. As part of the parent company becoming a listed company, a cash capital increase of DKK 945,653 thousand was completed. No capital increases were executed in 2022. Financing and the going concern assumption The Company is financed via shareholder’s equity and payables to group enterprises. The Company has received a letter of financial support from is sole shareholder, IO Biotech, Inc., wherein IO Biotech, Inc. guarantees to support the Company with sufficient liquidity, to finance the current investment program and planned operating losses at least though 30 June 2024. On this basis, the financial statements are prepared on going concern assumption. Unusual circumstances affecting recognition and measurement There are no material unusual circumstances affecting recognition and measurement according to the knowledge of the management. Events after the balance sheet date No events have occurred after the balance sheet date to this date, which would influence the evaluation of this annual report. 349060845 187898951 118951934 55109868 406299 684160 -467606480 -242324659 2206765 0 3137314 3586310 -468537029 -245910969 -5500000 -5500000 -463037029 -240410969 -463037029 -240410969 13622948 14765833 13622948 14765833 1190373 11306 1190373 11306 720 720 574503 256597 575223 257317 15388544 15034456 16577253 30133983 5250737 8173980 5500000 5500000 14788101 31341530 42116091 75149493 359523099 712961318 401639190 788110811 417027734 803145267 1829447 1829447 2433740 2433740 255478295 718515324 259741482 722778511 44247615 57375105 108815471 18868524 4122299 3820527 100867 302600 157286252 80366756 157286252 80366756 417027734 803145267 1829447 2433740 718515324 0 0 -463037029 1829447 2433740 255478295 634583 0 16901792 17536375 1198121 0 944454984 945653105 3257 -2433740 2430483 0 0 0 -240410969 1 Financing and the going concern assumption The Company is financed via shareholder’s equity and payables to group enterprises. The Company has received a letter of financial support from is sole shareholder, IO Biotech, Inc., wherein IO Biotech, Inc. guarantees to support the Company with sufficient liquidity, to finance the current investment program and planned operating losses at least though 30 June 2024. On this basis, the financial statements are prepared on going concern assumption. 2 Events after the balance sheet date No events have occurred after the balance sheet date to this date, which would influence the evaluation of the annual report. 3 Staff costs 2022 2021 DKK DKK Wages and salaries 23,506,803 18,223,540 Pensions costs 4,210,148 1,067,393 Other social security costs 214,973 61,963 27,931,924 19,352,896 Staff costs are recognized as follows in the financial statements: 2022 2021 Administrative expenses 7,808,510 4,329,542 Research and development costs 20,123,414 15,023,354 27,931,924 19,352,896 19 15 4 Financial income 2022 2021 DKK DKK Other financial income 2,206,765 0 2,206,765 0 5 Financial expenses 2022 2021 DKK DKK Other interest expenses 3,137,314 3,586,310 3,137,314 3,586,310 6 Tax on profit/loss for the year 2022 2021 DKK DKK Current tax (5,500,000) (5,500,000) (5,500,000) (5,500,000) 7 Intangible assets Acquired rights DKK Cost beginning of year 15,300,000 Additions 0 Cost end of the year 15,300,000 Amortization and impairment losses beginning of year (534,167) Amortization of the year (1,142,885) Amortization and impairment losses end of year (1,677,052) Carrying amount end of year 13,622,948 8 Property, plant and equipment Other fixtures and fittings, tools and equipment DKK Cost beginning of year 137,336 Additions 1,232,107 Cost end of the year 1,369,443 Depreciation and impairment losses beginning of year (126,030) Depreciation of the year (53,040) Depreciation and impairment losses end of year (179,070) Carrying amount end of year 1,190,373 9 Financial assets Investments in group enterprises Deposits DKK DKK Cost beginning of year 720 256,597 Additions 0 317,906 Cost end of the year 720 574,503 Carrying amount end of year 720 574,503 10 Unrecognized rental and lease commitments 2022 2021 DKK DKK Liabilities under rental or lease agreements until maturity in total 4,415,724 528,183 We enter into contracts in the ordinary course of business with third-party service providers for clinical trials, preclinical research studies and testing, manufacturing and other services and products for operating purposes. These contracts generally provide for termination upon notice of 30 to 90 days, and therefore, we believe that our non-cancelable obligations under these agreements are not material and we cannot reasonably estimate whether they will occur. However, in the event of a termination of any contracts with CROs or other institutions and with respect to active patients enrolled in our clinical trials, we may be financially obligated for a period beyond the contractual termination notice periods. We may also enter into additional research, 155 manufacturing, supplier, lease and other agreements in the future, which may require up-front payments and even long-term commitments of cash. 11 Group relations Name and registered office of the Parent preparing consolidated financial statements for the largest group: IO Biotech Inc. Orange Street 1209 DE 19801 Wilmington USA https://investors.iobiotech.com/ true true Referring to section 110 of the Danish Financial Statements Act, no consolidated financial statements have been prepared. Recognition and measurement Assets are recognised in the balance sheet when it is probable as a result of a prior event that future economic benefits will flow to the Entity, and the value of the asset can be measured reliably. Liabilities are recognised in the balance sheet when the Entity has a legal or constructive obligation as a result of a prior event, and it is probable that future economic benefits will flow out of the Entity, and the value of the liability can be measured reliably. On initial recognition, assets and liabilities are measured at cost. Measurement subsequent to initial recognition is effected as described below for each financial statement item. Anticipated risks and losses that arise before the time of presentation of the annual report and that confirm or invalidate affairs and conditions existing at the balance sheet date are considered at recognition and measurement. Income is recognised in the income statement when earned, whereas costs are recognised by the amounts attributable to this financial year. Translation policies Presentation currency The financial statements are presented in Danish Kroner (DKK). Foreign currency translation On initial recognition, transactions denominated in foreign currencies are translated at the exchange rates at the transaction date. Foreign exchange differences arising between the exchange rates at the transaction date and the date of payment are recognised in the income statement as financial income or financial expenses. Receivables, payables, and other monetary items denominated in foreign currencies are translated at the exchange rates at the balance sheet date. The difference between the exchange rates at the balance sheet date and the date at which the receivable or payable arose or was recognised in the latest financial statements is recognised in the income statement as financial income or financial expenses. Fixed assets acquired in foreign currency are measured at the exchange rate at the transaction date. Income statement Research and development costs The item includes research and development costs not satisfying the criteria for capitalisation. Research costs comprise salaries, patent costs, consultancy fees, clinical trial cost, etc. Contractual costs to provide services related to clinical trial start-up activities are recognised ratably over the estimated start-up period. Contractual costs to provide services related to patient treatment are recognised based on data related to patient screening, enrollment and monitoring visits. Fixed fees not directly correlated to patient activities, such as CRO, management fees or database maintenance, are often recognised ratably over the treatment period. Contractual costs to provide wrap-up activities are often recognised ratably over the estimated wrap-up period. The company will receive charges from subsidiaries as a part of the service delivered. Administrative expenses Administrative expenses include expenses incurred in the year for company management and administration, including expenses relating to administrative staff, Management, office premises, lawyers, auditors, consultants etc. and expenses as well as amortisation/depreciation of assets used for administrative purposes. Other operating income Other operating income comprise items of a secondary nature relative to the Company's core activities, including public grants, gains or losses on the sale of fixed assets. Public grants to cover expenses are recognised in the income statement when it is deemed likely that all grant criteria have been met. Grants which must be repaid under certain circumstances are recognised only where they are not expected to be repaid. Other financial income Other financial income comprises bank interest, realized - and unrealized exchange rates gains. Other financial expenses Other financial expenses are recognised in the income statements at the amounts that concern the financial year. Tax on profit/loss for the year Tax for the year includes current tax on the year's expected taxable income and the year's deferred tax adjustments. The portion of the tax for the year that relates to the profit/loss for the year is recognised in the income statement, whereas the portion that relates to transactions taken to equity is recognised in equity. Tax of the year includes tax credits for costs incurred in connection with research and development activities under the Danish Tax Regime. Balance sheet Intellectual property rights Intangible assets acquired intangible rights. Intangible assets are measured at cost less accumulated amortisation and impairment losses. Intellectual property rights etc are written down to the lower of recoverable amount and carrying amount. Amortisation is made over the estimated economic life without the determination of a residual value. The expected useful lives of the intangible assets are as follows: Acquired intangible rights 10-16 years Property, plant and equipment Items of property, plant and equipment are measured at cost less accumulated depreciation and impairment losses. Art is measured at cost without depreciation. Other fixtures and fittings, tools and equipment 3-5 years Cost includes the acquisition price and costs directly related to them acquisition until the time at which the asset is ready for use. Impairment of fixed assets The carrying amount of intangible assets and property, plant and equipment and equity investments in group entities is tested annually for indication of impairment other than the decrease in value reflected by amortisation/depreciation made. Impairment tests are conducted on individual assets or cash-generating units when there is indication of impairment. Write-down is made to the lower of the recoverable amount and carrying amount. The recoverable amount is the higher of the net selling price of an asset and its value in use. The value in use is calculated as the present value of the expected net cash flows from the use of the asset or the group of assets. Investments in group enterprises Investments in group enterprises are measured at cost. Investments are written down to the lower of recoverable amount and carrying amount. Impairment test are being made each year. Receivables Receivables are measured at amortised cost. The Company has chosen IAS 39 as interpretation for impairment of financial receivables. An impairment loss is recognised if there is objective evidence that a receivable or a group of receivables is impaired. If there is objective evidence that an individual receivable has been impaired, an impairment loss is recognised on an individual basis. Tax payable or receivable Current tax payables and receivables are recognised in the balance sheet as the estimated income tax charge for the year, adjusted for prior-year taxes and tax paid on account. Deferred tax is measured using the balance sheet liability method on all temporary differences between the carrying amount and the tax value of assets and liabilities, with the exception of temporary differences occurring at the time of acquisition of assets and liabilities neither affecting the results of operations nor the taxable income. Prepayments Prepayments recognised under "Assets" comprise prepaid expenses regarding subsequent financial reporting years. Cash Cash comprises cash and short-term securities which are readily convertible into cast and subject only to minor risks of changes in value. Equity Contributed capital The contributed capital comprises the nominal amount of the Company's class A, B, and C shares. Retained earnings Retained earnings includes the accumulated profit/loss for the year and the reduction from any expenses directly attributable to capital increases. Other reserves Other reserves comprise of amounts relating to the special reserve that has been established upon the execution of the share capital decrease in accordance with section §188 (1) (3) of the Danish Companies Act. The special fund may only be used after resolution of the general meeting. Liabilities other than provisions The Company has chosen IAS 39 as interpretation for recognition and measurement of liabilities. Financial liabilities are recognised at the date of borrowing at the proceeds received less transaction costs paid. On subsequent recognition, financial liabilities are measured at amortised cost, corresponding to the capitalised value, using the effective interest rate. Accordingly, the difference between the proceeds and the nominal value is recognised in the income statement over the term of the loan. Other liabilities are measured at net realisable value. Annual report Auditor's report on audited financial statements ParsePort XBRL Converter 2022-01-01 2022-12-31 2021-01-01 2021-12-31 2023-06-28 Reporting class B 2023-06-28 36474483 IO Biotech ApS Ole Maaløes Vej 3 2200 København N Opinion Basis for Opinion Copenhagen 2023-06-28 30700228 EY Godkendt Revisionspartnerselskab Dirch Passers Allé 36 2000 Frederiksberg