PROTAGONIST THERAPEUTICS, INC. You should read the following discussion and analysis of our financial condition and results of operations together with our Unaudited Condensed Consolidated Financial Statements and related notes included in Part I, Item 1 of this quarterly report (this "Quarterly Report") on Form 10-Q and with our Audited Consolidated Financial Statements and related notes thereto for the year endedDecember 31, 2020 , included in our Annual Report on Form 10-K filed with theSecurities and Exchange Commission ("SEC") onMarch 10, 2021 .
Forward-Looking Statements
This Quarterly Report contains certain forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended (the "Exchange Act"). These statements involve known and unknown risks, uncertainties and other factors that may cause our actual results, performance or achievements to be materially different from any future results, performances or achievements expressed or implied by the forward-looking statements. In some cases, you can identify forward-looking statements by terms such as "anticipates," "believes," "could," "estimates," "expects," "forecasts," "intends," "may," "plans," "potential," "predicts," "projects," "should," "targets," "will," "would," and similar expressions intended to identify forward-looking statements. Forward-looking statements reflect our current views with respect to future events, are based on assumptions, and are subject to risks, uncertainties and other important factors. In particular, statements, whether expressed or implied, concerning, among other things, the potential for our programs, the timing of our clinical trials, the potential for eventual regulatory approval and commercialization of our product candidates and our potential receipt of milestone payments and royalties under our collaboration agreements, the timing and amount of potential payments that we may be required to make to collaboration partners; future operating results or the ability to generate sales, income or cash flow, and the impact of the ongoing COVID-19 pandemic are forward-looking statements. They involve risks, uncertainties and assumptions that are beyond our ability to control or predict, including those discussed in Part II, Item 1A, of this Quarterly Report. While we believe such information forms a reasonable basis for such statements, such information may be limited or incomplete, and our statements should not be read to indicate that we have conducted an exhaustive inquiry into, or review of, all potentially available relevant information. Given these risks, uncertainties and other important factors, you should not place undue reliance on these forward-looking statements. Also, forward-looking statements represent our estimates and assumptions only as of the date of this Quarterly Report. Except as required by law, we assume no obligation to update any forward-looking statements publicly, or to update the reasons actual results could differ materially from those anticipated in any forward-looking statements, even if new information becomes available in the future. "Protagonist," the Protagonist logo and other trademarks, service marks and trade names of Protagonist are registered and unregistered marks ofProtagonist Therapeutics, Inc. inthe United States and other jurisdictions. 29 Table of Contents Overview We are a biopharmaceutical company with multiple peptide-based investigational new chemical entities in different stages of development, all derived from the Company's proprietary discovery technology platform. Our clinical programs fall into two broad categories of diseases; (i) hematology and blood disorders, and (ii) inflammatory and immunomodulatory diseases.
Our Product Pipeline
[[Image Removed: Graphical user interface Description automatically
generated with low confidence]]
Our most advanced clinical asset, rusfertide (generic name for PTG-300) is an
injectable hepcidin mimetic in development for the potential treatment of
erythrocytosis, iron overload and other blood disorders. Hepcidin is a key
hormone in regulating iron equilibrium and is critical to the proper development
of red blood cells. Rusfertide mimics the effect of the natural hormone
hepcidin, but with greater potency, solubility and stability. We initiated
Phase 2 proof of concept ("POC") studies in the blood disorders polycythemia
vera ("PV") in the third quarter of 2019 and hereditary hemochromatosis ("HH")
in January 2020 . In December 2020 , we presented four posters and one oral
presentation relating to rusfertide at the American Society for Hematology's
virtual annual meeting, including updated interim Phase 2 results for rusfertide
in PV. In June 2021 , we presented updated Phase 2 data supporting the long-term
efficacy of rusfertide in PV during an oral presentation at the European
Hematology Association ("EHA") 2021 Virtual Congress . We believe these interim
results provide evidence regarding the potential of rusfertide for managing
hematocrit, reducing thrombotic risk and improving iron deficiency symptoms.
Rusfertide has a unique mechanism of action in the potential treatment of PV,
which may enable it to decrease and maintain hematocrit levels within the range
of recommended clinical guidelines without causing the iron deficiency that may
occur with frequent phlebotomy.
On September 16, 2021 , the FDA orally informed us that a clinical hold would be
placed on our rusfertide clinical studies. We received formal written notice of
the clinical hold on September 17, 2021 . In October 2021 , we submitted a
Complete Response to the FDA related to the clinical hold, and the FDA removed
the clinical hold on October 8, 2021 . The clinical hold was imposed following
our submission to the FDA of findings in a 26-week rasH2 transgenic mouse
carcinogenicity study. In the rasH2 study, benign squamous cell papilloma were
observed in six of 75 male mice and six of 75 female mice treated with doses of
rusfertide ranging from 6.25 mg/kg to 25 mg/kg. Malignant squamous cell
carcinoma was also observed in one male mouse and one female mouse. There were
no findings in either the male or female control group. The rasH2 finding
prompted a re-examination of the four cases of cancer observed across all
rusfertide clinical trials (involving 160 patients) through the date of the
submission of the Complete Response. All cases were initially assessed as
unrelated to rusfertide treatment. Upon re-examination in light of the rasH2
finding, two of the cases were re-classified as possibly related to rusfertide.
No additional cancer cases, and no other unexpected safety signals, surfaced in
this process.
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In our Complete Response, we provided the individual patient clinical safety
reports the FDA requested for human cancers observed in rusfertide clinical
trials, updated the investigator brochure and patient informed consent forms for
ongoing rusfertide trials, proposed new safety and stopping rules in clinical
study protocols of our ongoing rusfertide clinical trials, and performed a
comprehensive review of our rusfertide safety database. Dosing of patients in
ongoing clinical trials with rusfertide is expected to resume in the fourth
quarter of 2021.
We completed enrollment of 63 patients in the ongoing Phase 2 clinical trial of
rusfertide in PV during the second quarter of 2021. Based on ongoing end of
Phase 2 feedback provided by the FDA's Division of Nonmalignant Hematology and
written comments from the European Medicines Agency ("EMA"), we expect to
initiate a global Phase 3 clinical trial of rusfertide in PV in the first
quarter of 2022. During the first quarter of 2021, we initiated another Phase 2
study for rusfertide in up to 20 patients diagnosed with PV and with routinely
elevated hematocrit levels (>48%). In addition, we completed enrollment for our
Phase 2 POC study in HH, our second indication, in April 2021 . An abstract
highlighting preliminary data our Phase 2 study of rusfertide in HH has been
selected for oral presentation at The Liver Meeting® 2021, hosted by
the American Association for the Study of Liver Diseases (AASLD), taking place
virtually in November 2021 .
To date we have received the following designations for rusfertide in PV:
? The FDA granted orphan drug designation for rusfertide for the treatment of PV
in
? The
for the treatment of PV in
? The FDA granted Fast Track designation for rusfertide for the treatment of PV
in
? The FDA granted Breakthrough Therapy Designation for rusfertide for the
treatment of PV in
Our alpha-4-beta-7 ("?4?7") antagonist PN-943 and our Interleukin-23 receptor
("IL-23R") antagonist compounds, including PN-232 and PN-235, are orally
delivered investigational drugs that are designed to block biological pathways
currently targeted by marketed injectable antibody drugs. Our orally stable
peptide approach may offer targeted delivery to the GI tissue compartment. We
believe that, compared to antibody drugs, these product candidates have the
potential to provide improved safety due to minimal exposure in the blood,
increased convenience and compliance due to oral delivery, and the opportunity
for the earlier introduction of targeted oral therapy.
PN-943 is an investigational, orally delivered, gut-restricted ?4?7 specific
integrin antagonist for inflammatory bowel disease ("IBD"). We submitted a U.S.
Investigational New Drug application with the FDA for PN-943 in December 2019 ,
which took effect in January 2020 . During the second quarter of 2020 we
initiated a 150-patient Phase 2 study evaluating the safety, tolerability and
efficacy of PN-943 in patients with moderate to severe UC. This study includes a
12-week induction period and a 40-week open label extension. Topline data from
the 12-week induction period is expected in the second quarter of 2022.
In May 2017 , we entered into a worldwide license and collaboration agreement
with Janssen Biotech, Inc. ("Janssen"), a Johnson & Johnson company, to
co-develop and co-detail our IL-23R antagonist compounds, including PTG-200 and
certain related compounds for all indications, including IBD. PTG-200 was an
investigational, orally delivered, IL-23R antagonist for the treatment of IBD.
The agreement with Janssen was amended in May 2019 to expand the collaboration
by supporting efforts towards second-generation IL-23R antagonists; and in July
2021 to, among other things, enable Janssen to develop collaboration compounds
for multiple indications and further align our financial interests around
potential multiple compound development for multiple indications in the IL-23
pathway.
Following a pre-specified interim analysis criteria, a portfolio decision was
made to stop further development of first generation IL-23R antagonist candidate
PTG-200 (JNJ-67864238), in favor of continued development of two
second-generation candidates PN-235 (JNJ-77242113) and PN-232 (JNJ-75105186)
with superior product profiles. In particular:
? The Phase 1 study of PN-235 is completed, and a Phase 2 study in psoriasis is
anticipated to initiate in early 2022.
? The Phase 1 study with PN-232 is under progress with study completion expected
by mid-2022.
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? Additional development in IBD is expected to initiate in 2022.
InOctober 2021 , we became eligible to receive a$7.5 million milestone payment from Janssen triggered by the completion of data collection for PN-235 Phase 1 activities. We will earn a$25.0 million milestone in connection with the initiation of the first Phase 2 study of a second-generation candidate, and a$10.0 million milestone in connection with the initiation of the second Phase 2 study of a second-generation candidate. We remain eligible for up to approximately$900.0 million in development-related milestone payments, in addition to the$87.5M in milestones already earned. Our clinical assets are all derived from our proprietary discovery platform. Our platform enables us to engineer novel, structurally constrained peptides that are designed to retain key advantages of both orally delivered small molecules and injectable antibody drugs in an effort to overcome many of their limitations as therapeutic agents. Importantly, constrained peptides can be designed to potentially alleviate the fundamental instability inherent in traditional peptides to allow different delivery forms, such as oral, subcutaneous, intravenous, and rectal. We continue to use our peptide technology platform to discover product candidates against targets in disease areas with significant unmet medical needs. COVID-19 Business Impact We are subject to risks and uncertainties as a result of the ongoing COVID-19 pandemic. We are continuing to closely monitor the impact of the COVID-19 pandemic on our business and have taken and continue to take proactive efforts to protect the health and safety of our patients, study investigators, clinical research staff and employees, and to maintain business continuity. The extent of the impact of the COVID-19 pandemic on our activities is uncertain and difficult to predict, as the pandemic and the response to the pandemic continue to evolve. Capital markets and economies worldwide have been significantly impacted by the COVID-19 pandemic, and the pandemic has contributed to a global economic recession. Such economic disruption could have a material adverse effect on our business. Policymakers around the globe have responded with fiscal policy actions to support the healthcare industry and economy as a whole. The magnitude and overall effectiveness of these actions remains uncertain. The severity of the impact of the COVID-19 pandemic on our activities will depend on a number of factors, including, but not limited to, the duration and severity of the pandemic, including the severity of any additional periods of increases or spikes in the number of cases in the areas we, our suppliers and our manufacturers operate and areas where our clinical trial sites are located; the development and spread of COVID-19 variants; the timing, extent, effectiveness and durability of vaccine programs or other treatments; and new or continuing travel and other restrictions and public health measures, such as social distancing, business closures or disruptions. Accordingly, the extent and severity of the impact on our existing and planned clinical trials, manufacturing, collaboration activities and operations is uncertain and cannot be fully predicted. We have experienced delays in our existing and planned clinical trials due to the worldwide impacts of the pandemic. Our future results of operations and liquidity could be adversely impacted by further delays in existing and planned clinical trials and collaboration activities, continued difficulty in recruiting patients for these clinical trials, delays in manufacturing and collaboration activities, supply chain disruptions, the ongoing impact on operating activities and employees, and the ongoing impact of any initiatives or programs that we may undertake to address financial and operational challenges. As of the date of issuance of this Quarterly Report on Form 10-Q, the extent to which the COVID-19 pandemic may materially impact our future financial condition, liquidity or results of operations is uncertain.
Operations
We have incurred net losses in each year since inception and we do not anticipate achieving sustained profitability in the foreseeable future. Our net loss was$33.8 million and$88.6 million for the three and nine months endedSeptember 30, 2021 , respectively. Our net loss was$7.8 million and$47.3 million for the three and nine months endedSeptember 30, 2020 , respectively. As ofSeptember 30, 2021 , we had an accumulated deficit of$372.5 million . Substantially all of our net losses have resulted from costs incurred in connection with our research and development programs and from general and administrative costs associated with our operations. We expect to continue to incur significant research, development, commercialization and other expenses related to our ongoing operations and product 32
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development, including clinical development activities under our worldwide license and collaboration agreement with Janssen, and, as a result, we expect to continue to incur losses in the future as we continue our development of, and seek regulatory approval for, our product candidates.
Janssen License and Collaboration Agreement
OnJuly 27, 2021 , we entered into an amended and restated License and Collaboration Agreement ("Restated Agreement") with Janssen. The Restated Agreement amends and restates the License and Collaboration Agreement, datedMay 26, 2017 , by and between us and Janssen (as amended by the First Amendment thereto, effectiveMay 7, 2019 , the "Original Agreement"). Janssen is a related party to us asJohnson & Johnson Innovation - JJDC, Inc. , a significant stockholder of ours, and Janssen are both subsidiaries of Johnson & Johnson. The Original Agreement became effective onJuly 13, 2017 . Upon the effectiveness of the Original Agreement, we received a non-refundable, upfront cash payment of$50.0 million from Janssen. Upon the effectiveness of the First Amendment, we received a$25.0 million payment from Janssen in 2019. We also received a$5.0 million payment triggered by the successful nomination of a second-generation IL-23R antagonist development compound during the first quarter of 2020. InOctober 2021 , we became eligible to receive a$7.5 million milestone payment from Janssen triggered by completion of the data collection for PN-235 Phase 1 activities. Following a pre-established interim analysis criteria, a portfolio decision was made to discontinue further development of first generation candidate PTG-200, in favor of further development of two second-generation candidates PN-235 and PN-232 with superior product profiles.
See Note 3 to the condensed consolidated financial statements included elsewhere in this report for additional information.
Critical Accounting Polices and Estimates
Our management's discussion and analysis of our financial condition and results of operations is based on our unaudited condensed consolidated financial statements, which have been prepared in accordance withUnited States generally accepted accounting principles. The preparation of these unaudited condensed consolidated financial statements requires us to make estimates and assumptions that affect the reported amounts of assets and liabilities and the disclosure of contingent liabilities at the date of the unaudited condensed consolidated financial statements, as well as the reported revenue generated and expenses incurred during the reporting periods. Our estimates are based on our historical experience and on various other factors that we believe are reasonable under the circumstances, the results of which form the basis for making judgments about the carrying value of assets and liabilities that are not readily apparent from other sources. Actual results may differ from these estimates under different assumptions or conditions. In making estimates and judgments, management employs critical accounting policies.
Use of Estimates
Due to the ongoing COVID-19 pandemic, there has been uncertainty and disruption in the global economy and financial markets. We have taken into consideration any known COVID-19 impacts in our accounting estimates to date and are not aware of any additional specific events or circumstances that would require any additional updates to our estimates or judgments or a revision of the carrying value of our assets or liabilities as of the date of issuance of this Quarterly Report on Form 10-Q. These estimates may change as new events occur and additional information is obtained. Actual results could differ materially from these estimates under different assumptions or conditions.
Stock-Based Compensation
We recognize compensation costs related to stock options accounted for under
Accounting Standards Codification Topic 718 - "Stock Compensation" based on the
estimated fair value of the awards on the date of grant. We estimate the fair
value, and the resulting stock-based compensation expense, using the
Black-Scholes option-pricing model. The estimated fair value of the stock-based
awards is generally recognized over the requisite service period, which is
generally the vesting period of the respective awards.
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The Black-Scholes option-pricing model requires the use of subjective assumptions which determine the fair value of stock-based awards. Expected volatility generally requires significant judgement to determine. For the year endedDecember 31, 2020 , our expected volatility was estimated based upon a mix of 75% of the average volatility for comparable publicly traded biopharmaceutical companies over a period equal to the expected term of the stock option grants and 25% of the volatility of our own stock price since our initial public offering inAugust 2016 . BeginningJanuary 1, 2021 , our expected volatility is estimated based upon a mix of 50% of the average volatility for comparable publicly traded biopharmaceutical companies over a period equal to the expected term of the stock option grants and 50% of the volatility of our own stock price since our initial public offering inAugust 2016 . These comparable companies are chosen based on their similar size, stage in the life cycle, or area of specialty. We will continue to apply this process until a longer period of historical information regarding the volatility of our own stock price becomes available. InFebruary 2021 , we granted performance share units ("PSUs) to certain of our executives. Stock-based compensation expense associated with PSUs is based on the fair value of our common stock on the grant date, which equals the closing price of our common stock on the grant date. We recognize compensation expense over the vesting period of the awards that are ultimately expected to vest when the achievement of the related performance obligation becomes probable. The total fair value of the PSUs granted inFebruary 2021 was$2.6 million . There have been no other material changes in our critical accounting policies during the three and nine months endedSeptember 30, 2021 , as compared to those disclosed in "Management's Discussion and Analysis of Financial Condition and Results of Operations-Critical Accounting Policies and Estimates" in our Annual Report on Form 10-K for the year endedDecember 31, 2020 filed with theSEC onMarch 10, 2021 .
Components of Our Results of Operations
License and Collaboration Revenue
Our license and collaboration revenue is derived from payments we receive under the Janssen License and Collaboration Agreement. See Note 3 to the condensed consolidated financial statements included elsewhere in this report for additional information.
Research and Development Expenses
Research and development expenses represent costs incurred to conduct research, such as the discovery and development of our product candidates. We recognize all research and development costs as they are incurred, unless there is an alternative future use in other research and development projects or otherwise. Non-refundable advance payments for goods and services that will be used in future research and development activities are expensed when the activity has been performed or when the goods have been received rather than when payment has been made. In instances where we enter into agreements with third parties to provide research and development services to us, costs are expensed as services are performed. Amounts due under such arrangements may be either fixed fee or fee for service and may include upfront payments, monthly payments, and payments upon the completion of milestones or the receipt of deliverables.
Research and development expenses consist primarily of the following:
? expenses incurred under agreements with clinical study sites that conduct
research and development activities on our behalf;
? employee-related expenses, which include salaries, benefits and stock-based
compensation;
? laboratory vendor expenses related to the preparation and conduct of
pre-clinical, non-clinical, and clinical studies;
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? costs related to production of clinical supplies and non-clinical materials,
including fees paid to contract manufacturers;
? license fees and milestone payments under license and collaboration agreements;
and
facilities and other allocated expenses, which include expenses for rent and
? maintenance of facilities, information technology, depreciation and
amortization expense and other supplies.
We recognize the funds from grants under government programs as a reduction of research and development expenses when the related research costs are incurred. In addition, we recognize the funds related to our Australian research and development refundable cash tax incentive that are not subject to refund provisions as a reduction of research and development expenses. The research and development tax incentives are recognized when there is reasonable assurance that the incentives will be received, the relevant expenditure has been incurred and the amount of the consideration can be reliably measured. We evaluate our eligibility under the tax incentive program as of each balance sheet date and make accruals and related adjustments based on the most current and relevant data available. We may alternatively be eligible for a taxable credit in the form of a non-cash tax incentive. We allocate direct costs and indirect costs incurred to product candidates when they enter clinical development. For product candidates in clinical development, direct costs consist primarily of clinical, pre-clinical, and drug discovery costs, costs of supplying drug substance and drug product for use in clinical and pre-clinical studies, including clinical manufacturing costs, contract research organization fees, and other contracted services pertaining to specific clinical and pre-clinical studies. Indirect costs allocated to our product candidates on a program specific basis include research and development employee salaries, benefits, and stock-based compensation, and indirect overhead and other administrative support costs. Program-specific costs are unallocated when the clinical expenses are incurred for our early-stage research and drug discovery projects, our internal resources, employees and infrastructure are not tied to any one research or drug discovery project and are typically deployed across multiple projects. As such, we do not provide financial information regarding the costs incurred for early-stage pre-clinical and drug discovery programs on a program-specific basis prior to the clinical development stage.
The following table summarizes our research and development expenses incurred during the periods indicated:
Three Months Ended Nine Months Ended
September 30, September 30,
2021 2020 2021 2020
(Dollars in thousands)
Clinical and development expense - rusfertide
(PTG-300) $ 14,881 $ 8,322 $ 37,128 $ 22,881
Clinical and development expense - PN-943 10,919 3,847 26,394 17,867
Clinical and development expense - PN-235 567 - 3,799 -
Clinical and development expense - PN-232 831 - 870 -
Clinical and development expense - PTG-200 11 183 13 1,108
Clinical and development expense - PTG-100 88 114 338 307
Preclinical and drug discovery research expense 6,126 3,779 17,371 13,695
Milestone payment obligation to former
collaboration partner 4,000 - 4,000 -
Grants and tax incentives expense
reimbursement, net (467) (250) (2,280) (838)
Total research and development expenses $ 36,956 $ 15,995 $ 87,633 $ 55,020 We expect our research and development expenses will increase as we progress our product candidates into later stage clinical trials, expand the number of ongoing clinical trials, advance development activities under the Janssen License and Collaboration Agreement, advance our discovery research projects into the pre-clinical stage and continue our early-stage research. The process of conducting research, identifying potential product candidates and conducting pre-clinical and clinical trials necessary to obtain regulatory approval is costly and time intensive. We may never succeed in achieving marketing approval for our product candidates regardless of our costs and efforts. The probability of success of our product candidates may be affected by numerous factors, including pre-clinical data, clinical data, competition, manufacturing capability, our ability to receive, and the timing of, regulatory approvals, market 35 Table of Contents conditions, and our ability to successfully commercialize our products if they are approved for marketing. As a result, we are unable to determine the duration and completion costs of our research and development projects or when and to what extent we will generate revenue from the commercialization and sale of any of our product candidates. Our research and development programs are subject to change from time to time as we evaluate our priorities and available resources.
General and Administrative Expenses
General and administrative expenses consist of personnel costs, allocated facilities costs and other expenses for outside professional services, including legal, human resources, audit and accounting services, and pre-commercial selling and marketing costs. Personnel costs consist of salaries, benefits and stock-based compensation. Allocated expenses consist of expenses for rent and maintenance of facilities, information technology, depreciation and amortization expense and other supplies. We expect to continue to incur expenses to support our continued operations, including expenses related to existing and future compliance with rules and regulations of theSEC and those of the national securities exchange on which our securities are traded, insurance expenses, investor relations, professional services and general overhead and administrative costs.
Interest Income
Interest income consists of interest earned on our cash, cash equivalents and marketable securities, which is comprised of contractual interest, premium amortization and discount accretion.
Interest Expense
Interest expense consists of interest recognized on borrowings under our term loan facility, which is comprised of contractual interest, amortization of origination fees and other issuance costs, and accretion of final payment fees.
Loss on Early Repayment of Debt
Loss on early repayment of debt consists of prepayment and final payment fees paid upon the early repayment of our long-term debt.
Other Expense, Net
Other expense, net consists primarily of amounts related to foreign exchange gains and losses and related items.
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Results of Operations
Comparison of the Three Months Ended
Three Months Ended
September 30, Dollar %
2021 2020 Change Change
(Dollars in thousands)
License and collaboration revenue - related party $ 10,286 $ 13,114 $ (2,828) (22)
Operating expenses:
Research and development (1) 36,956 15,995 20,961 131
General and administrative (2) 7,256 4,891 2,365 48
Total operating expenses 44,212 20,886 23,326 112
Loss from operations (33,926) (7,772) (26,154) 337
Interest income 122 87 35 40
Interest expense - (19) 19 (100)
Other expense, net - (59) 59 (100)
Loss before income tax expense (33,804) (7,763) (26,041) 335
Income tax expense - - - -
Net loss $ (33,804) $ (7,763) $ (26,041) 335
(1) Includes
expense for the three months ended
(2) Includes
expense for the three months ended
License and Collaboration Revenue
License and collaboration revenue decreased$2.8 million , or 22%, from$13.1 million for the three months endedSeptember 30, 2020 to$10.3 million for the three months endedSeptember 30, 2021 . We recognized$8.0 million as a cumulative catch-up amount during the three months endedSeptember 30, 2021 , following the amendment of our collaboration agreement for the development of IL23R assets with Janssen. This cumulative catch-up was primarily the result of an acceleration of our cumulative performance completed under our obligation, following the amendment to the collaboration which reduced the remaining services that we are responsible to provide We are nearing completion of our remaining services to be provided to Janssen under the collaboration, in particular, both the Phase 1 trials in PN-235 & PN-232, which are expected to be completed in the fourth quarter of 2021 and second quarter 2022, respectively. Revenue for the prior year's third quarter of 2020 also included an estimate update for services completed versus remaining services to be performed under the Janssen collaboration agreement which accelerated revenue recognition. We have determined that the transaction price of the initial performance obligation under the Restated Janssen License and Collaboration Agreement was$105.7 million as ofSeptember 30, 2021 , an increase of$9.9 million from the transaction price of$95.8 million as ofJune 30, 2021 under the Original Agreement. In order to determine the transaction price, we evaluated all payments expected to be received during the duration of the contract, net of development costs reimbursement expected to be payable to Janssen. We determined that the transaction price includes$80.0 million of nonrefundable payments received to date,$17.9 million of reimbursement from Janssen for services performed for IL-23R antagonist compound research costs and other services, and estimated variable consideration consisting of a$7.5 million milestone payment subject to the completion of the clinical data collection Phase 1 activities for PN-235 and$8.4 million of development cost reimbursement receivable from Janssen, partially offset by$8.1 million of net cost reimbursement due to Janssen for services performed. The increase in transaction price fromJune 30, 2021 toSeptember 30, 2021 was primarily due to changes related to the Second Amendment to the Janssen License and Collaboration Agreement. We re-evaluate the transaction price each reporting period and as uncertain events are resolved or other changes in circumstances occur. 37
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Research and Development Expenses
Three Months Ended
September 30, Dollar %
2021 2020 Change Change
(Dollars in thousands)
Clinical and development expense - rusfertide (PTG-300) $ 14,881 $ 8,322 $ 6,559 79
Clinical and development expense - PN-943 10,919 3,847 7,072 184
Clinical and development expense - PN-235 567 - 567 *
Clinical and development expense - PN-232 831 - 831 *
Clinical and development expense - PTG-200 11 183 (172) (94)
Clinical and development expense - PTG-100 88 114 (26) (23)
Preclinical and drug discovery research expense 6,126 3,779 2,347 62
Milestone payment obligation to former collaboration partner 4,000 - 4,000 *
Grants and tax incentives expense reimbursement, net (467) (250) (217) 87
Total research and development expenses $ 36,956 $ 15,995 $ 20,961 131 *Percentage not meaningful Research and development expenses increased$21.0 million , or 131%, from$16.0 million for the three months endedSeptember 30, 2020 to$37.0 million for the three months endedSeptember 30, 2021 . The increase was primarily due to an increase of$7.1 million in PN-943 clinical trial and development costs following the initiation of the Phase 2 trial in UC in 2020; an increase of$6.6 million in rusfertide clinical trial and development costs, including the ongoing Phase 2 trials in PV, which began inDecember 2019 and the first quarter of 2021, respectively, and HH, which began in early 2020, and clinical and contract manufacturing activities in preparation for a planned global Phase 3 clinical trial of rusfertide in PV;$4.0 million of expenses related to milestone payments and obligations under the Zealand Agreement for rusfertide pursuant to the resolution of related arbitration; an increase of$2.3 million in preclinical and drug discovery research expenses;$0.8 million of Phase 1 clinical trial and development costs for PN-232; and$0.6 million of Phase 1 clinical trial and development costs for PN-235. We had 92 and 57 full-time equivalent research and development employees as ofSeptember 30, 2021 and 2020, respectively. Research and development expenses for the three months endedSeptember 30, 2021 included increases$1.6 million in stock-based compensation expense and$1.6 million of other personnel related expenses compared to the three months endedSeptember 30, 2020 .
General and Administrative Expenses
General and administrative expenses increased$2.4 million , or 48%, from$4.9 million for the three months endedSeptember 30, 2020 to$7.3 million for the three months endedSeptember 30, 2021 primarily due to an increase of$1.6 million in personnel expenses, a$1.0 million increase in consulting fees to support the growth of our business, and a$0.2 million increase in insurance costs, partially offset by a$0.4 million decrease in legal fees. The increase in personnel expenses was primarily due to increases of$1.3 million in stock-based compensation expense and$0.2 million in wages and benefits.
We had 24 and 19 full-time equivalent general and administrative employees as of
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Comparison of the Nine Months Ended
Nine Months Ended
September 30, Dollar %
2021 2020 Change Change
(Dollars in thousands)
License and collaboration revenue - related party $ 18,740 $ 22,978 $ (4,238) (18)
Operating expenses:
Research and development (1) 87,633 55,020 32,613 59
General and administrative (2) 19,936 13,644 6,292 46
Total operating expenses 107,569 68,664 38,905 57
Loss from operations (88,829) (45,686) (43,143) 94
Interest income 321 820 (499) (61)
Interest expense - (471) 471 (100)
Loss on early repayment of debt - (585) 585 (100)
Other expense, net (136) (37) (99) 268
Loss before income tax expense (88,644) (45,959) (42,685) 93
Income tax expense - (1,305) 1,305 (100)
Net loss $ (88,644) $ (47,264) $ (41,380) 88
(1) Includes
expense for the nine months ended
(2) Includes
expense for the nine months ended
License and Collaboration Revenue
License and collaboration revenue decreased$4.2 million , or 18%, from$23.0 million for the nine months endedSeptember 30, 2020 to$18.7 million for the nine months endedSeptember 30, 2021 , which was primarily related to a decrease in services provided under the Janssen License and Collaboration Agreement recognized based on proportional performance partially offset by an$8.0 million cumulative catch-up amount recognized during the nine months endedSeptember 30, 2021 , following the amendment of our collaboration agreement for the development of IL23R assets with Janssen. This cumulative catch-up was primarily the result of an acceleration of our cumulative performance completed under our obligation, following the amendment to the collaboration which reduced the remaining services that we are responsible to provide Revenue for the nine months endedSeptember 30, 2020 included an update in the amounts forecast for future services remaining to be performed under the Janssen License and Collaboration Agreement, which correspondingly increased our overall cumulative percentage of completion of our performance obligation during the third quarter of 2020, coupled with continued performance and delivery of services under the ongoing Janssen License and Collaboration Agreement. We are nearing completion of our remaining services to be provided to Janssen under the collaboration, in particular, both the Phase 1 trials in PN-235 & PN-232, which are expected to be completed in the fourth quarter of 2021 and second quarter 2022, respectively. We have determined that the transaction price of the initial performance obligation under the Restated Janssen License and Collaboration Agreement was$105.7 million as ofSeptember 30, 2021 , an increase of$7.1 million from the transaction price of$98.6 million as ofDecember 31, 2020 under the Original Agreement. In order to determine the transaction price, we evaluated all payments expected to be received during the duration of the contract, net of development costs reimbursement expected to be payable to Janssen. We determined that the transaction price includes$80.0 million of nonrefundable payments received to date,$17.9 million of reimbursement from Janssen for services performed for IL-23R antagonist compound research costs and other services, and estimated variable consideration consisting of a$7.5 million milestone payment subject to the completion of the clinical data collection Phase 1 activities for PN-235 and$8.4 million of development cost reimbursement receivable from Janssen, partially offset by$8.1 million of net cost reimbursement due to Janssen for services performed. The increase in transaction price fromDecember 30, 2020 toSeptember 30, 2021 was due primarily to changes related to the
Second Amendment to the
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Janssen License and Collaboration Agreement. We re-evaluate the transaction price each reporting period and as uncertain events are resolved or other changes in circumstances occur.
Research and Development Expenses
Nine Months Ended
September 30, Dollar %
2021 2020 Change Change
(Dollars in thousands)
Clinical and development expense - rusfertide (PTG-300) $ 37,128 $ 22,881 $ 14,247 62
Clinical and development expense - PN-943 26,394 17,867 8,527 48
Clinical and development expense - PN-235 3,799 - 3,799 *
Clinical and development expense - PN-232 870 - 870 *
Clinical and development expense - PTG-200 13 1,108 (1,095) (99)
Clinical and development expense - PTG-100 338 307 31 10
Preclinical and discovery research expense 17,371 13,695 3,676 27
Milestone payment obligation to former collaboration partner 4,000 - 4,000 *
Grants and tax incentives expense reimbursement, net (2,280) (838) (1,442) 172
Total research and development expenses $ 87,633 $ 55,020 $ 32,613 59 *Percentage not meaningful Research and development expenses increased$32.6 million , or 59%, from$55.0 million for the nine months endedSeptember 30, 2020 to$87.6 million for the nine months endedSeptember 30, 2021 . The increase was primarily due to an increase of$14.2 million in rusfertide clinical trial and development costs as the clinical trials have enrolled and progressed, including the ongoing Phase 2 trials in PV, which began inDecember 2019 and the first quarter of 2021, respectively, and HH, which began in early 2020, and clinical and contract manufacturing activities incurred in 2021 in preparation for the ongoing Phase 2 trials and a planned global Phase 3 clinical trial of rusfertide in PV;$8.5 million in PN-943 clinical trial and development costs following the initiation of the Phase 2 trial in UC during the second quarter of 2020 and related contract manufacturing activities incurred in 2021;$4.0 million of expenses related to milestone payments and obligations under the Zealand Agreement for rusfertide pursuant to the resolution of related arbitration;$3.8 million of Phase 1 clinical trial and development costs for PN-235 beginning inDecember 2020 , an increase of$3.7 million in preclinical and drug discovery research expenses, and$0.9 million of Phase 1 clinical trial and development costs for PN-232 initiated inMay 2021 . These increases were partially offset by a$1.4 million increase in grant and accrued refundable cash tax incentives and a decrease of$1.1 million in PTG-200 clinical trial and development expenses under the Janssen License and Collaboration Agreement due to our delivery of substantially all agreed-upon services for the PTG-200 Phase 2 clinical trial. We had 92 and 57 full-time equivalent research and development employees as ofSeptember 30, 2021 and 2020, respectively. Research and development expenses for the nine months endedSeptember 30, 2021 included increases of$3.1 million in stock-based compensation expense and$3.1 million of other personnel-related expenses compared to the nine months endedSeptember 30, 2020 .
General and Administrative Expenses
General and administrative expenses increased$6.3 million , or 46%, from$13.6 million for the nine months endedSeptember 30, 2020 to$19.9 million for the nine months endedSeptember 30, 2021 primarily due to an increase of$3.5 million in personnel expenses,$1.4 million in consulting expenses,$0.7 million in market research expenses, and$0.5 million in recruiting expenses to support the growth of our operations, and a$0.2 million increase in legal fees. The increase in personnel expenses was primarily due to increases of$2.3 million in stock-based compensation expense and$1.2 million in wages and salaries.
We had 24 and 19 full-time equivalent general and administrative employees as of
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Interest Income
Interest income decreased $0.5 million , or 61%, from $0.8 million for the nine
months ended September 30, 2020 to $0.3 million for the nine months ended
September 30, 2021 . This decrease was due primarily to the recent record low
interest rate environment and a change in the mix of marketable securities
compared to the prior year period, despite higher interest-earning asset
balances.
Interest Expense
Interest expense of $0.5 million for the nine months ended September 30, 2020
reflects interest expense on our long-term debt under our term credit facility.
We prepaid our outstanding long-term debt under our term credit facility during
the second quarter of 2020. We executed a payoff letter to release all
obligations under the term credit facility during the third quarter of 2021.
Loss on Early Repayment of Debt
Loss on early repayment of debt of
Other Expense, Net
Other expense, net was$0.1 million for the nine months endedSeptember 30, 2021 compared to zero for the nine months endedSeptember 30, 2020 . The change was due primarily to an increase in foreign exchange losses.
Income Tax Expense
Income tax expense decreased$1.3 million , or 100%, from$1.3 million for the nine months endedSeptember 30, 2020 to zero for the nine months endedSeptember 30, 2021 . Our effective income tax rate was 0% for the nine months endedSeptember 30, 2021 as compared to 2.8% for the nine months endedSeptember 30, 2020 . During the second quarter of 2020, ourAustralia subsidiary sold beneficial rights to discovery intellectual property to ourU.S. entity, and theU.S. entity reimbursed theAustralia subsidiary for certain direct development costs. Upon completion of the sale, we analyzed tax planning strategies and future income and concluded that a valuation allowance is necessary for ourAustralia subsidiary. Income tax expense for the nine months endedSeptember 30, 2020 reflects this sale of intellectual property rights, cost reimbursements and related adjustments to the deferred tax asset, establishing a valuation allowance and certain uncertain tax position liabilities. We maintained a full valuation allowance on our tax position as ofSeptember 30, 2021 . 41
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Liquidity and Capital Resources
Sources of Liquidity
Historically, we have funded our operations primarily from net proceeds from the sale of shares of our common stock and payments under collaboration agreements.
InDecember 2020 , we filed an automatic registration statement on Form S-3ASR and an accompanying prospectus (Registration Statement No. 333-251254), pursuant to which we completed an underwritten public offering of 4,761,904 shares of common stock at a public offering price of$21.00 per share and issued an additional 714,285 shares of our common stock at a price of$21.00 per share following the underwriters' exercise of their option to purchase additional shares. Net proceeds, after deducting underwriting commissions and offering costs paid by us, were$107.6 million . InJune 2021 , pursuant to Registration Statement No. 333-251254, we completed an underwritten public offering of 3,046,358 shares of common stock at a public offering price of$37.75 per share and issued an additional 456,953 shares of common stock at a public offering price of$37.75 per share following the underwriters' exercise of their option to purchase additional shares. Net proceeds, after deducting underwriting commission and offering costs paid by us, were$123.8 million . This Form S-3ASR expires inDecember 2023 . InOctober 2019 , we filed a registration statement on Form S-3 (File no. 333-234414) that was declared effective as ofNovember 22, 2019 and permits the offering, issuance, and sale by us of up to a maximum aggregate offering price of$250.0 million of our common stock, preferred stock, debt securities and warrants (the "2019 Form S-3"). Up to a maximum of$75.0 million of the maximum aggregate offering price of$250.0 million may be issued and sold pursuant to an ATM financing facility under a sales agreement we entered into onNovember 27, 2019 (the "2019 Sales Agreement"). InMay 2020 , we completed an underwritten public offering of 7,000,000 shares of common stock at a public offering price of$14.00 per share, and we issued an additional 1,050,000 shares of our common stock at a price of$14.00 per share following the underwriters' exercise of their option to purchase additional shares. Net proceeds, after deducting underwriting commissions and offering costs paid by us, were$105.3 million . During the year endedDecember 31, 2020 , we issued 2,483,719 shares under our ATM facility for net proceeds of$41.9 million . No shares were issued under the ATM facility during the three and nine months endedSeptember 30, 2021 . As ofSeptember 30, 2021 , a total of$94.2 million of common stock remained available for sale under the 2019 Form S-3,$31.9 million of which remained available for sale under the ATM financing facility. This Form S-3 expires inOctober 2022 . We have received$80.0 million in non-refundable payments from Janssen since the inception of the Janssen License and Collaboration Agreement in 2017 throughSeptember 30, 2021 , as follows:
? Upon effectiveness of the agreement, we received a non-refundable, upfront cash
payment of
Upon effectiveness of the First Amendment, we became eligible to receive a
?
quarter of 2019; and
In
? triggered by the successful nomination of a second-generation development
compound, which was received during the first quarter of 2020.
InOctober 2021 , we became eligible to receive a$7.5 million milestone payment from Janssen triggered by completion of the data collection for PN-235 Phase 1 activities. We also receive payments for services provided under the collaboration agreement and in-kind reimburses Janssen for certain costs they have incurred based on the cost sharing terms of the agreement. 42
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Pursuant to the amended and restated License and Collaboration Agreement with Janssen executedJuly 27, 2021 (the "Restated Agreement"), we will be eligible to receive clinical development, regulatory and sales milestones, if and as achieved. Upcoming potential development milestones for second-generation products include:
?
trial for any second-generation product for any indication; and
? trial for any second-generation product for a second indication (i.e. an
indication different than the indication which triggered the
milestone described directly above).
Capital Requirements As ofSeptember 30, 2021 , we had$352.5 million of cash, cash equivalents and marketable securities and an accumulated deficit of$372.5 million . Our capital expenditures for nine months endedSeptember 30, 2021 were$0.9 million . Our capital expenditures for the years endedDecember 31, 2020 and 2019 were$0.5 million and$1.0 million , respectively. Our primary uses of cash are to fund operating expenses, primarily our research and development expenditures, general and administrative costs and pre-commercialization costs. Cash used to fund operating expenses is impacted by the timing of when we pay these expenses. We believe, based on our current operating plan and expected expenditures, that our existing cash, cash equivalents and marketable securities will be sufficient to meet our anticipated operating and capital expenditure requirements for at least the next 12 months from the date of this filing. We have based this estimate on assumptions that may prove to be wrong. We could utilize our available capital resources sooner than we currently expect if our planned pre-clinical and clinical trials are successful or expanded, our product candidates enter new and more advanced stages of clinical development or our newer product clinical trials or advance beyond the discovery stage. We expect to require additional financing to advance our product candidates through clinical development and toward potential regulatory approval and to develop, acquire or in-license other potential product candidates. Such additional funding may come from raising additional capital, seeking access to additional debt, and additional collaborative or other arrangements with corporate sources, but such funding may not be available at terms acceptable to us, if at all. We anticipate that we will need to raise substantial additional funding, the requirements of which will depend on many factors, including:
the progress, timing, scope, results and costs of advancing our clinical trials
? and pre-clinical studies for our product candidates, including the ability to
enroll patients in a timely manner for our clinical trials;
? the costs of and ability to obtain clinical and commercial supplies and any
other product candidates we may identify and develop;
? our ability to successfully commercialize the product candidates we may
identify and develop;
the selling and marketing costs associated with our current product candidates
? and any other product candidates we may identify and develop, including the
cost and timing of expanding our sales and marketing capabilities;
the achievement of development, regulatory and sales milestones resulting in
? payments to us from Janssen under the Janssen License and Collaboration
Agreement or other such arrangements that we may enter into, and the timing of
receipt of such payments, if any;
the timing, receipt and amount of royalties under the Janssen License and
? Collaboration Agreement on worldwide net sales of IL-23 receptor antagonist
compounds, upon regulatory approval or clearance, if any;
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the amount and timing of sales and other revenues from our current product
? candidates and any other product candidates we may identify and develop,
including the sales price and the availability of adequate third-party
reimbursement;
? the timing, payment and amount of potential milestones and royalties due under
our collaboration agreements;
? the cash requirements of any future acquisitions or discovery of product
candidates;
? the time and cost necessary to respond to technological and market
developments;
? the extent to which we may acquire or in-license other product candidates and
technologies;
? costs necessary to attract, hire and retain qualified personnel;
? the costs of maintaining, expanding and protecting our intellectual property
portfolio; and
? the costs of ongoing general and administrative activities to support the
growth or our business.
Adequate additional funding may not be available to us on acceptable terms, or
at all. Any failure to raise capital as and when needed could have a negative
impact on our financial condition and on our ability to pursue our business
plans and strategies. Further, our operating plans may change, and we may need
additional funds to meet operational needs and capital requirements for clinical
trials, other research and development activities and pre-commercialization
costs. If we do raise additional capital through public or private equity
offerings or convertible debt securities, the ownership interest of our existing
stockholders will be diluted, and the terms of these securities may include
liquidation or other preferences that adversely affect our stockholders' rights.
If we raise additional capital through debt financing, we may be subject to
covenants limiting or restricting our ability to take specific actions, such as
incurring additional debt, making capital expenditures or declaring dividends.
Because of the numerous risks and uncertainties associated with the development
and commercialization of our product candidates, we are unable to fully estimate
the amounts of increased capital outlays and operating expenditures associated
with our current and anticipated product development programs.
The following table summarizes our cash flows for the periods indicated (in
thousands):
Nine Months Ended
September 30,
2021 2020
Cash used in operating activities
Cash Flows from Operating Activities
Cash used in operating activities for the nine months endedSeptember 30, 2021 was$80.9 million , consisting of our net loss of$88.6 million and a net change of$6.9 million in net operating assets and liabilities, partially offset by$14.6 million in non-cash charges. Non-cash charges were primarily comprised of$11.4 million of stock-based compensation,$1.4 million of operating lease right-of-use asset amortization,$1.3 million of net amortization of discount on marketable securities, and$0.6 million of depreciation. The change in net operating assets and liabilities was primarily due to a decrease of$12.2 million in deferred revenue related to the Janssen License and Collaboration Agreement, an increase of$0.2 million in receivable from collaboration partner, an increase of$0.9 million in research and development tax incentive receivable, an increase in prepaid expenses and other assets of$2.6 million , a decrease of$1.5 million in operating lease liability, a decrease of$1.6 million in payable to collaboration partner, a decrease of$2.3 million in accounts payable and partially offset by an increase of$14.4 million in accrued expenses and other payables. 44 Table of Contents Cash used in operating activities for the nine months endedSeptember 30, 2020 was$53.6 million , consisting of our net loss of$47.3 million and a net change of$16.0 million in net operating assets, partially offset by$9.7 million in non-cash charges. Non-cash charges were primarily comprised of$5.9 million of stock-based compensation, a$1.4 million change in net deferred tax asset,$1.3 million of operating lease right-of-use asset amortization, a$0.6 million loss on early prepayment of long-term debt and$0.6 million of depreciation and amortization, partially offset by$0.2 million of net accretion of discount on marketable securities. The change in net operating assets and liabilities was primarily due to a decrease of$20.7 million in deferred revenue related to the Janssen License and Collaboration Agreement, a$1.6 million decrease in prepaid expenses and other assets, a$1.5 million decrease in operating lease liability, and a$0.5 million increase inAustralia research and development incentive receivable, partially offset by a decrease of$4.0 million in receivable from collaboration partner, an increase of$3.1 million in accrued expenses and other payables, an increase of$0.8 million in payable to collaboration partner, and an increase of$0.2 million in other liability.
Cash Flows from Investing Activities
Cash used in investing activities for the nine months endedSeptember 30, 2021 was$43.7 million , consisting of proceeds from maturities of marketable securities of$213.1 million , offset by purchases of marketable securities of$255.9 million and purchases of property and equipment of$0.9 million . Cash used in investing activities for the nine months endedSeptember 30, 2020 was$16.6 million , consisting of proceeds from maturities of marketable securities of$131.4 million , partially offset by purchases of marketable securities of$147.6 million and purchases of property and equipment of$0.3 million .
Cash Flows from Financing Activities
Cash provided by financing activities for the nine months endedSeptember 30, 2021 was$127.8 million , consisting of$124.0 million of cash proceeds from our public offering of common stock and$3.9 million from the issuance of common stock upon exercise of stock options and purchases of common stock under our employee stock purchase plan, partially offset by$0.2 million of tax withholding payments related to net settlement of restricted stock units. Cash provided by financing activities for the nine months endedSeptember 30, 2020 was$120.6 million , consisting primarily of cash proceeds from our public offering of common stock of$105.5 million , cash proceeds from ATM sales of$23.2 million , and proceeds from the issuance of common stock upon exercise of stock options and purchases of common stock under our employee stock purchase plan of$2.5 million , partially offset by early repayment of long-term debt of$10.5 million .
Contractual Obligations and Other Commitments
Our contractual obligations include minimum lease payments under our operating lease obligations. OnJuly 2, 2021 , we entered into an amendment to our facility lease agreement dated as ofMarch 2017 , as amended, to lease approximately 15,000 square feet of additional office space inNewark, California . See Note 10 to the condensed consolidated financial statements elsewhere in this Quarterly Report on Form 10-Q for additional information. Under the Janssen License and Collaboration Agreement, we share with Janssen certain development, regulatory and compound supply costs. The actual amounts that we pay Janssen or that Janssen pays us will depend on numerous factors, some of which are outside of our control and some of which are contingent upon the success of certain development and regulatory activities. OnJuly 27, 2021 , we entered into an amended and restated License and Collaboration Agreement ("Restated Agreement") withJanssen Biotech, Inc. , aPennsylvania corporation ("Janssen"). The Restated Agreement amends and restates the License and Collaboration Agreement, datedMay 26, 2017 , by and between the Company and Janssen (as amended by the First Amendment thereto, effectiveMay 7, 2019 , the "Original Agreement"). See Note 3 to the condensed consolidated financial statements elsewhere in the Quarterly Report on Form 10-Q for additional information. 45 Table of Contents OnJanuary 23, 2020 , we initiated arbitration proceedings with theInternational Court of Arbitration of theInternational Chamber of Commerce against Zealand Pharma related to a collaboration agreement we and Zealand entered into in 2012 and terminated in 2014. The agreement provides for certain post-termination payment obligations to Zealand with respect to compounds related to the collaboration that we elect to further develop and meet specified conditions. OnAugust 4, 2021 , we and Zealand agreed to resolve the dispute and reached an Arbitration Resolution Agreement. See Note 11 to the condensed consolidated financial statements included elsewhere in this Quarterly Report on Form 10-Q for additional information. During the three and nine months endedSeptember 30, 2021 , there were no other material changes to our contractual obligations and commitments described under Management's Discussion and Analysis of Financial Condition and Results of Operations in our Annual Report on Form 10-K for the year endedDecember 31, 2020 filed with theSEC onMarch 10, 2021 .
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