OmniAb Inc

Previous wording

This Quarterly Report contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended (the “Exchange Act”). All statements other than statements of historical facts contained in this Quarterly Report, including statements regarding our future results of operations and financial position, our expected cash runway, our business strategy, the effects of the separation or the distribution, our expectations regarding the application of, and the rate and degree of market acceptance of our OmniAb® technology platform and other technologies, our expectations regarding the addressable markets for our technologies, including the growth rate of the markets in which we operate, the potential for and timing of receipt of milestones and royalties under our license agreements with partners, our research and development plans, the potential for our partnered or internal programs to progress in their development, the anticipated timing of the initiation and completion of preclinical studies and clinical trials by our partners or us, the timing and likelihood of regulatory filings and product approvals by our partners or us, the potential for and timing and geographic markets of any commercial product launches by our partners and potential for commercial success, our ability to enter into any new, or maintain existing, strategic partnerships or collaborative relationships, our ability to obtain and maintain intellectual property protection for our platform, products and technologies, the timing and likelihood of success, plans and objectives of management for future operations, and future results of anticipated business development and product development efforts, are forward-looking statements. These statements involve known and unknown risks, uncertainties and other important factors that may cause our actual results, performance or achievements to be materially different from any future results, performance or achievements expressed or implied by the forward-looking statements.

Current wording

This Quarterly Report contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended (the “Exchange Act”). All statements other than statements of historical facts contained in this Quarterly Report, including statements regarding our future results of operations and financial position, our expected cash runway, our business strategy, our expectations regarding the application of, and the rate and degree of market acceptance of our OmniAb® technology platform and other technologies, our expectations regarding the addressable markets for our technologies, including the growth rate of the markets in which we operate, the potential for and timing of receipt of milestones and royalties under our license agreements with partners, our research and development plans, the potential for our partnered or internal programs to progress in their development, the anticipated timing of the initiation and completion of preclinical studies and clinical trials by our partners or us, the timing and likelihood of regulatory filings and product approvals by our partners or us, the potential for and timing and geographic markets of any commercial product launches by our partners and potential for commercial success, our ability to enter into any new, or maintain existing, strategic partnerships or collaborative relationships, our ability to obtain and maintain intellectual property protection for our platform, products and technologies, the timing and likelihood of success, plans and objectives of management for future operations, and future results of anticipated business development and product development efforts, are forward-looking statements. These statements involve known and unknown risks, uncertainties and other important factors that may cause our actual results, performance or achievements to be materially different from any future results, performance or achievements expressed or implied by the forward-looking statements.

Previous wording

As of March 31, 2024, we had 80 active partners with 327 active programs using the OmniAb technology platform, including 27 OmniAb-derived antibodies in clinical development by our partners, one under regulatory review, and three approved products of our partners.

Current wording

As of June 30, 2024, we had 83 active partners with 333 active programs using the OmniAb technology platform, including 28 OmniAb-derived antibodies in clinical development by our partners, one under regulatory review, and three approved products of our partners.

Previous wording

Comparison of the Three Months Ended March 31, 2024 and 2023

Current wording

Comparison of the Three and Six Months Ended June 30, 2024 and 2023

Previous wording

•License and milestone revenue fluctuates primarily due to the timing of milestone recognition related to our partners’ programs in clinical development. The decline in license and milestone revenue was primarily driven by the recognition in the prior year period of a $10 million milestone related to the first commercial sale of teclistimab in the E.U.

Current wording

•License and milestone revenue fluctuates primarily due to the timing of milestone recognition related to our partners’ programs in clinical development. The decline in license and milestone revenue was primarily driven by the recognition in the prior year period of milestones related to the start of pivotal studies in two additional indications for batoclimab, being developed by Immunovant, Inc.

Previous wording

Other income during the three months ended March 31, 2024 and 2023 related to interest earned on short-term investments.

Current wording

Other income, net during the three and six months ended June 30, 2024 and 2023 primarily related to interest earned on short-term investments.

Previous wording

Our effective tax rate for the three months ended March 31, 2024 differed from the federal statutory tax rate of 21.0% due to share-based compensation expense that is not tax deductible and an increase to our valuation allowance recorded against deferred tax assets, partially offset by the tax benefit from research and development tax credits. Our effective tax rate for the three months ended March 31, 2023 differed from the federal statutory tax rate of 21.0% due to share-based compensation expense that is not tax deductible, an increase to our valuation allowance recorded against deferred tax assets, and repricing of state tax deferrals, partially offset by the tax benefit of research and development tax credits.

Current wording

Our effective tax rate for the three and six months ended June 30, 2024 differed from the federal statutory tax rate of 21.0% due to share-based compensation expense that is not tax deductible and an increase to our valuation allowance recorded against deferred tax assets, partially offset by the tax benefit from research and development tax credits. Our effective tax rate for the three and six months ended June 30, 2023 differed from the federal statutory tax rate of 21.0% due to share-based compensation expense that is not tax deductible and increases to our valuation allowance recorded against deferred tax assets, partially offset by the tax benefit of research and development tax credits.

Previous wording

As of March 31, 2024, our cash, cash equivalents and short-term investments were $69.0 million. We believe our cash, cash equivalents and short-term investments and the cash we expect to generate from operations will provide us the flexibility we need to meet operating, investing, and financing needs and support our operations through at least the next 12 months.

Current wording

As of June 30, 2024, our cash, cash equivalents and short-term investments were $57.2 million. We believe our cash, cash equivalents and short-term investments and the cash we expect to generate from operations will provide us the flexibility we need to meet operating, investing, and financing needs and support our operations through at least the next 12 months.

Previous wording

During the three months ended March 31, 2024, cash used in operating activities of $17.0 million primarily reflected our net loss of $19.0 million, changes in our operating assets and liabilities in the amount of $5.5 million, partially offset by net non-cash charges of $7.4 million which primarily included $5.7 million in share-based compensation and $4.9 million in depreciation and amortization.

Current wording

During the six months ended June 30, 2024, cash used in operating activities of $29.2 million primarily reflected our net loss of $32.6 million, changes in our operating assets and liabilities in the amount of $11.3 million, partially offset by net non-cash charges of $14.6 million which primarily included $11.1 million in share-based compensation and $11.1 million in depreciation and amortization.

Previous wording

During the three months ended March 31, 2023, cash provided by operating activities of $27.7 million primarily reflected changes in our operating assets and liabilities in the amount of $25.0 million, net non-cash charges of $8.7 million which primarily included $6.1 million in share-based compensation, and $4.9 million in depreciation and amortization, partially offset by our net loss of $6.1 million.

Current wording

During the six months ended June 30, 2023, cash provided by operating activities of $17.7 million primarily reflected changes in our operating assets and liabilities in the amount of $22.3 million, net non-cash charges of $16.2 million which primarily included $12.6 million in share-based compensation, and $9.7 million in depreciation and amortization, partially offset by our net loss of $20.8 million.

Previous wording

During the three months ended March 31, 2024, cash provided by investing activities of$19.9 million primarily consisted of$26.0 million of proceeds from the maturity of short-term investments and$0.7 million from the sale of short-term investments, partially offset by$5.4 million of cash used to purchase short-term investments,$0.9 million of cash used to purchase property and equipment, and$0.4 million of payments to contingent liabilities holders.

Current wording

During the six months ended June 30, 2024, cash provided by investing activities of$33.1 million primarily consisted of$50.5 million of proceeds from the maturity of short-term investments and$1.3 million from the sale of short-term investments, partially offset by$16.7 million of cash used to purchase short-term investments and$1.7 million of cash used to purchase property and equipment.

Previous wording

During the three months ended March 31, 2023, cash used in investing activities of$37.2 million primarily consisted of$39.1 million of cash used to purchase short-term investments and$2.1 million of payments to contingent liabilities holders, partially offset by$4.0 million of proceeds from the maturity of short-term investments.

Current wording

During the six months ended June 30, 2023, cash used in investing activities of$29.4 million primarily consisted of$56.2 million of cash used to purchase short-term investments and$2.8 million of payments to contingent liabilities holders, partially offset by$30.0 million of proceeds from the maturity of short-term investments.

Previous wording

During the three months ended March 31, 2023, cash used in financing activities was$1.0 million which primarily consisted of$0.8 million taxes paid related to the net share settlement of equity awards and$0.5 million of transaction costs.

Current wording

During the six months ended June 30, 2024, cash provided by financing activities was$0.6 million, which primarily consisted of$2.1 million of proceeds from the issuance of common stock from stock plans, partially offset by$1.0 million of taxes paid related to the net share settlement of equity awards and$0.5 million of transaction costs.

Previous wording

During the three months ended March 31, 2024, cash used in financing activities was$0.2 million which primarily consisted of$0.9 million of taxes paid related to the net share settlement of equity awards and$0.3 million of transaction costs, partially offset by$1.0 million of proceeds from the issuance of common stock from stock plans.

Current wording

During the six months ended June 30, 2023, cash used in financing activities was$0.6 million, which primarily consisted of$0.9 million oftaxes paid related to the net share settlement of equity awards and$0.5 million of transaction costs, partially offset by$0.8 million of proceeds from the issuance of common stock from stock plans.

Previous wording

There have been no material changes to our critical accounting policies and estimates during the three months ended March 31, 2024, as compared to the critical accounting policies and estimates disclosed in “Management’s Discussion and Analysis of Financial Condition and Results of Operations” included in the 2023 Annual Report.

Current wording

There have been no material changes to our critical accounting policies and estimates during the six months ended June 30, 2024, as compared to the critical accounting policies and estimates disclosed in “Management’s Discussion and Analysis of Financial Condition and Results of Operations” included in the 2023 Annual Report.