TG THERAPEUTICS INC
For the period ended Sep 30, 2024. Filed Nov 7, 2024.
View on SEC.govAbout this filing
A company's report for each of its first three quarters. The financial statements are not audited. It shows how the business has moved since the last annual report, and what management says changed.
Sep 30, 2024 · Filed Nov 7, 2024
TGTX$59.83+3.2%Stored close · as of Nov 6, 2026
What changed in Management’s Discussion and Analysis?
Read the current filingPrevious report: 10-Q
Period ended 2024-06-30; filed 2024-08-09.
0001437749-24-025853
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of OperationsCurrent report: 10-Q
Period ended 2024-09-30; filed 2024-11-07.
0001437749-24-033948
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of OperationsThe baseline is this issuer’s latest earlier reporting period of the same form that was filed before the current report. A previous 10-Q is a different quarter, not a year-over-year comparison. Amendments are excluded.
Compared 64 previous paragraphs and 60 current paragraphs.
28 unchanged; 27 reworded; 5 added; 8 removed; 1 previous and 0 current paragraphs rearranged.
Tables are not compared: 5 previous and 5 current tables excluded. Dates, whitespace, punctuation and numbering changes are ignored; changes to financial figures remain significant.
A changed paragraph is not evidence that risk increased or decreased. An unchanged paragraph does not establish that risk stayed the same.
Added paragraphs (5)
Current report
BRIUMVI Five-Year Data Update
Current report
In September 2024 we presented new five-year data from the ULTIMATE I & II Phase 3 trials evaluating BRIUMVI® (ublituximab-xiiy) in patients with RMS, at the 2024 European Committee for Treatment and Research in Multiple Sclerosis (ECTRIMS) annual meeting. These data demonstrate that 92% of patients with RMS were free from disability progression after five years of BRIUVI treatment, the annualized relapse rate during year five of treatment was 0.02 (equivalent to one relapse occurring every fifty years of patient treatment), and the overall safety profile remained consistent over five years of continuous treatment, with no new safety signals emerging with prolonged treatment.
Current report
Interest Expense.*** ***Interest expense increased by $7.1 million to $10.8 million for the three months ended September 30, 2024, as compared to $3.7 million for the three months ended September 30, 2023. Interest expense for the three months ended September 30, 2024 is comprised of approximately $4.6 million of debt extinguishment costs pertaining to the First Amendment with Hercules, as well as $4.4 million in interest expense pertaining to the Initial Term Loan with Blue Owl during the same period (see Note 7 for more information).
Current report
Other Income.*** ***Other income totaled $2.7 million for the three months ended September 30, 2024, as compared to $2.9 million during the comparable period ended September 30, 2023.
Current report
Interest Expense.*** ***Interest expense increased by $6.8 million to $17.0 million for the nine months ended September 30, 2024, as compared to $10.2 million for the nine months ended September 30, 2023. Interest expense for the nine months ended September 30, 2024 is comprised of approximately $4.6 million of debt extinguishment costs pertaining to the First Amendment with Hercules, as well as increased interest expense pertaining to the Initial Term Loan with Blue Owl during the same period (see Note 7 for details).
Removed paragraphs (8)
Previous report
Corporate Update
Previous report
In August 2024 we announced the establishment of a new five year, $250 million credit facility with HealthCare Royalty and Blue Owl Capital, primarily to repay $107 million in outstanding debt and accrued interest, which was set to mature in multiple tranches from mid-2025 to January 2026 and to fund the buyback of up to $100 million of currently outstanding shares of our common stock. The remainder will be available for working capital purposes, providing us with additional operational flexibility.
Previous report
BRIUMVI Patents
Previous report
In February 2024, we announced the issuance of three additional patents by the United States Patent and Trademark Office (USPTO) for BRIUMVI, which extended patent protection through 2042.
Previous report
License Revenue. License revenue was less than $0.1 million for the three months ended June 30, 2024 and June 30, 2023. License revenue for both the three months ended June 30, 2024 and June 30, 2023 is predominantly comprised of recognition of a portion of the upfront payment from the Ublituximab sublicense agreement with Ildong.
Previous report
Interest Expense.*** ***Interest expense increased by $0.4 million to $4.0 million for the three months ended June 30, 2024, as compared to $3.6 million for the three months ended June 30, 2023.
Previous report
Other Revenue. Other revenue was approximately $1.3 million and zero for the six months ended June 30, 2024 and June 30, 2023, respectively. Other revenue for the six months ended June 30, 2024 is comprised mainly of consideration received for development and regulatory activities performed on behalf of Neuraxpharm in accordance with the Commercialization Agreement.
Previous report
Interest Expense.*** ***Interest expense decreased by $0.2 million to $6.3 million for the six months ended June 30, 2024, as compared to $6.5 million for the six months ended June 30, 2023.
Reworded paragraphs (27)
Previous wording
TG Therapeutics is a fully-integrated, commercial stage, biopharmaceutical company focused on the acquisition, development and commercialization of novel treatments for B-cell diseases. In addition to a research pipeline including several investigational medicines, TG has received approval from the FDA for BRIUMVI (ublituximab-xiiy) for the treatment of adult patients with RMS, to include clinically isolated syndrome, relapsing-remitting disease, and active secondary progressive disease, in adults. TG also received approval for BRIUMVI by the European Commission (EC) in the European Union (EU), and the Medicines and Healthcare Products Regulatory Agency (MHRA) in the United Kingdom (UK), for the treatment of adult patients with RMS who have active disease defined by clinical or imaging features. TG continues to actively evaluate complementary products, technologies and companies for in-licensing, partnership, acquisition and/or investment opportunities.
Current wording
TG Therapeutics is a fully-integrated, commercial stage, biopharmaceutical company focused on the acquisition, development and commercialization of novel treatments for B-cell diseases. In addition to a research pipeline including several investigational medicines, TG has received approval from the FDA for BRIUMVI (ublituximab-xiiy) for the treatment of adult patients with relapsing forms of multiple sclerosis (RMS), to include clinically isolated syndrome, relapsing-remitting disease, and active secondary progressive disease, in adults. TG also received approval for BRIUMVI by the European Commission (EC) in the European Union (EU), and the Medicines and Healthcare Products Regulatory Agency (MHRA) in the United Kingdom (UK), for the treatment of adult patients with RMS who have active disease defined by clinical or imaging features. TG continues to actively evaluate complementary products, technologies and companies for in-licensing, partnership, acquisition and/or investment opportunities.
Previous wording
In August 2024 we announced FDA clearance of the Investigational New Drug (IND) application for azercabtagene zapreleucel (azer-cel) for the treatment of progressive forms of multiple sclerosis. Previously, in January 2024, we entered into an agreement with Precision BioSciences, Inc. (Precision) to acquire a worldwide license to Precision’s azer-cel, for autoimmune diseases and all other non-oncology indications. Azer-cel is an allogeneic (off the shelf) CAR T program, and the Company has near term plans to evaluate the program in multiple autoimmune indications.
Current wording
In August 2024, we announced FDA clearance of the Investigational New Drug Application (IND) for azercabtagene zapreleucel (azer-cel) for the treatment of progressive forms of multiple sclerosis. Previously, in January 2024, we entered into an agreement with Precision BioSciences, Inc. (Precision) to acquire a worldwide license to Precision’s azer-cel, for autoimmune diseases and all other non-oncology indications. Azer-cel is an allogeneic (off the shelf) CAR T program, and the Company has near term plans to evaluate the program in multiple autoimmune indications.
Previous wording
On August 1, 2023, we announced an agreement with Neuraxpharm Pharmaceuticals, S.L. (Neuraxpharm), a leading European specialty pharmaceutical company focused on the treatment of CNS disorders, for the Ex-U.S. commercialization of BRIUMVI (Commercialization Agreement). Under the terms of the Commercialization Agreement, we received an upfront payment of $140 million, and are eligible to receive an additional $12.5 million upon launch in the first EU country and up to an additional $492.5 million in milestone-based payments on achievement of certain launch and commercial milestones. The total deal is valued at up to $645 million in upfront and milestone payments. In addition, we will receive tiered double-digit royalties on net product sales up to 30%. In exchange, Neuraxpharm will have the exclusive right to commercialize BRIUMVI in territories outside the U.S., Canada and Mexico, which are retained by TG, and excluding certain Asian countries of which the Company previously partnered. We retain an option to buy back all rights under the Commercialization Agreement for a period of two years in the event of a change in control of TG.
Current wording
On August 1, 2023, we announced an agreement with Neuraxpharm Pharmaceuticals, S.L. (Neuraxpharm), a leading European specialty pharmaceutical company focused on the treatment of CNS disorders, for the Ex-U.S. commercialization of BRIUMVI (Commercialization Agreement). Under the terms of the Commercialization Agreement, we received an upfront payment of $140 million, and $12.5 million upon launch in the first EU country (February 2024) and up to an additional $492.5 million in milestone-based payments on achievement of certain launch and commercial milestones. The total deal is valued at up to $645 million in upfront and milestone payments. In addition, we will receive tiered double-digit royalties on net product sales up to 30%. In exchange, Neuraxpharm will have the exclusive right to commercialize BRIUMVI in territories outside the U.S., Canada and Mexico, which are retained by TG, and excluding certain Asian countries of which the Company previously partnered. We retain an option to buy back all rights under the Commercialization Agreement for a period of two years in the event of a change in control of TG.
Previous wording
Product Revenue, Net*.*Product revenue, net was approximately $72.6 million for the three months ended June 30, 2024, compared to $16.0 million for the three months ended June 30, 2023. Product revenue, net for the both the three months ended June 30, 2024 and June 30, 2023 consisted of net product sales of BRIUMVI in the United States. In January 2023, we began commercial sales of BRIUMVI within the U.S. following FDA approval. The increase in product revenue, net is driven by an increase in product shipments for BRIUMVI as a result of greater market penetration.
Current wording
Product Revenue, Net*.*Product revenue, net was approximately $83.3 million for the three months ended September 30, 2024, compared to $25.1 million for the three months ended September 30, 2023. Product revenue, net for both the three months ended September 30, 2024 and September 30, 2023 consisted of net product sales of BRIUMVI in the United States. In January 2023, we began commercial sales of BRIUMVI within the U.S. following FDA approval.
Previous wording
Other Revenue. Other revenue was approximately $0.7 million and zero for the three months ended June 30, 2024 and June 30, 2023, respectively. Other revenue for the three months ended June 30, 2024 is comprised of consideration received for development and regulatory activities performed on behalf of Neuraxpharm in accordance with the Commercialization Agreement.
Current wording
License, Milestone, Royalty and Other Revenue. License, milestone, royalty and other revenue was $0.6 million for the three months ended September 30, 2024 and $140.7 million for the three months ended September 30, 2023. License, milestone, royalty and other revenue for the three months ended September 30, 2024 is primarily comprised of consideration received for development and regulatory activities performed on behalf of Neuraxpharm Pharmaceuticals, S.L. (Neuraxpharm) in accordance with the Commercialization Agreement with Neuraxpharm (see Note 2 for more information). License, milestone, royalty and other revenue for the three months ended September 30, 2023 is predominantly comprised of recognition of the one-time $140.0 million non-refundable upfront payment under the Commercialization Agreement with Neuraxpharm.
Previous wording
Cost of Revenue. Cost of revenue for the three months ended June 30, 2024 was $8.3 million compared to approximately $1.9 million for the three months ended June 30, 2023. Cost of revenue for both the three months ended June 30, 2024 and June 30, 2023 consists primarily of third-party manufacturing, distribution, overhead costs and royalties owed to our licensing partner for BRIUMVI sales. A portion of the costs of producing BRIUMVI sold to date was expensed as research and development prior to the FDA approval of BRIUMVI and therefore it is not reflected in the cost of revenue. As a result, our initial product gross margin is higher as our pre-launch inventory costs are not included in cost of revenue. We expect the cost of revenue for BRIUMVI to increase in relation to product revenues as we deplete these inventories. We expect to use the remaining pre-commercialization inventory for product sales through the first quarter of 2025, after which our product gross margin is anticipated to decrease modestly. The cost of revenue for both the three months ended June 30, 2024 and June 30, 2023 includes, respectively, $0.7 million and zero, costs related to delivering regulatory support & development services to Neuraxpharm in accordance with the Commercialization Agreement.
Current wording
Cost of Revenue. Cost of revenue for the three months ended September 30, 2024 was $9.3 million compared to approximately $3.5 million for the three months ended September 30, 2023. Cost of revenue for both the three months ended September 30, 2024 and September 30, 2023 consists primarily of third-party manufacturing, distribution, overhead costs and royalties owed to our licensing partner for BRIUMVI sales. A portion of the costs of producing BRIUMVI sold to date was expensed as research and development prior to the FDA approval of BRIUMVI and therefore it is not reflected in the cost of revenue. We expect the cost of revenue for BRIUMVI to increase in relation to product revenues as we deplete these inventories. We expect to use the remaining pre-commercialization inventory for product sales through the first quarter of 2025, after which our product gross margin is anticipated to decrease modestly. The cost of revenue for both the three months ended September 30, 2024 and September 30, 2023 includes $0.3 million and $0.7 million, respectively, of costs related to delivering regulatory support and development services to Neuraxpharm in accordance with the Commercialization Agreement.
Previous wording
Noncash Compensation Expense (Research and Development). Noncash compensation expense (research and development) related to equity incentive grants totaled $5.0 million for the six months ended June 30, 2024, as compared to $7.2 million during the comparable period ended June 30, 2023. The decrease in noncash compensation expense was primarily due to decreased vesting of milestone-based grants during the six months ended June 30, 2024, as compared to the six months ended June 30, 2023.
Current wording
Noncash Compensation Expense (Research and Development). Noncash compensation expense (research and development) related to equity incentive grants totaled $3.0 million for the three months ended September 30, 2024, as compared to $2.9 million during the comparable period ended September 30, 2023.
Previous wording
Other Research and Development Expense*.*Other research and development expense decreased for the three months ended June 30, 2024, by approximately $7.4 million to $15.0 million as compared to the comparable period ended June 30, 2023. The decrease in research and development expense during the three months ended June 30, 2024 was primarily due to reduced clinical trial related expense and license milestones incurred during the period.
Current wording
Other Research and Development Expense*.*Other research and development expense increased for the three months ended September 30, 2024, by approximately $5.3 million to $17.1 million as compared to the period ended September 30, 2023. The increase in research and development expense during the three months ended September 30, 2024 was primarily due to increased personnel, clinical trial related expenses and manufacturing costs incurred during the period.
Previous wording
Noncash Compensation Expense (Selling, General and Administrative).*** ***Noncash compensation expense (selling, general and administrative) related to equity incentive grants totaled $13.8 million for the six months ended June 30, 2024, as compared to $12.1 million during the comparable period ended June 30, 2023. The increase in noncash compensation expense was primarily due to greater vesting of equity grants during the six months ended June 30, 2024, as compared to the six months ended June 30, 2023.
Current wording
Noncash Compensation Expense (Selling, General and Administrative).*** ***Noncash compensation expense (selling, general and administrative) related to equity incentive grants totaled $8.7 million for the three months ended September 30, 2024, as compared to $6.3 million during the comparable period ended September 30, 2023. The increase in noncash compensation expense was primarily due to greater recognition of noncash compensation expense for grants to executives during the three months ended September 30, 2024.
Previous wording
Other Selling, General and Administrative Expenses.*** ***Other selling, general and administrative expenses totaled $31.8 million for the three months ended June 30, 2024, as compared to $23.8 million during the comparable period ended June 30, 2023. The increase was primarily due to other selling, general and administrative costs, including personnel and consultants, associated with the commercialization of BRIUMVI, during the three months ended June 30, 2024.
Current wording
Other Selling, General and Administrative Expenses.*** ***Other selling, general and administrative expenses totaled $33.2 million for the three months ended September 30, 2024, as compared to $26.5 million during the comparable period ended September 30, 2023. The increase was primarily due to other selling, general and administrative costs, including personnel, consultants, and third parties associated with the commercialization of BRIUMVI during the three months ended September 30, 2024.
Previous wording
The following table summarizes the results of operations for the six months ended June 30, 2024 and 2023:
Current wording
The following table summarizes the results of operations for the nine months ended September 30, 2024 and 2023:
Previous wording
Product Revenue, Net*.*Product revenue, net was approximately $123.1 million for the six months ended June 30, 2024, compared to $23.8 million for the six months ended June 30, 2023. Product revenue, net for the both the six months ended June 30, 2024 and June 30, 2023, consisted of net product sales of BRIUMVI in the United States. In January 2023, we began commercial sales of BRIUMVI within the U.S. following FDA approval. The increase in product revenue, net is driven by an increase in product shipments for BRIUMVI as a result of greater market penetration.
Current wording
Product Revenue, Net*.*Product revenue, net was approximately $206.4 million for the nine months ended September 30, 2024, compared to $48.9 million for the nine months ended September 30, 2023. Product revenue, net for both the nine months ended September 30, 2024 and September 30, 2023, consisted of net product sales of BRIUMVI in the United States. In January 2023, we began commercial sales of BRIUMVI within the U.S. following FDA approval.
Previous wording
License Revenue. License revenue was $12.6 million for the six months ended June 30, 2024 compared to approximately $0.1 million for the six months ended June 30, 2023. License revenue for the six months ended June 30, 2024 is predominantly comprised of a milestone payment under the Neuraxpharm Commercialization Agreement for the first key market commercial launch of BRIUMVI in the EU. License revenue for the six months ended June 30, 2023 is comprised of recognition of a portion of the upfront payment from the Ublituximab sublicense agreement with Ildong.
Current wording
License, Milestone, Royalty and Other Revenue. License, milestone, royalty and other revenue was $14.4 million for the nine months ended September 30, 2024 compared to approximately $140.8 million for the nine months ended September 30, 2023. License, milestone, royalty and other revenue for the nine months ended September 30, 2024 is comprised of a $12.5 million milestone payment under the Neuraxpharm Commercialization Agreement for the first key market commercial launch of BRIUMVI in the EU, as well as consideration received for development and regulatory activities performed on behalf of Neuraxpharm in accordance with the Commercialization Agreement. License, milestone, royalty and other revenue for the nine months ended September 30, 2023 is predominantly comprised of recognition of the one-time $140.0 million non-refundable upfront payment under the Commercialization Agreement with Neuraxpharm (see Note 2 for more information).
Previous wording
Cost of Revenue. Cost of revenue for the six months ended June 30, 2024 was $13.7 million compared to approximately $2.8 million for the six months ended June 30, 2023. Cost of revenue for both the six months ended June 30, 2024 and June 30, 2023 consists primarily of third-party manufacturing, distribution, overhead costs and royalties owed to our licensing partner for BRIUMVI sales. A portion of the costs of producing BRIUMVI sold to date was expensed as research and development prior to the FDA approval of BRIUMVI and therefore it is not reflected in the cost of revenue. As a result, our initial product gross margin is higher as our pre-launch inventory costs are not included in cost of revenue. We expect the cost of revenue for BRIUMVI to increase in relation to product revenues as we deplete these inventories. We expect to use the remaining pre-commercialization inventory for product sales through the first quarter of 2025, after which our product gross margin is anticipated to decrease modestly. The cost of revenue for the six months ended June 30, 2024 includes $1.1 million of costs related to delivering regulatory support & development services to Neuraxpharm in accordance with the Commercialization Agreement.
Current wording
Cost of Revenue. Cost of revenue for the nine months ended September 30, 2024 was $23.1 million compared to approximately $6.3 million for the nine months ended September 30, 2023. Cost of revenue for both the nine months ended September 30, 2024 and September 30, 2023 consists primarily of third-party manufacturing, distribution, overhead costs and royalties owed to our licensing partner for BRIUMVI sales. A portion of the costs of producing BRIUMVI sold to date was expensed as research and development prior to the FDA approval of BRIUMVI and therefore it is not reflected in the cost of revenue. We expect the cost of revenue for BRIUMVI to increase in relation to product revenues as we deplete these inventories. We expect to use the remaining pre-commercialization inventory for product sales through the first quarter of 2025, after which our product gross margin is anticipated to decrease modestly. The cost of revenue for the nine months ended September 30, 2024 and the nine months ended September 30. 2023 includes $1.4 million and $0.7 million, respectively, of costs related to delivering regulatory support and development services to Neuraxpharm in accordance with the Commercialization Agreement.
Previous wording
Noncash Compensation Expense (Research and Development). Noncash compensation expense (research and development) related to equity incentive grants totaled $2.5 million for the three months ended June 30, 2024, as compared to $5.7 million during the comparable period ended June 30, 2023. The decrease in noncash compensation expense was primarily due to decreased vesting of milestone-based grants during the three months ended June 30, 2024, as compared to the three months ended June 30, 2023.
Current wording
Noncash Compensation Expense (Research and Development). Noncash compensation expense (research and development) related to equity incentive grants totaled $8.0 million for the nine months ended September 30, 2024, as compared to $10.2 million during the comparable period ended September 30, 2023. The decrease in noncash compensation expense was primarily due to decreased vesting of milestone-based grants during the nine months ended September 30, 2024, as compared to the nine months ended September 30, 2023.
Previous wording
Other Research and Development Expense*.*Other research and development expense increased for the six months ended June 30, 2024, by approximately $8.6 million to $45.3 million as compared to the comparable period ended June 30, 2023. The increase in research and development expense during the six months ended June 30, 2024 was primarily attributable to the Precision License Agreement, as well as manufacturing related expenses during the period, offset by a decrease in clinical trial expenses.
Current wording
Other Research and Development Expense*.*Other research and development expense increased for the nine months ended September 30, 2024, by approximately $13.8 million to $62.4 million, as compared to $48.6 million during the comparable period ended September 30, 2023. The increase in other research and development expense during the nine months ended September 30, 2024 was primarily attributable to the Precision License Agreement, as well as manufacturing related expenses during the period, offset by a decrease in clinical trial expenses.
Previous wording
Noncash Compensation Expense (Selling, General and Administrative).*** ***Noncash compensation expense (selling, general and administrative) related to equity incentive grants totaled $7.0 million for the three months ended June 30, 2024, as compared to $6.9 million during the comparable period ended June 30, 2023.
Current wording
Noncash Compensation Expense (Selling, General and Administrative).*** ***Noncash compensation expense (selling, general and administrative) related to equity incentive grants totaled $22.6 million for the nine months ended September 30, 2024, as compared to $18.4 million during the comparable period ended September 30, 2023. The increase in noncash compensation expense was primarily due to greater recognition of noncash compensation expense for grants to executives during the nine months ended September 30, 2024.
Previous wording
Other Selling, General and Administrative Expenses.*** ***Other selling, general and administrative expenses totaled $59.5 million for the six months ended June 30, 2024, as compared to $46.7 million during the comparable period ended June 30, 2023. The increase was primarily due to other selling, general and administrative costs, including personnel and consultants, associated with the commercialization of BRIUMVI, during the six months ended June 30, 2024.
Current wording
Other Selling, General and Administrative Expenses.*** ***Other selling, general and administrative expenses totaled $92.7 million for the nine months ended September 30, 2024, as compared to $73.2 million during the comparable period ended September 30, 2023. The increase was primarily due to other selling, general and administrative costs, including personnel, consultants, and third parties associated with the commercialization of BRIUMVI during the nine months ended September 30, 2024.
Previous wording
Other Income.*** ***Other income increased by $1.3 million to $2.6 million for the six months ended June 30, 2024 as compared to the six months ended June 30, 2023. The increase is mainly due to greater accretion income earned from short-term investment securities during the six months ended June 30, 2024 compared to the comparable period ending June 30, 2023.
Current wording
Other Income.*** ***Other income increased by $1.0 million to $5.1 million for the nine months ended September 30, 2024, as compared to $4.1 million during the nine months ended September 30, 2023. The increase is mainly due to greater accretion income earned from short-term investment securities during the nine months ended September 30, 2024, compared to the comparable period ending September 30, 2023.
Previous wording
Historically, we have incurred operating losses; however, during the three months ended June 30, 2024, the Company experienced a net profit. Additionally, during the twelve months ended December 31, 2023, the Company experienced a net profit due to a $140.0 million non-refundable upfront payment recognized as license revenue in the third quarter of 2023 as part of our Commercialization Agreement with Neuraxpharm (see Note 2 for more information). We may incur operating losses in the near term and may never become profitable. As of June 30, 2024, we have an accumulated deficit of $1.6 billion.
Current wording
Historically, we have incurred operating losses; however, during the three and nine months ended September 30, 2024 the Company generated net income. Additionally, during the twelve months ended December 31, 2023, the Company experienced a net profit due to a $140.0 million non-refundable upfront payment recognized as license revenue in the third quarter of 2023 as part of our ex-U.S. commercialization agreement (the Commercialization Agreement) with Neuraxpharm (see Note 2 for more information). We may incur operating losses in the near term and may never become profitable. As of September 30, 2024, we have an accumulated deficit of $1.6 billion.
Previous wording
Our major sources of cash have been proceeds from private placements and public offerings of equity securities, our loan and security agreements executed with Hercules (see Note 7 for more information), and the upfront payment from the Commercialization Agreement (see Note 2 for more information). Substantially all our operating losses have resulted from costs incurred in connection with our research and development programs and from selling, general and administrative costs associated with our operations, including our commercialization activities. During the six months ended June 30, 2024, we generated $123.1 million in product revenue from sales of BRIUMVI. BRIUMVI first became commercially available in the United States in January of 2023. Even with the commercialization of BRIUMVI and the possible future commercialization of our other drug candidates, we may not become profitable. Our ability to achieve profitability depends on our ability to generate revenue and many other factors, including our ability to successfully commercialize our drug candidates alone or in partnership; successfully complete any post-approval regulatory obligations and our ability to maintain or obtain regulatory approval for our drug candidates. We may continue to incur operating losses even now that we are generating revenues from BRIUMVI.
Current wording
Our major sources of cash have been proceeds from private placements and public offerings of equity securities, from our loan and security agreements, the upfront payment from the Commercialization Agreement (see Note 2 for more information), and from product revenue from drug sales of BRIUMVI. During the nine months ended September 30, 2024, we generated $206.4 million in product revenue from drug sales of BRIUMVI. BRIUMVI is currently our only marketed product. Substantially all our operating losses have resulted from costs incurred in connection with our research and development programs and from selling, general and administrative costs associated with our operations, including our commercialization activities. We expect to continue to incur significant research and development expenses, as well as significant commercialization and outsourced manufacturing expenses as we continue to commercialize BRIUMVI. Because of the numerous risks and uncertainties associated with developing and commercializing pharmaceutical products, we are unable to predict the extent of any future losses, or for how long we may continue to experience a net profit. We may not be able to sustain or increase our profitability on a quarterly or annual basis. Our ability to become profitable depends upon our ability to generate substantial revenue.
Previous wording
As of June 30, 2024, we had $217.3 million in cash and cash equivalents, and investment securities. The Company believes its existing cash, cash equivalents, and investment securities, combined with projected revenues associated with the sale of BRIUMVI in the U.S. and ex-U.S., will be sufficient to fund its anticipated operating cash requirements for at least twelve months following the date of this filing.
Current wording
As of September 30, 2024, we had $341.0 million in cash, cash equivalents, and investment securities. The Company believes its existing cash, cash equivalents, and investment securities, combined with projected revenues associated with the sale of BRIUMVI in the U.S. and ex-U.S., will be sufficient to fund our anticipated operating cash requirements for at least twelve months following the date of this filing.
Previous wording
The following table summarizes our cash flows for the six months ended June 30, 2024 and 2023:
Current wording
The following table summarizes our cash flows for the nine months ended September 30, 2024 and 2023:
Previous wording
Cash used in operating activities for the six months ended June 30, 2024 was $2.7 million as compared to cash used in operating activities of $101.9 million for the six months ended June 30, 2023. The decrease in net cash used in operating activities was due to a lower net loss during the six months ended June 30, 2024, offset by an increase in inventory of $39.5 million during the same period. This inventory balance increase was due to the buildup of inventory in support of BRIUMVI forecasted sales, to ensure appropriate safety stock levels, and meet our commitment to supply BRIUMVI to Neuraxpharm in relation to the Commercialization Agreement.
Current wording
Cash used in operating activities for the nine months ended September 30, 2024 was $14.9 million as compared to cash used in operating activities of $18.2 million for the nine months ended September 30, 2023. The decrease in net cash used in operating activities was due to greater revenue during the nine months ended September 30, 2024, offset by higher operating expenditures and an increase in cash used for inventory purchases during the same period.
Previous wording
Net cash used in investing activities for the six months ended June 30, 2024 was $7.5 million as compared to $24.3 million provided by investing activities for the six months ended June 30, 2023. The increase in net cash used in investing activities was primarily due to increased investment in short-term securities during the six months ended June 30, 2024.
Current wording
Net cash used in investing activities for the nine months ended September 30, 2024 was $16.8 million as compared to $5.9 million used in investing activities for the nine months ended September 30, 2023. The increase in net cash used in investing activities was primarily due to increased investment in short-term securities during the nine months ended September 30, 2024.
Previous wording
Net cash provided by financing activities for the six months ended June 30, 2024 was approximately $0.1 million as compared to net cash provided by financing activities of $72.2 million for the six months ended June 30, 2023. The decrease in net cash provided by financing activities during the six months ended June 30, 2024 is due to the advance of $25.0 million drawn as part of the First Amendment entered into with Hercules on March 31, 2024 and $46.3 million received under 2022 ATM that occurred during the six months June 30, 2023.
Current wording
Net cash provided by financing activities for the nine months ended September 30, 2024 was approximately $134.6 million as compared to net cash provided by financing activities of $72.7 million for the nine months ended September 30, 2023. The increase in net cash provided by financing activities during the nine months ended September 30, 2024 is mainly due to the proceeds from the new loan with Blue Owl, offset by the payoff of our prior loan with Hercules.
Previous wording
A critical accounting policy is one that is both important to the portrayal of our financial condition and results of operation and requires management’s most difficult, subjective or complex judgments, often as a result of the need to make estimates about the effect of matters that are inherently uncertain. For a description of our significant accounting policies, refer to “Part II, Item 8. Financial Statements and Supplementary Data, Note 1 – Organization and Summary of Significant Accounting Policies”** **in our 2023 Annual Report on Form 10-K for the year ended December 31, 2023 and refer to Note 1 in this Quarterly Report on Form 10-Q for significant accounting policies due to commercialization for revenue recognition, gross-to-net sales adjustments, accounts receivable, inventory, and cost of revenue. Of these policies, the following are considered critical to an understanding of our Unaudited Condensed Consolidated Financial Statements as they require the application of the most difficult, subjective and complex judgments: stock-based compensation expenses, and fair value measurement of financial liabilities. Refer to “Note 2 –Revenue”, “Note 5 - Fair Value Measurements” and “Note 6 – Stockholders’ Equity” respectively, for more information.
Current wording
A critical accounting policy is one that is both important to the portrayal of our financial condition and results of operation and requires management’s most difficult, subjective or complex judgments, often as a result of the need to make estimates about the effect of matters that are inherently uncertain. For a description of our significant accounting policies, refer to “Part II, Item 8. Financial Statements and Supplementary Data, Note 1 – Organization and Summary of Significant Accounting Policies”** **in our Annual Report on Form 10-K for the year ended December 31, 2023, and refer to Note 1 in this Quarterly Report on Form 10-Q for significant accounting policies due to commercialization for revenue recognition, gross-to-net sales adjustments, accounts receivable, inventory, and cost of revenue. Of these policies, the following are considered critical to an understanding of our Unaudited Condensed Consolidated Financial Statements as they require the application of the most difficult, subjective and complex judgments: stock-based compensation expenses, and fair value measurement of financial liabilities. Refer to “Note 2 – Revenue”, “Note 5 – Fair Value Measurements” and “Note 6 – Stockholders’ Equity” respectively, for more information.
Rearranged previous paragraphs (1)
Previous report — wording carried elsewhere
Other Income.*** ***Other income increased by $1.0 million to $1.7 million for the three months ended June 30, 2024 as compared to the three months ended June 30, 2023. The increase is mainly due to higher interest income received from our money market investments.