--12-3100016044642012-08-013falseseven years3Q10001604464us-gaap:RestrictedStockUnitsRSUMember2023-01-012023-03-310001604464us-gaap:CorporateDebtSecuritiesMemberus-gaap:FairValueMeasurementsRecurringMember2022-12-310001604464us-gaap:ComputerEquipmentMember2023-03-310001604464atra:HcrxAgreementMember2023-01-012023-03-310001604464atra:BayerManufacturingAgreementMember2023-03-310001604464us-gaap:FurnitureAndFixturesMember2023-03-3100016044642022-01-012022-12-3100016044642023-01-012023-03-310001604464atra:LabEquipmentMember2022-12-3100016044642022-01-310001604464atra:PierreFabreCommercializationAgreementMember2023-01-012023-03-310001604464us-gaap:RetainedEarningsMember2023-01-012023-03-310001604464us-gaap:LeaseholdImprovementsMember2022-12-310001604464us-gaap:GeneralAndAdministrativeExpenseMember2022-01-012022-03-310001604464us-gaap:ShortTermInvestmentsMemberus-gaap:FairValueMeasurementsRecurringMember2022-12-310001604464us-gaap:FurnitureAndFixturesMember2022-12-310001604464atra:LabEquipmentMember2023-03-310001604464us-gaap:FairValueMeasurementsRecurringMember2023-03-310001604464srt:MaximumMemberatra:PierreFabreCommercializationAgreementMember2021-10-310001604464atra:TwoThousandFourteenEquityIncentivePlanAndInducementPlanMember2023-01-012023-03-310001604464us-gaap:CommonStockMemberatra:AtTheMarketOfferingMember2022-01-012022-03-310001604464us-gaap:CommonStockMember2022-03-310001604464us-gaap:ShortTermInvestmentsMemberus-gaap:FairValueMeasurementsRecurringMember2023-03-310001604464us-gaap:MachineryAndEquipmentMember2023-03-310001604464atra:PierreFabreCommercializationAgreementMember2022-09-012022-09-300001604464us-gaap:GeneralAndAdministrativeExpenseMember2022-01-012022-03-310001604464atra:BayerManufacturingAgreementMember2022-09-3000016044642022-01-012022-03-310001604464us-gaap:RestrictedStockUnitsRSUMember2023-03-310001604464us-gaap:AdditionalPaidInCapitalMemberatra:AtTheMarketOfferingMember2022-01-012022-03-3100016044642022-04-042022-04-040001604464us-gaap:WarrantMemberatra:UnderwrittenPublicOfferingMember2020-12-310001604464us-gaap:AdditionalPaidInCapitalMember2023-03-310001604464atra:EmployeeStockPurchasePlanMember2023-01-012023-03-310001604464srt:MaximumMemberatra:HcrxAgreementMember2023-01-012023-03-310001604464us-gaap:WarrantMemberatra:UnderwrittenPublicOfferingMember2022-04-242022-04-250001604464us-gaap:ResearchAndDevelopmentExpenseMember2023-01-012023-03-310001604464atra:TwoThousandFourteenEquityIncentivePlanAndInducementPlanMember2022-12-310001604464atra:HcrxAgreementMember2022-01-012022-12-310001604464us-gaap:CashEquivalentsMemberus-gaap:FairValueMeasurementsRecurringMember2022-12-310001604464srt:MinimumMemberatra:HcrxAgreementMember2023-01-012023-03-310001604464us-gaap:ResearchAndDevelopmentExpenseMember2022-01-012022-03-3100016044642022-12-310001604464us-gaap:CommonStockMember2022-01-012022-03-310001604464atra:CommercializationRevenueMember2023-01-012023-03-3100016044642021-12-310001604464atra:EmployeesAndNonEmployeesMembersrt:MaximumMember2023-01-012023-03-310001604464atra:PierreFabreCommercializationAgreementMember2022-12-310001604464us-gaap:CashEquivalentsMemberus-gaap:FairValueMeasurementsRecurringMember2023-03-310001604464us-gaap:AdditionalPaidInCapitalMember2021-12-310001604464atra:CowenAndCompanyLimitedLiabilityCompanyMemberatra:AtTheMarketOfferingMember2023-03-310001604464us-gaap:USGovernmentAgenciesShorttermDebtSecuritiesMemberus-gaap:FairValueMeasurementsRecurringMember2022-12-310001604464atra:TwoThousandAndFourteenEquityIncentivePlanMember2023-03-310001604464us-gaap:AccumulatedOtherComprehensiveIncomeMember2021-12-310001604464atra:BayerManufacturingAgreementMember2023-01-012023-03-310001604464atra:PierreFabreCommercializationAgreementMember2021-10-012021-10-310001604464atra:FromDateOfGrantMembersrt:MaximumMemberus-gaap:RestrictedStockUnitsRSUMember2023-01-012023-03-310001604464us-gaap:AdditionalPaidInCapitalMember2022-12-310001604464atra:EmployeesAndNonEmployeesMembersrt:MinimumMember2023-01-012023-03-310001604464us-gaap:AccumulatedOtherComprehensiveIncomeMember2022-03-310001604464us-gaap:CommercialPaperMemberus-gaap:FairValueMeasurementsRecurringMember2022-12-310001604464us-gaap:MachineryAndEquipmentMember2022-12-310001604464atra:TwoThousandFourteenEquityIncentivePlanAndInducementPlanMember2022-01-012022-12-310001604464us-gaap:EmployeeStockOptionMember2023-01-012023-03-310001604464us-gaap:AccumulatedOtherComprehensiveIncomeMember2023-03-310001604464srt:MinimumMember2023-01-012023-03-310001604464us-gaap:AdditionalPaidInCapitalMember2022-03-310001604464us-gaap:AccumulatedOtherComprehensiveIncomeMember2022-12-3100016044642022-03-310001604464us-gaap:CommonStockMember2021-12-310001604464us-gaap:CommonStockMemberatra:AtTheMarketOfferingMember2023-01-012023-03-310001604464us-gaap:RetainedEarningsMember2022-01-012022-03-310001604464us-gaap:RetainedEarningsMember2022-12-310001604464us-gaap:FairValueMeasurementsRecurringMember2022-12-310001604464us-gaap:EmployeeStockOptionMember2023-01-012023-03-310001604464us-gaap:LeaseholdImprovementsMember2023-03-310001604464us-gaap:WarrantMembersrt:MinimumMemberatra:UnderwrittenPublicOfferingMember2022-04-242022-04-250001604464us-gaap:RestrictedStockUnitsRSUMember2022-12-310001604464us-gaap:WarrantMembersrt:MaximumMemberatra:UnderwrittenPublicOfferingMember2022-04-242022-04-250001604464us-gaap:CorporateDebtSecuritiesMemberus-gaap:FairValueMeasurementsRecurringMember2023-03-310001604464us-gaap:RetainedEarningsMember2023-03-310001604464us-gaap:RetainedEarningsMember2021-12-310001604464us-gaap:AccumulatedOtherComprehensiveIncomeMember2023-01-012023-03-310001604464us-gaap:ResearchAndDevelopmentExpenseMember2022-01-012022-03-310001604464us-gaap:AssetBackedSecuritiesMemberus-gaap:FairValueMeasurementsRecurringMember2022-12-310001604464us-gaap:ConstructionInProgressMember2023-03-310001604464us-gaap:MoneyMarketFundsMemberus-gaap:FairValueMeasurementsRecurringMember2023-03-310001604464atra:TwoThousandFourteenEmployeeStockPurchasePlanMember2023-03-310001604464us-gaap:EmployeeStockOptionMember2022-01-012022-03-310001604464atra:CommercializationRevenueMember2023-03-310001604464us-gaap:AssetBackedSecuritiesMemberus-gaap:FairValueMeasurementsRecurringMember2023-03-310001604464us-gaap:AdditionalPaidInCapitalMember2023-01-012023-03-310001604464atra:PierreFabreCommercializationAgreementMember2022-01-012022-03-310001604464atra:UnderwrittenPublicOfferingMemberatra:TwoThousandNineteenWarrantsMember2023-03-310001604464atra:InducementPlanMember2020-11-300001604464us-gaap:CommercialPaperMemberus-gaap:FairValueMeasurementsRecurringMember2023-03-310001604464us-gaap:ResearchAndDevelopmentExpenseMember2023-01-012023-03-310001604464atra:BayerManufacturingAgreementMember2022-12-310001604464atra:InducementPlanMember2023-03-310001604464us-gaap:AccumulatedOtherComprehensiveIncomeMember2022-01-012022-03-310001604464us-gaap:CommonStockMember2023-01-012023-03-310001604464us-gaap:RestrictedStockUnitsRSUMember2023-01-012023-03-310001604464us-gaap:WarrantMemberatra:UnderwrittenPublicOfferingMember2020-05-310001604464atra:CowenAndCompanyLimitedLiabilityCompanyMemberatra:AtTheMarketOfferingMember2023-01-012023-03-310001604464atra:TwoThousandFourteenEquityIncentivePlanAndInducementPlanMember2023-03-310001604464us-gaap:RestrictedStockUnitsRSUMember2022-01-012022-03-310001604464us-gaap:RetainedEarningsMember2022-03-310001604464us-gaap:ConstructionInProgressMember2022-12-3100016044642022-08-080001604464us-gaap:EmployeeStockOptionMember2023-03-310001604464atra:TwoThousandEighteenInducementPlanMember2023-03-310001604464us-gaap:ComputerEquipmentMember2022-12-310001604464us-gaap:AdditionalPaidInCapitalMember2022-01-012022-03-310001604464us-gaap:USTreasurySecuritiesMemberus-gaap:FairValueMeasurementsRecurringMember2023-03-3100016044642023-05-010001604464us-gaap:GeneralAndAdministrativeExpenseMember2023-01-012023-03-310001604464us-gaap:AdditionalPaidInCapitalMemberatra:AtTheMarketOfferingMember2023-01-012023-03-310001604464atra:CommercializationRevenueMember2022-12-310001604464atra:FromDateOfGrantMembersrt:MinimumMemberus-gaap:RestrictedStockUnitsRSUMember2023-01-012023-03-310001604464us-gaap:WarrantMemberatra:UnderwrittenPublicOfferingMember2019-07-310001604464us-gaap:GeneralAndAdministrativeExpenseMember2023-01-012023-03-310001604464atra:EmployeeStockPurchasePlanMember2022-01-012022-03-3100016044642023-03-310001604464us-gaap:CommonStockMember2022-12-310001604464us-gaap:USTreasurySecuritiesMemberus-gaap:FairValueMeasurementsRecurringMember2022-12-310001604464atra:BayerManufacturingAgreementMember2022-01-012022-03-310001604464us-gaap:MoneyMarketFundsMemberus-gaap:FairValueMeasurementsRecurringMember2022-12-310001604464atra:HcrxAgreementMember2023-03-310001604464us-gaap:USGovernmentAgenciesShorttermDebtSecuritiesMemberus-gaap:FairValueMeasurementsRecurringMember2023-03-310001604464us-gaap:CommonStockMember2023-03-31xbrli:purexbrli:sharesiso4217:USDiso4217:USDxbrli:shares

 

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

 

FORM 10-Q

 

QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended March 31, 2023

 

OR

TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from to

Commission file number 001-36548

 

ATARA BIOTHERAPEUTICS, INC.

(Exact Name of Registrant as Specified in its Charter)

 

 

Delaware

46-0920988

(State or Other Jurisdiction of Incorporation or Organization)

 

(I.R.S. Employer Identification No.)

 

 

 

2380 Conejo Spectrum Street, Suite 200

Thousand Oaks, CA

91320

(Address of Principal Executive Offices)

 

(Zip Code)

Registrant’s Telephone Number, Including Area Code: (805) 623-4211

 

Securities registered pursuant to Section 12(b) of the Act:

 

Title of Each Class

 

Trading Symbol(s)

 

Name of Each Exchange on Which Registered

Common Stock, par value $0.0001 per share

 

ATRA

 

The Nasdaq Stock Market LLC

Indicate by check mark whether the Registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes ☒ No ☐

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the Registrant was required to submit such files). Yes ☒ No ☐

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.

 

Large accelerated filer

Accelerated filer

Non-accelerated filer

Smaller reporting company

Emerging growth company

 

 

 

 

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

Indicate by check mark whether the Registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ☐ No

The number of outstanding shares of the Registrant’s Common Stock as of May 1, 2023 was 97,972,246 shares.

 

 


 

ATARA BIOTHERAPEUTICS, INC.

INDEX

 

Page

PART I.

FINANCIAL INFORMATION

 

 

 

 

Item 1.

Financial Statements (Unaudited)

 

 

 

 

Condensed Consolidated Balance Sheets

6

 

 

 

Condensed Consolidated Statements of Operations and Comprehensive Loss

7

 

 

 

Condensed Consolidated Statements of Changes in Stockholders’ Equity

8

 

 

 

Condensed Consolidated Statements of Cash Flows

9

 

 

 

Notes to Condensed Consolidated Financial Statements

10

 

 

 

Item 2.

Management’s Discussion and Analysis of Financial Condition and Results of Operations

23

 

 

 

Item 3.

Quantitative and Qualitative Disclosures about Market Risk

34

 

 

 

Item 4.

Controls and Procedures

34

 

 

 

PART II.

OTHER INFORMATION

35

 

 

 

Item 1.

Legal Proceedings

35

 

 

 

Item 1A.

Risk Factors

35

 

Item 6.

Exhibits

78

 

 

 

Signatures

79

 

 

 

 

2


 

NOTE REGARDING FORWARD-LOOKING STATEMENTS

This Quarterly Report on Form 10-Q contains forward-looking statements within the meaning of the safe harbor provisions of the U.S. Private Securities Litigation Reform Act of 1995. Such forward-looking statements, which represent our intent, belief or current expectations, involve risks and uncertainties and other factors that could cause actual results and the timing of certain events to differ materially from future results expressed or implied by such forward-looking statements. In some cases you can identify these statements by forward-looking words such as “believe,” “may,” “will,” “estimate,” “continue,” “anticipate,” “intend,” “could,” “would,” “project,” “predict,” “plan,” “expect” or the negative or plural of these words or similar expressions. The forward-looking statements include, but are not limited to, statements about:

our expectations regarding the timing of initiating clinical studies, opening client sites, enrolling clinical studies and reporting results of clinical studies for our programs;
the likelihood and timing of regulatory submissions or related approvals for our product candidates, including the initiation, completion and expectations about the timing of approvals for a biologics license application (BLA) for tab-cel® for patients with Epstein-Barr virus with post-transplant lymphoproliferative disease (EBV+ PTLD);
the potential indications for our product and product candidates;
commercialization of Ebvallo™ in the European Union (EU) and our Commercialization Agreement with Pierre Fabre Medicament, including potential milestone and royalty payments under the agreement;
our Purchase and Sale Agreement and related transactions with HCR Molag Fund, L.P.;
our Commercial Manufacturing Services Agreement with Charles River Laboratories, Inc. (CRL) and other agreements we may enter into with CRL;
our Master Services and Supply Agreement and related transactions with FUJIFILM Diosynth Biotechnologies California, Inc.;
our expectations regarding the potential commercial market opportunities, market size and the size of the patient populations for our product and product candidates;
estimates of our expenses, capital requirements and need for additional financing;
our expectation regarding the length of time that our existing capital resources will be sufficient to enable us to fund our planned operations, including our going concern assessment;
our ability to enter into favorable commercialization arrangements with third parties to commercialize our product and product candidates;
our ability to develop, acquire and advance product candidates into, and successfully complete, clinical studies;
the initiation, timing, costs, progress and results of future preclinical studies and clinical studies and our research and development programs;
our ability to enter into and maintain contracts with clinical research organizations, manufacturing organizations and other vendors for clinical and preclinical studies, supplies and other services;
the scope of protection we are able to obtain and maintain for the intellectual property rights covering our product and product candidates;
our financial performance;
developments and projections relating to our competitors and our industry;
our ability to have our product and product candidates manufactured for our clinical studies or for commercial sale, including at commercially reasonable values;
the impact of public health emergencies, such as COVID-19, to our business and operations, as well as the businesses and operations of third parties on which we rely;
our ability to attract and retain qualified personnel and to our business, operations and financial condition; and
timing and costs related to the qualification of our contract manufacturing organizations’ (CMO) manufacturing facilities for commercial production.

3


 

These statements are only current predictions and are subject to known and unknown risks, uncertainties, including, without limitation, risks and uncertainties associated with the costly and time-consuming pharmaceutical product development process and the uncertainty of clinical success; the sufficiency of our cash resources and need for additional capital; and other factors that may cause our or our industry’s actual results, levels of activity, performance or achievements to be materially different from those anticipated by the forward-looking statements. We discuss many of these risks in this report in greater detail under the heading “1A. Risk Factors” and elsewhere in this report. You should not rely upon forward-looking statements as predictions of future events. New risk factors and uncertainties may emerge from time to time, and it is not possible for management to predict all risks and uncertainties.

In this Quarterly Report on Form 10-Q, unless the context requires otherwise, “Atara,” “Atara Biotherapeutics,” “Company,” “we,” “our,” and “us” means Atara Biotherapeutics, Inc. and, where appropriate, its subsidiaries.

Summary Risk Factors

Our business is subject to numerous risks and uncertainties that may have a material adverse effect on our business, financial condition or results of operations. These risks are more fully described under the heading “1A. Risk Factors” and elsewhere in this report and include, among others:

we have incurred substantial losses since our inception and anticipate that we will continue to incur substantial losses for the foreseeable future;
we have earned limited commercialization revenues to date, and we may never achieve profitability;
we are generally early in our development efforts and have only a small number of product candidates in clinical development, and all of our other product candidates are still in preclinical development. If we or our collaborators are unable to successfully develop, manufacture and commercialize our product or product candidates or experience significant delays in doing so, our business may be materially harmed;
we will require substantial additional financing to achieve our goals, and a failure to obtain this necessary capital when needed could force us to delay, limit, reduce or terminate our product development or manufacturing efforts;
our future success depends on our ability to retain our executive officers and to attract, retain and motivate qualified personnel;
the results of preclinical studies or earlier clinical studies are not necessarily predictive of future results, and our existing product candidates in clinical studies, and any other product candidates we advance into clinical studies may not have favorable results in later clinical studies or receive regulatory approval;
clinical drug development involves a lengthy and expensive process with an uncertain outcome;
our T-cell immunotherapy product and product candidates and our next-generation CAR T programs represent new therapeutic approaches that could result in heightened regulatory scrutiny, delays in clinical development or our inability to achieve regulatory approval, commercialization or payor coverage of our product candidates;
there can be no assurance that we will achieve all of the anticipated benefits of the Fujifilm Transaction and we could face unanticipated challenges;
the market opportunities for our product and product candidates may be limited to those patients who are ineligible for or have failed prior treatments and may be small;
we may not be able to obtain or maintain orphan drug exclusivity for our product candidates;
we have been affected by and could be adversely affected in the future by the effects of health epidemics and pandemics, including the ongoing COVID-19 pandemic, which could materially and adversely affect our business and operations in the future, as well as the businesses and operations of third parties on which we rely;
if we are unable to obtain and maintain sufficient intellectual property protection for our product candidates, or if the scope of the intellectual property protection is not sufficiently broad, our ability to commercialize our product candidates successfully and to compete effectively may be adversely affected;
our principal stockholders own a significant percentage of our stock and will be able to exert control or significant influence over matters subject to stockholder approval;

4


 

our 2022 workforce reduction may not result in anticipated savings, could result in total costs and expenses that are greater than expected and could disrupt our business; and
maintaining clinical and commercial timelines is dependent on our end-to-end supply chain network to support manufacturing; if we experience problems with our third party suppliers or CMOs, development and/or commercialization of our product and product candidates may be adversely affected.

5


 

Atara Biotherapeutics, Inc.

Condensed Consolidated Balance Sheets

(Unaudited)

(In thousands, except per share amounts)

 

 

 

March 31,

 

 

December 31,

 

 

 

2023

 

 

2022

 

Assets

 

 

 

 

 

 

Current assets:

 

 

 

 

 

 

Cash and cash equivalents

 

$

48,741

 

 

$

92,942

 

Short-term investments

 

 

156,666

 

 

 

149,877

 

Restricted cash

 

 

146

 

 

 

146

 

Accounts receivable

 

 

397

 

 

 

40,221

 

Inventories

 

 

5,340

 

 

 

1,586

 

Other current assets

 

 

12,892

 

 

 

10,308

 

Total current assets

 

 

224,182

 

 

 

295,080

 

Property and equipment, net

 

 

5,852

 

 

 

6,300

 

Operating lease assets

 

 

65,143

 

 

 

68,022

 

Other assets

 

 

6,906

 

 

 

7,018

 

Total assets

 

$

302,083

 

 

$

376,420

 

 

 

 

 

 

 

 

Liabilities and stockholders’ equity

 

 

 

 

 

 

Current liabilities:

 

 

 

 

 

 

Accounts payable

 

$

5,068

 

 

$

6,871

 

Accrued compensation

 

 

8,913

 

 

 

17,659

 

Accrued research and development expenses

 

 

23,766

 

 

 

24,992

 

Deferred revenue

 

 

9,924

 

 

 

8,000

 

Other current liabilities

 

 

20,205

 

 

 

21,394

 

Total current liabilities

 

 

67,876

 

 

 

78,916

 

Deferred revenue - long-term

 

 

78,041

 

 

 

77,000

 

Operating lease liabilities - long-term

 

 

54,918

 

 

 

58,064

 

Liability related to the sale of future revenues - long-term

 

 

31,111

 

 

 

30,236

 

Other long-term liabilities

 

 

5,177

 

 

 

5,564

 

Total liabilities

 

 

237,123

 

 

 

249,780

 

 

 

 

 

 

 

 

Commitments and contingencies (Note 8)

 

 

 

 

 

 

 

 

 

 

 

 

 

Stockholders’ equity:

 

 

 

 

 

 

Common stock—$0.0001 par value, 500,000 shares authorized as of March 31,
   2023 and December 31, 2022;
96,538 and 95,927 shares issued and outstanding
   as of March 31, 2023 and December 31, 2022, respectively

 

 

10

 

 

 

10

 

Additional paid-in capital

 

 

1,833,982

 

 

 

1,821,721

 

Accumulated other comprehensive (loss) income

 

 

(1,237

)

 

 

(2,067

)

Accumulated deficit

 

 

(1,767,795

)

 

 

(1,693,024

)

Total stockholders’ equity

 

 

64,960

 

 

 

126,640

 

Total liabilities and stockholders’ equity

 

$

302,083

 

 

$

376,420

 

See accompanying notes to the condensed consolidated financial statements.

6


 

Atara Biotherapeutics, Inc.

Condensed Consolidated Statements of Operations and Comprehensive Loss

(Unaudited)

(In thousands, except per share amounts)

 

 

 

Three Months Ended March 31,

 

 

 

2023

 

 

2022

 

Commercialization revenue

 

$

884

 

 

$

 

License and collaboration revenue

 

 

342

 

 

 

7,314

 

Total revenue

 

 

1,226

 

 

 

7,314

 

Costs and operating expenses:

 

 

 

 

 

 

Cost of commercialization revenue

 

 

216

 

 

 

 

Research and development expenses

 

 

62,156

 

 

 

74,963

 

General and administrative expenses

 

 

13,872

 

 

 

20,571

 

Total costs and operating expenses

 

 

76,244

 

 

 

95,534

 

Loss from operations

 

 

(75,018

)

 

 

(88,220

)

Other income (expense), net:

 

 

 

 

 

 

Interest income

 

 

1,802

 

 

 

228

 

Interest expense

 

 

(1,336

)

 

 

(4

)

Other income (expense), net

 

 

(197

)

 

 

(109

)

Total other income (expense), net

 

 

269

 

 

 

115

 

Loss before provision for income taxes

 

 

(74,749

)

 

 

(88,105

)

Provision for income taxes

 

 

22

 

 

 

 

Net loss

 

$

(74,771

)

 

$

(88,105

)

Other comprehensive gain (loss):

 

 

 

 

 

 

Unrealized gain (loss) on available-for-sale securities

 

 

830

 

 

 

(1,524

)

Comprehensive loss

 

$

(73,941

)

 

$

(89,629

)

 

 

 

 

 

 

 

Basic and diluted loss per common share

 

$

(0.72

)

 

$

(0.87

)

 

 

 

 

 

 

 

Basic and diluted weighted-average shares outstanding

 

 

103,969

 

 

 

100,726

 

See accompanying notes to the condensed consolidated financial statements.

7


 

Atara Biotherapeutics, Inc.

Condensed Consolidated Statements of Changes in Stockholders’ Equity

(Unaudited)

(In thousands)

 

 

 

 

 

 

 

 

 

 

 

 

Accumulated

 

 

 

 

 

 

 

 

 

Common

 

 

Additional

 

 

Other

 

 

 

 

 

Total

 

 

 

Stock

 

 

Paid-in

 

 

Comprehensive

 

 

Accumulated

 

 

Stockholders’

 

For the Three Months Ended March 31, 2023

 

Shares

 

 

Amount

 

 

Capital

 

 

Income (Loss)

 

 

Deficit

 

 

Equity

 

Balance as of January 1, 2023

 

 

95,927

 

 

$

10

 

 

$

1,821,721

 

 

$

(2,067

)

 

$

(1,693,024

)

 

$

126,640

 

Issuance of common stock through ATM facilities, net of commissions and offering costs of $97

 

 

148

 

 

 

 

 

 

590

 

 

 

 

 

 

 

 

 

590

 

RSU settlements, net of shares withheld

 

 

463

 

 

 

 

 

 

(93

)

 

 

 

 

 

 

 

 

(93

)

Issuance of common stock pursuant to employee stock awards

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Stock-based compensation expense

 

 

 

 

 

 

 

 

11,764

 

 

 

 

 

 

 

 

 

11,764

 

Net loss

 

 

 

 

 

 

 

 

 

 

 

 

 

 

(74,771

)

 

 

(74,771

)

Unrealized gain (loss) on available-for-sale securities

 

 

 

 

 

 

 

 

 

 

 

830

 

 

 

 

 

 

830

 

Balance as of March 31, 2023

 

 

96,538

 

 

$

10

 

 

$

1,833,982

 

 

$

(1,237

)

 

$

(1,767,795

)

 

$

64,960

 

 

 

 

 

 

 

 

 

 

 

 

 

Accumulated

 

 

 

 

 

 

 

 

 

Common

 

 

Additional

 

 

Other

 

 

 

 

 

Total

 

 

 

Stock

 

 

Paid-in

 

 

Comprehensive

 

 

Accumulated

 

 

Stockholders’

 

For the Three Months Ended March 31, 2022

 

Shares

 

 

Amount

 

 

Capital

 

 

Income (Loss)

 

 

Deficit

 

 

Equity

 

Balance as of January 1, 2022

 

 

91,671

 

 

$

9

 

 

$

1,744,695

 

 

$

(368

)

 

$

(1,464,722

)

 

$

279,614

 

Issuance of common stock through ATM facilities, net of commissions and offering costs of $419

 

 

1,320

 

 

 

 

 

 

20,516

 

 

 

 

 

 

 

 

 

20,516

 

RSU settlements, net of shares withheld

 

 

405

 

 

 

 

 

 

(616

)

 

 

 

 

 

 

 

 

(616

)

Issuance of common stock pursuant to employee stock awards

 

 

10

 

 

 

 

 

 

96

 

 

 

 

 

 

 

 

 

96

 

Stock-based compensation expense

 

 

 

 

 

 

 

 

14,335

 

 

 

 

 

 

 

 

 

14,335

 

Net loss

 

 

 

 

 

 

 

 

 

 

 

 

 

 

(88,105

)

 

 

(88,105

)

Unrealized gain (loss) on available-for-sale securities

 

 

 

 

 

 

 

 

 

 

 

(1,524

)

 

 

 

 

 

(1,524

)

Balance as of March 31, 2022

 

 

93,406

 

 

$

9

 

 

$

1,779,026

 

 

$

(1,892

)

 

$

(1,552,827

)

 

$

224,316

 

See accompanying notes to the condensed consolidated financial statements.

8


 

Atara Biotherapeutics, Inc.

Condensed Consolidated Statements of Cash Flows

(Unaudited)

(In thousands)

 

 

 

Three Months Ended March 31,

 

 

 

2023

 

 

2022

 

Operating activities

 

 

 

 

 

 

Net loss

 

$

(74,771

)

 

$

(88,105

)

Adjustments to reconcile net loss to net cash used in operating activities:

 

 

 

 

 

 

Stock-based compensation expense

 

 

11,764

 

 

 

14,335

 

Depreciation and amortization expense

 

 

1,214

 

 

 

1,591

 

Accretion of liability related to sale of future revenues

 

 

1,204

 

 

 

 

Amortization (accretion) of investment premiums (discounts)

 

 

(351

)

 

 

498

 

Non-cash operating lease expense

 

 

2,879

 

 

 

627

 

Other non-cash items, net

 

 

80

 

 

 

7

 

Changes in operating assets and liabilities:

 

 

 

 

 

 

Accounts receivable

 

 

39,824

 

 

 

318

 

Inventories

 

 

(3,754

)

 

 

 

Prepaid expenses and other current assets

 

 

(2,584

)

 

 

609

 

Other assets

 

 

(156

)

 

 

51

 

Accounts payable

 

 

(1,886

)

 

 

(4,588

)

Accrued compensation

 

 

(8,746

)

 

 

(8,769

)

Accrued research and development expenses

 

 

(1,226

)

 

 

539

 

Other current liabilities

 

 

(609

)

 

 

(570

)

Deferred revenue

 

 

2,965

 

 

 

(525

)

Operating lease liabilities

 

 

(4,174

)

 

 

(645

)

Other long-term liabilities

 

 

(102

)

 

 

98

 

Net cash used in operating activities

 

 

(38,429

)

 

 

(84,529

)

Investing activities

 

 

 

 

 

 

Purchases of short-term investments

 

 

(67,903

)

 

 

(26,427

)

Proceeds from maturities and sales of short-term investments

 

 

62,295

 

 

 

89,247

 

Purchases of property and equipment

 

 

(399

)

 

 

(2,605

)

Net cash (used in) provided by investing activities

 

 

(6,007

)

 

 

60,215

 

Financing activities

 

 

 

 

 

 

Proceeds from issuance of common stock through ATM facilities, net

 

 

640

 

 

 

20,539

 

Proceeds from employee stock awards

 

 

 

 

 

96

 

Taxes paid related to net share settlement of restricted stock units

 

 

(93

)

 

 

(616

)

Principal payments on finance lease obligations

 

 

(312

)

 

 

(64

)

Other financing activities, net

 

 

 

 

 

(104

)

Net cash provided by financing activities

 

 

235

 

 

 

19,851

 

Decrease in cash, cash equivalents and restricted cash

 

 

(44,201

)

 

 

(4,463

)

Cash, cash equivalents and restricted cash at beginning of period

 

 

93,088

 

 

 

107,478

 

Cash, cash equivalents and restricted cash at end of period

 

$

48,887

 

 

$

103,015

 

Non-cash investing and financing activities

 

 

 

 

 

 

Property and equipment purchases included in accounts payable and other accrued liabilities

 

$

194

 

 

$

1,188

 

Accrued costs related to ATM facility

 

$

73

 

 

$

23

 

Supplemental cash flow disclosure

 

 

 

 

 

 

Cash paid for interest

 

$

112

 

 

$

5

 

Cash paid for income taxes

 

$

1

 

 

$

14

 

See accompanying notes to the condensed consolidated financial statements.

9


 

Atara Biotherapeutics, Inc.

Notes to Condensed Consolidated Financial Statements

(Unaudited)

1.
Description of Business

Atara Biotherapeutics, Inc. (Atara, we, our or the Company) was incorporated in August 2012 in Delaware. Atara is a leader in T-cell immunotherapy, leveraging its novel allogeneic Epstein-Barr Virus (EBV) T-cell platform to develop transformative therapies for patients with cancer and autoimmune disease.

We have several T-cell immunotherapies in clinical development and are progressing multiple next-generation allogeneic chimeric antigen receptor T-cell (CAR T) programs. Our most advanced T-cell immunotherapy program, tab-cel® (tabelecleucel), has received marketing authorization approval by the European Commission (EC) for commercial sale and use in the European Union (EU) under the proprietary name Ebvallo™ and is currently in Phase 3 development in the US. In October 2021, we entered into a commercialization agreement (Pierre Fabre Commercialization Agreement) with Pierre Fabre Medicament (Pierre Fabre), as amended in September 2022, pursuant to which we granted to Pierre Fabre an exclusive, field-limited license to commercialize and distribute tab-cel in Europe and select emerging markets in the Middle East, Africa, Eastern Europe and Central Asia (the Territory), following regulatory approval. We retain full rights to tab-cel in other major markets, including North America, Asia Pacific and Latin America. See Note 5 for further information.

We have licensed rights to T-cell product candidates from Memorial Sloan Kettering Cancer Center (MSK), rights related to our next-generation CAR T programs from MSK and from H. Lee Moffitt Cancer Center (Moffitt), and rights to know-how and technology from the Council of the Queensland Institute of Medical Research (QIMR Berghofer). See Note 8 for further information.

In January 2022, we entered into an asset purchase agreement with FUJIFILM Diosynth Biotechnologies California, Inc. (FDB) and, for certain limited purposes, FUJIFILM Holdings America Corporation, to sell all of the Company’s right, title and interest in and to certain assets related to the Atara T-Cell Operations and Manufacturing facility (ATOM Facility) located in Thousand Oaks, California for $100 million in cash, subject to potential post-closing adjustments pursuant to the asset purchase agreement (the Fujifilm Transaction). The closing of the Fujifilm Transaction occurred on April 4, 2022, at which time 136 of our ATOM Facility employees transitioned to FDB as part of the transaction. We also entered into a Master Services and Supply Agreement and related Statements of Work with FDB (collectively, the Fujifilm MSA) which became effective upon the closing and could extend for up to ten years. Pursuant to the Fujifilm MSA, FDB will supply us with specified quantities of our cell therapy product candidates and any products approved by regulatory authorities, manufactured in accordance with cGMP standards. See Note 8 for further information.

Certain prior year amounts, which are not material, have been reclassified to conform to current year presentation in the Condensed Consolidated Statements of Operations and Comprehensive Loss, Condensed Consolidated Statements of Cash Flows and Notes to Condensed Consolidated Financial Statements.

2.
Summary of Significant Accounting Policies

Basis of Presentation

The accompanying unaudited interim condensed consolidated financial statements include the accounts of Atara and its wholly owned subsidiaries and have been prepared in accordance with U.S. generally accepted accounting principles (U.S. GAAP) and the requirements of the Securities and Exchange Commission (SEC) for interim reporting. As permitted under those rules, certain footnotes or other financial information that are normally required by U.S. GAAP can be condensed or omitted. These unaudited interim condensed consolidated financial statements should therefore be read in conjunction with the audited consolidated financial statements and notes for the year ended December 31, 2022, included in the Company’s Annual Report on Form 10-K filed with the SEC on February 8, 2023. In the opinion of management, the condensed consolidated financial statements reflect all adjustments, consisting only of normal recurring adjustments, which are necessary for a fair presentation of the Company’s condensed consolidated financial statements. The results of operations for any interim period are not necessarily indicative of the results to be expected for the full year or any other future period. The condensed consolidated balance sheet as of December 31, 2022 has been derived from audited consolidated financial statements at that date but does not include all of the information required by U.S. GAAP for complete consolidated financial statements.

10


 

Liquidity and Going Concern

We have incurred significant operating losses since inception and have relied primarily on public and private equity financings and receipts from license and collaboration agreements to fund our operations. As we continue to incur losses, our transition to profitability will depend on the successful development, approval and commercialization of product candidates and on the achievement of sufficient revenues to support our cost structure. We may never achieve sustained operating cash inflows or profitability. We expect that existing cash, cash equivalents and short-term investments as of March 31, 2023, will not be sufficient to fund our planned operations for at least the next twelve months from the date of issuance of these condensed consolidated financial statements. These conditions raise substantial doubt about our ability to continue as a going concern for at least 12 months after the date these condensed consolidated financial statements are issued. The interim condensed consolidated financial statements do not include any adjustments that might result from the outcome of this uncertainty.

To alleviate the conditions that raise substantial doubt about our ability to continue as a going concern, we plan to secure additional capital, potentially through a combination of public or private security offerings; use of our existing 2021 ATM Facility, under which we have $55.2 million of our common stock remaining and available for sale; and/or strategic transactions, including, but not limited to, seeking a commercialization partner for tab-cel in the U.S. We may also need to raise additional funding as required based on the status of our development programs and our projected cash flows. Although we have been successful in raising capital in the past, and expect to continue to raise capital as required, there is no assurance that we will be successful in obtaining sufficient funding on terms acceptable to us to fund continuing operations, if at all, or identify and enter into any strategic transactions that will provide the capital that we will require. If we are unable to obtain sufficient funding on acceptable terms, we could be forced to delay, limit, reduce or terminate preclinical studies, clinical studies or other development activities for one or more of our product candidates, which could have a material adverse effect on our business, results of operations, and financial condition. Accordingly, we have concluded that substantial doubt exists with respect to our ability to continue as a going concern for at least 12 months after the issuance of the accompanying condensed consolidated financial statements.

Use of Estimates

The preparation of financial statements in conformity with U.S. GAAP requires management to make estimates, assumptions and judgments that affect the amounts reported in the financial statements and accompanying notes. Significant estimates relied upon in preparing these financial statements include estimates related to revenue recognition, accrued research and development expenses, stock-based compensation expense, income taxes and the liability related to the sale of future revenues. Actual results could differ materially from those estimates.

Recent Accounting Pronouncements

We consider the applicability and impact of any recent Accounting Standards Update (ASU) issued by the Financial Accounting Standards Board (FASB). Based on our assessment, the ASUs were determined to be either not applicable or are expected to have minimal impact on our condensed consolidated financial statements.

3.
Net Loss per Common Share

Basic net loss per common share is calculated by dividing net loss by the weighted-average number of shares of common stock and pre-funded warrants outstanding during the period, without consideration of common share equivalents. Diluted net loss per common share is computed by dividing net loss by the weighted-average number of shares of common stock, pre-funded warrants and common share equivalents outstanding for the period. The pre-funded warrants are included in the computation of basic and diluted net loss per common share as the exercise price is negligible and the pre-funded warrants are fully vested and exercisable. Common share equivalents are only included in the calculation of diluted net loss per common share when their effect is dilutive.

Potential dilutive securities, which include unvested restricted stock units (RSUs), unvested performance-based RSUs and performance-based options to purchase common stock for which established performance criteria have been achieved as of the end of the respective periods, vested and unvested options to purchase common stock and shares to be issued under our employee stock purchase plan (ESPP), have been excluded from the computation of diluted net loss per common share as the effect is antidilutive. Therefore, the denominator used to calculate both basic and diluted net loss per common share is the same in all periods presented.

11


 

The following table represents the potential common shares issuable pursuant to outstanding securities as of the dates listed that were excluded from the computation of diluted net loss per common share, as their inclusion would have an antidilutive effect:

 

 

 

 

 

 

 

As of March 31,

 

 

2023

 

 

2022

 

Unvested RSUs

 

10,565,596

 

 

 

7,932,532

 

Vested and unvested options

 

13,441,909

 

 

 

10,857,620

 

ESPP share purchase rights

 

472,184

 

 

 

220,029

 

Total

 

24,479,689

 

 

 

19,010,181

 

 

4.
Financial Instruments

Our financial assets are measured at fair value on a recurring basis using the following hierarchy to prioritize valuation inputs, in accordance with applicable U.S. GAAP:

Level 1: Quoted prices in active markets for identical assets or liabilities that we have the ability to access

Level 2: Observable market-based inputs or unobservable inputs that are corroborated by market data such as quoted prices, interest rates and yield curves

Level 3: Inputs that are unobservable data points that are not corroborated by market data

We review the fair value hierarchy classification on a quarterly basis. Changes in the ability to observe valuation inputs may result in a reclassification of levels of certain securities within the fair value hierarchy. We recognize transfers into and out of levels within the fair value hierarchy in the period in which the actual event or change in circumstances that caused the transfer occurs. There have been no transfers between Level 1, Level 2 and Level 3 in any periods presented.

Financial assets and liabilities are considered Level 2 when their fair values are determined using inputs that are observable in the market or can be derived principally from or corroborated by observable market data such as pricing for similar securities, recently executed transactions, cash flow models with yield curves, and benchmark securities. In addition, Level 2 financial instruments are valued using comparisons to like-kind financial instruments and models that use readily observable market data as their basis. U.S. Treasury, government agency and corporate debt obligations, commercial paper and asset-backed securities are valued primarily using market prices of comparable securities, bid/ask quotes, interest rate yields and prepayment spreads and are included in Level 2.

Financial assets and liabilities are considered Level 3 when their fair values are determined using pricing models, discounted cash flow methodologies, or similar techniques, and at least one significant model assumption or input is unobservable. We have no Level 3 financial assets or liabilities.

12


 

The following tables summarize the estimated fair value and related valuation input hierarchy of our available-for-sale securities as of each period end:

 

 

 

 

Total

 

 

Total

 

 

Total

 

 

Total

 

 

 

 

 

Amortized

 

 

Unrealized

 

 

Unrealized

 

 

Estimated

 

As of March 31, 2023:

 

Input Level

 

Cost

 

 

Gain

 

 

Loss

 

 

Fair Value

 

 

 

 

 

(in thousands)

 

Money market funds

 

Level 1

 

$

38,355

 

 

$

 

 

$

 

 

$

38,355