PTC THERAPEUTICS INC

Previous wording

We have two products, Translarna™ (ataluren) and Emflaza® (deflazacort), for the treatment of Duchenne muscular dystrophy, or DMD, a rare, life threatening disorder. Translarna currently has conditional marketing authorization in the European Economic Area, or EEA, for the treatment of nonsense mutation Duchenne muscular dystrophy, or nmDMD, in ambulatory patients aged two years and older. Translarna also has marketing authorization in Russia for the treatment of nmDMD in patients aged two years and older, and in Brazil for the treatment of nmDMD in ambulatory patients two years and older and for continued treatment of patients that become non-ambulatory, as well as in various other countries. During the quarter ended March 31, 2024, we recognized $103.6 million in net sales of Translarna. We hold worldwide commercialization rights to Translarna for all indications in all territories. Emflaza is approved in the United States for the treatment of DMD in patients two years and older. During the quarter ended March 31, 2024, we recognized $57.5 million in net sales of Emflaza.

Current wording

We have two products, Translarna™ (ataluren) and Emflaza® (deflazacort), for the treatment of Duchenne muscular dystrophy, or DMD, a rare, life threatening disorder. Translarna currently has conditional marketing authorization in the European Economic Area, or EEA, for the treatment of nonsense mutation Duchenne muscular dystrophy, or nmDMD, in ambulatory patients aged two years and older. Translarna also has marketing authorization in Russia for the treatment of nmDMD in patients aged two years and older, and in Brazil for the treatment of nmDMD in ambulatory patients two years and older and for continued treatment of patients that become non-ambulatory, as well as in various other countries. During the quarter ended June 30, 2024, we recognized $70.4 million in net sales of Translarna. We hold worldwide commercialization rights to Translarna for all indications in all territories. Emflaza is approved in the United States for the treatment of DMD in patients two years and older. During the quarter ended June 30, 2024, we recognized $47.3 million in net sales of Emflaza.

Previous wording

There is substantial risk that if the EC ratifies the CHMP’s negative opinion, or we are otherwise unable to renew our EEA marketing authorization during any annual renewal cycle, or we are unable to identify other potential mechanisms in which we may provide Translarna to nmDMD patients in the EEA should the EC adopt the CHMP’s negative opinion or our product label is materially restricted, we would lose all, or a significant portion of, our ability to generate revenue from sales of Translarna in the EEA and other territories.

Current wording

There is substantial risk that if the EC adopts the CHMP’s negative opinion following re-examination, or we are otherwise unable to renew our EEA marketing authorization during any annual renewal cycle, or we are unable to identify other potential mechanisms by which we may provide Translarna to nmDMD patients in the EEA should the EC adopt the CHMP’s negative opinion or our product label is materially restricted, we would lose all, or a significant portion of, our ability to generate revenue from sales of Translarna in the EEA and other territories.

Previous wording

Translarna is an investigational new drug in the United States. During the first quarter of 2017, we filed a New Drug Application, or NDA, for Translarna for the treatment of nmDMD over protest with the United States Food and Drug Administration, or FDA. In October 2017, the Office of Drug Evaluation I of the FDA issued a Complete Response Letter for the NDA, stating that it was unable to approve the application in its current form. In response, we filed a formal dispute resolution request with the Office of New Drugs of the FDA. In February 2018, the Office of New Drugs of the FDA denied our appeal of the Complete Response Letter. In its response, the Office of New Drugs recommended a possible path forward for the ataluren NDA submission based on the accelerated approval pathway. This would involve a re-submission of an NDA containing the current data on effectiveness of ataluren with new data to be generated on dystrophin production in nmDMD patients’ muscles. We followed the FDA’s recommendation and collected, using newer technologies via procedures and methods that we designed, such dystrophin data in a new study, Study 045, and announced the results of Study 045 in February 2021. Study 045 did not meet its pre-specified primary endpoint. In June 2022, we announced top-line results from the placebo-controlled trial of Study 041. Following this announcement, we submitted a meeting request to the FDA to gain clarity on the regulatory pathway for a potential re-submission of an NDA for Translarna. The FDA provided initial written feedback that Study 041 does not provide substantial evidence of effectiveness to support NDA re-submission. We held a Type C meeting with the FDA in the fourth quarter of 2023 to discuss the totality of Translarna data. Based on feedback from the FDA, we plan to re-submit the NDA based on results from Study 041 and from our international drug registry study for nmDMD patients receiving Translarna by mid-year 2024.

Current wording

Translarna is an investigational new drug in the United States. During the first quarter of 2017, we filed a New Drug Application, or NDA, for Translarna for the treatment of nmDMD over protest with the United States Food and Drug Administration, or FDA. In October 2017, the Office of Drug Evaluation I of the FDA issued a Complete Response Letter for the NDA, stating that it was unable to approve the application in its current form. In response, we filed a formal dispute resolution request with the Office of New Drugs of the FDA. In February 2018, the Office of New Drugs of the FDA denied our appeal of the Complete Response Letter. In its response, the Office of New Drugs recommended a possible path forward for the ataluren NDA submission based on the accelerated approval pathway. This would involve a re-submission of an NDA containing the current data on effectiveness of ataluren with new data to be generated on dystrophin production in nmDMD patients’ muscles. We followed the FDA’s recommendation and collected, using newer technologies via procedures and methods that we designed, such dystrophin data in a new study, Study 045, and announced the results of Study 045 in February 2021. Study 045 did not meet its pre-specified primary endpoint. In June 2022, we announced top-line results from the placebo-controlled trial of Study 041. Following this announcement, we submitted a meeting request to the FDA to gain clarity on the regulatory pathway for a potential re-submission of an NDA for Translarna. The FDA provided initial written feedback that Study 041 does not provide substantial evidence of effectiveness to support NDA re-submission. We held a Type C meeting with the FDA in the fourth quarter of 2023 to discuss the totality of Translarna data. Based on feedback from the FDA, we re-submitted the NDA in July 2024, based on the results from Study 041 and from our international drug registry study for nmDMD patients receiving Translarna.

Previous wording

Our product Upstaza is a gene therapy used for the treatment of Aromatic L-Amino Decarboxylase, or AADC, deficiency, a rare central nervous system, or CNS, disorder arising from reductions in the enzyme AADC that results from mutations in the dopa decarboxylase gene. In July 2022, the EC approved Upstaza for the treatment of AADC deficiency for patients 18 months and older within the EEA. In November 2022, the Medicines and Healthcare Products Regulatory Agency

Current wording

Our product Upstaza is a gene therapy used for the treatment of Aromatic L-Amino Decarboxylase, or AADC, deficiency, a rare central nervous system, or CNS, disorder arising from reductions in the enzyme AADC that results from mutations in the dopa decarboxylase gene. In July 2022, the EC approved Upstaza for the treatment of AADC deficiency for patients 18 months and older within the EEA. In November 2022, the Medicines and Healthcare Products Regulatory Agency approved Upstaza for the treatment of AADC deficiency for patients 18 months and older within the United Kingdom. In March 2024, we submitted a biologics license application, or BLA, to the FDA for Upstaza for the treatment of AADC deficiency in the United States. In May 2024, the FDA has accepted for filing the BLA for our gene therapy for the treatment of AADC deficiency and granted priority review with a target regulatory action date of November 13, 2024.

Previous wording

One of our most advanced clinical stage molecules is sepiapterin. Sepiapterin is a precursor to intracellular tetrahydrobiopterin, which is a critical enzymatic cofactor involved in metabolism and synthesis of numerous metabolic products. In May 2023, we announced that the primary endpoint was achieved in our registration-directed Phase 3 trial for sepiapterin for phenylketonuria, or PKU. The primary endpoint of the study was the achievement of statistically-significant reduction in blood Phe level. The primary analysis population included those patients who have a greater than 30% reduction in blood Phe levels during the Part 1 run-in phase of the trial. Sepiapterin demonstrated Phe level reduction of approximately 63% in the overall primary analysis population and Phe level reduction of approximately 69% in the subset for classical PKU patients. Additionally, sepiapterin was well tolerated with no serious adverse events. Following the placebo-controlled study, patients were eligible to enroll in a long-term open-label study, which is still ongoing and will evaluate long-term safety, durability and Phe tolerance. In March 2024, we submitted a marketing authorization application, or MAA, to the EMA for sepiapterin for the treatment of PKU in the EEA. Additionally, we participated in a pre-NDA meeting with the FDA in the third quarter of 2023. At that meeting, the FDA stated that the sepiapterin clinical safety and efficacy data supported NDA submission for the treatment of pediatric and adult PKU patients. However, the FDA has requested that we complete a 26-week nonclinical mouse study to assess sepiapterin carcinogenicity potential prior to NDA submission. This nonclinical study was not initially required when we acquired sepiapterin, as the NDA submission was planned under the Section 505(b)(2) pathway. Given that sepiapterin is a novel therapy with distinct pharmacology, biodistribution, mechanism of action and differentiated efficacy, we subsequently decided to make the NDA submission under the Section 505(b)(1) pathway, which requires the 26-week study, which is considered a required NDA component needed to inform labeling and is typically completed prior to submission. Based on the timing to complete this study, we expect to submit an NDA to the FDA for sepiapterin for the treatment of PKU no later than the third quarter of 2024 and we intend to discuss with the FDA the potential for an earlier submission if we are permitted to submit the 26-week mouse study report during the NDA review process. We also expect to make regulatory submissions for sepiapterin for the treatment of PKU in Japan and Brazil in 2024.

Current wording

One of our most advanced clinical stage molecules is sepiapterin. Sepiapterin is a precursor to intracellular tetrahydrobiopterin, which is a critical enzymatic cofactor involved in metabolism and synthesis of numerous metabolic products. In May 2023, we announced that the primary endpoint was achieved in our registration-directed Phase 3 trial for sepiapterin for phenylketonuria, or PKU. The primary endpoint of the study was the achievement of statistically-significant reduction in blood Phe level. The primary analysis population included those patients who have a greater than 30% reduction in blood Phe levels during the Part 1 run-in phase of the trial. Sepiapterin demonstrated Phe level reduction of approximately 63% in the overall primary analysis population and Phe level reduction of approximately 69% in the subset for classical PKU patients. Additionally, sepiapterin was well tolerated with no serious adverse events. Following the placebo-controlled study, patients were eligible to enroll in a long-term open-label study, which is still ongoing and will evaluate long-term safety, durability and Phe tolerance. In March 2024, we submitted a marketing authorization application, or MAA, to the EMA for sepiapterin for the treatment of PKU in the EEA, which was validated and accepted for review by the EMA in May 2024. Additionally, we participated in a pre-NDA meeting with the FDA in the third quarter of 2023. At that meeting, the FDA stated that the sepiapterin clinical safety and efficacy data supported NDA submission for the treatment of pediatric and adult PKU patients. However, the FDA requested that we complete a 26-week nonclinical mouse study to assess sepiapterin carcinogenicity potential prior to NDA submission. This nonclinical study was not initially required when we acquired sepiapterin, as the NDA submission was planned under the Section 505(b)(2) pathway.

Previous wording

In addition to our SMA program, our splicing platform also includes PTC518, which is being developed for the treatment of Huntington’s disease, or HD. We announced the results from our Phase 1 study of PTC518 in healthy volunteers in September 2021 demonstrating dose-dependent lowering of huntingtin messenger ribonucleic acid and protein levels, that PTC518 efficiently crosses blood brain barrier at significant levels and that PTC518 was well tolerated. We initiated a Phase 2 study of PTC518 for the treatment of HD in the first quarter of 2022, which consists of an initial 12-week placebo-controlled phase focused on safety, pharmacology and pharmacodynamic effects followed by a nine-month placebo-controlled phase focused on PTC518 biomarker effect. In June 2023, we announced interim data from the 12-week placebo-controlled phase. The study demonstrated dose-dependent lowering of Huntingtin, or HTT, protein levels in peripheral blood cells, reaching an approximate mean 30% reduction in mutant HTT levels at the 10mg dose level. In addition, PTC518 exposure in the cerebrospinal fluid was consistent with or higher than plasma unbound drug levels. Furthermore, PTC518 was well tolerated with no treatment-related serious adverse events. The Phase 2 study is actively ongoing outside the United States, while it has been paused within the United States as the FDA requested additional data to allow the Phase 2 study to proceed. We expect to provide 12-month interim data from the Phase 2 study of PTC518 for the treatment of HD in the second quarter of 2024. We expect to submit a safety data update to the FDA in the second quarter of 2024 to support lifting of the partial clinical hold on the program.

Current wording

In addition to our SMA program, our splicing platform also includes PTC518, which is being developed for the treatment of Huntington’s disease, or HD. We announced the results from our Phase 1 study of PTC518 in healthy volunteers in September 2021 demonstrating dose-dependent lowering of huntingtin messenger ribonucleic acid and protein levels, that PTC518 efficiently crosses blood brain barrier at significant levels and that PTC518 was well tolerated. We initiated a Phase 2 study of PTC518 for the treatment of HD in the first quarter of 2022, which consists of an initial 12-week placebo-controlled phase focused on safety, pharmacology and pharmacodynamic effects followed by a nine-month placebo-controlled phase focused on PTC518 biomarker effect. In June 2023, we announced interim data from the 12-week placebo-controlled phase. The study demonstrated dose-dependent lowering of Huntingtin, or HTT, protein levels in peripheral blood cells, reaching an approximate mean 30% reduction in mutant HTT levels at the 10mg dose level. In addition, PTC518 exposure in the cerebrospinal fluid was consistent with or higher than plasma unbound drug levels. Furthermore, PTC518 was well tolerated with no treatment-related serious adverse events. In June 2024, we announced additional interim results from the Phase 2 study of PTC518. At month 12, PTC518 treatment demonstrated durable dose-dependent lowering of mutant HTT, or mHTT, protein in the blood and dose-dependent lowering of mHTT protein in the cerebrospinal fluid in the interim cohort of stage 2 patients. In addition, favorable trends were demonstrated on several relevant HD clinical assessments. Furthermore, following 12 months of treatment, PTC518 continued to be well tolerated. Based on its review of the interim Phase 2 study data, the FDA lifted the partial clinical hold on the program.

Previous wording

Ourferroptosis and inflammation platform consists of small molecule compounds that target oxidoreductase enzymes that regulate oxidative stress and inflammatory pathways central to the pathology of a number of CNS diseases. The two most advanced molecules in our ferroptosis and inflammation platform are vatiquinone and utreloxastat. We announced topline results from a registration-directed Phase 3 trial of vatiquinone in children and young adults with Friedreich ataxia, called MOVE-FA, in May 2023. While the study did not meet its primary endpoint of statistically significant change in modified Friedreich Ataxia Rating Scale, or mFARS, score at 72 weeks in the primary analysis population, vatiquinone treatment did demonstrate significant benefit on key disease subscales and secondary endpoints. In addition, in the population of subjects that completed the study protocol, significance was reached in the mFARS endpoint and several secondary endpoints, including the upright stability subscale. Furthermore, vatiquinone was well tolerated. In the first quarter of 2024, we met with the FDA, who expressed willingness to review an NDA for vatiquinone for the treatment of Friedreich ataxia based on the MOVE-FA trial as well as data from the ongoing open label extension study following the MOVE-FA trial, potentially allowing for the submission of an NDA in late 2024. In the first quarter of 2024, we also received scientific advice from the EMA on the MOVE-FA trial results, in which the EMA stated that the MOVE-FA data would likely not be sufficient for conditional authorization. In the third quarter of 2021, we completed a Phase 1 trial in healthy volunteers to evaluate the safety and pharmacology of utreloxastat. Utreloxastat was found to be well-tolerated with no reported serious adverse events while demonstrating predictable pharmacology. We initiated a Phase 2 registration directed trial of utreloxastat for amyotrophic lateral sclerosis, or ALS, in the first quarter of 2022. We expect topline results from this trial in the fourth quarter of 2024.

Current wording

Ourferroptosis and inflammation platform consists of small molecule compounds that target oxidoreductase enzymes that regulate oxidative stress and inflammatory pathways central to the pathology of a number of CNS diseases. The two most advanced molecules in our ferroptosis and inflammation platform are vatiquinone and utreloxastat. We announced topline results from a registration-directed Phase 3 trial of vatiquinone in children and young adults with Friedreich ataxia, called MOVE-FA, in May 2023. While the study did not meet its primary endpoint of statistically significant change in modified Friedreich Ataxia Rating Scale, or mFARS, score at 72 weeks in the primary analysis population, vatiquinone treatment did demonstrate significant benefit on key disease subscales and secondary endpoints. In addition, in the population of subjects that completed the study protocol, significance was reached in the mFARS endpoint and several secondary endpoints, including the upright stability subscale. Furthermore, vatiquinone was well tolerated. In the first quarter of 2024, we met with the FDA, who expressed willingness to review an NDA for vatiquinone for the treatment of Friedreich ataxia based on the MOVE-FA trial as well as data from the ongoing open label extension study following the MOVE-FA trial. We plan to submit an NDA for vatiquinone in late 2024. In the third quarter of 2021, we completed a Phase 1 trial in healthy volunteers to evaluate the safety and pharmacology of utreloxastat. Utreloxastat was found to be well-tolerated with no reported serious adverse events while demonstrating predictable pharmacology. We initiated a Phase 2 registration directed trial of utreloxastat for amyotrophic lateral sclerosis, or ALS, in the first quarter of 2022. We expect topline results from this trial in the fourth quarter of 2024.

Previous wording

The success of our products and any other product candidates we may develop, depends largely on obtaining and maintaining reimbursement from governments and third-party insurers. Our revenues are primarily generated from sales of Translarna for the treatment of nmDMD in countries where we were able to obtain acceptable commercial pricing and reimbursement terms and in select countries where we are permitted to distribute Translarna under our EAP programs or through similar styled programs, and from sales of Emflaza for the treatment of DMD in the United States. We also

Current wording

The success of our products and any other product candidates we may develop, depends largely on obtaining and maintaining reimbursement from governments and third-party insurers. Our revenues are primarily generated from sales of Translarna for the treatment of nmDMD in countries where we were able to obtain acceptable commercial pricing and reimbursement terms and in select countries where we are permitted to distribute Translarna under our EAP programs or through similar styled programs, and from sales of Emflaza for the treatment of DMD in the United States. We also generate revenue from sales of Upstaza for the treatment of AADC deficiency in the EEA and have recognized revenue associated with milestone and royalty payments from Roche pursuant to a License and Collaboration Agreement, or the SMA License Agreement, by and among us, Roche and, for the limited purposes set forth therein, the SMA Foundation, under our SMA program.

Previous wording

In October 2023, we entered into an Amended and Restated Royalty Purchase Agreement, or the A&R Royalty Purchase Agreement, with Royalty Pharma Investments 2019 ICAV, or Royalty Pharma, and, for the limited purposes set forth in the agreement, Royalty Pharma plc which amends and restates in its entirety the Original Royalty Purchase Agreement. Pursuant to the A&R Royalty Purchase Agreement, we have sold or agreed to sell to Royalty Pharma certain portions of our remaining retained right, title and interest in and to our right to receive sales-based royalty payments, or the Royalty, on worldwide net sales of Evrysdi and any other product developed pursuant to the SMA License Agreement under the SMA program (all such Royalty rights retained by us, are referred to as the Retained Royalty Rights, and all such Royalty rights that are sold to Royalty Pharma pursuant to the A&R Royalty Purchase Agreement, are referred to as the A&R Assigned Royalty Rights). At closing, Royalty Pharma paid us $1.0 billion in cash consideration for 38.0447% of our Retained Royalty Rights (which is in addition to the 42.9330% assigned to Royalty Pharma in connection with the Original Royalty Purchase Agreement and referred to as the Original Assigned Royalty Rights, for a total of 80.9777% of the total Royalty) until such time as Royalty Pharma has received payments in respect of the Original Assigned Royalty Rights equal to $1.3 billion in the aggregate, and thereafter 66.6667% of the total Royalty.

Current wording

In June 2024, we entered into an amendment with Royalty Pharma Investments 2019 ICAV, or Royalty Pharma, and Royalty Pharma plc, to the Amended and Restated Royalty Purchase Agreement, dated October 18, 2023, or the A&R Royalty Purchase Agreement, which amends and restates in its entirety the Royalty Purchase Agreement, dated as of July 17, 2020, or the Original Royalty Purchase Agreement. Pursuant to the A&R Royalty Purchase Agreement, we have sold to Royalty Pharma a portion of our right to receive sales-based royalty payments, or the Royalty, on worldwide net sales of Evrysdi and any other product developed pursuant to the SMA License Agreement under the SMA program. To date, Royalty Pharma has paid to us cash consideration of $1.9 billion (less Royalty payments received by us with respect to assigned Royalties, or the Assigned Royalty Rights) in exchange for 90.49% of the Royalty, which will be reduced to 83.33% after Royalty Pharma receives $1.3 billion in aggregate payments, or the Assigned Royalty Cap, from the Royalty assigned under the Original Royalty Purchase Agreement. We currently retain 9.51% of the Royalty, which increases to 16.67% after the Assigned Royalty Cap has been met. We have the option to sell our retained portions of the Royalty to Royalty Pharma in up to three tranches for the following payments: (1) $100.0 million in exchange for 3.81% of the Royalty, which increases to 6.67% after the Assigned Royalty Cap has been met, (2) $100.0 million in exchange for 3.81% of the Royalty, which increases to 6.67% after the Assigned Royalty Cap has been met, and (3) $50.0 million in exchange for 1.90% of the Royalty, which increases to 3.33% after the Assigned Royalty Cap has been met, in each case less Royalty payments received by us with respect to the Assigned Royalty Rights. See “Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations—Liquidity and capital resources—Sources of Liquidity” for additional information.

Previous wording

In August 2019, we entered into an At the Market Offering Sales Agreement, or the Sales Agreement, with Cantor Fitzgerald and RBC Capital Markets, LLC, or together, the Sales Agents, pursuant to which, we may offer and sell shares of our common stock, having an aggregate offering price of up to $125.0 million from time to time through the Sales Agents by any method that is deemed to be an “at the market offering” as defined in Rule 415(a)(4) promulgated under the Securities Act of 1933, as amended, or the Securities Act. During the three months ended March 31, 2024, we did not issue or sell any shares of common stock pursuant to the Sales Agreement. The remaining shares of our common stock available to be issued and sold, under the Sales Agreement, have an aggregate offering price of up to $93.0 million as of March 31, 2024.

Current wording

In August 2019, we entered into an At the Market Offering Sales Agreement, or the Sales Agreement, with Cantor Fitzgerald and RBC Capital Markets, LLC, or together, the Sales Agents, pursuant to which, we may offer and sell shares of our common stock, having an aggregate offering price of up to $125.0 million from time to time through the Sales Agents by any method that is deemed to be an “at the market offering” as defined in Rule 415(a)(4) promulgated under the Securities Act of 1933, as amended, or the Securities Act. During the three months ended June 30, 2024, we did not issue or sell any shares of common stock pursuant to the Sales Agreement. The remaining shares of our common stock

Previous wording

As of March 31, 2024, we had an accumulated deficit of $3,375.2 million. We had a net loss of $91.6 million and $139.0 million for the three months ended March 31, 2024 and 2023, respectively.

Current wording

As of June 30, 2024, we had an accumulated deficit of $3,474.3 million. We had a net loss of $190.8 million and $337.8 million for the six months ended June 30, 2024 and 2023, respectively.

Previous wording

We anticipate that we will continue to incur significant expenses in connection with our commercialization efforts in the United States, the EEA, Latin America and other territories, including expenses related to our commercial infrastructure and corresponding sales and marketing, legal and regulatory, and distribution and manufacturing undertakings as well as administrative and employee-based expenses. In addition to the foregoing, we expect to continue to incur significant costs in connection with ongoing, planned and potential future clinical trials and studies for sepiapterin and our splicing and ferroptosis and inflammation programs as well as studies in our products for maintaining authorizations, label extensions and additional indications. We continue to seek marketing authorization for Translarna for the treatment of nmDMD in territories that we do not currently have marketing authorization in and we are exploring other potential mechanisms in which we may provide Translarna to nmDMD patients in the EEA if the EC ratifies the CHMP’s negative opinion for Translarna following a re-examination procedure. In March 2024, we submitted a BLA to the FDA for Upstaza for the treatment of AADC deficiency in the United States. Also in March 2024, we submitted an MAA to the EMA for sepiapterin for the treatment of PKU and we expect to submit an NDA to the FDA for sepiapterin for the treatment of PKU no later than the third quarter of 2024. These efforts may significantly impact the timing and extent of our commercialization and manufacturing expenses.

Current wording

Weanticipate that we will continue to incur significant expenses in connection with our commercialization efforts in the United States, the EEA, Latin America and other territories, including expenses related to our commercial infrastructure and corresponding sales and marketing, legal and regulatory, and distribution and manufacturing undertakings as well as administrative and employee-based expenses. In addition to the foregoing, we expect to continue to incur significant costs in connection with ongoing, planned and potential future clinical trials and studies for sepiapterin and our splicing and ferroptosis and inflammation programs as well as studies in our products for maintaining authorizations, label extensions and additional indications. We continue to seek marketing authorization for Translarna for the treatment of nmDMD in territories that we do not currently have marketing authorization in. Additionally, in response to the CHMP’s negative opinion for Translarna for the treatment of nmDMD, we have submitted a request for re-examination per EMA guidelines. We are also exploring other potential mechanisms by which we may provide Translarna to nmDMD patients in the EEA if the EC adopts the CHMP’s negative opinion on the renewal of the conditional marketing authorization of Translarna following a re-examination procedure. In March 2024, we submitted a BLA to the FDA for our gene therapy for the treatment of AADC deficiency in the United States. In May 2024, the FDA accepted the filing for the BLA and granted priority review with a target regulatory action date of November 13, 2024. In March 2024, we submitted an MAA, to the EMA for sepiapterin for the treatment of PKU in the EEA. In July 2024, we submitted an NDA to the FDA for sepiapterin for the treatment of PKU. These efforts may significantly impact the timing and extent of our commercialization and manufacturing expenses.

Previous wording

We expect to make payments to the former Censa Pharmaceuticals, Inc., or Censa, securityholders of $65.0 million in the aggregate in cash upon the potential achievement in 2024 of regulatory milestones relating to sepiapterin pursuant to the Agreement and Plan of Merger, dated as of May 5, 2020, or the Censa Merger Agreement, by and among us, Hydro Merger Sub, Inc., our wholly owned, indirect subsidiary, Censa and, solely in its capacity as the representative, agent and attorney-in-fact of the securityholders of Censa, Shareholder Representative Services LLC. We also expect to pay the former equityholders of Agilis Biotherapeutics, Inc., or Agilis, $20.0 million in regulatory milestone payments upon the acceptance for filing by the FDA of a BLA for Upstaza for the treatment of AADC deficiency and $4.5 million in regulatory milestone payments upon the approval of the BLA from the FDA pursuant to the Agreement and Plan of Merger, dated as of July 19, 2018, or the Agilis Merger Agreement, by and among us, Agility Merger Sub, Inc., a Delaware corporation and our wholly owned, indirect subsidiary, Agilis and, solely in its capacity as the representative, agent and attorney-in-fact of the equityholders of Agilis, Shareholder Representative Services LLC. The BLA for Upstaza to the FDA was submitted in March 2024.

Current wording

In March 2024, we submitted a BLA for our gene therapy for the treatment of AADC deficiency to the FDA. In May 2024, the BLA submission was accepted for filing by the FDA. The acceptance triggered a $20.0 million milestone payment to the former equityholders of Agilis Biotherapeutics, Inc., or Agilis for the three months ended June 30, 2024. The $20.0 million milestone was recorded in accounts payable and accrued expense on the consolidated balance sheet as of June 30, 2024. Additionally, we expect to pay $4.5 million in regulatory milestone payments upon the approval of the BLA from the FDA pursuant to the Agreement and Plan of Merger, dated as of July 19, 2018, or the Agilis Merger Agreement, by and among us, Agility Merger Sub, Inc., a Delaware corporation and our wholly owned, indirect subsidiary, Agilis and, solely in its capacity as the representative, agent and attorney-in-fact of the equityholders of Agilis, Shareholder Representative Services LLC.

Previous wording

We also have certain significant contractual obligations and commercial commitments that require funding and we have disclosed these items under the heading “Management’s Discussion and Analysis of Financial Condition and Results of Operations-Funding Obligations” in our 2023 Annual Report. There were no material changes to these obligations and commitments during the period ended March 31, 2024. Furthermore, since we are a public company, we have incurred and expect to continue to incur additional costs associated with operating as such including significant legal, accounting, investor relations and other expenses.

Current wording

We also have certain significant contractual obligations and commercial commitments that require funding and we have disclosed these items under the heading “Management’s Discussion and Analysis of Financial Condition and Results of Operations-Funding Obligations” in our 2023 Annual Report. There were no material changes to these obligations and commitments during the period ended June 30, 2024. Furthermore, since we are a public company, we have incurred and

Previous wording

*Net product revenues.*To date, our net product revenues have consisted primarily of sales of Translarna for the treatment of nmDMD in territories outside of the United States and sales of Emflaza for the treatment of DMD in the United States. We recognize revenue when performance obligations with customers have been satisfied. Our performance obligations are to provide products based on customer orders from distributors, hospitals, specialty pharmacies or retail pharmacies. The performance obligations are satisfied at a point in time when our customer obtains control of the product, which is typically upon delivery. We invoice customers after the products have been delivered and invoice payments are generally due within 30 to 90 days of invoice date. We determine the transaction price based on fixed consideration in its contractual agreements. Contract liabilities arise in certain circumstances when consideration is due for goods not yet provided. As we have identified only one distinct performance obligation, the transaction price is allocated entirely to the product sale. In determining the transaction price, a significant financing component does not exist since the timing from when we

Current wording

*Net product revenues.*To date, our net product revenues have consisted primarily of sales of Translarna for the treatment of nmDMD in territories outside of the United States and sales of Emflaza for the treatment of DMD in the United States. We recognize revenue when performance obligations with customers have been satisfied. Our performance obligations are to provide products based on customer orders from distributors, hospitals, specialty pharmacies or retail pharmacies. The performance obligations are satisfied at a point in time when our customer obtains control of the product, which is typically upon delivery. We invoice customers after the products have been delivered and invoice payments are generally due within 30 to 90 days of invoice date. We determine the transaction price based on fixed consideration in its contractual agreements. Contract liabilities arise in certain circumstances when consideration is due for goods not yet provided. As we have identified only one distinct performance obligation, the transaction price is allocated entirely to the product sale. In determining the transaction price, a significant financing component does not exist since the timing from when we deliver product to when the customers pay for the product is typically less than one year. Customers in certain countries pay in advance of product delivery. In those instances, payment and delivery typically occur in the same month.

Previous wording

We record product sales net of any variable consideration, which includes discounts, allowances, rebates related to Medicaid and other government pricing programs, and distribution fees. We use the expected value or most likely amount method when estimating variable consideration, unless discount or rebate terms are specified within contracts. The identified variable consideration is recorded as a reduction of revenue at the time revenues from product sales are recognized. These estimates for variable consideration are adjusted to reflect known changes in factors and may impact such estimates in the quarter those changes are known. Revenue recognized does not include amounts of variable consideration that are constrained. During the three months ended March 31, 2024 and 2023, net product sales outside of the United States were $120.1 million and $133.0 million, respectively, consisting of sales of Translarna, Tegsedi, Waylivra, and Upstaza. Translarna net revenues made up $103.6 million and $115.1 million of the net product sales outside of the United States for the three months ended March 31, 2024 and 2023, respectively. During the three months ended March 31, 2024 and 2023, net product sales in the United States were $57.5 million and $54.6 million, respectively, consisting solely of sales of Emflaza. During the three months ended March 31, 2024, two countries, the United States and Russia, accounted for at least 10% of the Company’s net product sales, representing $57.5 million and $52.6 million of the net product sales, respectively. During the three months ended March 31, 2023, three countries, the United States, Russia, and Brazil, accounted for at least 10% of the Company’s net product sales, representing $54.6 million, $44.6 million, and $25.9 million of the net product sales, respectively. For the three months ended March 31, 2024 and 2023, two of the Company’s distributors each accounted for over 10% of the Company’s net product sales.

Current wording

We record product sales net of any variable consideration, which includes discounts, allowances, rebates related to Medicaid and other government pricing programs, and distribution fees. We use the expected value or most likely amount method when estimating variable consideration, unless discount or rebate terms are specified within contracts. The identified variable consideration is recorded as a reduction of revenue at the time revenues from product sales are recognized. These estimates for variable consideration are adjusted to reflect known changes in factors and may impact such estimates in the quarter those changes are known. Revenue recognized does not include amounts of variable consideration that are constrained. During the three months ended June 30, 2024 and 2023, net product sales outside of the United States were $85.9 million and $108.9 million, respectively, consisting of sales of Translarna, Tegsedi, Waylivra, and Upstaza. Translarna net revenues made up $70.4 million and $96.5 million of the net product sales outside of the United States for the three months ended June 30, 2024 and 2023, respectively. During the three months ended June 30, 2024 and 2023, net product sales in the United States were $47.3 million and $65.7 million, respectively, consisting solely of sales of Emflaza. During the three months ended June 30, 2024, two countries, the United States and Brazil, accounted for at least 10% of the Company’s net product sales, representing $47.3 million and $30.4 million of the net product sales, respectively. During the three months ended June 30, 2024, three countries, the United States, Russia, and Brazil, accounted for at least 10% of the Company’s net product sales, representing $65.7 million, $19.1 million, and $23.1 million of the net product sales, respectively. For the three months ended June 30, 2024 and 2023, two of the Company’s distributors each accounted for over 10% of the Company’s net product sales.

Previous wording

*Roche and the SMA Foundation Collaboration.*In November 2011, we entered into the SMA License Agreement pursuant to which we are collaborating with Roche and the SMA Foundation to further develop and commercialize compounds identified under our SMA program with the SMA Foundation. The research component of this agreement terminated effective December 31, 2014. We are eligible to receive additional payments from Roche if specified events are achieved with respect to each licensed product, including up to $135.0 million in research and development event milestones, up to $325.0 million in sales milestones upon achievement of specified sales events, and up to double digit royalties on worldwide annual net sales of a commercial product. As of March 31, 2024, we had recognized a total of $310.0 million in milestone payments and $372.9 million royalties on net sales pursuant to the SMA License Agreement. As of March 31, 2024, there are no remaining research and development event milestones that we can receive. The remaining potential sales milestones as of March 31, 2024 are $150.0 million upon achievement of certain sales events.

Current wording

*Roche and the SMA Foundation Collaboration.*In November 2011, we entered into the SMA License Agreement pursuant to which we are collaborating with Roche and the SMA Foundation to further develop and commercialize compounds identified under our SMA program with the SMA Foundation. The research component of this agreement terminated effective December 31, 2014. We are eligible to receive additional payments from Roche if specified events are achieved with respect to each licensed product, including up to $135.0 million in research and development event milestones, up to $325.0 million in sales milestones upon achievement of specified sales events, and up to double digit royalties on worldwide annual net sales of a commercial product. As of June 30, 2024, we had recognized a total of $310.0 million in milestone payments and $426.1 million royalties on net sales pursuant to the SMA License Agreement. As of June 30, 2024, there are no remaining research and development event milestones that we can receive. The remaining potential sales milestones as of June 30, 2024 are $150.0 million upon achievement of certain sales events.

Previous wording

For the three months ended March 31, 2024, we did not recognize collaboration revenue related to the SMA License Agreement with Roche. For the three months ended March 31, 2023, the amounts recognized for the collaboration revenue related to the SMA License Agreement with Roche were immaterial.

Current wording

For the three and six months ended June 30, 2024 and 2023, the amounts recognized for the collaboration revenue related to the SMA License Agreement with Roche were immaterial.

Previous wording

For the three months ended March 31, 2024 and 2023, we recognized $31.2 million and $30.8 million of royalty revenue, respectively, related to Evrysdi.

Current wording

For the three and six months ended June 30, 2024, we recognized $53.2 million and $84.3 million of royalty revenue, respectively, related to Evrysdi. For the three and six months ended June 30, 2023, we recognized $36.9 million and $67.7 million of royalty revenue, respectively, related to Evrysdi.

Previous wording

The following table provides research and development expense for our most advanced principal product development programs, for the three months ended March 31, 2024 and 2023.

Current wording

The following tables provides research and development expense for our most advanced principal product development programs, for the three and six months ended June 30, 2024 and 2023.

Previous wording

For 2024 compared to 2023, the decrease in development expenses primarily reflected the decrease in program spend related to our strategic pipeline prioritization as we continue to focus on our resources on our differentiated, high potential research and development programs.

Current wording

For the three and six months ended June 30, 2024, compared to the three and six months ended June 30, 2023, the decrease in development expenses primarily reflected the decrease in program spend related to our strategic pipeline prioritization as we continue to focus our resources on our differentiated, high potential research and development programs.

Previous wording

For 2024 compared to 2023, the decrease in milestone expenses primarily related to the achievement of a $30.0 million success-based development milestone for the completion of enrollment of a Phase 3 clinical trial for sepiapterin for PKU in 2023.

Current wording

For the three months ended June 30, 2024, compared to the three months ended June 30, 2023, the increase in milestone expenses primarily related to the achievement of a $15.0 million success-based regulatory milestone for the validation and acceptance of an MMA for sepiapterin for PKU in May 2024. For the six months ended June 30, 2024, compared to the six months ended June 30, 2023, the decrease in milestone expenses primarily related to the achievement of a $30.0 million success-based development milestone for the completion of enrollment of a Phase 3 clinical trial for sepiapterin for PKU in 2023.

Previous wording

For 2024 compared to 2023, the decrease in payroll, benefits, and share-based stock compensation expenses primarily relates to our reduction in workforce in connection with our strategic pipeline prioritization and discontinuation of our preclinical and early research programs in our gene therapy platform.

Current wording

For the three and six months ended June 30, 2024 compared to the three and six months ended June 30, 2023, the decrease in payroll, benefits, and share-based stock compensation expenses primarily relates to our reduction in workforce in connection with our strategic pipeline prioritization and discontinuation of our preclinical and early research programs in our gene therapy platform.

Previous wording

During the three months ended March 31, 2024, there were no material changes to our critical accounting policies as reported in our 2023 Annual Report.

Current wording

During the three and six months ended June 30, 2024, there were no material changes to our critical accounting policies as reported in our 2023 Annual Report.

Previous wording

Net product revenues. Net product revenues were $177.6 million for the three months ended March 31, 2024, a decrease of $10.0 million, or 5%, from $187.6 million for the three months ended March 31, 2023. The decrease in net product revenue was primarily due to a decrease in net product sales of Translarna, offset by an increase in net product sales of Emflaza. Emflaza net product revenues were $57.5 million for the three months ended March 31, 2024, an increase of $2.9

Current wording

Net product revenues. Net product revenues were $133.2 million for the three months ended June 30, 2024, a decrease of $41.4 million, or 24%, from $174.6 million for the three months ended June 30, 2023. The decrease in net product revenue was primarily due to a decrease in net product sales of Translarna and Emflaza. Emflaza net product revenues were $47.3

Previous wording

million, or 5%, compared to $54.6 million for the three months ended March 31, 2023. These results were driven by new patient starts and high compliance. Translarna net product revenues were $103.6 million for the three months ended March 31, 2024, a decrease of $11.5 million, or 10%, compared to $115.1 million for the three months ended March 31, 2023, driven by new patients in existing geographies and continued geographic expansion. The decrease was due to the timing of bulk patient orders.

Current wording

million for the three months ended June 30, 2024, a decrease of $18.4 million, or 28%, compared to $65.7 million for the three months ended June 30, 2023. These results were driven by the expiration of Emflaza’s orphan drug exclusivity in February 2024. Translarna net product revenues were $70.4 million for the three months ended June 30, 2024, a decrease of $26.1 million, or 27%, compared to $96.5 million for the three months ended June 30, 2023. These results were due to the timing of bulk government orders.

Previous wording

*Royalty revenue.*Royalty revenue was $31.2 million for the three months ended March 31, 2024, an increase of $0.3 million, or 1%, from $30.8 million for the three months ended March 31, 2023. The increase in royalty revenue was due to higher Evrysdi sales in the three months ended March 31, 2024 as compared to the three months ended March 31, 2023. In accordance with the SMA License Agreement, we are entitled to royalties on worldwide annual net sales of the product.

Current wording

*Royalty revenue.*Royalty revenue was $53.2 million for the three months ended June 30, 2024, an increase of $16.3 million, or 44%, from $36.9 million for the three months ended June 30, 2023. The increase in royalty revenue was due to higher Evrysdi sales in the three months ended June 30, 2024 as compared to the three months ended June 30, 2023. In accordance with the SMA License Agreement, we are entitled to royalties on worldwide annual net sales of the product.

Previous wording

Manufacturing revenue. Manufacturing revenues were $1.4 million for the three months ended March 31, 2024, a decrease of $0.6 million, or 32%, from $2.0 million for the three months ended March 31, 2023. The decrease is due to less manufacturing services related to the production of plasmid DNA and AAV vectors for gene therapy applications for external customers being performed in the three months ended March 31, 2024 as compared to the three months ended March 31, 2023.

Current wording

Manufacturing revenue. Manufacturing revenues were $0.3 million for the three months ended June 30, 2024, a decrease of $2.1 million, or 87%, from $2.4 million for the three months ended June 30, 2023. The decrease is due to less manufacturing services related to the production of plasmid DNA and AAV vectors for gene therapy applications for external customers being performed in the three months ended June 30, 2024 as compared to the three months ended June 30, 2023. In June 2024, we sold our gene therapy manufacturing business in Hopewell Township, New Jersey. Accordingly, we do not expect to have manufacturing revenue going forward.

Previous wording

Cost of product sales, excluding amortization of acquired intangible asset. Cost of product sales, excluding amortization of acquired intangible asset, were $14.7 million for the three months ended March 31, 2024, an increase of $0.6 million, or 4%, from $14.1 million for the three months ended March 31, 2023. Cost of product sales consist primarily of royalty payments associated with Emflaza, Translarna, and Upstaza net product sales, excluding contingent payments to Marathon Pharmaceuticals, LLC (now known as Complete Pharma Holdings, LLC), or Marathon, costs associated with Emflaza, Translarna, and Upstaza products sold during the period, and royalty expense related to royalty revenues and collaboration milestone revenues. The increase in cost of product sales, excluding amortization of acquired intangible asset, is primarily due to increases in Translarna and Upstaza inventory reserves, and increases in royalty costs driven by the full amortization of the Emflaza intangible asset during the three months ended March 31, 2024. All Emflaza milestone payments are now recorded on the consolidated statement of operations within cost of product sales, excluding amortization of acquired intangible assets.

Current wording

Cost of product sales, excluding amortization of acquired intangible assets. Cost of product sales, excluding amortization of acquired intangible assets were $15.5 million for the three months ended June 30, 2024, an increase of $2.8 million, or 22%, from $12.7 million for the three months ended June 30, 2023. Cost of product sales consist primarily of royalty payments associated with Emflaza, Translarna, and Upstaza net product sales, costs associated with Emflaza, Translarna, and Upstaza products sold during the period, and royalty expense related to royalty revenues and collaboration milestone revenues. The increase in cost of product sales, excluding amortization of acquired intangible asset, is primarily due to increases in royalty costs driven by Emflaza. As of February 2024, the Emflaza rights intangible asset was fully amortized, therefore for the three months ended June 30, 2024, the milestone payment was recorded on the consolidated statement of operations within cost of product sales, excluding amortization of acquired intangible assets.

Previous wording

Amortization of acquired intangible asset. Amortization of our intangible assets was $51.5 million for the three months ended March 31, 2024, an increase of $12.1 million, or 31%, from $39.4 million for the three months ended March 31, 2023. These amounts are related to the Emflaza rights acquisition, as well as the Waylivra, Tegsedi, and Upstaza intangible assets, which are all being amortized on a straight-line basis over their estimated useful lives. The amortization increase is primarily related to additional Marathon contingent payments for Emflaza. The Emflaza intangible asset was fully amortized during the three months ended March 31, 2024.

Current wording

Amortization of acquired intangible assets. Amortization of acquired intangible assets were $2.9 million for the three months ended June 30, 2024, a decrease of $44.5 million, or 94%, from $47.4 million for the three months ended June 30, 2023. These amounts are related to the Emflaza rights acquisition, as well as the Waylivra, Tegsedi, and Upstaza intangible assets, which are all being amortized on a straight-line basis over their estimated useful lives. The amortization decrease is driven by the Emflaza rights intangible asset being fully amortized as of February 2024, and therefore, for the three months ended June 30, 2024, the milestone payment was recorded on the consolidated statement of operations within cost of product sales, excluding amortization of acquired intangible assets.

Previous wording

Research and development expense. Research and development expense was $116.1 million for the three months ended March 31, 2024, a decrease of $79.0 million, or 40%, from $195.1 million for the three months ended March 31, 2023. The decrease in research and development expenses reflects strategic portfolio prioritization as we continue to focus our resources on our differentiated, high potential research and development programs.

Current wording

Research and development expense. Research and development expense was $132.2 million for the three months ended June 30, 2024, a decrease of $53.7 million, or 29%, from $185.9 million for the three months ended June 30, 2023. The decrease in research and development expenses reflects strategic portfolio prioritization as we continue to focus our resources on our differentiated, high potential research and development programs. Research and development expense also includes a $15.0 million regulatory success-based milestone payable to the former Censa securityholders for the three months ended June 30, 2024.

Previous wording

Selling, general and administrative expense. Selling, general and administrative expense was $73.3 million for the three months ended March 31, 2024, a decrease of $13.6 million, or 16%, from $86.9 million for the three months ended March 31, 2023. The decrease reflects lower employee costs as a result of the reduction in workforce in 2023.

Current wording

Selling, general and administrative expense. Selling, general and administrative expense was $69.5 million for the three months ended June 30, 2024, a decrease of $18.9 million, or 21%, from $88.4 million for the three months ended June 30, 2023. The decrease reflects lower employee costs as a result of the reduction in workforce in 2023.

Previous wording

*Change in the fair value of contingent consideration.*The change in the fair value of contingent consideration was a gain of $0.1 million for the three months ended March 31, 2024, a change of $2.5 million, or over 100%, from a loss of $2.4 million for the three months ended March 31, 2023. The change is related to the fair valuation of the potential future consideration to be paid to former equityholders of Agilis as a result of our merger with Agilis which closed in August

Current wording

*Change in the fair value of contingent consideration.*The change in the fair value of contingent consideration was a loss of $5.1 million for the three months ended June 30, 2024, a change of $134.0 million, or over 100%, from a gain of $128.9 million for the three months ended June 30, 2023. The change is primarily related to our strategic portfolio prioritization and decision to discontinue our preclinical and early research programs in our gene therapy platform, which included Friedreich ataxia and Angelman syndrome, which was announced in May 2023. As a result, we fully impaired the Friedreich ataxia and Angelman syndrome intangible assets and determined that the fair value for all of the contingent consideration payable related to Friedreich ataxia and Angelman syndrome was $0. As a result, we recorded a fair value

Previous wording

*Interest expense, net.*Interest expense, net was $40.8 million for the three months ended March 31, 2024, an increase of $13.5 million, or 49%, from $27.3 million for the three months ended March 31, 2023. Theincrease in interest expense, net was primarily due to interest expense recorded from the liability for the sale of future royalties related to the A&R Royalty Purchase Agreement, offset by a decrease in interest expense due to the termination of our Blackstone Credit Agreement.

Current wording

*Interest expense, net.*Interest expense, net was $43.5 million for the three months ended June 30, 2024, an increase of $14.1 million, or 48%, from $29.4 million for the three months ended June 30, 2023. Theincrease in interest expense, net was primarily due to interest expense recorded from the liability for the sale of future royalties related to the A&R Royalty Purchase Agreement, offset by a decrease in interest expense due to the termination of our Blackstone Credit Agreement.

Previous wording

Other income, net. Other income, net was $1.6 million for the three months ended March 31, 2024, a decrease of $8.4 million, or 84%, from other income, net o­f $10.0 million for the three months ended March 31, 2023. For the three months ended March 31, 2024, unrealized and realized foreign exchange gains were $1.2 million, a decrease of $7.1 million, compared to gains of $8.3 million for the three months ended March 31, 2023. For the three months ended March 31, 2024, unrealized gains from our ClearPoint debt and equity investments and marketable securities - equity investments were $0.4 million, a decrease of $1.3 million, compared to unrealized gains of $1.7 million for the three months ended March 31, 2023.

Current wording

Other (expense) income, net. Other expense was $2.0 million for the three months ended June 30, 2024, a change of $3.5 million, or over 100%, from other income, net o­f $1.5 million for the three months ended June 30, 2023. The change in other (expense) income, net primarily relates to net unrealized losses of $3.4 million from our ClearPoint Neuro. Inc. debt and equity investments, offset by a net realized and unrealized gain from foreign currency of $0.9 million for the three months ended June 30, 2024. Other income, net for the three months ended June 30, 2023 was primarily related to realized and unrealized foreign exchange gains, net, of $2.9 million, and unrealized gains of $2.3 million on marketable securities – equity investments, offset by unrealized and realized losses, net, on our equity investments in ClearPoint Neuro, Inc. of $1.9 million and unrealized losses on our convertible debt security in ClearPoint Neuro, Inc. of $1.6 million.

Previous wording

Income tax expense. Income tax expense was $6.9 million for the three months ended March 31, 2024, an increase of $2.9 million, or 73%, compared to income tax expense of $4.0 million for the three months ended March 31, 2023. The increase in income tax expense is attributable to the recognition of the revenue associated with the Royalty Pharma agreement of 2023. Additionally, we incur income tax expenses in various foreign jurisdictions, and our foreign tax liabilities are largely dependent upon the distribution of pre-tax earnings among these different jurisdictions.

Current wording

Income tax (expense) benefit. Income tax expense was $13.4 million for the three months ended June 30, 2024, an increase of $52.0 million, or over 100%, compared to income tax benefit of $38.6 million for the three months ended June 30, 2023. The change in income tax (expense) benefit is attributable to the recognition of the revenue associated with the Royalty Pharma agreement of 2023. Additionally, we incur income tax expenses in various foreign jurisdictions, and our foreign tax liabilities are largely dependent upon the distribution of pre-tax earnings among these different jurisdictions.

Previous wording

Collaboration revenues. Collaboration revenues were $0.0 million for the three months ended March 31, 2024, a decrease of $6.0 thousand, or 100%, from $6.0 thousand for the three months ended March 31, 2023. The activity for collaboration revenue was immaterial for the three months ended March 31, 2024 and the three months ended March 31, 2023.

Current wording

Collaboration revenue. Collaboration revenue was $0.0 thousand for the six months ended June 30, 2024, a decrease of $6.0 thousand, or 100%, from $6.0 thousand for the six months ended June 30, 2023. No milestones were triggered in the six months ended June 30, 2024. The activity for collaboration revenue was immaterial for the six months ended June 30, 2023.

Previous wording

As a growing commercial-stage biopharmaceutical company, we are engaging in significant commercialization efforts for our products while also devoting a substantial portion of our efforts on research and development related to our products, product candidates and other programs. To date, our product revenue has primarily consisted of sales of Translarna for the treatment of nmDMD in territories outside of the United States and from Emflaza for the treatment of DMD in the United States. Our ongoing ability to generate revenue from sales of Translarna for the treatment of nmDMD is dependent upon our ability to maintain our marketing authorizations in Brazil, Russia and in the EEA and secure market access through commercial programs following the conclusion of pricing and reimbursement terms at sustainable levels in the member states of the EEA or through EAP programs or similar styled programs in the EEA and other territories. On January 25, 2024, the CHMP issued a negative opinion for the renewal of the conditional marketing authorization following a re-examination procedure. In accordance with EMA regulations, the EC has approximately 67 days to adopt the opinion from the date of its issuance. At this time, the EC has not yet adopted the negative opinion. If the EC adopts the negative opinion, Translarna would no longer have marketing authorization in the EEA. Emflaza is approved in the United States for the treatment of DMD in patients two years and older. Our ability to generate product revenue from Emflaza will largely depend on the coverage and reimbursement levels set by governmental authorities, private health insurers and other third-party payors. Additionally, Emflaza’s seven-year period of orphan drug exclusivity related to the treatment of DMD in patients five years and older expired in February 2024. We have previously relied on this exclusivity period to commercialize Emflaza in the United States. We expect the expiration of this orphan drug exclusivity to have a significant negative impact on Emflaza net product revenue. Emflaza’s orphan drug exclusivity related to the treatment of DMD in patients two years of age to less than five expires in June 2026.

Current wording

As a growing commercial-stage biopharmaceutical company, we are engaging in significant commercialization efforts for our products while also devoting a substantial portion of our efforts on research and development related to our products, product candidates and other programs. To date, our product revenue has primarily consisted of sales of Translarna for the treatment of nmDMD in territories outside of the United States and from Emflaza for the treatment of DMD in the United States. Our ongoing ability to generate revenue from sales of Translarna for the treatment of nmDMD is dependent upon our ability to maintain our marketing authorizations in Brazil, Russia and in the EEA and secure market access through commercial programs following the conclusion of pricing and reimbursement terms at sustainable levels in the member states of the EEA or through EAP programs or similar styled programs in the EEA and other territories. In January 2024, the CHMP issued a negative opinion for the renewal of the conditional marketing authorization following a re-examination procedure. In May 2024, the EC decided not to adopt the CHMP’s negative opinion for the renewal of the conditional marketing authorization of Translarna and returned such opinion to the CHMP for re-evaluation. On June 27, 2024, following the EC’s request for re-review, the CHMP issued a negative opinion on the renewal of the conditional marketing authorization of Translarna for the treatment of nmDMD. Per EMA guidelines, we have requested a re-examination of the CHMP opinion regarding the renewal of the existing conditional marketing authorization. The marketing authorization for Translarna remains in effect, pending the outcomes of the re-examination procedure and subsequent EC adoption. Based on the timeline of these procedures, we expect the marketing authorization for Translarna to remain in effect through the end of 2024 even if the negative opinion is maintained and adopted. We are exploring other potential mechanisms by which we may provide Translarna to nmDMD patients in the EEA if the negative opinion is adopted by the EC. Emflaza is approved in the United States for the treatment of DMD in patients two years and older. Our ability to generate product revenue from Emflaza will largely depend on the coverage and reimbursement levels set by governmental authorities, private health insurers and other third-party payors. Additionally, Emflaza’s seven-year period of orphan drug exclusivity related to the treatment of DMD in patients five years and older expired in February 2024. We have previously relied on this exclusivity period to commercialize Emflaza in the United States. We expect the expiration of this orphan drug exclusivity to have a significant negative impact on Emflaza net product revenue. Emflaza’s orphan drug exclusivity related to the treatment of DMD in patients two years of age to less than five expires in June 2026.

Previous wording

We have historically financed our operations primarily through the issuance and sale of our common stock in public offerings, our “at the market offering” of our common stock, proceeds from the A&R Royalty Purchase Agreement, the private placements of our preferred stock, collaborations, bank and institutional lender debt, private offerings of convertible senior notes and convertible debt financings and grants and clinical trial support from governmental and philanthropic organizations and patient advocacy groups in the disease areas addressed by our product candidates. We

Current wording

We have historically financed our operations primarily through the issuance and sale of our common stock in public offerings, our “at the market offering” of our common stock, proceeds from the A&R Royalty Purchase Agreement, the private placements of our preferred stock, collaborations, bank and institutional lender debt, private offerings of convertible senior notes and convertible debt financings and grants and clinical trial support from governmental and philanthropic organizations and patient advocacy groups in the disease areas addressed by our product candidates. We expect to continue to incur significant expenses and operating losses for at least the next fiscal year. The net losses we incur may fluctuate significantly from quarter to quarter.

Previous wording

As of March 31, 2024, we had cash, cash equivalents and marketable securities of $884.8 million.

Current wording

As of June 30, 2024, we had cash, cash equivalents and marketable securities of $1.09 billion.