UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM
☒ |
QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
For the quarterly period ended
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
ATARA BIOTHERAPEUTICS, INC.
(Exact name of Registrant as specified in its Charter)
Delaware |
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46-0920988 |
(State or other jurisdiction of incorporation or organization) |
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(I.R.S. Employer Identification No.) |
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(Address of principal executive offices) |
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(Zip Code) |
(Registrant’s telephone number, including area code: (
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.
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 |
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Accelerated filer |
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Non-accelerated filer |
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Smaller reporting company |
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Emerging growth company |
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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 ☒
Securities registered pursuant to Section 12(b) of the Act:
Title of Each Class |
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Trading Symbol(s) |
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Name of Each Exchange on Which Registered |
Common Stock, par value $0.0001 per share |
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The Nasdaq Stock Market LLC |
The number of outstanding shares of the Registrant’s Common Stock as of July 31, 2019 was
ATARA BIOTHERAPEUTICS, INC.
INDEX
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Page |
PART I. |
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FINANCIAL INFORMATION |
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Item 1. |
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3 |
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3 |
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Condensed Consolidated Statements of Operations and Comprehensive Loss |
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4 |
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Condensed Consolidated Statements of Changes in Stockholders’ Equity |
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5 |
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6 |
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7 |
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Item 2. |
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Management’s Discussion and Analysis of Financial Condition and Results of Operations |
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19 |
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Item 3. |
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26 |
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Item 4. |
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26 |
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PART II. |
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OTHER INFORMATION |
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Item 1. |
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28 |
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Item 1A. |
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28 |
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Item 2. |
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59 |
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Item 3. |
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59 |
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Item 4. |
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59 |
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Item 5. |
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59 |
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Item 6. |
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60 |
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61 |
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2
Atara Biotherapeutics, Inc.
Condensed Consolidated Balance Sheets
(Unaudited)
(In thousands, except per share amounts)
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June 30, |
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December 31, |
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2019 |
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2018 |
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Assets |
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Current assets: |
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Cash and cash equivalents |
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$ |
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$ |
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Short-term investments |
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Restricted cash - short-term |
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Prepaid expenses and other current assets |
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Total current assets |
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Property and equipment, net |
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Operating lease assets |
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Restricted cash - long-term |
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Other assets |
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Total assets |
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$ |
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$ |
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Liabilities and stockholders’ equity |
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Current liabilities: |
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Accounts payable |
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$ |
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$ |
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Accrued compensation |
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Accrued research and development expenses |
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Other current liabilities |
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Total current liabilities |
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Operating lease liabilities - long-term |
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Other long-term liabilities |
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Total liabilities |
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Commitments and contingencies (Note 8) |
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Stockholders’ equity: |
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Common stock—$ and December 31, 2018, respectively; outstanding as of June 30, 2019 and December 31, 2018, respectively |
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Additional paid-in capital |
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Accumulated other comprehensive income (loss) |
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( |
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Accumulated deficit |
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( |
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( |
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Total stockholders’ equity |
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Total liabilities and stockholders’ equity |
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$ |
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$ |
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See accompanying notes.
3
Atara Biotherapeutics, Inc.
Condensed Consolidated Statements of Operations and Comprehensive Loss
(Unaudited)
(In thousands, except per share amounts)
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Three Months Ended June 30, |
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Six Months Ended June 30, |
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2019 |
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2018 |
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2019 |
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2018 |
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Operating expenses: |
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Research and development |
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$ |
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$ |
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$ |
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$ |
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General and administrative |
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Total operating expenses |
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Loss from operations |
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( |
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( |
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( |
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( |
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Interest and other income, net |
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Loss before provision for income taxes |
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( |
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( |
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( |
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( |
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Provision for income taxes |
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Net loss |
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$ |
( |
) |
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$ |
( |
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$ |
( |
) |
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$ |
( |
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Other comprehensive loss: |
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Unrealized gain (loss) on available-for-sale securities |
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( |
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Comprehensive loss |
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$ |
( |
) |
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$ |
( |
) |
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$ |
( |
) |
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$ |
( |
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Net loss per common share: |
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Basic and diluted net loss per common share |
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$ |
( |
) |
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$ |
( |
) |
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$ |
( |
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$ |
( |
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Weighted-average shares outstanding used to calculate basic and diluted net loss per common share |
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See accompanying notes.
4
Atara Biotherapeutics, Inc.
Condensed Consolidated Statements of Changes in Stockholders’ Equity
(Unaudited)
(In thousands)
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Accumulated |
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Common |
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Additional |
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Other |
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Total |
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Stock |
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Paid-in |
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Comprehensive |
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Accumulated |
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Stockholders’ |
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For the Six Months Ended June 30, 2019 |
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Shares |
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Amount |
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Capital |
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Income (Loss) |
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Deficit |
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Equity |
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Balance as of December 31, 2018 |
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$ |
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$ |
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$ |
( |
) |
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$ |
( |
) |
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$ |
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Effect of the adoption of ASC topic 842 (Leases) |
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— |
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— |
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— |
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— |
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Balance as of January 1, 2019 |
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$ |
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$ |
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$ |
( |
) |
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$ |
( |
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$ |
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RSU settlements, net of shares withheld |
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— |
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( |
) |
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— |
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— |
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( |
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Issuance of common stock pursuant to employee stock awards |
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— |
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— |
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— |
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Stock-based compensation expense |
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— |
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— |
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— |
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— |
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Net loss |
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— |
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— |
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— |
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— |
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( |
) |
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( |
) |
Unrealized gain on available-for-sale securities |
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— |
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— |
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— |
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— |
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Balance as of March 31, 2019 |
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( |
) |
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Issuance of common stock through ATM Facility, net of commissions and offering costs of $ |
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— |
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— |
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— |
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RSU settlements, net of shares withheld |
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— |
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( |
) |
|
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— |
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( |
) |
Issuance of common stock pursuant to employee stock awards |
|
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— |
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— |
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— |
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|
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Stock-based compensation expense |
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— |
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— |
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— |
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— |
|
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Net loss |
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— |
|
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— |
|
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— |
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— |
|
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|
( |
) |
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( |
) |
Unrealized gain on available-for-sale securities |
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— |
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— |
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— |
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|
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|
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— |
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Balance as of June 30, 2019 |
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$ |
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$ |
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$ |
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$ |
( |
) |
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$ |
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Accumulated |
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Common |
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Additional |
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Other |
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Total |
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Stock |
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Paid-in |
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Comprehensive |
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Accumulated |
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Stockholders’ |
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For the Six Months Ended June 30, 2018 |
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Shares |
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Amount |
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Capital |
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Income (Loss) |
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Deficit |
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Equity |
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Balance as of December 31, 2017 |
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$ |
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$ |
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$ |
( |
) |
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$ |
( |
) |
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$ |
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Issuance of common stock through underwritten offerings, net of commissions and offering costs of $ |
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— |
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— |
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RSU settlements, net of shares withheld |
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— |
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( |
) |
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— |
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— |
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( |
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Issuance of common stock pursuant to employee stock awards |
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— |
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— |
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— |
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Stock-based compensation expense |
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— |
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— |
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— |
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— |
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Net loss |
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— |
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— |
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— |
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— |
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|
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( |
) |
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( |
) |
Unrealized loss on available-for-sale securities |
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— |
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|
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— |
|
|
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— |
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( |
) |
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— |
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( |
) |
Balance as of March 31, 2018 |
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( |
) |
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( |
) |
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Issuance of common stock through ATM Facility, net of commissions and offering costs of $ |
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— |
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— |
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RSU settlements, net of shares withheld |
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— |
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( |
) |
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— |
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— |
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( |
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Issuance of common stock pursuant to employee stock awards |
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— |
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— |
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— |
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Stock-based compensation expense |
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— |
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— |
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— |
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— |
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Net loss |
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— |
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— |
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— |
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— |
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( |
) |
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( |
) |
Unrealized gain on available-for-sale securities |
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— |
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— |
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— |
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|
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— |
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Balance as of June 30, 2018 |
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$ |
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$ |
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$ |
( |
) |
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$ |
( |
) |
|
$ |
|
|
See accompanying notes.
5
Atara Biotherapeutics, Inc.
Condensed Consolidated Statements of Cash Flows
(Unaudited)
(In thousands)
|
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Six Months Ended June 30, |
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2019 |
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2018 |
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Operating activities |
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Net loss |
|
$ |
( |
) |
|
$ |
( |
) |
Adjustments to reconcile net loss to net cash used in operating activities: |
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Stock-based compensation expense |
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Accretion of investment discounts |
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( |
) |
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( |
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Depreciation and amortization expense |
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Loss on disposals of property and equipment |
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Non-cash interest expense |
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Asset retirement obligation accretion expense |
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Changes in operating assets and liabilities: |
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Prepaid expenses and other current assets |
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( |
) |
Operating lease assets |
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Other assets |
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( |
) |
Accounts payable |
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( |
) |
Accrued compensation |
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( |
) |
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( |
) |
Accrued research and development expenses |
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( |
) |
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Other current liabilities |
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( |
) |
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Operating lease liabilities |
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( |
) |
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Other long-term liabilities |
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Net cash used in operating activities |
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( |
) |
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( |
) |
Investing activities |
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Purchases of short-term investments |
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( |
) |
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( |
) |
Proceeds from maturities and sales of short-term investments |
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Purchases of property and equipment |
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( |
) |
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( |
) |
Proceeds from sale of property and equipment |
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Net cash provided by (used in) investing activities |
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( |
) |
Financing activities |
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Proceeds from sale of common stock in underwritten offerings, net |
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Proceeds from issuance of common stock through ATM facility, net |
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Proceeds from employee stock awards |
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Taxes paid related to net share settlement of restricted stock units |
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( |
) |
|
|
( |
) |
Principal payments on finance and capital lease obligations |
|
|
( |
) |
|
|
( |
) |
Net cash provided by financing activities |
|
|
|
|
|
|
|
|
(Decrease) increase in cash, cash equivalents and restricted cash |
|
|
( |
) |
|
|
|
|
Cash, cash equivalents and restricted cash at beginning of period |
|
|
|
|
|
|
|
|
Cash, cash equivalents and restricted cash at end of period |
|
$ |
|
|
|
$ |
|
|
Non-cash investing and financing activities |
|
|
|
|
|
|
|
|
Property and equipment purchases included in accounts payable and other accrued liabilities |
|
$ |
|
|
|
$ |
|
|
Capitalized lease obligations |
|
$ |
|
|
|
$ |
|
|
Property & equipment acquired under capital leases |
|
$ |
|
|
|
$ |
|
|
Asset retirement cost |
|
$ |
|
|
|
$ |
|
|
Interest capitalized during construction period for build-to-suit lease transaction |
|
$ |
|
|
|
$ |
|
|
Receivable for options exercised |
|
$ |
|
|
|
$ |
|
|
Supplemental cash flow disclosure |
|
|
|
|
|
|
|
|
Cash paid for interest |
|
$ |
|
|
|
$ |
|
|
See accompanying notes.
6
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
We licensed rights to T-cell product candidates from Memorial Sloan Kettering Cancer Center (“MSK”) in June 2015 and licensed rights related to our next-generation CAR T programs from MSK in May 2018 and December 2018 and from Moffitt Cancer Center in August 2018. Additionally, we licensed rights to know-how and technology from the Council of the Queensland Institute of Medical Research (“QIMR Berghofer”) in October 2015, September 2016 and June 2018. See Note 6 for further information.
We have incurred significant operating losses since inception and have relied on public and private equity financings to fund our operations. As of June 30, 2019, we had an accumulated deficit of $
In July 2019, we completed an underwritten public offering of shares of common stock and pre-funded warrants and received aggregate net proceeds of approximately $
2. |
Summary of Significant Accounting Policies |
Basis of Presentation
The accompanying unaudited 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 condensed consolidated financial statements have been prepared on the same basis as the Company’s annual consolidated financial statements included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2018, except for the recognition of operating lease assets and operating lease liabilities effective January 1, 2019, in accordance with newly-adopted accounting pronouncements relating to leases as discussed below. 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 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, 2018 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.
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 clinical trial and other accruals, stock-based compensation expense and income taxes. Actual results could differ materially from those estimates.
Leases
We lease office space in multiple locations. We determine if an arrangement is a lease at inception. Operating leases are included in operating lease assets, other current liabilities, and operating lease liabilities on our condensed consolidated balance sheets. Leases with an initial term of 12 months or less are not recorded on the balance sheet; we recognize lease expense for these leases on a straight-line basis over the lease term. Finance leases are included in property and equipment, other current liabilities, and other long-term liabilities on our condensed consolidated balance sheets.
7
Operating lease assets and operating lease liabilities are recognized based on the present value of the future minimum lease payments over the lease term at commencement date. As most of our leases do not provide an implicit rate, we use our incremental borrowing rate based on the information available at commencement date in determining the present value of future payments. The incremental borrowing rate for our leases is determined based on lease term and currency in which lease payments are made, adjusted for impacts of collateral. The operating lease asset also includes any lease payments made and excludes lease incentives and initial direct costs incurred. Lease expense for minimum lease payments is recognized on a straight-line basis over the lease term.
Our facilities and equipment operating leases have lease and non-lease components and we have made a policy election to account for the lease and non-lease components as a single lease component.
Through December 31, 2018, the leases were reviewed for classification as operating, capital or build-to-suit leases. For operating leases, rent was recognized on a straight-line basis over the lease period. For capital leases, we recorded the leased asset with a corresponding liability for principal and interest. Payments were recorded as reductions to these liabilities with interest being charged to interest expense in our condensed consolidated statements of operations and comprehensive loss.