Protagonist Therapeutics, Inc 10-Q for FY2022 Q1

Protagonist Therapeutics, Inc (PTGX)

10-Q 2022-05-05 For: 2022-03-31

Added on April 07, 2026

About this 10-Q

Protagonist Therapeutics, Inc filed this 10-Q on May 5, 2022, covering the quarter ended March 31, 2022 (FY2022 Q1).

Headline figures

Quarter ended March 31, 2022, as reported in this filing, compared with the same period a year earlier where the filing states it.

Revenue: $25.72M; up 315.6% from $6.19M a year earlier
Net loss: $20.93M; compared with a net loss of $24M a year earlier
Diluted EPS: -$0.43; compared with -$0.54 a year earlier

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Delaware		98-0505495
(State or other jurisdiction of incorporation or organization)		(I.R.S. Employer Identification No.)

7707 Gateway Boulevard, Suite 140 Newark, California 94560-1160		(510) 474-0170
(Address, including zip code, of registrant’s principal executive offices)		(Telephone number, including area code, of registrant’s principal executive offices)


Title of each class	Trading Symbol(s)	Name of each exchange on which registered
Common Stock, par value $0.00001	PTGX	The Nasdaq Stock Market, LLC



Large accelerated filer	☒	Accelerated filer	☐
		Smaller reporting company	☐
Non-accelerated filer	☐	Emerging growth company	☐

I
		Page

PART I	FINANCIAL INFORMATION

Item 1.	Condensed Consolidated Financial Statements (unaudited)
	Condensed Consolidated Balance Sheets	1
	Condensed Consolidated Statements of Operations	2
	Condensed Consolidated Statements of Comprehensive Loss	3
	Condensed Consolidated Statements of Stockholders’ Equity	4
	Condensed Consolidated Statements of Cash Flows	5
	Notes to Unaudited Condensed Consolidated Financial Statements	6
Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	21
Item 3.	Quantitative and Qualitative Disclosures About Market Risk	32
Item 4.	Controls and Procedures	33

PART II	OTHER INFORMATION

Item 1.	Legal Proceedings	33
Item 1A.	Risk Factors	33
Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds	59
Item 3.	Defaults Upon Senior Securities	59
Item 4.	Mine Safety Disclosure	59
Item 5.	Other Information	59
Item 6.	Exhibits	59
	SIGNATURES	61


	March 31,		December 31,
	2022		2021
Assets
Current assets:
Cash and cash equivalents	$	98,477	$	123,665
Marketable securities		206,812		203,235
Receivable from collaboration partner and contract asset - related party		25,150		1,566
Research and development tax incentive receivable		2,878		2,792
Prepaid expenses and other current assets		8,205		9,478
Total current assets		341,522		340,736
Property and equipment, net		2,064		1,798
Restricted cash - noncurrent		225		225
Operating lease right-of-use asset		4,485		4,936
Total assets	$	348,296	$	347,695
Liabilities and Stockholders’ Equity
Current liabilities:
Accounts payable	$	7,159	$	1,600
Payable to collaboration partner - related party		380		899
Accrued expenses and other payables		32,874		37,716
Deferred revenue - related party		768		1,601
Operating lease liability - current		2,275		2,200
Total current liabilities		43,456		44,016
Operating lease liability - noncurrent		3,062		3,658
Total liabilities		46,518		47,674
Commitments and contingencies
Stockholders’ equity:
Preferred stock, $0.00001 par value, 10,000,000 shares authorized; no shares issued and outstanding		—		—
Common stock, $0.00001 par value, 90,000,000 shares authorized 48,552,102 and 47,838,330 shares issued and outstanding as of March 31, 2022 and December 31, 2021, respectively		—		—
Additional paid-in capital		732,542		709,682
Accumulated other comprehensive loss		(472)		(299)
Accumulated deficit		(430,292)		(409,362)
Total stockholders’ equity		301,778		300,021
Total liabilities and stockholders’ equity	$	348,296	$	347,695


☒	QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934


☐	TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934



	Three Months Ended March 31,
	2022		2021
License and collaboration revenue - related party	$	25,722	$	6,189
Operating expenses:
Research and development		36,318		24,245
General and administrative		10,515		5,965
Total operating expenses		46,833		30,210
Loss from operations		(21,111)		(24,021)
Interest income		168		102
Other income (expense), net		13		(79)
Net loss	$	(20,930)	$	(23,998)
Net loss per share, basic and diluted	$	(0.43)	$	(0.54)
Weighted-average shares used to compute net loss per share, basic and diluted		48,752,548		44,224,169


						Accumulated
				Additional		Other				Total
	Common			Paid-In		Comprehensive		Accumulated		Stockholders’
	Stock			Capital		(Loss) Gain		Deficit		Equity
Three months ended March 31, 2022	Shares	Amount
Balance at December 31, 2021	47,838,330	$	—	$	709,682	$	(299)	$	(409,362)	$	300,021
Issuance of common stock pursuant to at-the-market offering, net of issuance costs	422,367		—		14,553		—		—		14,553
Issuance of common stock under equity incentive and employee stock purchase plans	299,131		—		2,558		—		—		2,558
Shares withheld for net settlement of tax withholding upon vesting of restricted stock units	(7,726)		—		(186)		—		—		(186)
Stock-based compensation expense	—		—		5,935		—		—		5,935
Other comprehensive loss	—		—		—		(173)		—		(173)
Net loss	—		—		—		—		(20,930)		(20,930)
Balance at March 31, 2022	48,552,102	$	—	$	732,542	$	(472)	$	(430,292)	$	301,778


	Balance at						Balance at
	Beginning of						End of
Three Months Ended March 31, 2022	Period		Additions		Deductions		Period
Contract assets:
Receivable from collaboration partner - related party	$	1,566	$	25,150	$	(1,566)	$	25,150
Contract liabilities:
Deferred revenue - related party	$	1,601	$	25,658	$	(26,491)	$	768
Payable to collaboration partner - related party	$	899	$	330	$	(849)	$	380


	Balance at						Balance at
	Beginning of						End of
Three Months Ended March 31, 2021	Period		Additions		Deductions		Period
Contract assets:
Receivable from collaboration partner - related party	$	2,426	$	1,570	$	—	$	3,996
Contract liabilities:
Deferred revenue - related party	$	14,477	$	1,017	$	(9,726)	$	5,768
Payable to collaboration partner - related party	$	2,732	$	4,091	$	—	$	6,823


	March 31, 2022
	Level 1		Level 2		Level 3		Total
Assets:
Money market funds	$	35,422	$	—	$	—	$	35,422
Commercial paper		—		138,084		—		138,084
Corporate debt securities		—		45,350		—		45,350
U.S. Treasury and agency securities		—		77,648		—		77,648
Supranational and sovereign government securities		—		3,000		—		3,000
Total financial assets carried at fair value	$	35,422	$	264,082	$	—	$	299,504


	December 31, 2021
	Level 1		Level 2		Level 3		Total
Assets:
Money market funds	$	39,854	$	—	$	—	$	39,854
Commercial paper		—		157,141		—		157,141
Corporate debt securities		—		75,548		—		75,548
U.S. Treasury and agency securities				40,017		—		40,017
Supranational and sovereign government securities		—		6,010		—		6,010
Total financial assets carried at fair value	$	39,854	$	278,716	$	—	$	318,570


	March 31, 2022
	Amortized		Gross Unrealized
	Cost		Gains		Losses		Fair Value
Money market funds	$	35,422	$	—	$	—	$	35,422
Commercial paper		138,123		1		(40)		138,084
Corporate debt securities		45,455		—		(105)		45,350
U.S. Treasury and agency securities		77,915		1		(268)		77,648
Supranational and sovereign government securities		3,000		—		—		3,000
Total cash equivalents and marketable securities	$	299,915	$	2	$	(413)	$	299,504
Classified as:
Cash equivalents							$	92,692
Marketable securities - current								206,812
Total cash equivalents and marketable securities							$	299,504



		Weighted-		Weighted-
		Average		Average
		Exercise		Remaining	Aggregate
	Options	Price Per		Contractual	Intrinsic
	Outstanding	Share		Life (years)	Value (1)
					(in millions)
Balances at December 31, 2021	5,890,540	$	17.66	7.47	$	102.7
Options granted	1,122,100		28.85
Options exercised	(165,488)		11.68
Options forfeited	(37,542)		39.04
Balances at March 31, 2022	6,809,610	$	19.53	7.37	$	46.0
Options exercisable – March 31, 2022	3,349,241	$	13.59	6.05	$	34.5
Options vested and expected to vest – March 31, 2022	6,809,610	$	19.53	7.37	$	46.0


		Weighted
		Average
	Number of	Grant Date
	Shares	Fair Value
Unvested RSUs at December 31, 2021	405,972	$	20.13
Granted	312,550		28.73
Vested	(104,712)		14.73
Forfeited	(7,000)		28.73
Unvested RSUs at March 31, 2022	606,810	$	24.61


	March 31,		December 31,
	2022		2021
Laboratory equipment	$	4,619	$	4,156
Furniture and computer equipment		1,072		1,023
Leasehold improvements		898		877
Total property and equipment		6,589		6,056
Less: accumulated depreciation		(4,525)		(4,258)
Property and equipment, net	$	2,064	$	1,798


	Three Months Ended March 31,
	2022	2021
Expected term (in years)	5.27- 6.08	5.27- 6.08
Expected volatility	97.1% - 98.2%	89.8% - 90.2%
Risk-free interest rate	1.64% - 2.13%	0.11% - 0.97%
Dividend yield	—	—


	Three Months Ended March 31,				Dollar		%
	2022		2021		Change		Change

	(Dollars in thousands)
License and collaboration revenue - related party	$	25,722	$	6,189	$	19,533	316
Operating expenses:
Research and development ⁽¹⁾		36,318		24,245		12,073	50
General and administrative ⁽²⁾		10,515		5,965		4,550	76
Total operating expenses		46,833		30,210		16,623	55
Loss from operations		(21,111)		(24,021)		2,910	(12)
Interest income		168		102		66	65
Other income (expense), net		13		(79)		92	(116)
Net loss	$	(20,930)	$	(23,998)	$	3,068	(13)


	Three Months Ended March 31,
Condensed Consolidated Statements of Cash Flows Data:	2022		2021

	(Dollars in thousands)
Cash used in operating activities	$	(37,666)	$	(28,756)
Cash used in investing activities	$	(4,476)	$	(6,793)
Cash provided by financing activities	$	16,925	$	979
Stock-based compensation	$	5,935	$	2,660
Receivable from collaboration partner - related party	$	(23,584)	$	(1,570)
Decrease in deferred revenue - related party	$	(833)	$	(8,709)


Exhibit		Incorporation By Reference
Number	Exhibit Description	Form	SEC File No.	Exhibit	Filing Date
3.1	Amended and Restated Certificate of Incorporation	8-K	001-37852	3.1	8/16/2016
3.2	Amended and Restated Bylaws	S-1/A	333-212476	3.2	8/1/2016
10.1+	Employment Offer Letter dated March 25, 2022 by and between the Registrant and Asif Ali
31.1+	Certification of Chief Executive Officer required by Rule 13a-14(a) or Rule 15d-14(a) of the Securities Exchange Act of 1934, as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002
31.2+	Certification of Chief Financial Officer required by Rule 13a-14(a) or Rule 15d-14(a) of the Securities Exchange Act of 1934, as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002
32.1+*	Certification of Chief Executive Officer and Chief Financial Officer, as required by Rule 13a-14(b) or Rule 15d-14(b) and Section 1350 of Chapter 63 of Title 18 of the United States Code (18 U.S.C. §1350), as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002
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101.SCH+	Inline XBRL Taxonomy Extension Schema Document
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101.PRE+	Inline XBRL Taxonomy Extension Presentation Linkbase Document
104	Cover Page Interactive Data File - The cover page interactive data file does not appear in the Interactive Data File because its XBRL tags are embedded within the Inline XBRL document

	PROTAGONIST THERAPEUTICS, INC.


Date: May 5, 2022	By:	/s/ Dinesh V. Patel, Ph.D.
		Dinesh V. Patel, Ph.D.
		President, Chief Executive Officer and Director
		(Principal Executive Officer)

Date: May 5, 2022	By:	/s/ Asif Ali
		Asif Ali
		Executive Vice President, Chief Financial Officer
		(Principal Financial and Accounting Officer)