Kiniksa Pharmaceuticals International, plc Income Taxes Disclosure

14.         Income Taxes

Prior to the Redomiciliation, the Company was incorporated and principally subject to taxation in Bermuda. Following the Redomiciliation, the Company is incorporated and principally subject to taxation in the United Kingdom. Under the previous laws of Bermuda, tax on a company’s income is assessed at a zero percent tax rate. As a result, the

Company has not recorded any income tax benefits from its losses incurred in Bermuda during the reporting periods in which it was incorporated there, and no net operating loss carryforwards will be available to the Company for those losses. Following the Redomiciliation, the Company’s income is subject to the enacted United Kingdom statutory corporate tax rate and net operating losses incurred have an indefinite carryforward. The Company’s wholly owned United States subsidiaries, Kiniksa US and Primatope, are subject to federal and state income taxes in the United States. The Company’s wholly owned subsidiary Kiniksa Bermuda remained subject to taxation, if any, in Bermuda for the period of time prior to its liquidation in November 2025. The Company’s wholly owned subsidiary Kiniksa UK, and Kiniksa UK’s wholly owned subsidiaries, Kiniksa Switzerland, Kiniksa Germany, and Kiniksa France are subject to taxation in their respective countries. Certain of the Company’s subsidiaries operate under cost plus intercompany arrangements.

The Company has engaged in a series of intra-entity asset transfers and allocations to contribute assets to its wholly owned Switzerland subsidiary and Kiniksa UK’s Swiss branch office. In December 2023, Kiniksa UK allocated all of its rights, title and interest in, among other things, certain contracts (including the Regeneron Agreement), intellectual property rights, product filings and approvals and other information, plans and inventory owned or controlled by the Company insofar as they related exclusively or primarily to ARCALYST to Kiniksa UK’s Swiss branch office.

The December 2023 allocation of the assets to the Swiss branch did not result in a taxable disposal for Kiniksa UK as the allocation was to a branch within the entity. The future results of Kiniksa UK’s Swiss branch office are subject to income taxes in Switzerland and the Company expects it will not be subject to tax in the UK. Kiniksa UK’s Swiss branch office received a step up in basis resulting in a Swiss deferred tax asset. The fair value of the allocated ARCALYST intellectual property assets was determined utilizing forecasted cash flows attributable to commercial operations and estimated probabilities of success of such cash flows, discounted to present value utilizing the discounted cash flow method. The fair value of the ARCALYST inventory was determined utilizing the average net selling price less estimated costs to sell.

In January 2024, Kiniksa Bermuda transferred to Kiniksa Switzerland all rights, title and interest in, among other things, certain contracts, intellectual property rights, product filings and approvals and other information, plans and materials owned insofar as they related exclusively or primarily to abiprubart, KPL-387 and certain preclinical assets. In October 2024, Kiniksa UK contributed all of its rights, title and interest in, among other things, certain contracts (including the Biogen Agreement), intellectual property rights, product filings and approvals and other information, plans and materials owned or controlled by Kiniksa UK insofar as they related exclusively or primarily to vixarelimab to Kiniksa Switzerland.

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The consolidated Company did not incur tax liabilities on any of the January 2024 intra-entity transfers since the transferor, Kiniksa Bermuda, is exempt from income tax in Bermuda. Kiniksa Switzerland accounted for the intra-entity transfers as transfers of assets between related parties and received stepped up tax bases in the contributed intellectual property assets, equal to the fair value of the assets at the time of transfer. The consolidated Company did not incur tax liabilities on any of the October 2024 intra-entity transfers since the transferor, Kiniksa UK, is the sole direct shareholder of Kiniksa Switzerland. Kiniksa Switzerland accounted for the intra-entity transfers as transfers of assets between related parties and received stepped up tax bases in the contributed intellectual property assets, equal to the fair value of the assets at the time of transfer.

The fair values of the transferred assets were determined utilizing future cash flows of projected operations and estimated probabilities of success of such cash flows, discounted to present value utilizing the discounted cash flow method. The Company recorded deferred tax assets as a result of these contributions, which represent the difference between the stepped-up tax bases and the book bases for financial statement purposes. The Company maintains a valuation allowance on the full amount of the Kiniksa Switzerland deferred tax assets. There are no material deferred tax assets in the jurisdictions outside the United States, UK and Switzerland.

On July 4, 2025, new United States tax legislation was signed into law (known as the "One Big Beautiful Bill Act" or "OBBBA") which makes permanent many of the tax provisions enacted in 2017 as part of the Tax Cuts and Jobs Act that were set to expire at the end of 2025. In addition, the OBBBA makes changes to certain United States corporate tax provisions, but many are generally not effective until 2026. The Company continues to assess the impact of the tax provisions of the OBBBA on its consolidated financial statements, the Company currently believes that the tax provisions of the legislation are not expected to have a material impact on its operations.

Income (loss) before benefit (provision) for income taxes consisted of the following:

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The components of the Company’s income tax benefit (provision) were as follows:

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A reconciliation of the statutory income tax rate of the Company’s effective income tax rate for the year ended December 31, 2025, after the adoption of ASU 2023-09 for 2025 is as follows:

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A reconciliation of the statutory income tax rate of the Company’s effective income tax rate for the years ended December 31, 2024 and 2023, prior to the adoption of ASU 2023-09 were as follows:

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Net deferred tax assets consisted of the following:

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As of December 31, 2025 and 2024, the Company had United States federal research and development tax credit carryforwards of approximately $3,224 and $808 available to reduce future tax liabilities, respectively, which begin to expire in 2045. As of December 31, 2025 and 2024, the Company had state research and development tax credit carryforwards of approximately $869 and $184 respectively, available to reduce future tax liabilities, which can be carried forward indefinitely. As of December 31, 2025 and 2024 the Company had foreign net operating loss (NOL) carryforwards of $106,244 and $66,990 respectively, available to reduce future tax liabilities. As of December 31, 2025 and 2024 the Company had UK domestic NOLs of $3,119 and $18,382, respectively. The NOLs may be carried forward and utilized, subject to local limitations.

As required by ASC 740 management regularly reassesses the valuation allowance on the Company’s deferred income tax assets. Valuation allowances require an assessment of both positive and negative evidence when determining whether it is more likely than not that the Company will be able to recover its deferred tax assets. Such assessment is required on a jurisdiction-by-jurisdiction basis. The ultimate realization of deferred tax assets is dependent upon the generation of future taxable income during the periods in which those temporary differences become deductible.

The valuation allowance increased by $9,749 in 2025 primarily as a result of additional net operating losses of Kiniksa Switzerland. The valuation allowance increased by $610,452 in 2024 primarily as a result of the establishment of the valuation allowance for the Kiniksa Switzerland deferred tax assets which primarily consisted of the tax basis in intellectual property transferred from Bermuda and net operating losses.

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In the second quarter of 2023, the Company assessed the valuation allowance on its United States deferred tax assets and considered positive evidence, including cumulative United States income in recent years, primarily related to cost plus intercompany arrangements and expectations regarding future profitability. The Company determined it was more likely than not that its United States deferred tax assets are realizable in the future and released the associated valuation allowance as of June 30, 2023.

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In the fourth quarter of 2023, the Company assessed the valuation allowance on its Kiniksa UK deferred tax assets and considered positive and negative evidence, including among other things, the impact of future profitability decreasing in the UK as a result of the allocation of ARCALYST to the Swiss branch office. After assessing both the positive and negative evidence, the Company determined it was more likely than not that a portion of the UK deferred tax assets would not be realized in the future and established a partial valuation allowance on those assets during the year ended December 31, 2023. In 2025, the Company reassessed the valuation allowance on its Kiniksa UK deferred tax assets. After assessing both the positive and negative evidence, including but not limited to future profitability in the UK, the Company determined it was more likely than not that all the UK deferred tax assets would be realized in the future, and released the remaining partial valuation allowance on those assets.

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The Company recognized a non-cash deferred tax benefit of $33,788 during the year ended December 31, 2023. This benefit primarily resulted from the step up in basis of intangible assets and inventory received in Switzerland associated with the allocation of ARCALYST to the Swiss branch office and the release of the United States valuation allowance. This was partially offset by the establishment of a partial UK valuation allowance. There are no material deferred tax assets in the jurisdictions outside the United States, UK and Switzerland.

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Utilization of the United States federal and state NOLs and research and development tax credits may be subject to substantial annual limitation under Section 382 of the Internal Revenue Code of 1986 due to ownership changes that could occur in the future. These ownership changes may limit the amount of carryforwards that can be utilized annually to offset future taxable income. In general, an ownership change, as defined by Section 382, results from transactions increasing the ownership of certain shareholders or public groups in the shares of a corporation by more than 50% over a three-year period.

The Company recognizes the tax benefit from an uncertain tax position only if it is more-likely-than-not that the tax position will be sustained on examination by taxing authorities, based on the technical merits of the position. The tax benefits recognized in the financial statements from such a position are measured based on the largest benefit that has a greater than 50% likelihood of being realized upon ultimate settlement. The amount of unrecognized tax benefits is $32,675, $13,390 and $1,794 as of December 31, 2025, 2024 and 2023, respectively. The net change in 2025, 2024 and 2023 relate to tax positions on the Company’s intellectual property transfers.

As of December 31, 2025, the Company had a liability of $32,675 for unrecognized tax benefits of which, $19,214, if recognized, would reduce the effective tax rate. A roll forward of the Company’s uncertainties in its income tax provision liability is presented below:

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The Company’s policy is to record interest and penalties related to income taxes as part of its income tax provision. The Company has accrued $1,117 at year end December 31, 2025 and immaterial interest and penalties on the tax positions during the year ended December 31, 2024 and 2023.

The Company files United States federal income tax returns and income tax returns in various state, local and foreign jurisdictions. The Company’s income tax returns are subject to tax examinations for the tax years ended

December 31, 2022 and subsequent years. His Majesty’s Revenue and Customs (“HMRC”) commenced an examination of the Company’s 2023 and 2024 UK corporate income tax returns. At December 31, 2025, the examination is in the preliminary stages. Based upon available information, the Company does not believe that the audit will result in any adjustment that would result in a material change in the Company’s financial position. To the extent the Company has tax attribute carryforwards, the tax years in which the attribute was generated may still be adjusted upon examination by tax authorities to the extent utilized in a future period.

The following table summarizes income taxes paid net of tax refunds:

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