Sorrento Therapeutics concludes that the unaudited condensed consolidated financial statements for the three and nine months ended September 30, 2017 should no longer be relied upon (8.85)
On February 26, 2018, the Audit Committee of the Board, after discussion with the Company's independent registered public accounting firm, concluded that the Company's unaudited condensed consolidated financial statements for the three and nine months ended September 30, 2017 should no longer be relied upon as a result of the conclusion by the Audit Committee that an other-than-temporary impairment in value had occurred in the Company's equity method investment in Immunotherapy NANTibody, LLC for the three and nine months ended September 30, 2017.
- In February 2018, NANTibody notified the Company that in July 2017 NANTibody acquired assets from a party related to its 60% owner, NantCell, Inc., for approximately $90 million cash. As a result, the Company reassessed the recoverability of its equity method investment in NANTibody and, on February 26, 2018, the Company and Audit Committee concluded that a previously unrecorded other-than-temporary impairment in value had occurred in its equity method investment in NANTibody as of September 30, 2017. The resulting impact on the Company's 40% equity interest in NANTibody is a $36.0 million impairment on equity method investment in the Company's condensed consolidated statement of operations for the three and nine months ended September 30, 2017. This impairment expense will not result in cash expenditures in past or future periods.
- The Company will restate its unaudited condensed consolidated financial statements and other financial information contained in its Quarterly Report on Form 10-Q for the three and nine months ended September 30, 2017, filed with the Securities and Exchange Commission on November 9, 2017, to reflect the impact of the impairment in the value of the Company's equity investment in NANTibody by filing an amendment to the Form 10-Q on or about February 26, 2018.