Atea Pharmaceuticals Inc
For the period ended Dec 31, 2024. Filed Mar 6, 2025.
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FY2024 · Filed Mar 6, 2025
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What changed in Management’s Discussion and Analysis?
Read the current filingPrevious report: 10-K
Period ended 2023-12-31; filed 2024-02-28.
0000950170-24-022226
Item 7. Management’s Discussion and Analysis of Financial Condition and Results of OperationsCurrent report: 10-K
Period ended 2024-12-31; filed 2025-03-06.
0000950170-25-034808
Item 7. Management’s Discussion and Analysis of Financial Condition and Results of OperationsThe baseline is this issuer’s latest earlier reporting period of the same form that was filed before the current report. A previous 10-Q is a different quarter, not a year-over-year comparison. Amendments are excluded.
Compared 148 previous paragraphs and 144 current paragraphs.
72 unchanged; 42 reworded; 29 added; 33 removed; 1 previous and 1 current paragraphs rearranged.
Tables are not compared: 4 previous and 4 current tables excluded. Dates, whitespace, punctuation and numbering changes are ignored; changes to financial figures remain significant.
A changed paragraph is not evidence that risk increased or decreased. An unchanged paragraph does not establish that risk stayed the same.
Added paragraphs (29)
Current report
HCV
Current report
HCV is a blood-borne, positive-sense, single-stranded ribonucleic acid ("RNA") virus that primarily infects liver cells. HCV is a leading cause of chronic liver disease, liver transplants and liver cancer in the United States ("US"), Europe and Japan.
Current report
Despite the availability of direct-acting antiviral (“DAA”) oral combination treatment regimens and eradication efforts by the World Health Organization and others, HCV continues to be a serious viral disease. An estimated 50 million people globally live with chronic HCV infection, with approximately 1 million new infections occurring each year. In 2022, HCV led to an estimated 242,000 deaths. These deaths are primarily attributable to cirrhosis and hepatocellular cancer, each of which are serious long-term consequences resulting from prolonged exposure, generally up to 20 years of HCV infection.
Current report
In the US, it is estimated that there are between 2.4 and 4.0 million persons infected with untreated HCV. Further it is reported that on an annual basis in the US, there are greater than 160,000 newly reported HCV infections. This incidence of newly reported infections outpaces substantially stagnant rates of treatment.
Current report
In the US and elsewhere, HCV is increasingly affecting younger people, with high case rates among those between 20 to 49 years of age. Since recently infected and younger patient populations are less likely to have developed cirrhosis given the relatively shorter cumulative exposure to the virus, there has been a trend in the US of decreasing incidence of cirrhosis among individuals with HCV infection. It is estimated by that less than 10% of the HCV-infected population in the US has cirrhosis.
Current report
Our Goal
Current report
The objective of our HCV development program is to improve upon the current standard of care ("SOC") by offering, the regimen of bemnifosbuvir and ruzasvir, if successfully developed and approved, as a differentiated pan-genotypic protease inhibitor-free therapeutic for HCV-infected patients. We believe that a novel treatment, with a profile that can be easily prescribed for and administered to today’s population of HCV-infected patients (e.g. young, newly infected, non-cirrhotic) would be a significant improvement to the current SOC.
Current report
Presently, there are no short-course (i.e., 8 week) nucleoside inhibitor-based, pan-genotypic HCV treatment regimens. Results from the clinical and nonclinical studies we have conducted to date, including a global Phase 2 clinical trial which enrolled 275 HCV infected patients, have shown that the regimen of bemnifosbuvir and ruzasvir offers high potency, a low risk for drug-drug interactions, good tolerability and convenience in that it can be taken with or without food which we believe would offer a significant improvement to the current SOC, if approved.
Current report
Based upon the encouraging clinical and nonclinical results to date, we are advancing the regimen of bemnifosbuvir and ruzasvir to Phase 3 clinical development. In the Phase 3 clinical trials, we will evaluate the regimen as an 8-week treatment duration for patients without cirrhosis and a 12-week treatment duration for patients with compensated cirrhosis. We believe that the regimen of bemnifosbuvir and ruzasvir, if approved, will rapidly become a therapy preferred by both HCV prescribers and patients.
Current report
Key Clinical Trial Results
Current report
In December 2024, we announced that the global Phase 2 study evaluating the regimen of bemnifosbuvir and ruzasvir had met its primary endpoints of safety and sustained virologic response (“SVR”) at 12 weeks post treatment (“SVR12”). The regimen of bemnifosbuvir and ruzasvir was generally well-tolerated with no drug-related serious adverse events (“SAEs”) or treatment discontinuations.
Current report
Primary efficacy endpoint results showed a 98% (208/213) SVR12 rate in the per-protocol treatment adherent patient population after 8 weeks of treatment with the regimen. The efficacy evaluable patient population, which included 17% treatment non-adherent patients, achieved a 95% (242/256) SVR12 rate. Additional results from the Phase 2 study showed in treatment adherent patients who were non-cirrhotic and infected with genotypes 1-4, an SVR12 rate of 99% (178/179) was achieved, demonstrating pan-genotypic potency. Treatment adherent patients with cirrhosis achieved an 88% (30/34) SVR12 rate. Although viral kinetics were slower in cirrhotic patients, all cirrhotic patients (100%; 34/34) achieved an end of treatment response at Week 8.
Current report
The global Phase 2 study enrolled 275 HCV treatment-naïve patients, both with and without compensated cirrhosis. The study was designed to evaluate the safety and efficacy of 8 weeks of treatment with the regimen consisting of once-daily bemnifosbuvir 550 mg and ruzasvir 180 mg. The primary endpoints were safety and SVR12 in the per-protocol treatment adherent population. Secondary and other endpoints included SVR12 in the efficacy evaluable population (a broader analysis population which included treatment non-adherent patients), SVR at 24 weeks post treatment (“SVR24”), virologic failure and resistance.
Current report
Phase 3 Clinical Development
Current report
In January 2025, we met with the U.S. Food and Drug Administration (“FDA”) at an End-of-Phase 2 meeting to seek feedback on the design of the Phase 3 clinical trials. The End-of-Phase 2 feedback from the FDA supported our decision to advance the program to Phase 3 clinical development.
Current report
The global HCV Phase 3 program we are currently initiating includes two randomized, open label Phase 3 trials comparing the regimen of bemnifosbuvir and ruzasvir to sofosbuvir and velpatasvir in patients with chronic HCV infection. The overall clinical trial design is identical for each trial. Currently, we are planning for one trial to be conducted in the U.S and Canada and one trial to be conducted outside of North America. This global geographic footprint is intended to assist us in enrolling patients with varied HCV genotypes.
Current report
Each trial is expected to enroll approximately 800 treatment-naïve patients, both with and without compensated cirrhosis. Patients will be stratified by genotype and cirrhosis status, and patients with human immunodeficiency virus ("HIV") co-infection will be allowed. For non-cirrhotic patients, 8 weeks of treatment with the regimen of bemnifosbuvir and ruzasvir will be compared to 12 weeks of sofosbuvir and velpatasvir. For cirrhotic patients, 12 weeks of bemnifosbuvir and ruzasvir will be compared to 12 weeks of sofosbuvir and velpatasvir.
Current report
The primary efficacy endpoint in each Phase 3 trial is HCV RNA < LLOQ at 24 weeks from the start of treatment. Measurement of sustained response at the Week 24 study visit is selected to ensure the primary endpoint occurs at the same relative timepoint from start of treatment in all patients. As the treatment duration is 8 weeks for patients without cirrhosis in the bemnifosbuvir and ruzasvir study arm and 12 weeks for all other study arms, the primary endpoint encompasses the period at least through the SVR12 timepoint for each treatment arm.
Current report
COVID-19
Current report
In September 2024 we announced the outcome of the global Phase 3 SUNRISE-3 trial evaluating bemnifosbuvir versus placebo for the treatment of Coronavirus Disease 2019 ("COVID-19"). The trial did not meet the primary endpoint of a statistically significant reduction in all-cause hospitalization or death through Day 29 in the monotherapy cohort of 2,221 high-risk patients with mild to moderate COVID-19. We believe that the unfavorable results from this study were impacted by the constantly evolving variants of COVID-19 and rapidly changing natural history of the disease, which during the study period trended toward a milder disease. This has led us to discontinue efforts to develop bemnifosbuvir for the treatment of COVID-19. In SUNRISE-3, bemnifosbuvir was generally safe and well tolerated. Currently, we are continuing to wind down and close out the study.
Current report
Respiratory and Other RNA Virus Infections
Current report
Separately, we are engaged in efforts to discover a product candidate for the treatment of respiratory diseases resulting from infection with single stranded RNA viruses. Additionally, we engaged in efforts to screen compounds which are a part of our compound library to assess antiviral activity against other RNA viral infections. Each of these efforts are at early stages and no clinical candidates have yet to be nominated.
Current report
conduct Phase 3 clinical development of the regimen of bemnifosbuvir and ruzasvir for the treatment of HCV;
Current report
continue discovery activities to identify within our compound library other potential product candidates for the treatment of diseases caused by single stranded RNA viruses;
Current report
manufacture the combination of bemnifosbuvir and ruzasvir in a fixed dose tablets for use in the Phase 3 clinical trials, and, if approved, for potential commercialization, for the treatment of HCV;
Current report
hire additional personnel, if necessary, to support our activities; and
Current report
General and administrative expenses decreased by $1.1 million from $49.9 million for the year ended December 31, 2023 to $48.8 million for the year ended December 31, 2024. The net decrease was primarily related to lower professional fees.
Current report
the outcome of our search for a strategic partnership to strengthen our commercialization capabilities in the U.S. and enhance our global commercialization reach;
Current report
The table above does not contain any potential amounts we may be obligated to pay under the Merck License Agreement as they will be recorded when the contingency is resolved and the milestone becomes payable. Additionally, the table above does not include any potential amounts due under the consulting agreement as none are probable and estimable at December 31, 2024.
Removed paragraphs (33)
Previous report
Bemnifosbuvir
Previous report
Derived from our internal discovery program, bemnifosbuvir (AT-527), is an investigational, novel, orally administered guanosine nucleotide analog polymerase inhibitor that combines a unique nucleotide scaffold with novel double prodrugs for the intended purpose of inhibiting the enzymes central to viral replication. We believe that utilizing this double prodrug moiety approach allows us to maximize formation of the active metabolite potentially resulting in an oral antiviral product candidate that is selective for and highly effective at preventing replication and transcription of SARS-CoV-2, the causative agent of COVID-19, HCV and other single ssRNA viruses while avoiding toxicity to host cells.
Previous report
COVID-19 – Our Strategy and Objective
Previous report
More than four years after emerging as a global pandemic and public health crisis, COVID-19 remains a persistent and serious health threat because of continued variant fueled surges of infection. The SARS-CoV-2 virus is accumulating mutations with amino acid substitutions faster than any other endemic ssRNA virus and the constant evolution of new variants has resulted in continued waves of infections globally.
Previous report
Our COVID-19 strategy is focused on the development of bemnifosbuvir for the treatment of COVID-19. We believe that oral antivirals protecting against the development of severe infection and transmission remain urgently needed particularly for high-risk patients who currently have few or no treatment options due to limitations of currently available vaccines and therapeutics. High-risk patients include those who are unvaccinated, patients who fail to respond to available vaccines, vaccinated patients with waning efficacy, which can occur between three to six months after immunization, and patients for whom current treatments are contraindicated. Without suitable treatments, high-risk patients remain vulnerable to severe COVID-19 and associated hospitalization and death.
Previous report
As COVID-19 continues to persist as a global endemic disease, we believe that the global COVID-19 therapeutic market, and in particular the US market, will remain a multi-billion-dollar commercial opportunity for many years to come. Further, as the commercialization of COVID-19 therapeutics enters more fully into traditional distribution and reimbursement channels in 2024 and after, we anticipate that a major consideration for third-party payers will be a cost/value analysis that is driven in part by the economic burden of hospitalization, especially for high-risk populations.
Previous report
The objective of our COVID-19 development program is to address the current unmet medical needs of high-risk patients who remain vulnerable to hospitalization and death from COVID-19 by developing bemnifosbuvir, as a safe, effective, convenient, oral antiviral without the key limitations of current treatment options, including drug-drug interactions, tolerability and other safety concerns. The FDA has granted Fast Track designation for the investigation of bemnifosbuvir to treat COVID-19. Currently, we are evaluating bemnifosbuvir in SUNRISE-3, a global Phase 3 clinical trial that is enrolling high-risk patients with mild to moderate COVID-19.
Previous report
For COVID-19, bemnifosbuvir targets the SARS-CoV-2 RNA polymerase (Nsp12), a highly conserved enzyme that is unlikely to change as the virus mutates and new variants continue to emerge. The RNA polymerase complex is responsible for both replication and transcription of SARS-CoV-2. Bemnifosbuvir has a unique dual mechanism of action at both the RdRp and nidovirus RdRp associated NiRAN active sites on the highly conserved SARS-CoV-2 RNA polymerase, which has the potential to create a high barrier to resistance. In vitro data have shown that bemnifosbuvir was active with similar activity against all SARS-CoV-2 VOC and VOI that have been tested to date, including Omicron subvariants BA.4, BA.5 and XBB and EG.5.1.
Previous report
HCV – Our Strategy and Objective
Previous report
Despite the availability of direct acting antiviral oral combination treatment regimens, HCV continues to be a serious viral disease in the US and globally. Approximately 58 million people globally are living with chronic HCV infection. The WHO estimates a global incidence of 1.5 million new infections and 290,000 deaths per year.
Previous report
In the US, HCV is recognized as a health crisis with approximately 2.4 million individuals estimated to be infected. Prevalence of HCV in the US is expected to remain constant over the coming years as rising HCV is incidence largely attributable to the opioid crisis, IV drug use, and HCV reinfection, especially among younger adults, offsets the number of new patients treated.
Previous report
Our HCV strategy focuses on the development of bemnifosbuvir in combination with ruzasvir, an HCV NS5A inhibitor, a product candidate which we have exclusively licensed from Merck. Combination therapy utilizing two or more direct acting antivirals with different mechanisms of action is a scientifically and clinically well-established approach that is utilized by currently available human immunodeficiency virus, hepatitis B virus and HCV treatment regimens.
Previous report
The objective of our HCV development program is to improve upon the current SOC by offering, if successfully developed, the combination of bemnifosbuvir and ruzasvir, as a potentially differentiated eight-week duration, pan-genotypic protease inhibitor-free regimen for HCV-infected patients with or without cirrhosis. Currently, we are conducting a Phase 2 clinical trial of bemnifosbuvir in combination with ruzasvir in treatment naïve HCV infected patients, either without cirrhosis or with compensated cirrhosis.
Previous report
For HCV, the combination of bemnifosbuvir and ruzasvir targets the HCV NS5B and the HCV NS5A, respectively, and is designed to inhibit these enzymes which are essential for HCV replication. Both bemnifosbuvir and ruzasvir have individually demonstrated potent, pan-genotypic, antiviral activity against HCV and the combination of bemnifosbuvir and ruzasvir has exhibited synergistic activity against HCVin vitro.
Previous report
Key Clinical Trials
Previous report
COVID-19 – SUNRISE-3: Global Phase 3 Clinical Trial of Bemnifosbuvir
Previous report
SUNRISE-3, is a currently ongoing global, multicenter, randomized, double-blind, placebo-controlled Phase 3 clinical trial that is evaluating bemnifosbuvir (550 mg BID) for five days) in high-risk non-hospitalized patients with mild or moderate COVID-19. SUNRISE-3 is designed to evaluate bemnifosbuvir as monotherapy (primary analysis) but it is also exploring the effect of combination therapy in a smaller sub-set of patients who receive a compatible antiviral drug along with bemnifosbuvir (secondary analysis).
Previous report
The trial consists of two study populations derived from the type of SOC received: 1) a “supportive care population” (those patients who do not qualify for another antiviral treatment or where other antivirals are not locally available) which is assessing bemnifosbuvir given as monotherapy (primary analysis) and 2) a “combination antiviral population” which is assessing combination therapy if the SOC includes treatment with other compatible antiviral drugs against COVID-19 (secondary analysis). Patients are being randomized 1:1 to receive either bemnifosbuvir 550 mg BID plus locally available SOC or placebo BID plus locally available SOC for five days.
Previous report
The primary endpoint of the SUNRISE-3 study is all-cause hospitalization or death through Day 29 in approximately 2,200 patients in the supportive care monotherapy population. Secondary endpoints in each of the supportive care monotherapy patient population and the combination antiviral population include COVID-19 related hospitalization or death, COVID-19 complications, medically attended visits, symptom rebound/relapse and viral load rebound.
Previous report
The trial is enrolling patients who are ≥70 years old (regardless of other risk factors), patients ≥55 years old with one or more risk factors, patients ≥50 years old with two or more risk factors and patients ≥18 years old with certain risk factors including immunocompromised conditions, all regardless of COVID-19 vaccination status. We believe that this population encompasses those patients who currently remain at high-risk for progression of COVID-19 to severe disease and associated hospitalization and death.
Previous report
In January and February 2024, we announced the enrollment of more than 650 patients and more than 1,350 patients, respectively, in the supportive care monotherapy cohort. Each of these patient enrollment milestones triggers an interim analysis by an independent DSMB principally for safety and futility after the respective patient group has completed Day 29 post treatment. As a result, we currently anticipate that the first interim analysis by the DSMB will occur in March of 2024 and the second interim analysis by the DSMB will occur in the second quarter of 2024. Patient enrollment in the SUNRISE-3 trial, which has currently surpassed 1,400 patients in the supportive care monotherapy population, continues and topline data from the trial are anticipated in the second half of 2024.
Previous report
Currently, we are conducting a global Phase 2 clinical trial of bemnifosbuvir in combination with ruzasvir in treatment-naïve, HCV-infected patients either without cirrhosis or with compensated cirrhosis. This study is designed to evaluate the safety and efficacy of eight weeks of treatment with the combination consisting of once daily bemnifosbuvir 550 mg and ruzasvir 180 mg. Up to approximately 280 HCV-infected, treatment-naïve patients across HCV GTs, including a lead-in cohort of 60 patients without cirrhosis, are expected to be enrolled in this Phase 2 clinical trial. The primary endpoints of the study are safety and SVR12. Other virologic endpoints include virologic failure, SVR24 and resistance.
Previous report
In February 2024, we announced final results from the full lead-in cohort in which a 98% SVR4 rate was observed [58 of 59 subjects achieved SVR4 with one patient who did not return for post-treatment follow-up]. The one patient who did not achieve SVR4 had poor adherence, and was infected with HCV GT-2. These results are consistent with the initial results announced in January 2024. The SVR4 rate exceeded the protocol-defined efficacy criterion of ≥90% SVR4 for continuing the study. As a result, in January 2024 we commenced enrolling up to an additional 220 patients in the study, including patients with cirrhosis. In the lead-in cohort, very rapid kinetics were observed with viral load for each patient near or below the LLOQ at four weeks of treatment, which we believe is supportive of an eight-week treatment regimen for the combination of bemnifosbuvir and ruzasvir. All 60 patients in the lead-in cohort achieved viral load below the LLOQ by the end of the eight-week treatment regimen.
Previous report
The combination of bemnifosbuvir and ruzasvir in the lead-in cohort was generally safe and well tolerated and there were no drug related SAEs, no treatment discontinuations and adverse events AEs were mostly mild. Final SVR12 results from all 280 patients enrolled in the global Phase 2 study are anticipated in the second half of 2024.
Previous report
If the Phase 2 study is successfully completed, subject to discussion and alignment with regulatory authorities, we anticipate initiating a Phase 3 clinical development program in the second half of 2024.
Previous report
Dengue
Previous report
After conducting a Phase 2 clinical trial, in February 2023, we decided not to pursue further clinical development of AT-752 for the treatment and prophylaxis of dengue. This action was taken due to the long timelines anticipated for patient enrollment, expected clinical operational challenges, including the challenge of successfully identifying patients shortly after infection which is not feasible with the diagnostic tests that are currently readily available in endemic countries, and the estimated resource burdens, including substantial costs, associated with the further clinical development of an antiviral for each of the treatment and prophylaxis of dengue.
Previous report
continue Phase 3 clinical development of bemnifosbuvir as a monotherapy for the treatment of COVID-19;
Previous report
continue the clinical development of the combination of bemnifosbuvir and ruzasvir for the treatment of HCV which is expected to include later stage Phase 3 development if the Phase 2 clinical trial we are currently conducting is successful;
Previous report
manufacture increasing quantities of bemnifosbuvir drug substance and drug product in anticipation of potential commercialization;
Previous report
hire additional research, development and administrative personnel; and
Previous report
Research and development expenses increased by $32.3 million from $81.9 million for the year ended December 31, 2022 to $114.2 million for the year ended December 31, 2023. The increase was primarily driven by higher external spend related to our Phase 3 COVID-19 SUNRISE-3 clinical trial and our Phase 2 clinical trial of the combination of bemnifosbuvir and ruzasvir for the treatment of HCV offset by a larger reduction related to credits received from Roche. We also had an increase of $4.4 million in internal costs primarily due to an increase of $2.8 million in personnel-related expenses, including salaries and bonuses, benefits and increased stock-based compensation expense of $0.8 million for our research and product development employees and $1.6 million in consulting and other research and development expenses.
Previous report
General and administrative expenses increased by $1.2 million from $48.7 million for the year ended December 31, 2022 to $49.9 million for the year ended December 31, 2023. The increase in general and administrative expenses reflected an increase of $2.4 million in personnel-related expenses, including salaries, benefits and increased stock-based compensation expense of $1.9 million; partially offset by a decrease in professional fees and other expenses of $1.3 million.
Reworded paragraphs (42)
Previous wording
We are a clinical-stage biopharmaceutical company leveraging our deep understanding of antiviral drug development, medicinal chemistry, biology, biochemistry and virology to discover and develop novel orally administered product candidates to treat serious viral diseases. Currently, we are developing our lead product candidate, bemnifosbuvir, in a global Phase 3 clinical trial as a monotherapy for the treatment of COVID-19, and in a global Phase 2 clinical trial as part of a combination therapy with ruzasvir, an NS5A inhibitor, for the treatment of HCV infection.
Current wording
We are a clinical-stage biopharmaceutical company leveraging our deep understanding of antiviral drug development, medicinal chemistry, biology, biochemistry and virology to discover and develop novel orally administered product candidates to treat serious viral diseases. Our lead product candidate is a the regimen consisting of bemnifosbuvir and ruzasvir, which we are developing for the treatment of hepatitis C virus (“HCV”) infection. Currently, we expect to commence enrollment of patients in an HCV Phase 3 program evaluating the regimen in April 2025.
Previous wording
We believe we are well capitalized to advance our current programs. We had $578.1 million in cash, cash equivalents and marketable securities at December 31, 2023. Based on our current plans, we anticipate these financial resources will allow us to advance our current and planned clinical programs to and through key inflection points and to fund our activities through 2026. We have based this estimate on assumptions that may prove to be wrong and we could exhaust our available capital resources sooner than we expect.
Current wording
We believe we are well capitalized to advance our current programs. We had $454.7 million in cash, cash equivalents and marketable securities at December 31, 2024. Based on our current plans, we anticipate these financial resources will allow us to advance our current and planned clinical programs to and through key inflection points including the completion of clinical development of the regimen of bemnifosbuvir and ruzasvir for the treatment of HCV and to fund our activities into 2028. We have based this estimate on assumptions that may prove to be wrong and we could exhaust our available capital resources sooner than we expect.
Previous wording
In October 2020, with Roche, we entered into the Roche License Agreement in connection with the global development, manufacture and commercialization of bemnifosbuvir, products containing bemnifosbuvir or AT-511, the free base of bemnifosbuvir, and related companion diagnostics. During the term of the Roche License Agreement, Roche and we jointly developed bemnifosbuvir for COVID-19 on a worldwide-basis and equally shared the costs associated with such development activities.
Current wording
In October 2020, with Roche, we entered into a License Agreement (“Roche License Agreement”) with F. Hoffmann-LaRoche Ltd. and Genentech, Inc. (together, “Roche”) in connection with the global development, manufacture and commercialization of bemnifosbuvir, products containing bemnifosbuvir or AT-511, the free base of bemnifosbuvir, and related companion diagnostics. During the term of the Roche License Agreement, Roche and we jointly developed bemnifosbuvir for COVID-19 on a worldwide-basis and equally shared the costs associated with such development activities.
Previous wording
The Roche License Agreement terminated on February 10, 2022, and, accordingly, our obligations to share costs with Roche also ended. As a result of the termination of the Roche License Agreement, we regained worldwide exclusive rights from Roche to research, develop, manufacture and commercialize bemnifosbuvir, products containing bemnifosbuvir and related companion diagnostics in all fields of use.
Current wording
The Roche License Agreement terminated on February 10, 2022, and, accordingly, our obligations to share costs with Roche also ended. As a result of the termination of the Roche License Agreement, we regained worldwide exclusive rights from Roche to research, develop, manufacture and commercialize bemnifosbuvir, products containing bemnifosbuvir or AT-511 and related companion diagnostics in all fields of use.
Previous wording
In December 2021, we entered into the Merck License Agreement for the development, manufacture and commercialization of ruzasvir. Ruzasvir is an investigational NS5A inhibitor we are developing in combination with bemnifosbuvir for the treatment of HCV.
Current wording
In December 2021, we entered into a license agreement (“Merck License Agreement”) with MSD International GmbH, an affiliate of Merck & Co., Inc. (“Merck”) for the development, manufacture and commercialization of ruzasvir. Ruzasvir is the investigational NS5A inhibitor we are developing in combination with bemnifosbuvir for the treatment of HCV.
Previous wording
Pursuant to the terms of the Merck License Agreement, we obtained from Merck an exclusive (subject to certain reserved rights to conduct internal research), sublicensable, and worldwide license under certain Merck patents and know-how to research, develop, manufacture, have manufactured, use, import, export, sell, offer for sale, and otherwise commercialize a Product for all therapeutic or prophylactic uses in humans.
Current wording
Pursuant to the terms of the Merck License Agreement, we obtained from Merck an exclusive (subject to certain reserved rights to conduct internal research), sublicensable, and worldwide license under certain Merck patents and know-how to research, develop, manufacture, have manufactured, use, import, export, sell, offer for sale, and otherwise commercialize ruzasvir or products containing ruzasvir (each a “Product”) for all therapeutic or prophylactic uses in humans.
Previous wording
In addition to a non-refundable upfront payment that we made in February 2022, we will be required to pay Merck milestone payments upon our achievement of certain development, regulatory and sales-based milestones. Additionally, we will pay Merck tiered royalties based on annual net sales of Products ranging from high single digits to mid-teens percentages. Our royalty payment obligations will continue until the later of (i) the expiration of the last to expire valid claim of a licensed Merck patent claiming such Product and (ii) a period of years after the first commercial sale of such Product in such country. We may terminate the Merck License Agreement for convenience upon prior written notice. The first potential milestone, in the amount of $5.0 million, would be payable upon the commencement of a Phase 3 clinical trial.
Current wording
In addition to a non-refundable upfront payment that we made in February 2022, we will be required to pay Merck milestone payments upon our achievement of certain development, regulatory and sales-based milestones. Additionally, we will pay Merck tiered royalties based on annual net sales of Products ranging from high single digits to mid-teens percentages. Our royalty payment obligations will continue until the later of (i) the expiration of the last to expire valid claim of a licensed Merck patent claiming such Product and (ii) a period of years after the first commercial sale of such Product in such country. We may terminate the Merck License Agreement for convenience upon prior written notice. The first milestone, in the amount of $5.0 million, is payable upon initiation of the first clinical trial in our Phase 3 program. We currently anticipate enrollment of patients to commence in the Phase 3 program in April 2025 and we expect this milestone to become payable in conjunction with such event.
Previous wording
As of December 31, 2023, we had cash, cash equivalents and marketable securities of $578.1 million. Net cash used in operating activities was $85.4 million for the year ended December 31, 2023.
Current wording
As of December 31, 2024, we had cash, cash equivalents and marketable securities of $454.7 million. Net cash used in operating activities was $135.5 million for the year ended December 31, 2024.
Previous wording
We expect that our net cash used in operating activities will increase significantly as we advance our product candidates through preclinical and clinical development, seek regulatory approval, and prepare for and, if approved, proceed to commercialization; acquire, discover, validate and develop additional product candidates; obtain, maintain, protect and enforce our intellectual property portfolio; and hire additional personnel. In addition, we may incur additional costs as we continue to operate as a public company. We believe that our available cash and cash equivalents will be sufficient to fund our planned operations through 2026. We have based this estimate on assumptions that may prove to be wrong and we could exhaust our available capital resources sooner than we expect.
Current wording
We expect that our net cash used in operating activities will remain significant as we advance our HCV product candidate through preclinical and clinical development, seek regulatory approval, and prepare for and, if approved, manufacture such product at commercial scale and otherwise pursue commercialization activities; acquire, discover, validate and develop additional product candidates; obtain, maintain, protect and enforce our intellectual property portfolio; and, if necessary, hire additional personnel. In addition, we may incur additional costs as we continue to operate as a public company. We believe that our available cash, cash equivalents and marketable securities will be sufficient to fund our planned operations into 2028. We have based this estimate on assumptions that may prove to be wrong and we could exhaust our available capital resources sooner than we expect.
Previous wording
We do not have any products approved for sale and have not generated any product revenue since inception. We do not anticipate generating any revenue from product sales for the foreseeable future. Our ability to generate product revenue will depend on the successful development, regulatory approval and eventual commercialization of one or more of our product candidates. Until such time as we can generate significant revenue from product sales, if ever, we expect to finance our operations through private or public equity or debt financings, collaborative or other arrangements with third parties, or through other sources of financing. Adequate funding may not be available to us on acceptable terms, or at all. If we fail to raise capital or enter into such agreements as and when needed, we may have to significantly delay, scale back or discontinue the development and commercialization of our product candidates.
Current wording
We do not have any products approved for sale and have not generated any product revenue since inception. We do not anticipate generating any revenue from product sales for the foreseeable future. Our ability to generate product revenue will depend on the successful development, regulatory approval and eventual commercialization of one or more of our product candidates. Until such time as we can generate significant revenue from product sales, if ever, we expect to finance our operations through private or public equity or debt financings, collaborative or other arrangements with third parties, or through other sources of financing. Our failure to meet the primary endpoint of our COVID-19 SUNRISE-3 Phase 3 clinical trial may make such financing more difficult. Adequate funding may not be available to us on acceptable terms, or at all. If we fail to raise capital or enter into such agreements as and when needed, we may have to significantly delay, scale back or discontinue the development and commercialization of our product candidates.
Previous wording
We plan to continue to use third-party service providers, including CROs to carry out our preclinical and clinical development, and CMOs to manufacture and supply the materials used during the development of our product candidates. Additionally, we expect to rely on CMOs for the manufacture of commercial supply of any product candidate we may successfully develop.
Current wording
We plan to continue to use third-party service providers, including clinical research organizations (“CROs”) to carry out our preclinical and clinical development, and contract manufacturing organizations (“CMOs”) to manufacture and supply the materials used during the development of our product candidates. Additionally, we expect to rely on CMOs for the manufacture of commercial supply of any product candidate we may successfully develop.
Previous wording
As we continue to advance our programs, we expect to incur significantly higher expenses over the next several years. We anticipate that our expenses will increase significantly in connection with our ongoing activities, as we:
Current wording
As we continue to advance our programs, we expect to incur significant expenses over the next several years, as we:
Previous wording
continue discovery and IND-enabling activities in anticipation of nominating a protease inhibitor product candidate for the treatment of COVID-19;
Current wording
continue discovery and IND-enabling activities in anticipation of nominating a protease inhibitor product candidate for the treatment of respiratory diseases resulting from infection with single stranded RNA viruses;
Previous wording
initiate clinical development of a protease inhibitor for the treatment of COVID-19;
Current wording
initiate clinical development of a protease inhibitor for the treatment of respiratory and other diseases resulting from infection with single stranded RNA viruses;
Previous wording
seek market approval and prepare for potential commercialization of product candidates we may successfully develop;
Current wording
seek market approval and prepare for potential commercialization of any product candidates that we may successfully develop;
Previous wording
If our development efforts for our product candidates are successful and result in commercialization, we may generate revenue in the future from product sales. Additionally, we may generate revenue from collaboration or license agreements that we may enter into with third parties.
Current wording
If our product candidate development efforts are successful and result in commercialization, we may generate revenue in the future from product sales. Additionally, we may generate revenue from collaboration or license agreements that we may enter into with third parties.
Previous wording
Substantially all of our research and development expenses consist of expenses incurred in connection with the discovery and development of our product candidates. These expenses include external costs consisting of fees paid to third parties, including CROs and CMOs, to conduct certain research and development activities on our behalf and consulting costs, as well as internal costs consisting of payroll and personnel-related expenses, including salaries and bonuses, employee benefit costs and stock-based compensation expenses for our research and product development employees and allocated overhead, including rent, equipment, depreciation, information technology costs and utilities attributable to our research and development personnel. We expense both internal and external research and development expenses as they are incurred. In circumstances where amounts have been paid in advance or in excess of costs incurred, we record a prepaid expense, which is expensed as services are performed or goods are delivered.
Current wording
Substantially all of our research and development expenses consist of expenses incurred in connection with the discovery and development of our product candidates. These expenses include external costs consisting of fees paid to third parties, including CROs and CMOs, to conduct certain research and development activities on our behalf and consulting costs, as well as internal costs consisting of payroll and personnel-related expenses, including salaries and bonuses, employee benefit costs and stock-based compensation expenses for our research and development employees and allocated overhead, including rent, equipment, depreciation, information technology costs and utilities attributable to our research and development personnel. We expense both internal and external research and development expenses as they are incurred. In circumstances where amounts have been paid in advance or in excess of costs incurred, we record a prepaid expense, which is expensed as services are performed or goods are delivered.
Previous wording
As discussed in Note 3 to our consolidated financial statements, during the term of the Roche License Agreement which terminated in February 2022, we and Roche shared certain manufacturing and clinical development costs on a 50/50 basis. Billings to us by Roche for our percentage share of such expenses were recorded in research and development expenses. During the year ended December 31, 2023, we recorded a net reduction to research and development expenses of $18.6 million related to credits received from Roche. During the year ended December 31, 2022, we recorded a net reduction to research and development expenses of $6.9 million related to credits received from Roche. These credits were the result, following the termination of the Roche License Agreement, of changes and adjustments by Roche in estimated amounts of expenses reported by Roche during the period in which we and Roche shared costs associated with the development of bemnifosbuvir.
Current wording
As discussed in Note 3 to our consolidated financial statements, during the term of the Roche License Agreement which terminated in February 2022, we and Roche shared certain COVID-19 manufacturing and clinical development costs on a 50/50 basis. Billings to us by Roche for our percentage share of such expenses were recorded in research and development expenses. During the years ended December 31, 2024 and 2023, we recorded a net reduction to research and development expenses of $1.3 million and $18.6 million, respectively, related to credits received from Roche. These credits were the result, following the termination of the Roche License Agreement, of changes and adjustments by Roche in estimated amounts of expenses reported by Roche during the period in which we and Roche shared costs associated with the development of bemnifosbuvir for the treatment of COVID-19. We do not anticipate to receive any additional credits from Roche or record any related additional net reductions to research and development expenses.
Previous wording
We are focusing substantially all of our resources on the development of our product candidates, particularly bemnifosbuvir for the treatment of COVID-19 and the combination of bemnifosbuvir and ruzasvir for the treatment of HCV. We expect our research and development expenses to continue to increase substantially for at least the next few years, as we seek to complete our current clinical programs which in the case of HCV, is expected to include a Phase 3 clinical trial if our Phase 2 clinical trial is successful, pursue regulatory approval of our product candidates and prepare for the possible commercialization of these product candidates. Predicting the timing or cost to complete our clinical programs, validate our commercial manufacturing and supply processes and manufacture of product at commercial scale is difficult and delays may occur because of many factors, including factors outside of our control. For example, if the FDA or other regulatory authorities were to require us to conduct clinical trials beyond those that we currently anticipate or the time to complete planned clinical trials is extended due to delays in enrollment or otherwise, we could be required to expend significant additional financial resources and time on the completion of clinical development. Furthermore, we are unable to predict with any certainty when our product candidates, if ever, will receive regulatory approval with any certainty, if ever.
Current wording
Substantially all of our resources are focused on the development of our product candidates. We expect our research and development expenses to vary quarter over quarter particularly as we advance our Phase 3 HCV clinical program and prepare for the possible commercialization of the combination of bemnifosbuvir and ruzasvir if the Phase 3 clinical development is successful. Predicting the timing or cost to complete our clinical programs, validate our commercial manufacturing and supply processes and manufacture of product at commercial scale is difficult and delays may occur because of many factors, including factors outside of our control. For example, if the FDA or other regulatory authorities were to require us to conduct clinical trials beyond those that we currently anticipate or the time to complete planned clinical trials is extended due to delays in enrollment or otherwise, we could be required to expend significant additional financial resources and time on the completion of clinical development. Furthermore, we are unable to predict with any certainty when our HCV product candidate or any other product candidate we may develop will, if ever, receive regulatory approval. Early stage activities consist of assessing the antiviral activity and other properties of select compounds derived from our compound library against respiratory and other RNA viral infections.
Previous wording
General and administrative expenses consist principally of payroll and personnel expenses, including salaries and bonuses, benefits and stock-based compensation expenses, professional fees for legal, consulting, accounting and tax services, allocated overhead, including rent, equipment, depreciation, information technology costs and utilities, and other general operating expenses not otherwise classified as research and development expenses.
Current wording
General and administrative expenses consist principally of payroll and personnel expenses, including salaries and bonuses, benefits and stock-based compensation expenses, professional fees for legal, consulting, accounting and tax services, business insurance, allocated overhead, including rent, equipment, depreciation, information technology costs and utilities, and other general operating expenses not otherwise classified as research and development expenses.
Previous wording
HCV – Global Phase 2 Clinical Trial of the Combination of Bemnifosbuvir and Ruzasvir
Current wording
Research and development expenses increased by $29.9 million from $114.2 million for the year ended December 31, 2023 to $144.1 million for the year ended December 31, 2024. The net increase was primarily driven by higher external spend related to our COVID-19 Phase 3 SUNRISE-3 clinical trial and our HCV Phase 2 clinical trial of the combination of bemnifosbuvir and ruzasvir. Enrollment in both trials was completed in 2024 and we announced end of study results from the SUNRISE-3 clinical trial in September 2024 and primary endpoint results from our global HCV Phase 2 in December 2024.
Previous wording
Interest income and other, net, increased by $18.1 million for the year ended December 31, 2023 compared to the year ended December 31, 2022, primarily due to investing in higher yield marketable securities and higher interest rates for the entire year.
Current wording
Interest income and other, net, decreased by $3.7 million for the year ended December 31, 2024 compared to the year ended December 31, 2023, primarily due to lower investment balances.
Previous wording
We recorded an income tax expense of $1.0 million for the year ended December 31, 2023 as compared to a net income tax benefit of $3.6 million for the year ended December 31, 2022. The net income tax benefit recorded for the year ended December 31, 2022 was primarily the result of changes in estimates between our original provision for 2021 income taxes and the actual amounts reflected in the income tax returns as filed.
Current wording
We recorded an income tax expense of $0.9 million for the year ended December 31, 2024 as compared to an income tax expense of $1.1 million for the year ended December 31, 2023.
Previous wording
As of December 31, 2023, we had cash, cash equivalents and marketable securities of $578.1 million. We believe that our available cash, cash equivalents and marketable securities will be sufficient to fund our planned operations through 2026. We have based this estimate on assumptions that may prove to be wrong and we could exhaust our available capital resources sooner than we expect.
Current wording
As of December 31, 2024, we had cash, cash equivalents and marketable securities of $454.7 million. We believe that our available cash, cash equivalents and marketable securities will be sufficient to fund our planned operations into 2028 including the completion of the Phase 3 program evaluating the regimen of bemnifosbuvir and ruzasvir for the treatment of HCV. We have based this estimate on assumptions that may prove to be wrong and we could exhaust our available capital resources sooner than we expect.
Previous wording
We entered into an open market sales agreement ("Sales Agreement") with Jefferies LLC ("Jefferies"), in 2021 pursuant to which we may from time to time offer and sell shares of our common stock for an aggregate offering price of up to $200.0 million, through or to Jefferies, acting as sales agent or principal. We have agreed to pay Jefferies a commission of up to 3.0% of the aggregate gross proceeds from each sale of shares, reimburse legal fees and disbursements and provide Jefferies with customary indemnification and contribution rights. As of December 31, 2023, no shares have been issued under the Sales Agreement. The shares will be offered and sold under the Company's shelf registration statement on Form S-3 and related prospectus filed with the SEC on November 24, 2021, as amended.
Current wording
We are party to an amended and restated open market sales agreement ("Sales Agreement") with Jefferies LLC ("Jefferies"), pursuant to which we may from time to time offer and sell shares of our common stock for an aggregate offering price of up to $200.0 million, through or to Jefferies, acting as sales agent or principal. We have agreed to pay Jefferies a commission of up to 3.0% of the aggregate gross proceeds from each sale of shares, reimburse legal fees and disbursements and provide Jefferies with customary indemnification and contribution rights. As of December 31, 2024, no shares have been issued under the Sales Agreement. The shares will be offered and sold under the Company's shelf registration statement on Form S-3 declared effective by the SEC on November 19, 2024.
Previous wording
To date, we have not generated any product revenue. We do not expect to generate any product revenue unless and until we obtain regulatory approval of and commercialize any of our product candidates and we do not know when, or if, this will occur. We expect to continue to incur increased expenditures for the foreseeable future, and we expect our expenses to increase as we continue the development of, and seek regulatory approvals for, our product candidates and begin to commercialize any approved products. We are subject to all of the risks typically related to the development of new product candidates, and we may encounter unforeseen expenses, difficulties, complications, delays and other unknown factors that may adversely affect our business. Moreover, we expect to incur additional general and administrative costs as we continue to operate as a public company and expand our organization to support more advanced clinical development of our product candidates and the initiation of activities in preparation for potential commercialization of our product candidates.
Current wording
To date, we have not generated any product revenue. We do not expect to generate any product revenue unless and until we obtain regulatory approval of and commercialize any of our product candidates and we do not know when, or if, this will occur. We expect to continue to incur significant expenditures for the foreseeable future as we continue the development of, and seek regulatory approvals for, our product candidates and begin to commercialize any approved products. We are subject to all of the risks typically related to the development of new product candidates, and we may encounter unforeseen expenses, difficulties, complications, delays and other unknown factors that may adversely affect our business. Moreover, we expect to incur additional general and administrative costs as we continue to operate as a public company and potentially expand our organization to support the initiation of activities in preparation for potential commercialization of our product candidates.
Previous wording
We will continue to require additional capital to develop our product candidates and fund operations for the foreseeable future. We may seek to raise capital through public or private equity or debt financings, collaborative arrangements with third parties, or through other sources of financing. We anticipate that we may need to raise substantial additional capital, the requirements for which will depend on many factors, including:
Current wording
We will continue to invest significant capital to develop our product candidates and fund operations for the foreseeable future. To fund such investment, we may seek to raise capital through public or private equity or debt financings, collaborative arrangements with third parties, or through other sources of financing. We anticipate that we may need to raise substantial additional capital, the requirements for which will depend on many factors, including:
Previous wording
the scope, timing, rate of progress and costs of our drug discovery efforts, preclinical development activities, laboratory testing and clinical trials for our product candidates;
Current wording
the scope, timing, rate of progress and costs of our Phase 3 program evaluating the combination of bemnifosbuvir and ruzasvir for the treatment of HCV and our other drug discovery efforts, preclinical development activities, laboratory testing and clinical trials for other product candidates;
Previous wording
Market volatility, inflation, interest rate fluctuations and concerns associated with the evolution of COVID-19, macroeconomic trends and geopolitical events, including civil or political unrest and terrorism, may have a significant impact on the availability of funding sources and the terms on which any funding may be available.
Current wording
Market volatility, inflation, interest rate fluctuations, tariffs, macroeconomic trends and geopolitical events, including civil or political unrest and terrorism, may have a significant impact on the availability of funding sources and the terms on which any funding may be available.
Previous wording
The following table sets forth the primary sources and uses of cash, cash equivalents, and restricted cash for each of the periods presented below:
Current wording
The following table sets forth the primary sources and uses of cash and cash equivalents for each of the periods presented below:
Previous wording
Net cash used in operating activities for the year ended December 31, 2023 was $85.4 million. Cash used in operating activities was primarily due to a net loss of $136.0 million, accretion of premium and discounts on marketable securities of $15.4 million, an increase in prepaid expenses and other assets of
Current wording
Net cash used in operating activities for the year ended December 31, 2024 was $135.5 million. Cash used in operating activities was primarily due to a net loss of $168.4 million, accretion of premium and discounts on marketable securities of $11.8 million, and a decrease in accrued expenses of $13.4 million, partially offset by stock-based compensation of $51.8 million and a decrease in prepaid expenses and other assets of $5.9 million.
Previous wording
Net cash used in operating activities for the year ended December 31, 2022 was $121.0 million. Cash used in operating activities was primarily due to a net loss of $115.9 million, accretion of premium and discounts on marketable securities of $5.5 million, an increase in prepaid expenses and other assets of $7.7 million, partially offset by a decrease in accounts payable and accrued expenses of $39.6 million and stock-based compensation of $46.7 million.
Current wording
Net cash used in operating activities for the year ended December 31, 2023 was $85.4 million. Cash used in operating activities was primarily due to a net loss of $136.0 million, accretion of premium and discounts on marketable securities of $15.4 million, partially offset by a decrease in prepaid expenses and other assets of $1.9 million, increase in accounts payable and accrued expenses of $14.4 million and stock-based compensation of $49.4 million.
Previous wording
Net cash used in investing activities for the year ended December 31, 2022 was $455.4 million and consisted of purchases of fixed assets of $1.9 million and purchases of marketable securities of $545.4 million offset by sales and maturities of marketable securities of $91.9 million.
Current wording
Net cash provided by investing activities for the year ended December 31, 2024 was $56.1 million and consisted of sales and maturities of marketable securities of $517.3 million offset by purchases of marketable securities of $461.2 million.
Previous wording
Net cash used in investing activities for the year ended December 31, 2023 was $40.3 million and consisted of purchases of marketable securities of $562.4 million offset by sales and maturities of marketable securities of $602.7 million.
Current wording
Net cash provided by investing activities for the year ended December 31, 2023 was $40.3 million and consisted of purchases of marketable securities of $562.4 million offset by sales and maturities of marketable securities of $602.7 million.
Previous wording
Net cash provided by financing activities for the year ended December 31, 2023 was $0.3 million and consisted of proceeds from the issuance of common stock under our Employee Stock Purchase Plan.
Current wording
Net cash provided by financing activities for the year ended December 31, 2024 was $0.3 million and consisted of proceeds from the issuance of our common stock under our Employee Stock Purchase Plan.
Previous wording
Net cash provided by financing activities for the year ended December 31, 2022 was $0.4 million and consisted of proceeds from the exercise of stock options and proceeds from the issuance of common stock under our Employee Stock Purchase Plan.
Current wording
Net cash provided by financing activities for the year ended December 31, 2023 was $0.3 million and consisted of proceeds from the issuance of our common stock under our Employee Stock Purchase Plan.
Previous wording
In consideration for the rights we acquired under the Merck License Agreement, we paid Merck a non-refundable upfront payment in the amount of $25 million. We are obligated to pay Merck milestone payments of $135 million in the aggregate upon its achievement of certain development and regulatory milestones and up to $300 million in the aggregate upon its achievement of certain sales-based milestones. Additionally, we will pay Merck tiered royalties based on annual net sales of Products ranging from high single digits to mid-teens percentages. Our royalty payment obligations will continue until the later of (i) the expiration of the last to expire valid claim of a licensed Merck patent claiming such Product and (ii) a period of years after the first commercial sale of such Product in such country. We may terminate the Merck License Agreement for convenience upon prior written notice. The first potential milestone would be payable upon the commencement of a Phase 3 clinical trial in the amount of $5.0 million. The table above does not include the potential milestones or royalties that we may be obligated to pay under the Merck License Agreement.
Current wording
In consideration for the rights we acquired under the Merck License Agreement, we paid Merck a non-refundable upfront payment in the amount of $25 million. We are obligated to pay Merck milestone payments of $135 million in the aggregate upon its achievement of certain development and regulatory milestones and up to $300 million in the aggregate upon its achievement of certain sales-based milestones. Additionally, we will pay Merck tiered royalties based on annual net sales of Products ranging from high single digits to mid-teens percentages. Our royalty payment obligations will continue until the later of (i) the expiration of the last to expire valid claim of a licensed Merck patent claiming such Product and (ii) a period of years after the first commercial sale of such Product in such country. We may terminate the Merck License Agreement for convenience upon prior written notice. The first milestone, in the amount of $5.0 million, is payable upon initiation of the first clinical trial in our Phase 3 program. We currently anticipate enrollment of patients to commence in the Phase 3 program in April 2025 and we expect this milestone to become payable in conjunction with such event.
Previous wording
The table above also does not include potential milestone and success fees that we may be required to pay under agreements we have entered into with certain consultants. We have an agreement with a consultant that requires payment of a success fee calculated as a percentage of certain product sales, subject to a cumulative maximum payout of $5.0 million. This success payment is contingent upon the occurrence of future events and the timing and likelihood of such payment is neither probable nor estimable.
Current wording
We have an agreement with a consultant that requires payment of a success fee calculated as a percentage of certain product sales, subject to a cumulative maximum payout of $5.0 million.
Previous wording
Our financial statements have been prepared in accordance with US generally accepted accounting principles (“GAAP”). The preparation of these financial statements requires us to make estimates and assumptions that affect the reported amounts of assets and liabilities, the disclosure of contingent assets and liabilities at the date of the financial statements and the reported expenses incurred during the reporting periods. Our estimates are based on our historical experience and on various other factors that we believe are reasonable under the circumstances, the results of which form the basis for making judgments about the carrying value of assets and liabilities that are not readily apparent from other sources. Actual results may differ from these estimates under different assumptions or conditions. The effects of material revisions in estimates, if any, will be reflected in the consolidated financial statements prospectively from the date of change in estimates.
Current wording
Our financial statements have been prepared in accordance with US generally accepted accounting principles (“GAAP”). The preparation of these financial statements requires us to make estimates and assumptions that affect the reported amounts of assets and liabilities, the disclosure of contingent assets and liabilities at the date of the financial statements and the reported expenses incurred during the reporting periods. Our estimates are based on our historical experience and on various other factors that we believe are reasonable under the circumstances, the results of which form the basis for making judgments about the carrying value of assets and liabilities that are not readily apparent from other sources. Actual results may differ from these estimates. The effects of material revisions in estimates, if any, will be reflected in the consolidated financial statements prospectively from the date of change in estimates.
Previous wording
We have entered into various agreements with CMOs and CROs. Our research and development accruals are estimated based on the level of services performed, progress of the studies, including the phase or completion of events, and contracted costs. The estimated costs of research and development provided, but not yet invoiced, are included in accrued liabilities on the balance sheet. If the actual timing of the performance of services or the level of effort varies from the original estimates, we will adjust the accrual accordingly. Payments made to CMOs and CROs under these arrangements in advance of the performance of the related services are recorded as prepaid expenses and other current assets until the services are rendered. Although we do not expect our estimates to be materially different from amounts actually incurred, our understanding of the status and timing of services performed relative to the actual status and timing of services performed may vary and may result in reporting amounts that are too high or too low in any particular period. To date, there have not been any material adjustments to our prior estimates of accrued research and development expenses.
Current wording
We have entered into various agreements with CMOs and CROs. Our research and development accruals are estimated based on the level of services performed, progress of the studies, including the phase or completion of events, and contracted costs. The estimated costs of research and development services performed, but not yet invoiced, are included in accrued liabilities on the balance sheet. If the actual timing of the performance of services or the level of effort varies from the original estimates, we will adjust the accrual accordingly. Payments made to CMOs and CROs under these arrangements in advance of the performance of the related services are recorded as prepaid expenses and other current assets until the services are rendered. Although we do not expect our estimates to be materially different from amounts actually incurred, our understanding of the status and timing of services performed relative to the actual status and timing of services performed may vary and may result in reporting amounts that are too high or too low in any particular period. To date, there have not been any material adjustments to our prior estimates of accrued research and development expenses.
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Rearranged current paragraphs (1)
Current report — wording carried from elsewhere
We do not have any products approved for sale and have not generated any product revenue since inception. We do not anticipate generating any revenue from product sales for the foreseeable future. Our ability to generate product revenue will depend on the successful development, regulatory approval and eventual commercialization of one or more of our product candidates. Until such time as we can generate significant revenue from product sales, if ever, we expect to finance our operations through private or public equity or debt financings, collaborative or other arrangements with third parties, or through other sources of financing. Our failure to meet the primary efficacy endpoint of our COVID-19 SUNRISE-3 Phase 3 clinical trial may make such financing more difficult. Adequate funding may not be available to us on acceptable terms, or at all. If we fail to raise capital or enter into such agreements as and when needed, we may have to significantly delay, scale back or discontinue the development and commercialization of our product candidates.
Rearranged previous paragraphs (1)
Previous report — wording carried elsewhere
$1.9 million, partially offset by and a decrease in accounts payable and accrued expenses of $14.4 million and stock-based compensation of $49.4 million.