Atara Biotherapeutics, Inc.

Previous wording

You should read the following discussion and analysis of our financial condition and results of operations together with our condensed consolidated financial statements and related notes included elsewhere in our Quarterly Report on Form 10-Q for the quarter ended June 30, 2025. This discussion and other parts of this Quarterly Report contain forward-looking statements that involve risk and uncertainties, such as statements of our plans, objectives, expectations and intentions. As a result of many factors, including those factors set forth in the “Risk Factors” section of this Quarterly Report, our actual results could differ materially from the results described in or implied by the forward-looking statements contained in the following discussion and analysis.

Current wording

You should read the following discussion and analysis of our financial condition and results of operations together with our condensed consolidated financial statements and related notes included elsewhere in our Quarterly Report on Form 10-Q for the quarter ended September 30, 2025 and our Annual Report on Form 10-K for the year ended 2024. This discussion and other parts of this Quarterly Report contain forward-looking statements that involve risk and uncertainties, such as statements of our plans, objectives, expectations and intentions. As a result of many factors, including those factors set forth in the “Risk Factors” section of this Quarterly Report, our actual results could differ materially from the results described in or implied by the forward-looking statements contained in the following discussion and analysis.

Previous wording

On October 31, 2023, we entered into an amended and restated Pierre Fabre Commercialization Agreement (A&R Commercialization Agreement), pursuant to which we expanded Pierre Fabre’s exclusive rights to research, develop, manufacture, commercialize and distribute tab-cel (Ebvallo) to include all other countries in the world (Additional Territory) in addition to the Initial Territory (together, the Territory), subject to our performance of certain obligations as described below. In December 2023, upon the effective date of the A&R Commercialization Agreement, we met the contractual right to receive an additional upfront cash payment of $20.0 million for the expanded exclusive license grant, for which the cash was received in January 2024. In March 2024, we met the contractual right to receive $20.0 million in milestone payments upon achieving a regulatory milestone, for which the cash was received in April 2024. In July 2024, we met the contractual right to receive an additional $20.0 million in milestone payments upon achieving acceptance of our biologics license application (BLA) for tab-cel by the United States Food and Drug Administration (FDA) and we received the cash in August 2024. In March 2025, we completed the transfer of all manufacturing responsibility to Pierre Fabre under the A&R Commercialization Agreement Amendment. Pierre Fabre is now responsible for manufacturing and supplying tabelecleucel for development and commercialization worldwide at its cost. Pursuant to the A&R Commercialization Agreement Amendment, Pierre Fabre has also agreed to assume the costs related to remediation of the third-party manufacturing facility to address the FDA's requests to support resubmission of the BLA for tab-cel. In exchange for accelerating the transfer of all manufacturing responsibility and assumption of such remediation costs by Pierre Fabre, among other things, we agreed to reduce the amount of certain potential future regulatory and commercial milestone payments under the A&R Commercialization Agreement. In July 2025, we further amended the A&R Commercialization Agreement and completed the transfer of all clinical (including sponsorship of the ALLELE and tab-cel multi-cohort studies) and development responsibility to Pierre Fabre. Pierre Fabre is, at its cost, responsible for all clinical (including sponsorship of the ALLELE and tab-cel multi-cohort studies) and development activities (other than responsibility for regulatory activities) for tabelecleucel worldwide. Under the terms of the A&R Commercialization Agreement, as amended by the A&R Commercialization Agreement Amendment, we are entitled to receive an aggregate of up to $308.0 million in remaining milestone payments upon achieving certain regulatory and commercial milestones relating to tab-cel in the Initial Territory, and an aggregate of up to $550.0 million in additional potential milestone payments upon achieving certain regulatory and commercial milestones relating to tab-cel i…

Excerpt shortened here; the source contains the full paragraph.

Current wording

On October 31, 2023, we entered into an amended and restated Pierre Fabre Commercialization Agreement (A&R Commercialization Agreement), pursuant to which we expanded Pierre Fabre’s exclusive rights to research, develop, manufacture, commercialize and distribute tab-cel (Ebvallo) to include all other countries in the world (Additional Territory) in addition to the Initial Territory (together, the Territory), subject to our performance of certain obligations as described below. In December 2023, upon the effective date of the A&R Commercialization Agreement, we met the contractual right to receive an additional upfront cash payment of $20.0 million for the expanded exclusive license grant, for which the cash was received in January 2024. In March 2024, we met the contractual right to receive $20.0 million in milestone payments upon achieving a regulatory milestone, for which the cash was received in April 2024. In July 2024, we met the contractual right to receive an additional $20.0 million in milestone payments upon achieving acceptance of our biologics license application (BLA) for tab-cel by the United States Food and Drug Administration (FDA) and we received the cash in August 2024. In March 2025, we completed the transfer of all manufacturing responsibility to Pierre Fabre under the A&R Commercialization Agreement Amendment. Pierre Fabre is now responsible for manufacturing and supplying tabelecleucel for development and commercialization worldwide at its cost. Pursuant to the A&R Commercialization Agreement Amendment, Pierre Fabre has also agreed to assume the costs related to remediation of the third-party manufacturing facility to address the FDA's requests to support resubmission of the BLA for tab-cel. In exchange for accelerating the transfer of all manufacturing responsibility and assumption of such remediation costs by Pierre Fabre, among other things, we agreed to reduce the amount of certain potential future regulatory and commercial milestone payments under the A&R Commercialization Agreement. In July 2025, we further amended the A&R Commercialization Agreement and completed the transfer of all clinical (including sponsorship of the ALLELE and tab-cel multi-cohort studies) and development responsibility to Pierre Fabre. Pierre Fabre is, at its cost, responsible for all clinical (including sponsorship of the ALLELE and tab-cel multi-cohort studies) and development activities (other than responsibility for regulatory activities) for tabelecleucel worldwide. In October 2025, we further amended the A&R Commercialization Agreement to transfer all regulatory activities (including sponsorship of the tab-cel BLA) to Pierre Fabre. Pierre Fabre is, at its cost, responsible for all regulatory activities (including sponsorship of the tab-cel BLA) for tab-cel worldwide, and Pierre Fabre is to use commercially reasonable efforts to obtain BLA approval as soon as possible. We will, at Pierre Fabre’s expense, continue to observe the regulatory ac…

Excerpt shortened here; the source contains the full paragraph.

Previous wording

We had non-cancellable minimum commitments for products and services, subject to agreements with a term of greater than one year, with CROs and CMOs. In March 2025, these agreements have been assigned to Pierre Fabre as part of the A&R Commercialization Agreement Amendment and have been relieved of our obligations under these agreements as of June 30, 2025.

Current wording

We had non-cancellable minimum commitments for products and services, subject to agreements with a term of greater than one year, with CROs and CMOs. In March 2025, these agreements were assigned to Pierre Fabre as part of the A&R Commercialization Agreement Amendment, and we have been relieved of our obligations under these agreements as of June 30, 2025.

Previous wording

On July 4, 2025, President Trump signed the tax law referred to as One Big Beautiful Bill Act (“OBBB”), which includes comprehensive U.S. corporate tax legislation. The legislation includes the modification and extension of prior tax law under the Tax Cuts and Jobs Act (“TCJA”) and the introduction of new provisions. Examples include the extension of so-called permanently restoring bonus depreciation allowances, permanent changes in the limitations for deducting business interest expense and permanent expensing of domestic research and development costs. The impact on current and deferred taxes for tax law changes is reported in continuing operations in the interim period which includes the enactment date. The Company has done a preliminary analysis of the changes impacting the Company’s business and has determined that the aggregate impact, assuming various state tax legislation conforms to the OBBB, would not have a material impact to the Company. We will continue to assess the tax accounting impacts as more information is made available and will record the tax impact, if any, in the third quarter of 2025.

Current wording

On July 4, 2025, President Trump signed the tax law referred to as One Big Beautiful Bill Act (“OBBBA”), which includes comprehensive U.S. corporate tax legislation. The legislation includes the modification and extension of prior tax law under the Tax Cuts and Jobs Act (TCJA) and the introduction of new provisions. Examples include the extension of so-called permanently restoring bonus depreciation allowances, permanent changes in the limitations for deducting business interest expense and permanent expensing of domestic research and development costs. The impact on current and deferred taxes for tax law changes is reported in continuing operations in the interim period which includes the enactment date. The Company has done a preliminary analysis of the changes impacting the Company’s business and has determined that the aggregate impact, assuming various state tax legislation conforms to the OBBBA, would not have a material impact to the Company. We will continue to assess the tax accounting impacts as more information is made available and will record the tax impact, if any, in the fourth quarter of 2025.

Previous wording

In July 2025, we resubmitted, and the FDA accepted, the tab-cel BLA. We believe the tab-cel BLA is on track with a Prescription Drug User Fee Act target action date of January 10, 2026.

Current wording

In July 2025, we resubmitted, and the FDA accepted, the tab-cel BLA. In October 2025, we further amended the A&R Commercialization Agreement to transfer all regulatory activities (including sponsorship of the tab-cel BLA) to Pierre Fabre. Pierre Fabre is, at its cost, responsible for all regulatory activities (including sponsorship of the tab-cel BLA) for tab-cel worldwide, and Pierre Fabre is to use commercially reasonable efforts to obtain BLA approval as soon as possible. We will, at Pierre Fabre’s expense, continue to observe the regulatory activities and support Pierre Fabre in its efforts to obtain BLA approval. We believe the tab-cel BLA is on track with a Prescription Drug User Fee Act target action date of January 10, 2026.

Previous wording

Our net income (loss) was $40.4 million and $(50.8) million for the six months ended June 30, 2025 and 2024, respectively. As of June 30, 2025, we had an accumulated deficit of $2.0 billion. Substantially all of our net losses have resulted from costs incurred in connection with our research and development programs and from general and administrative expenses associated with our operations. As of June 30, 2025, our cash, cash equivalents and short-term investments totaled $22.3 million, which we intend to use to fund our operations.

Current wording

Our net income (loss) was $36.1 million and $(72.7) million for the nine months ended September 30, 2025 and 2024, respectively. As of September 30, 2025, we had an accumulated deficit of $2.0 billion. Substantially all of our net losses have resulted from costs incurred in connection with our research and development programs and from general and administrative expenses associated with our operations. As of September 30, 2025, our cash, cash equivalents and short-term investments totaled $13.7 million, which we intend to use to fund our operations.

Previous wording

We plan to continue investment in the development of our product candidates. Our current planned research and development activities include the following:

Current wording

We plan to continue investment in the development of our product candidates.

Previous wording

Our expenditures on current and future preclinical and clinical development programs are subject to numerous uncertainties in timing and cost to completion. The duration, costs, and timing of clinical studies and development of our product candidates will depend on a variety of factors, including:

Current wording

Our expenditures on future preclinical and clinical development programs are subject to numerous uncertainties in timing and cost to completion. The duration, costs, and timing of clinical studies and development of our product candidates will depend on a variety of factors, including:

Previous wording

the availability of qualified drug supply for use in our ongoing Phase 3 or other clinical studies;

Current wording

the availability of qualified drug supply;

Previous wording

There have been no significant changes to our critical accounting policies and significant judgments and estimates during the six months ended June 30, 2025 from those disclosed in our management’s discussion and analysis of financial condition and results of operations included in our Annual Report on Form 10-K for the year ended December 31, 2024 filed with the SEC on March 7, 2025.

Current wording

There have been no significant changes to our critical accounting policies and significant judgments and estimates during the nine months ended September 30, 2025 from those disclosed in our management’s discussion and analysis of financial condition and results of operations included in our Annual Report on Form 10-K for the year ended December 31, 2024 filed with the SEC on March 7, 2025.

Previous wording

Comparison of the Three and Six Months Ended June 30, 2025 and 2024

Current wording

Comparison of the Three and Nine Months Ended September 30, 2025 and 2024

Previous wording

Commercialization revenues were $17.6 million and $115.7 million for the three and six months ended June 30, 2025 as compared to $28.6 million and $56.0 million in the comparative 2024 periods. The decrease in the three month comparative period was primarily due to there being no revenue associated with the Initial Territory Obligation in the 2025 period, as all remaining revenue for this obligation was recognized as of March 31, 2025. The increase in the six month comparative period was primarily due to revenue recognized as a result of the transfer of manufacturing responsibilities to Pierre Fabre as of March 31, 2025.

Current wording

Commercialization revenues were $3.5 million and $119.2 million for the three and nine months ended September 30, 2025 as compared to $40.2 million and $96.2 million in the comparative 2024 periods. The decrease in the three month comparative period was primarily due to there being no revenue associated with the Initial Territory Obligation in the 2025 period, as all remaining revenue for this obligation was recognized as of March 31, 2025. The increase in the nine month comparative period was primarily due to revenue recognized as a result of the transfer of manufacturing responsibilities to Pierre Fabre as of March 31, 2025 according to the A&R Commercialization Agreement Amendment.

Previous wording

Cost of commercialization revenue was $0.6 million and $21.0 million for the three and six months ended June 30, 2025, as compared to $4.6 million and $6.6 million in the comparative 2024 periods. The decrease in the three month comparative period is primarily due to there being no manufacturing activities in the 2025 period following the transfer of such activities to Pierre Fabre as of March 31, 2025. The increase in the six month comparative period was primarily due to the cost of inventory sold to Pierre Fabre on March 31, 2025 according to the A&R Commercialization Agreement Amendment.

Current wording

Cost of commercialization revenue was $0.1 million and $21.1 million for the three and nine months ended September 30, 2025, as compared to $7.6 million and $14.2 million in the comparative 2024 periods. The decrease in the three month comparative period is primarily due to there being no manufacturing activities in the 2025 period following the transfer of such activities to Pierre Fabre as of March 31, 2025. The increase in the nine month comparative period was primarily due to the cost of inventory sold to Pierre Fabre on March 31, 2025 according to the A&R Commercialization Agreement Amendment.

Previous wording

Technical operations and quality expenses were $2.5 million and $21.8 million in the three and six months ended June 30, 2025, as compared to $21.5 million and $49.0 million in the comparative 2024 periods. The decreases in the 2025 periods were primarily due to the transition of tab-cel manufacturing activities to Pierre Fabre as of March 31, 2025 as part of the A&R Commercialization Agreement Amendment and reduced headcount following the January and March 2025 reductions in force.

Current wording

Technical operations and quality expenses were $1.7 million and $23.5 million in the three and nine months ended September 30, 2025, as compared to $30.0 million and $79.1 million in the comparative 2024 periods. The decreases in the 2025 periods were primarily due to the transition of tab-cel manufacturing activities to Pierre Fabre as of March 31, 2025 as part of the A&R Commercialization Agreement Amendment, reduced headcount following the January, March and May 2025 reductions in force and pause of research and development of the CAR T programs in March 2025.

Previous wording

Regulatory expenses were $1.1 million and $4.0 million in the three and six months ended June 30, 2025, as compared to $3.5 million and $8.0 million in the comparative 2024 periods. The decreases in 2025 were primarily due to reduced headcount following the January and March 2025 reductions in force and decrease in tab-cel BLA related activities.

Current wording

Regulatory expenses were $1.0 million and $4.9 million in the three and nine months ended September 30, 2025, as compared to $4.4 million and $12.4 million in the comparative 2024 periods. The decreases in 2025 were primarily due to reduced headcount following the January, March and May 2025 reductions in force and a decrease in tab-cel BLA related activities.

Previous wording

General and administrative expenses were $6.5 million and $18.0 million in the three and six months ended June 30, 2025, as compared to $8.9 million and $20.0 million in the respective comparative 2024 periods. The decrease in the 2025 periods was primarily due to reduced headcount following the January and March 2025 reductions in force.

Current wording

General and administrative expenses were $4.0 million and $22.0 million in the three and nine months ended September 30, 2025, as compared to $10.4 million and $30.4 million in the respective comparative 2024 periods. The decrease in the 2025 periods was primarily due to reduced headcount following the January, March and May 2025 reductions in force.

Previous wording

Interest income was $0.1 million and $0.4 million in the three and six months ended June 30, 2025, as compared to $0.5 million and $1.1 million in the comparative 2024 periods. The decreases in 2025 were primarily due to lower average balances of cash, cash equivalents and available-for-sale securities.

Current wording

Interest income was $0.2 million and $0.6 million in the three and nine months ended September 30, 2025, as compared to $0.5 million and $1.5 million in the comparative 2024 periods. The decreases in 2025 were primarily due to lower average balances of cash, cash equivalents and available-for-sale securities.

Previous wording

Interest expense was $1.0 million and $2.0 million in the three and six months ended June 30, 2025, as compared to $1.3 million and $2.4 million in the comparative 2024 periods. The decreases in 2025 were primarily due to decreased interest expense recognized on the liability related to the sale of future revenues under the HCRx Agreement.

Current wording

Interest expense was $0.9 million and $2.9 million in the three and nine months ended September 30, 2025, as compared to $1.2 million and $3.6 million in the comparative 2024 periods. The decreases in 2025 were primarily due to decreased interest expense recognized on the liability related to the sale of future revenues under the HCRx Agreement.

Previous wording

During the six months ended June 30, 2025, we did not sell any shares of common stock under the 2023 ATM Facility.

Current wording

During the nine months ended September 30, 2025, 124,434 shares of common stock were sold under the 2023 ATM Facility.

Previous wording

As of June 30, 2025, we had $88.7 million of common stock remaining and available to be sold under the 2023 ATM Facility.

Current wording

As of September 30, 2025, we had $87.2 million of common stock remaining and available to be sold under the 2023 ATM Facility.

Previous wording

Net cash used in operating activities was $35.5 million in the six months ended June 30, 2025 as compared to $40.3 million in the comparative 2024 period. The decrease of $4.8 million was primarily due to changes in net working capital following the transfer of manufacturing responsibilities to Pierre Fabre in the first quarter of 2025.

Current wording

Net cash used in operating activities was $45.2 million in the nine months ended September 30, 2025 as compared to $44.2 million in the comparative 2024 period. The increased of $1.0 million was primarily due to changes in net working capital following the transfer of manufacturing responsibilities to Pierre Fabre in the first quarter of 2025.

Previous wording

Net cash provided by investing activities in the six months ended June 30, 2025 consisted primarily of $17.2 million received from maturities and sales of available-for-sale securities. Net cash provided by investing activities in the comparative 2024 period primarily consisted primarily of $22.1 million received from maturities and sales of available-for-sale securities.

Current wording

Net cash provided by investing activities in the nine months ended September 30, 2025 consisted primarily of $17.2 million received from maturities and sales of available-for-sale securities. Net cash provided by investing activities in the comparative 2024 period primarily consisted primarily of $25.1 million received from maturities and sales of available-for-sale securities.

Previous wording

Net cash provided by financing activities in the six months ended June 30, 2025 primarily consisted of $15.3 million in proceeds from the issuance of prefunded warrants and shares in a underwritten registered direct offering, net of discount. Net cash provided by financing activities in the comparative 2024 period primarily consisted of $14.8 million of proceeds received from the issuance of prefunded warrants in a direct registered offering and $9.3 million of net proceeds received from the 2023 ATM Facility.

Current wording

Net cash provided by financing activities in the nine months ended September 30, 2025 primarily consisted of $14.8 million in proceeds from the issuance of prefunded warrants and shares in a underwritten registered direct offering, net of discount and $1.5 million of net proceeds received from the 2023 ATM facility. Net cash provided by financing activities in the comparative 2024 period primarily consisted of $50.8 million of proceeds received from the issuance of prefunded warrants in a direct registered offering and $9.3 million of net proceeds received from the 2023 ATM Facility.

Previous wording

In order to complete the process of obtaining regulatory approval for our product candidate that has not received approval in the US, we may require substantial additional funding. We expect to continue to seek access to additional funds through additional public or private equity offerings or debt financings, through potential collaboration, partnering or other strategic arrangements, or a combination of the foregoing. If we are unable to obtain sufficient funding on acceptable terms, we could be forced to further delay, limit, reduce or terminate clinical studies or other development activities.

Current wording

In order to complete the process of obtaining regulatory approval for tab-cel in the US, we may require substantial additional funding. We expect to continue to seek access to additional funds through additional public or private equity offerings or debt financings, through potential collaboration, partnering or other strategic arrangements, or a combination of the foregoing. If we are unable to obtain sufficient funding on acceptable terms, we could be forced to further delay, limit, reduce or terminate clinical studies or other development activities.

Previous wording

Our contractual obligations primarily consist of our obligations under non-cancellable operating and finance leases and contracts we enter into in the normal course of business with CROs for clinical studies, with CMOs for clinical and commercial materials, and with other vendors for preclinical studies and supplies and other services and products for operating purposes. These contracts generally provide for termination for convenience following a notice period. There have been no material changes to our contractual obligations and commitments reported in our Annual Report on Form 10-K for the year ended December 31, 2024 filed with the SEC on March 7, 2025 other than those previously discussed in this document.

Current wording

Our contractual obligations primarily consist of our obligations under non-cancellable operating and finance leases and contracts we enter into in the normal course of business with CROs for clinical studies, with CMOs for clinical and commercial materials, and with other vendors for preclinical studies and supplies and other services and products for operating purposes. These contracts generally provide for termination for convenience following a notice period. In August 2025, we entered into an amendment to the ARC lease agreement, effective upon the closing of the landlord's sale of the building, which is expected to occur in November 2025. Under the terms of the amendment, our square footage at ARC will be reduced to 12,750 square feet of office, lab and warehouse space. The amendment also terminates our option to extend the ARC lease. There have been no material changes to our contractual obligations and commitments reported in our Annual Report on Form 10-K for the year ended December 31, 2024 filed with the SEC on March 7, 2025 other than those previously discussed in this document.