PROTALIX BIOTHERAPEUTICS, INC. CAUTIONARY STATEMENT REGARDING FORWARD-LOOKING STATEMENTS
AND RISK FACTORS SUMMARY
You should read the following discussion and analysis of our financial condition
and results of operations together with our financial statements and the
consolidated financial statements and the related notes included elsewhere in
this Form 10-Q and in our Annual Report on Form 10-K for the year ended
Examples of the risks and uncertainties include, but are not limited to, the following:
?risks related to the timing and progress of the preparation of an updated BLA addressing the CRL;
?risks related to the timing, progress and likelihood of final approval by the FDA of a resubmitted BLA for PRX-102 and, if approved, whether the use of PRX-102 will be commercially successful; ?the risk that the FDA, theEuropean Medicines Agency , or EMA, or other foreign regulatory authorities may not accept or approve a marketing application we file for any of our product candidates; ?failure or delay in the commencement or completion of our preclinical studies and clinical trials, which may be caused by several factors, including: slower than expected rates of patient recruitment; unforeseen safety issues; determination of dosing issues; lack of effectiveness during clinical trials; inability or unwillingness of medical investigators and institutional review boards to follow our clinical protocols; inability to monitor patients adequately during or after treatment; and or lack of sufficient funding to finance our clinical trials; ?the risk that the results of our clinical trials will not support the applicable claims of safety or efficacy and that our product candidates will not have the desired effects or will have undesirable side effects or other unexpected characteristics; ?risks relating to our ability to make required payments under our outstanding convertible notes or any other indebtedness as they come due and our ability to obtain additional financing and raise capital as necessary should the regulatory approval process become more extended; ?risks associated with the COVID-19 outbreak, which may adversely impact our business, preclinical studies and clinical trials; ?risks relating to our evaluation and pursuit of strategic alternatives;
?risks relating to our ability to manage our relationship with our collaborators, distributors or partners;
?risks relating to changes to interim, topline or preliminary data from clinical trials that we announce or publish;
?risks related to any transactions we may effect in the public or private equity markets to raise capital to finance future research and development activities, general and administrative expenses and working capital;
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?risk of significant lawsuits, including stockholder litigation, which is common in the life sciences sector;
?our dependence on performance by third-party providers of services and supplies;
?the impact of development of competing therapies and/or technologies by other companies;
?risks related to our supply of drug product to Pfizer;
?risks related to our expectations with respect to the potential commercial value of our product and product candidates;
?risks relating to the compliance by Fiocruz, an arm of the Brazilian MoH, with its purchase obligations under our supply and technology transfer agreement, which may have a material adverse effect on us and may also result in the termination of such agreement;
?potential product liability risks, and risks of securing adequate levels of related insurance coverage;
?the possibility of infringing a third-party's patents or other intellectual property rights and the uncertainty of obtaining patents covering our products and processes and successfully enforcing our intellectual property rights against third-parties;
?risks relating to changes in healthcare laws, rules and regulations in
?the possible disruption of our operations due to terrorist activities and armed conflict, including as a result of the disruption of the operations of regulatory authorities, our subsidiaries, our manufacturing facilities and our customers, suppliers, distributors, collaborative partners, licensees and clinical trial sites.
Recent Company Developments
?OnMay 13, 2021 , we signed a binding term sheet with Chiesi pursuant to which we amended the Chiesi Agreements in order to provide us with near-term capital. Chiesi agreed to make a$10.0 million milestone payment to us before the end of the second quarter in exchange for a$25.0 million reduction in a longer term regulatory milestone payment in the Chiesi EX-US Agreement. All other regulatory and commercial milestone payments remain unchanged. We also agreed to negotiate certain manufacturing related matters. ?OnApril 28, 2021 , we, together Chiesi, announced the receipt from the FDA of a CRL in response to the PRX-102 BLA. ?OnFebruary 23, 2021 , we, together with Chiesi, announced positive topline results from our phase III BRIGHT clinical trial of PRX-102 for the treatment of Fabry disease, or the BRIGHT study, designed to evaluate the safety, efficacy and pharmacokinetics of PRX-102 treatment, 2 mg/kg every four weeks, in up to 30 patients with Fabry disease previously treated with a commercially available ERT (agalsidase alfa - Replagal® or agalsidase beta - Fabrazyme®). ?OnFebruary 18, 2021 , we announced the closing of a public offering of our common stock raising gross proceeds of approximately$40.2 million at a price equal to$4.60 per share, before deducting the underwriting discount and estimated expenses of the offering. ?OnFebruary 11, 2021 , we announced an exclusive worldwide license agreement with SarcoMed for PRX-110 for use in the treatment of any human respiratory disease or condition including, but not limited to, sarcoidosis, pulmonary fibrosis, and other related diseases via inhaled delivery.
We continue to actively advance all our clinical programs. We are in close
contact with our principal investigators and clinical sites and our clinical
research organizations, which are primarily located in
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In response to the local spread of COVID-19 at the end of
In
We will continue to evaluate the impact of the COVID-19 pandemic on our business as we learn more and the impact of COVID-19 on our industry becomes more clear. We intend to continuously assess the impact of COVID-19 on our trials, expected timelines and costs.
ProCellEx: Our Proprietary Protein Expression System
?ProCellEx is our proprietary platform used to produce and manufacture recombinant proteins through plant cell-based expressions in suspension. ProCellEx consists of a comprehensive set of proprietary technologies and capabilities, including the use of advanced genetic engineering and plant cell culture technology, enabling us to produce complex, proprietary, and biologically equivalent proteins for a variety of human diseases. Our protein expression system facilitates the creation and selection of high-expressing, genetically-stable cell lines capable of expressing recombinant proteins. ?Our ProCellEx technology allows for many unique advantages, including: biologic optimization; an ability to handle complex protein expressions; flexible manufacturing with improvements through efficiencies, enhancements and/or rapid horizontal scale-ups; a simplified production process; elimination of the risk of viral contaminations from mammalian components; and intellectual property advantages. ?We are the first and only company to gain FDA approval of a protein produced through plant cell-based expression. Our ProCellEx platform uses flexible polyethylene disposable bioreactors and is optimized for plant cell cultures. As opposed to the large stainless-steel bioreactors commonly used for recombinant protein production, our ProCellEx bioreactors are easy to use and maintain and allow for the major advantage of rapid horizontal scale-up.
Plant Cell Production Advantages
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[[Image Removed: Graphic]] Product Pipeline [[Image Removed: Graphic]]
Pegunigalsidase Alfa (PRX-102) for the Treatment of Fabry Disease
PRX-102 is our lead product candidate and we expect it to be the primary subject
of our development efforts in the short-term. It is our proprietary,
investigational, plant cell culture expressed enzyme, and a chemically modified
stabilized version of, the recombinant ?-Galactosidase-A protein, a lysosomal
enzyme, under development for the treatment of Fabry disease. Fabry disease is a
serious life-threatening rare genetic disorder. Fabry patients lack
?-galactosidase-A resulting in the progressive accumulation of abnormal deposits
of a fatty substance called globotriaosylceramide, or Gb3, in blood vessel walls
throughout their body. The abnormal storage of Gb3 increases with time and, as a
result, Gb3 accumulates, primarily in the blood and in the blood vessel walls.
The accumulation leads to a narrowing of the blood vessels, which in turn leads
to decreased blood flow and tissue nourishment. The ultimate consequences of Gb3
deposition range from episodes of pain and impaired peripheral sensation to
end-organ failure, particularly of the kidneys, but also of the heart and the
cerebrovascular system. Fabry disease occurs in one person per 40,000 to 60,000
males. The global market for Fabry disease is forecasted to be approximately
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A BLA for PRX-102 for the treatment of adult patients with Fabry disease was
submitted to the FDA on
The BLA submission includes a comprehensive set of preclinical, clinical and manufacturing data compiled from our completed phase I/II clinical trial of PRX-102, including the related extension study succeeding our phase I/II clinical trial, interim clinical data from our phase III BRIDGE switch-over study and safety data from our on-going clinical studies of PRX-102 in patients receiving 1 mg/kg every other week.
The CRL did not report any concerns relating to the potential safety or efficacy of PRX-102 in the submitted data package.
In the CRL, the FDA noted that an inspection of
In addition to the foregoing, in the CRL, the FDA noted that Fabrazyme, a
therapy used to treat Fabry patients, was recently converted to full approval
which must be addressed in the context of any potential resubmission seeking
accelerated approval of PRX-102.
In
In
Key Trials and Design
Our phase III clinical program of PRX-102 for the treatment of Fabry disease
includes three individual studies; the BALANCE, BRIDGE and BRIGHT studies.
Enrollment has been completed in all three studies. In 2015, we completed a
phase I/II clinical trial of PRX-102. Patients that completed the phase I/II
clinical trial were offered the opportunity to continue PRX-102 treatment as
part of a long-term extension study. In the phase III clinical program, we are
studying two alternative doses and regimens for PRX-102; 1 mg/kg every two
weeks, with the potential for improved efficacy and safety offering a potential
alternative to existing enzyme replacement therapies, and 2 mg/kg every four
weeks, which has the potential to lower treatment burden versus existing
treatments and potentially provide a better quality of life for a subset of
Fabry patients. Final results from the BRIDGE study were released in
In
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in an official "Agreement Letter" which outlines an agreed-upon approach to evaluate the safety and efficacy of PRX-102 in pediatric Fabry patients in a clinical trial to be performed by Chiesi with our collaborative efforts.
Phase III BALANCE Study
The BALANCE study is a 24-month, randomized, double blind, active control study of PRX-102 in Fabry patients with impaired renal function. We have completed enrollment of 78 patients in the trial, which is designed to evaluate the safety and efficacy of PRX-102 compared to agalsidase beta (Fabrazyme) on renal function in Fabry patients with progressing kidney disease previously treated with Fabrazyme infused once every two weeks. Patients previously treated with Fabrazyme for approximately one year and on a stable dose for at least six months were screened and then randomized on a 2:1 ratio to 1 mg/kg of PRX-102 or 1 mg/kg of Fabrazyme. Randomization is being stratified by urinary protein to creatinine ratio (UPCR) of < or ? 1 g/g by spot urine sample. The study was designed such that no more than 50% of the patients enrolled in the study would be female. Approximately 40% of the enrolled patients were female.
The primary endpoint for the BALANCE study is the comparison in the annualized rate of decline of eGFR slope between Fabrazyme and PRX-102. eGFR is considered a reliable and accepted test to measure the level of kidney function and stage of kidney disease. Additional parameters being evaluated include: cardiac assessment, Lyso-Gb3 (a biomarker for monitoring Fabry patients during therapy), pain, quality of life, immunogenicity, Fabry clinical events and pharmacokinetic and other parameters. The study also evaluates the safety and tolerability of PRX-102.
We intend to conduct an interim analysis when the last patient reaches 12 months of treatment to test for non-inferiority to support anticipated regulatory filings with the EMA. Patients enrolled in the BALANCE study will continue to be treated for a total of 24 months, at which point the data will be analyzed to test for superiority. If the anticipated BLA filing results in an approval from the FDA under the Accelerated Approval pathway, this analysis will also be used to support converting the accelerated approval into a full approval. We anticipate announcing interim results from our BALANCE study in the first half of 2021.
Phase III BRIDGE Study
The BRIDGE study was a 12-month open-label, single arm switch-over study
evaluating the safety and efficacy of pegunigalsidase alfa, 1 mg/kg infused
every two weeks, in up to 22 Fabry patients. The trial, which is was completed
in
Final results of the data generated in the study showed substantial improvement in renal function as measured by mean annualized estimated Glomerular Filtration Rate, or eGFR, slope in both male and female patients who were switched from agalsidase alfa to PRX-102. Twenty of 22 patients completed the 12-month treatment duration. Eighteen of the patients who completed the study opted to roll over to a long-term extension study and continue to be treated with PRX-102. In the study, the mean annualized eGFR slope of the study participants improved from -5.90 mL/min/1.73m2/year while on agalsidase alfa to -1.19 mL/min/1.73m2/year on PRX-102 in all patients. Male patients improved from -6.36 mL/min/1.73m2/year to -1.73 mL/min/1.73m2/year and female patients improved from -5.03 mL/min/1.73m2/year to -0.21 mL/min/1.73m2/year. Following the switch to PRX-102, there was a decrease in patients with progressing or fast progressing kidney disease, and most patients achieved a stable status post-switch.
PRX-102 was well-tolerated in the study, with all adverse events being transient in nature without sequelae. Of the 22 patients enrolled in the BRIDGE study, the majority of treatment emergent adverse events were mild or moderate in severity, with two patients (9.1%) withdrawing from the therapy due to hypersensitivity reaction that was resolved. The most common moderate treatment emergent adverse events were nasopharyngitis, headache and dyspnea.
An immunogenicity assessment indicated that four out of 20 patients (20%) developed persistent antidrug antibodies over the course of the study, of which two had neutralizing activity.
Baseline characteristics of the 20 patients that completed the study, ranging from ages 28 to 60 years, were as follows: mean eGFR 75.87 mL/min/1.73m2 in males, and 86.14 mL/min/1.73m2 in females and plasma lyso-Gb3 were 51.81 nM and 13.81 nM in males and females, respectively. While lyso-Gb3 levels remain slightly high, particularly within the male cohort, continuous reduction in lyso-Gb3 levels was observed of 19.55 nM (32.35%) in males and 4.57 nM (29.81%) in females.
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Data from the interim analysis of the BRIDGE study, which were first announced
in
Phase III BRIGHT Study
The phase III BRIGHT clinical trial of PRX-102 for the treatment of Fabry
disease, or the BRIGHT study, was a 12-month, open-label, switch-over study
designed to evaluate the safety, efficacy and pharmacokinetics of PRX-102 via IV
infusions of 2 mg/kg administered every 4 weeks. The trial, which was completed
in
We announced topline results in
The BRIGHT study enrolled 24 adult males and 6 adult females. The most common Fabry disease symptoms were acroparesthesia, heat intolerance, angiokeratomas and hypohydrosis. All 30 patients received at least one dose of PRX-102, and 29 patients (mean [SD] age was 40.5 [11.3] years, ranging from 19 to 58 years) completed the 12-month study. Of these 29 patients, 28 received the intended regimen of 2 mg/kg every four weeks throughout the study, while one patient was switched to PRX-102 1 mg/kg every two weeks per protocol. One patient withdrew from the study after the first infusion due to a traffic accident.
Following screening, patients were enrolled and switched from their then current ERT to IV infusions of 2 mg/kg of PRX-102 every four weeks for 52 weeks (a total of 14 infusions). First infusions of PRX-102 were administered under controlled conditions at the investigation site. Based on the protocol-specified criteria, patients were able to receive their PRX-102 infusions at a home care setup once the Investigator and Sponsor Medical Monitor agreed that it was safe to do so. Safety and efficacy exploratory endpoints were assessed throughout the 52-week study.
Study outcome measures showed plasma lyso-Gb3 concentrations remained stable during the study with a mean change of 3.01 nM from baseline (19.36 nM) to Week 52 (22.23 nM). Mean absolute change of eGFR values were stable during the 52-week treatment period, with a mean change from baseline of -1.27 mL/min/1.73m2.
Following a survey of participants using the Quality of Life EQ-5D-5L questionnaire, responses indicate that patient perception of their own health remained high and stable throughout the 52-week study duration, with overall health mean (SE) scores of 78.3 (3.1) and 82.1 (2.9) at baseline and Week 52, respectively, in a 0 to 100 scale. Using the short-form Brief Pain Inventory, or BPI, questionnaire, approximately 75% of study participants had an improvement or no change in average pain severity at Week 52 (compared to baseline). The short-form BPI interference items also remained stable during the study. Pain-related results indicate that there was no increase and/or relapse in pain. No Fabry clinical events were reported during the study.
To date, substantially all of the patients who completed the study opted, with the advice of the treating physician, to continue treatment under the 4-week dosing regimen in a long-term extension study.
COVID-19 Impact on PRX-102 Clinical Trials
To date, the COVID-19 pandemic has had a minimal effect on the performance of the phase III clinical trials of PRX-102 as many of the patients were already treated in home care settings. In a minimal amount of cases, patients that completed a trial were not able to
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be transferred into an extension study due to the pandemic restrictions, and, accordingly, the main trial was prolonged for the patients to permit the continuation of treatment.
Phase I/II Study
Our phase I/II clinical trial of PRX-102, which we completed in 2015, was a worldwide, multi-center, open-label, dose ranging study designed to evaluate the safety, tolerability, pharmacokinetics, immunogenicity and efficacy parameters of PRX-102 in adult Fabry patients. Sixteen adult, naïve Fabry patients (9 male and 7 female) completed the trial, each in one of three dosing groups, 0.2 mg/kg, 1 mg/kg and 2 mg/kg. Each patient received IV infusions of PRX-102 every two weeks for 12 weeks, with efficacy follow-up after six-month and twelve-month periods. A majority of the patients who completed the trial opted to continue receiving PRX-102 in an open-label, 60-month extension study under which all patients were switched to receive 1 mg/kg of the drug, the selected dose for our BALANCE and BRIDGE studies of PRX-102.
The adult symptomatic, ERT-naïve Fabry disease patients enrolled in the phase I/II study were evaluated for Gb3 levels in kidney biopsies and for plasma Lyso-Gb3 concentration by the quantitative BLISS methodology. Biopsies were available from 14 patients. The outcome of ? 50% reduction in the average number of Gb3 inclusions per kidney PTC from baseline to Month 6 was demonstrated in 11 of 14 (78.6%) of the patients treated with PRX-102. The overall results demonstrate that PRX-102 reaches the affected tissue and reduces kidney Gb3 inclusions burden and Lyso-Gb3 in the circulation. A high correlation was found between the two Fabry disease biomarkers, reduction of kidney Gb3 inclusions and the reduction of plasma Lyso-Gb3 over six months of treatment.
Data was recorded at 24 months from 11 patients who completed 12 months of the long-term open-label extension trial that succeeded the phase I/II study. Patients who did not continue in the extension trial included: female patients who became or planned to become pregnant and therefore were unable to continue in accordance with the study protocol; and patients who relocated to a location where treatment was not available under the clinical study.
Results show that Lyso-Gb3 levels decreased approximately 90% from baseline. Renal function remained stable with mean eGRF levels of 108.02 and 107.20 at baseline and 24 months, respectively, with a modest annual eGFR slope of -2.1. An improvement across all the gastrointestinal symptoms evaluated, including severity and frequency of abdominal pain and frequency of diarrhea, was noted. Cardiac parameters, including LVM, LVMI and EF, remained stable with no cardiac fibrosis development detected. In conclusion, an improvement of over 40% in disease severity was shown as measured by the Mainz Severity Score Index, or MSSI, a score compiling the different elements of the disease severity including neurological, renal and cardiovascular parameters. In addition, an improvement was noted in each of the individual parameters of the MSSI.
The majority of adverse events were mild-to-moderate in severity, and transient
in nature. During the first 12 months of treatment, only three of 16 patients
(less than 19%) formed anti-drug antibodies (ADA), of which two of these
patients (less than 13%) had neutralizing antibodies. Importantly, however, the
ADAs turned negative for all three of these patients following 12 months of
treatment. The
Commercialization Agreements with
We have entered into two exclusive global licensing and supply agreements for
PRX-102 for the treatment of Fabry disease with Chiesi. The agreements have
significant revenue potential for
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On
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Elelyso® for the Treatment of Gaucher Disease
Elelyso (taliglucerase alfa), our first commercial product, was approved by the
FDA in 2012 for injection as an enzyme replacement therapy (ERT) for the
long-term treatment of adult patients with a confirmed diagnosis of type 1
Gaucher disease. In
Gaucher disease, also known as glucocerebrosidase, or GCD, deficiency, is a rare genetic autosomal recessive disorder and one of the most common Lysosomal Storage Disorders, or LSD, in the world. It is one of a group of disorders that affect specific enzymes that normally break down fatty substances for reuse in the cells. If the enzymes are missing or do not work properly, the substances can build up and become toxic. Gaucher disease occurs when a lipid called glucosylceramide accumulates in the cells of the bone marrow, lungs, spleen, liver, and sometimes the brain. Gaucher disease symptoms can include fatigue, anemia, easy bruising and bleeding, severe bone pain and easily broken bones, and distended stomach due to an enlarged spleen and thrombocytopenia. Epidemiology of Gaucher disease varies; recent literature provides that prevalence of Gaucher disease ranges from 0.70 to 1.75 per 100,000 in the general population. In people of Ashkenazi Jewish heritage, estimates of occurrence vary from approximately 1 in 400 to 1 in 850 people.
Gaucher disease is a
Commercialization Agreements for Elelyso
We have licensed to Pfizer the global rights to Elelyso in all markets excluding
For the first 10-year period after the execution of our Amended Pfizer Agreement, we have agreed to sell drug substance to Pfizer for the production of Elelyso, and Pfizer maintains the right to extend the supply period for up to two additional 30-month periods subject to certain terms and conditions. In a subsequent amendment, we agreed that after the completion of the first 10-year supply period, the supply term would automatically extend for a five-year period.
We maintain distribution rights to Elelyso in
Alidornase Alfa (PRX-110)
Alidornase alfa is our chemically-modified plant cell expressed recombinant human DNase I, administered via inhalation. Recombinant human DNase I enzymatically cleaves DNA but its activity is inhibited by actin, which is present in the blood and other target organs. PRX-110 is designed to be less susceptible to actin inhibition and have higher affinity to DNA, thus enhancing enzymatic activity. In-vitro studies have shown PRX-110 to have a highly improved catalytic efficiency and affinity to DNA, compared to dornase alfa (Pulmozyme®, currently the only commercially available DNase therapy), even more so in the presence of actin.
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PRX-115
PRX-115 is our plant cell-expressed recombinant PEGylated uricase (urate
Oxidase) - a chemically modified enzyme under development for the potential
treatment of refractory gout. Gout is the most common inflammatory arthritis in
Currently available urate-lowering therapies, or ULTs, can be effective in
treating gout. Refractory gout patients are those whom, despite treatment with
existing ULTs, have high flare frequency, consistent tophi, and the inability to
maintain therapeutic goals of urate levels. An estimated approximately 2% of the
gout population is considered to have chronic refractory disease and are in in
need of other therapeutic options. One option may be a therapeutic use of the
uricase enzyme which converts uric acid to allantoin, which is easily eliminated
through urine. The uricase enzyme does not exist naturally in humans. To date,
two variants of recombinant uricases are approved for marketing: (i) Krystexxa®
for treatment of chronic gout refractory to conventional therapy (no longer
approved in the
PRX-119
PRX-119 is our plant cell-expressed PEGylated recombinant human DNase I product candidate being designed to elongate half-life in the circulation for NETs-related diseases. NETs, Neutrophil extracellular traps, are web-like structures, released by activated neutrophils that trap and kill a variety of microorganisms. NETs are composed of DNA, histones, antimicrobial and pro-inflammatory proteins. Excessive formation or ineffective clearance of NETs can cause different pathological effects. NETs formation has been observed in various autoimmune, inflammatory and fibrotic conditions, diverse forms of thrombosis, cancer and metastasis. According to scientific literature, animal studies have demonstrated that DNase treatment reduces NETs toxicity. Our proprietary modified DNase I design for long and customized systemically circulating in the bloodstream, may potentially enable effective treatment of acute and chronic conditions.
Intellectual Property
A key element of our overall strategy is to establish a broad portfolio of
patents to protect our proprietary technology, proprietary product and product
candidates and their methods of use. As of
Scientific Presentations
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Research & Development
We continuously work on the further development of our ProCellEx plant cell expression technology and bioreactor system. In addition, we are working on the development of new products, each in different initial stages of development, for specific products for which there are unmet needs in terms of efficacy and safety. Our development strategy focuses on the utilization of different modification approaches and development improvements, customized for each protein product, in all stages of expression and development. As disclosed above, we have entered into an exclusive license agreement with SarcoMed relating to the treatment of any human respiratory disease or condition including, but not limited to, sarcoidosis, pulmonary fibrosis, and other related diseases via inhaled delivery.
Critical Accounting Policies
Our significant accounting policies are more fully described in Note 1 to our
consolidated financial statements appearing in this Quarterly Report. There have
been no material changes to our critical accounting policies since we filed our
Annual Report on Form 10-K for the year ended
The discussion and analysis of our financial condition and results of operations
is based on our financial statements, which we prepared in accordance with
The full extent to which the COVID-19 pandemic will directly or indirectly impact our financial condition, liquidity, or results of operations will depend on future developments that are highly uncertain, including as a result of new information that may emerge concerning COVID-19 and the actions taken to contain or treat COVID-19, as well as the economic impact on local, regional, national and international customers and markets.
Results of Operations
Three months ended
Revenues from Selling Goods
We recorded revenues from selling goods of
Revenues from License and R&D Services
We recorded revenues from license and R&D services of
Cost of Goods Sold
Cost of goods sold was
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Research and Development Expenses, Net
Research and development expenses were
We expect research and development expenses to continue to be our primary expense as we enter into a more advanced stage of preclinical and clinical trials for certain of our product candidates.
Selling, General and Administrative Expenses
Selling, general and administrative expenses were
Financial Expenses, Net
Financial expenses net were
Liquidity and Capital Resources
Our sources of liquidity include our cash balances and bank deposits. At
During the three months ended
We believe that our cash and cash equivalents and bank deposits as of
Cash Flows
Net cash used in operations was
Net cash used in operations was
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Future Funding Requirements
As a result of our significant research and development expenditures and the
lack of significant revenue from sales of taliglucerase alfa, we have generated
operating losses from our continuing operations since our inception. Our
outstanding 2021 Notes are secured by a perfected lien on all of our assets.
Under the terms of the indenture governing the 2021 Notes, we are required to
maintain a minimum cash balance of at least
We expect to continue to incur significant expenditures in the near future as we increase our research and developments efforts with respect to our product candidates given the receipt of the CRL from the FDA discussed above, we expect to incur additional expenses in connection with any resubmission. We cannot anticipate the costs or the timing of the occurrence of such costs. As well, to the extent we need to obtain additional financing in connection with this process or with any additional clinical testing that may be required, it may be more difficult for us to do so given the volatility of the price of our common stock. Our material cash needs for the next 24 months will include, among other expenses, (i) costs of preclinical and clinical trials, (ii) employee salaries, (iii) payments for rent and operation of our manufacturing facilities, (iv) fees to our consultants and legal advisors, patents and fees for service providers in connection with our research and development efforts and (v) payment of principal and interest on our outstanding convertible promissory notes and other debt. We believe that the funds currently available to us are sufficient to satisfy our capital needs for at least 12 months.
As discussed above, we may be required to raise additional capital to develop our product candidates and continue research and development activities. Our ability to raise capital, and the amounts of necessary capital, will depend on many other factors, including:
? our efforts, combined with those of Chiesi, to file for resubmission with the
FDA and to commercialize PRX-102;
? the progress and results of our clinical trials, particularly the PRX-102
BALANCE study;
? our progress in commercializing BioManguinhos alfataliglicerase in
? the duration and cost of discovery and preclinical development and laboratory
testing and clinical trials for our product candidates;
? the timing and outcome of regulatory review of our product candidates;
? the costs involved in preparing, filing, prosecuting, maintaining, defending
and enforcing patent claims and other intellectual property rights; and
? the costs associated with any litigation claims.
We expect to finance our future cash needs through corporate collaborations,
licensing or similar arrangements, public or private equity offerings and/or
debt financings. We currently do not have any commitments for future external
funding, except with respect to the development-related payments and milestone
payments that may become payable under the Chiesi Agreements and under our
agreement with SarcoMed. In addition, our ATM program provides us with a quick
and efficient manner to raise capital through the sale of shares of our common
stock. To date, we have the right to raise an additional
Effects of Currency Fluctuations
Currency fluctuations could affect us through increased or decreased acquisition
costs for certain goods and services. We do not believe currency fluctuations
have had a material effect on our results of operations during the three months
ended
Off-Balance Sheet Arrangements
We have no off-balance sheet arrangements as of each of
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