KARYOPHARM THERAPEUTICS INC. You should read the following discussion and analysis of our financial condition and results of operations together with our financial statements and related notes appearing elsewhere in this quarterly report and the audited financial information and the notes thereto included in our Annual Report on Form 10-K for the year endedDecember 31, 2021 , as filed with theSecurities and Exchange Commission ("SEC") onMarch 1, 2022 ("Annual Report").
FORWARD-LOOKING STATEMENTS
This Quarterly Report on Form 10-Q, contains forward-looking statements regarding the expectations ofKaryopharm Therapeutics Inc. , herein referred to as "Karyopharm," the "Company," "we," or "our," with respect to the possible achievement of discovery and development milestones, our future discovery and development efforts, including regulatory submissions and approvals, our commercialization efforts, our partnerships and collaborations with third parties, our future operating results and financial position, our business strategy, and other objectives for future operations. We often use words such as "anticipate," "believe," "estimate," "expect," "intend," "may," "plan," "predict," "project," "target," "potential," "will," "would," "could," "should," "continue," and other words and terms of similar meaning to help identify forward-looking statements, although not all forward-looking statements contain these identifying words. You also can identify these forward-looking statements by the fact that they do not relate strictly to historical or current facts. There are a number of important risks and uncertainties that could cause actual results or events to differ materially from those indicated by forward-looking statements. These risks and uncertainties include, but are not limited to, those described in Part II, Item 1A - Risk Factors of this Quarterly Report on Form 10-Q. As a result of these and other factors, we may not actually achieve the plans, intentions, expectations or results disclosed in our forward-looking statements, and you should not place undue reliance on our forward-looking statements. Our forward-looking statements do not reflect the potential impact of any future acquisitions, mergers, dispositions, joint ventures or investments we may make. We do not assume any obligation to update any forward-looking statements, whether as a result of new information, future events or otherwise, except as required by law.
References to XPOVIO® (selinexor) also refer to NEXPOVIO®(selinexor) when
discussing its approval and commercialization outside of the
OVERVIEW
We are a commercial-stage pharmaceutical company pioneering novel cancer
therapies and dedicated to the discovery, development and commercialization of
first-in-class drugs directed against nuclear export for the treatment of cancer
and other diseases. Our scientific expertise is based upon an understanding of
the regulation of intracellular communication between the nucleus and the
cytoplasm. We have discovered and are developing and commercializing novel,
small molecule Selective Inhibitor of Nuclear Export ("SINE") compounds that
inhibit the nuclear export protein exportin 1 ("XPO1"). These SINE compounds
represent a new class of drug candidates with a novel mechanism of action that
have the potential to treat a variety of diseases with high unmet medical need.
Our lead asset, XPOVIO® (selinexor), was the first oral XPO1 inhibitor to
receive marketing approval, receiving its initial U.S. approval from the U.S.
Food and Drug Administration ("FDA") in July 2019 , and is currently approved and
marketed in the U.S. for the following indications:
•
In combination with bortezomib and dexamethasone for the treatment of adult patients with multiple myeloma who have received at least one prior therapy. Approval in this indication was supported by data from theBOSTON (Bortezomib, Selinexor and Dexamethasone) study (the "BOSTON Study");
•
In combination with dexamethasone for the treatment of adult patients with
relapsed or refractory multiple myeloma who have received at least four prior
therapies and whose disease is refractory to at least two proteasome inhibitors
("Pls"), at least two immunomodulatory agents ("IMiDs"), and an anti-CD38
monoclonal antibody ("mAB"). We refer to myeloma that is refractory to these
five agents as penta-refractory. Approval in this indication was supported by
data from the STORM (Selinexor Treatment of Refractory Myeloma) study (the
"STORM Study"); and
•
For the treatment of adult patients with relapsed or refractory diffuse large
B-cell lymphoma ("DLBCL"), not otherwise specified, including DLBCL arising from
follicular lymphoma, after at least two lines of systemic therapy. This
indication was approved under accelerated approval based on response rate and
was supported by data from the SADAL (Selinexor Against Diffuse Aggressive
Lymphoma) study. Continued approval for this indication may be contingent upon
verification and description of clinical benefit in confirmatory trial(s).
The commercialization of XPOVIO in the U.S. , for both the multiple myeloma and
DLBCL indications, is currently supported by sales representatives, nurse
liaisons, and a market access team as well as KaryForward™, an extensive patient
and healthcare provider support program. Our commercial efforts are also
supplemented by patient support initiatives coordinated by our dedicated
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network of participating specialty pharmacy providers. We plan to continue to educate physicians, other healthcare providers and patients about XPOVIO's clinical profile and unique mechanism of action as we continue to expand XPOVIO use. The commercialization of XPOVIO and NEXPOVIO (the brand name for selinexor inEurope and theUnited Kingdom ) outside of theU.S. is managed by our partners in their respective territories. We have received the following regulatory approval for NEXPOVIO outside of theU.S. :
•
European Union : Conditional approval received inMarch 2021 from theEuropean Commission for NEXPOVIO in combination with dexamethasone for the treatment of adult patients with penta-refractory multiple myeloma in 27European Union member countries as well as the European Economic Area countries ofIceland ,Liechtenstein andNorway . InDecember 2021 , we entered into a license agreement (the "Menarini Agreement") withBerlin-Chemie AG , an affiliate of theMenarini Group ("Menarini"), pursuant to which we granted Menarini a non-exclusive license to develop, and an exclusive license to commercialize, products containing selinexor for all human oncology indications inEurope and other key global territories.
•
United Kingdom : Conditional approval received inMay 2021 from theUnited Kingdom's Medicines & Healthcare Products Regulatory Agency for NEXPOVIO in combination with dexamethasone for the treatment of adult patients with penta-refractory multiple myeloma. Under the terms of the Menarini Agreement, Menarini obtained the exclusive rights to commercialize NEXPOVIO in theUnited Kingdom .
Our partners have received the following regulatory approvals for XPOVIO outside
of the
•
Australia : Approval received inMarch 2022 for XPOVIO (a) in combination with bortezomib and dexamethasone for the treatment of adult patients with multiple myeloma who have received at least one prior therapy; and (b) in combination with dexamethasone for the treatment of adult patients with relapsed and/or refractory multiple myeloma who have received at least three prior therapies and whose disease is refractory to at least one PI, at least one IMiD, and an anti-CD38 mAb.
•
Singapore : Approval received inMarch 2022 for XPOVIO (a) in combination with bortezomib and dexamethasone for the treatment of adult patients with multiple myeloma who have received at least one prior therapy; (b) in combination with dexamethasone for the treatment of adult patients with relapsed or refractory multiple myeloma who have received at least four prior therapies and whose disease is refractory to at least two PIs, at least two IMiDs, and an antiCD38 mAb; and (c) for the treatment of adult patients with relapsed or refractory DLBCL, not otherwise specified, including DLBCL arising from follicular lymphoma, after at least two lines of therapy who are not eligible for haematopoietic cell transplant.
•
MainlandChina : Conditional approval received inDecember 2021 for XPOVIO in combination with dexamethasone in patients with relapsed or refractory multiple myeloma who have received prior therapies and whose disease is refractory to at least a PI, an IMiD, and an anti-CD38 mAb.
•
South Korea : Approval received inJuly 2021 for XPOVIO (a) in combination with dexamethasone for the treatment of adult patients with penta-refractory multiple myeloma; and (b) as a monotherapy for the treatment of adult patients with relapsed or refractory DLBCL who have received at least two prior lines of treatment.
•
Israel : Approval received inFebruary 2021 for XPOVIO (a) in combination with dexamethasone for the treatment of adult patients with relapsed refractory multiple myeloma who have received at least three prior therapies and whose disease is refractory to at least one PI, at least one IMiD, and an anti-CD38 mAb; and (b) for the treatment of adult patients with relapsed or refractory DLBCL, not otherwise specified, including DLBCL arising from follicular lymphoma, after at least two lines of systemic therapy. InJanuary 2022 , approval was also received for XPOVIO in combination with bortezomib and dexamethasone for the treatment of adult patients with multiple myeloma who have received at least one prior therapy. In addition, inApril 2021 , theEuropean Medicines Agency ("EMA") validated our Type II variation to the marketing authorization application ("MAA") based on the data from the Phase 3 BOSTON Study, which evaluated once-weekly administration of selinexor in combination with once-weekly administration of Velcade® (bortezomib) and low-dose dexamethasone compared to standard twice-weekly administration of Velcade® plus low-dose dexamethasone in patients with multiple myeloma who have received one to three prior lines of therapy. InJanuary 2022 , as part of the MAA approval process, the EMA conducted a preapproval good clinical practices ("GCP") inspection at our corporate headquarters, which was also attended by the FDA. In addition, an inspection of one of the clinical trial sites that participated in theBOSTON Study took place in late 2021. InFebruary 2022 , the EMA issued its initial GCP inspection reports, which included certain questions and findings. We promptly addressed the questions and findings included in the inspection reports. We have since received and responded to additional questions and requests from the CHMP. The Type II variation is currently under review by the Committee for Medicinal Products for Human Use ("CHMP"). An opinion by the CHMP could be issued in the first half of 2022. There can be no assurances that our responses will be acceptable to the EMA. 17
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Our primary focus is on marketing XPOVIO in its currently approved indications
as well as developing and seeking the regulatory approval of selinexor as an
oral agent in multiple myeloma, endometrial cancer, and myelofibrosis ("MF"),
eltanexor in myelodysplastic syndromes ("MDS") and selinexor and eltanexor in
additional cancer indications with significant unmet medical need. We plan to
continue to conduct clinical trials and to seek additional approvals for the use
of selinexor and eltanexor as single agents or in combination with other
oncology therapies to expand the patient populations that are eligible for
treatment with selinexor or eltanexor. In addition to selinexor and eltanexor,
we continue to advance our pipeline of novel drug candidates, including
verdinexor, our other oral SINE compound, KPT-9274 and a proprietary recombinant
human interleukin 12 ("IL-12").
On February 8, 2022 , we announced top-line results from our Phase 3 SIENDO study
evaluating the efficacy and safety of selinexor for front-line maintenance
therapy in patients with advanced or recurrent endometrial cancer (the "SIENDO
Study"). On February 25, 2022 , we attended a pre-supplemental New Drug
Application ("sNDA") submission meeting with the FDA during which we received
feedback, including that the top-line results from the SIENDO Study are unlikely
to support an sNDA approval. Considering the FDA's feedback and based on the
promising study results in a prespecified exploratory subgroup of patients with
p53 wild-type tumors, we are planning to initiate a new placebo-controlled
randomized clinical study of selinexor in patients with p53 wild-type with
advanced or recurrent endometrial cancer. To that end, we are currently in
discussions with the FDA regarding the design of this new study. Pending the
outcome of those discussions, we are planning to initiate this study in the
second half of 2022.
In the first half of 2022, we expect the first patient to be enrolled in a
randomized global Phase 3 study evaluating selinexor in combination with
pomalidomide and dexamethasone ("SPd") versus elotuzumab, pomalidomide, and
dexamethasone ("EloPd") in patients with relapsed or refractory multiple myeloma
(NCT05028348//EMN29). Patients in this Phase 3 study will have received one to
four prior lines of therapy, including a PI, lenalidomide and an anti-CD38 mAb.
Sixty patients will be randomized to SPd 40, SPd 60 or EloPd (Part 1) followed
by Part 2, with 240 patients randomized to SPd (at the identified optimal dose
from Part 1) versus EloPd in a 1:1 fashion. This global study is sponsored by
the European Myeloma Network. The primary endpoint of this study is
progression-free survival and secondary endpoints include overall response rate,
overall survival and duration of response.
As of March 31, 2022 , we had an accumulated deficit of $1.2 billion . We had net
losses of $41.4 million and $57.4 million for the three months ended March 31,
2022 and 2021, respectively.
Uncertainty Relating to the COVID-19 Pandemic
The COVID-19 pandemic has and will continue to affect economies, healthcare systems, and businesses around the world. We continue to closely monitor the impact of the COVID-19 pandemic on all aspects of our business, including the impact on our employees, patients and business operations. We have experienced and may continue to experience, disruptions that could impact clinical trial enrollment and/or our results of operations, including product revenue and our financial condition. These uncertainties include the availability, administration rates and effectiveness of vaccines and therapeutics against any variants as new strains of the virus evolve, the continued duration and severity of the pandemic, governmental, business or other actions, changes to our operations and how quickly and to what extent normal economic and operation conditions can resume, among others. We will continue to monitor the COVID-19 situation closely and intend to follow health and safety guidelines as they evolve. Further, the impacts of a potential worsening of global economic conditions and the continued disruptions to, and volatility in, the credit and financial markets, as well as other unanticipated consequences, remain unknown. The situation surrounding the COVID-19 pandemic remains fluid and we are actively managing our response and assessing potential impacts to our operating results and financial condition, as well as adverse developments in our business. For further information regarding the impact of the COVID-19 pandemic on us, see Part II, Item 1A - Risk Factors included in this Quarterly Report on Form 10-Q.
CRITICAL ACCOUNTING ESTIMATES
We believe that several accounting policies are important to understanding our
historical and future performance. We refer to these policies as "critical"
because these specific areas generally require us to make judgments and
estimates about matters that are uncertain at the time we make the estimate, and
different estimates - which also would have been reasonable - could have been
used, which would have resulted in different financial results.
There have been no changes to the critical accounting estimates we identified in
Item 7. Management's Discussion and Analysis of Financial Condition and Results
of Operations in our Annual Report.
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RESULTS OF OPERATIONS
The following table summarizes our results of operations (in thousands except
for percentages):
Three Months Ended March 31,
2022 2021 $ Change % Change
Product revenue, net $ 28,300 $ 21,731 $ 6,569 30 %
License and other revenue 19,370 1,529 17,841 1167 %
Total revenues 47,670 23,260 24,410 105 %
Operating expenses:
Cost of sales 1,426 933 493 53 %
Research and development 42,062 37,050 5,012 14 %
Selling, general and administrative 38,768 37,650 1,118 3 %
Loss from operations (34,586 ) (52,373 ) 17,787 (34 )%
Other expense, net (6,683 ) (4,892 ) (1,791 ) 37 %
Loss before income taxes (41,269 ) (57,265 ) 15,996 (28 )%
Income tax provision (130 ) (149 ) 19 (13 )%
Net loss $ (41,399 ) $ (57,414 ) $ 16,015 (28 )%
Product Revenue, net (in thousands, except for percentages)
Three Months Ended March 31,
2022 2021 $ Change % Change
Product revenue, net $ 28,300 $ 21,731 $ 6,569 30 %
Net product revenue from U.S. commercial sales of XPOVIO for the three months
ended March 31, 2022 increased 30% as compared to the three months ended March
31, 2021 due to an increasing number of patients treated in earlier lines of
therapy and the increasing utilization of XPOVIO by physicians in the first
quarter of 2022 compared to the first quarter of 2021. We expect this trend to
continue, resulting in increased net product revenue in 2022 as compared to
2021.
License and Other Revenue (in thousands, except for percentages)
Three Months Ended March 31,
2022 2021 $ Change % Change
Antengene Therapeutics Limited
("Antengene") $ 9,014 $ 492 $ 8,522 1732 %
Menarini 7,086 - 7,086 100 %
Other 3,270 1,037 2,233 215 %
Total $ 19,370 $ 1,529 $ 17,841 1167 %
License and other revenue for the three months ended March 31, 2022 increased as
compared to the three months ended March 31, 2021 , due to $7.8 million that we
recognized in development/regulatory milestones from Antengene and $7.1 million
that we earned for reimbursement of development expenses from Menarini in the
first quarter of 2022.
We expect license and other revenue will decrease in the second quarter of 2022
as compared to the first quarter of 2022, due primarily to the recognition of
milestones earned in the first quarter of 2022 related to our license agreement
with Antengene.
Operating Expenses (in thousands, except for percentages)
Three Months Ended March 31,
2022 2021 $ Change % Change
Cost of sales $ 1,426 $ 933 $ 493 53 %
Research and development 42,062 37,050 5,012 14 %
Selling, general and administrative 38,768 37,650 1,118 3 %
Total $ 82,256 $ 75,633 $ 6,623 9 %
Cost of Sales
During the three months ended March 31, 2022 and 2021, we recorded $1.4 million
and $0.9 million , respectively, of cost of sales, including $0.3 million and
$0.1 million , respectively, related to royalties. The cost of sales during the
three months ended March 31, 2022 and 2021 only reflects a portion of the costs
related to the manufacturing of XPOVIO and related materials, since,
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prior to theJuly 2019 FDA approval, these costs were expensed. The manufacturing costs of XPOVIO on-hand upon FDA approval amounted to approximately$2.8 million . AtMarch 31, 2022 , we had$2.0 million of previously expensed XPOVIO costs and related material on-hand. We expect to utilize zero cost inventory with respect to XPOVIO for an extended period of time. We do not expect cost of sales to materially change in the second quarter of 2022, as compared to the first quarter of 2022.
Research and Development Expense (in thousands, except for percentages)
Three Months Ended March 31,
2022 2021 $ Change % Change
Clinical trial costs $ 18,230 $ 16,750 $ 1,480 9 %
Personnel costs 17,240 14,107 3,133 22 %
Stock-based compensation 2,968 2,932 36 1 %
Consulting, professional and
other costs 3,624 3,261 363 11 %
Total $ 42,062 $ 37,050 $ 5,012 14 %
Research and development expense for the three months ended March 31, 2022
increased as compared to the three months ended March 31, 2021 , primarily due to
an increase in personnel costs, including $1.6 million related to severance
charges recognized in the quarter. In addition, clinical trial costs increased
by approximately $1.5 million , primarily related to an increase of $4.0 million
in costs related to our Phase 3 study evaluating selinexor in combination with
pomalidomide and dexamethasone in patients with relapsed or refractory multiple
myeloma. This increase was partially offset by a $2.3 million decrease in costs
related to our BOSTON , SIENDO, SEAL and SADAL studies.
We expect our research and development expense to increase in the second quarter of 2022 as compared to the first quarter of 2022, due primarily to severance-related stock-based compensation expense.
Selling, General and Administrative Expense (in thousands, except for
percentages)
Three Months Ended March 31,
2022 2021 $ Change % Change
Personnel costs $ 19,448 $ 18,285 $ 1,163 6 %
Consulting, professional and
other costs 11,807 12,259 (452 ) (4 )%
Stock-based compensation 4,313 4,383 (70 ) (2 )%
Facility and information
technology infrastructure costs 3,200 2,723 477 18 %
Total $ 38,768 $ 37,650 $ 1,118 3 %
Selling, general and administrative expense for the three months ended March 31,
2022 increased as compared to the three months ended March 31, 2021 , primarily
due to an increase of $1.2 million in personnel costs, largely attributable to
severance-related charges recognized in the quarter.
We expect our selling, general and administrative expenses to increase in the
second quarter of 2022 as compared to the first quarter of 2022, due primarily
to severance-related stock-based compensation expense.
Other Expense, net (in thousands, except for percentages)
Three Months Ended March 31,
2022 2021 $ Change % Change
Interest expense $ (6,684 ) $ (5,095 ) $ (1,589 ) 31 %
Interest income 74 264 (190 ) (72 )%
Other income (expense):
Realized gains on marketable
equity securities - 14 (14 ) (100 )%
Foreign currency translation (73 ) (75 ) 2 (3 )%
Total other expense, net $ (6,683 ) $ (4,892 ) $ (1,791 ) 37 %
Other expense, net for the three months ended March 31, 2022 increased as
compared to the three months ended March 31, 2021 primarily due to an increase
in interest expense of $1.6 million related to our Revenue Interest Agreement
that we entered into with HealthCare Royalty Partners III, L.P. and HealthCare
Royalty Partners IV, L.P. ("HCR") and was amended in June 2021 ("Amended Revenue
Interest Agreement") resulting in an increased deferred royalty obligation
following the closing of the Amended Revenue Interest Agreement. We expect other
expense, net to remain relatively consistent in the second quarter of 2022, as
compared to the first quarter of 2022.
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LIQUIDITY AND CAPITAL RESOURCES
Cash Flows
To date, we have financed our operations through a combination of product revenue sales, through private placements of our preferred stock, proceeds from our initial public offering and follow-on offerings of common stock, proceeds from the issuance of convertible debt, proceeds pursuant to the deferred royalty obligation, proceeds from sales of common stock under our Open Market Sale Agreement (as defined below), and cash generated from our business development activities. As ofMarch 31, 2022 , our principal source of liquidity was$205.3 million of cash, cash equivalents and investments. We have had recurring losses since inception and incurred a loss of$41.4 million for the three months endedMarch 31, 2022 . Net cash used in operations for the three months endedMarch 31, 2022 was$59.2 million . We expect that our cash, cash equivalents and investments atMarch 31, 2022 will be sufficient to fund our current operating plans and capital expenditure requirements for at least twelve months from the date of issuance of the financial statements contained in this Quarterly Report on Form 10-Q. The following table provides information regarding our cash flows (in thousands): Three Months Ended March 31, 2022 2021 Net cash used in operating activities$ (59,197 ) $ (52,888 ) Net cash (used in) provided by investing activities (14,035 ) 43,186 Net cash provided by financing activities 30,783
10,676
Effect of exchange rate (90 ) (91 ) Net (decrease) increase in cash, cash equivalents and restricted cash$ (42,539 ) $ 883 Operating activities. The net cash used in operating activities in each of the three months endedMarch 31, 2022 andMarch 31, 2021 primarily reflects our net losses adjusted for non-cash charges and changes in the components of working capital. The increase in cash used in operating activities during the quarter endedMarch 31, 2022 as compared to the quarter endedMarch 31, 2021 was driven by a$16.0 million decrease in our net loss that was more than offset by a$21.6 million increase in the change in operating assets and liabilities. Investing activities. The net cash used in investing activities during the three months endedMarch 31, 2022 , compared to the net cash provided by investing activities during the three months endedMarch 31, 2021 , primarily reflects a$47.4 million decrease in proceeds from the sales and maturities of investments coupled with a$9.8 million increase in the purchases of investments. Financing activities. The$20.1 million increase in net cash provided by financing activities for the three months endedMarch 31, 2022 compared to the three months endedMarch 31, 2021 was primarily due to the net cash proceeds of$29.3 million from the sale of shares of our common stock under our Open Market Sale Agreement in the first quarter of 2022, compared to net cash proceeds of$9.9 million during the first quarter of 2021.
Sources of Liquidity
OnJune 23, 2021 , we and certain of our subsidiaries entered into an amendment to the Revenue Interest Agreement with HCR. Pursuant to the Revenue Interest Agreement, HCR paid us$75.0 million , less certain transaction expenses, onSeptember 27, 2019 and pursuant to the Amended Revenue Interest Agreement, HCR paid us$60.0 million , less certain transaction expenses, onJune 23, 2021 . For additional information on the Amended Revenue Interest Agreement, see Note 10, "Long-Term Obligations", to the condensed consolidated financial statements included under Part I, Item I of this Quarterly Report on Form 10-Q. OnMay 5, 2020 , we entered into Amendment No. 1 to the Open Market Sale Agreement, datedAugust 17, 2018 (the "Open Market Sale Agreement") withJefferies LLC , as agent ("Jefferies") pursuant to which we increased the maximum aggregate offering price of shares of our common stock that we may issue and sell from time to time through Jefferies, by$100.0 million from$75.0 million to up to$175.0 million . As ofMarch 31, 2022 ,$70.7 million of shares of our common stock may be issued and sold under the Open Market Sale Agreement. We sold an aggregate of 2,941,517 shares under the Open Market Sale Agreement, for net proceeds of approximately$29.3 million during the three months endedMarch 31, 2022 . During the quarter endedMarch 31, 2022 , we received$1.6 million in milestone payments under our license and distribution arrangements pursuant to which we are entitled to receive additional milestone payments, if certain development goals and sales milestones are achieved, as well as royalties on future net sales of the licensed and sold products in the territories under such arrangements. In addition, under our license agreement with Menarini, Menarini will reimburse us for 25% of all documented expenses we incur for the global development of selinexor during 2022 through 2025, provided that such reimbursements shall not exceed$15.0 million per calendar year. 21
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Commitments, Contingencies and Contractual Obligations
Operating Leases
We are party to an operating lease of 98,502 square feet of office and research space inNewton, Massachusetts with a term throughSeptember 30, 2025 (the "Newton, MA Lease"). Pursuant to theNewton, MA Lease, we have provided a security deposit in the form of a cash-collateralized letter of credit in the amount of$0.6 million . The amount is classified within long-term restricted cash. We expect lease costs under this commitment to total$3.4 million in 2022 and increase annually; we expect total future lease costs to be approximately$13.1 million . In addition, we are party to certain short-term leases having a term of twelve months or less at the commencement date. We recognize short-term lease expense on a straight-line basis and do not record a related right-of use asset or lease liability for such leases. These costs were insignificant for the three months endedMarch 31, 2022 . Contractual Obligations We have contractual obligations under our Notes and under our Amended Revenue Interest Agreement as disclosed in Note 10, "Long-Term Obligations", to the condensed consolidated financial statements included under Part I, Item 1 of this Quarterly Report on Form 10-Q.
Funding Requirements
We expect our expenses, excluding stock-based compensation, to remain relatively consistent in 2022 as compared to 2021. We expect to continue to incur costs related to our clinical development programs as well as commercialization expenses related to sales, marketing, manufacturing and distribution of any of our approved products, to the extent that these functions are not the responsibility of our collaborators. Identifying potential product candidates and conducting preclinical studies and clinical trials is a time-consuming, expensive and uncertain process that takes years to complete. In addition, our product candidates for which we receive marketing approval may not achieve commercial success. Our ability to become and remain profitable depends on our ability to generate revenue. There can be no assurance as to the amount or timing of any such revenue, and we may not achieve profitability for several years, if at all, as described more fully in the risk factor entitled "We have incurred significant losses since inception, expect to continue to incur significant losses, and may never achieve or maintain profitability," under the heading "Risk Factors" in this Quarterly Report on Form 10-Q. Accordingly, we will need to continue to rely on additional financing to achieve our business objectives. Adequate additional financing may not be available to us on acceptable terms, or at all. We may seek additional capital due to favorable market conditions or strategic considerations, even if we believe we have sufficient funds for our current or future operating plans. If we are unable to raise capital when needed or on attractive terms, we would be forced to delay, reduce or eliminate our research and development programs or commercialization efforts. We currently expect that cash, cash equivalents and short- and long-term investments atMarch 31, 2022 will be sufficient to fund our current operating plans and capital expenditure requirements for at least twelve months from the date of issuance of the financial statements contained in this Quarterly Report on Form 10-Q while we continue to commercialize XPOVIO in theU.S. and continue the clinical trials of our product candidates. Our future long-term capital requirements will depend on many factors, as described more fully in the risk factor entitled "We will need additional funding to achieve our business objectives. If we are unable to raise capital when needed or on acceptable terms, we would be forced to delay, reduce or eliminate our research and development programs and/or commercialization efforts," under the heading "Risk Factors" in this Quarterly Report on Form 10-Q.
In addition to the expenses required to fund our operations described above, our funding requirements also include the following:
•
Lease costs for our headquarters inNewton, Massachusetts with a term throughSeptember 30, 2025 , which totaled$2.8 million in 2021 and increase annually; we expect total future lease costs to be approximately$13.1 million ;
•
Increased cash operating expenditures over our 2021 totals of
•
Future long-term debt obligations related to the Notes of
•
Future royalty obligations to HCR under our Revenue Interest Financing Agreement
of approximately
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