Cytokinetics, Incorporated (NASDAQ:CYTK) Q1 2021 Earnings Conference Call May 6, 2021 4:30 PM ET Company Participants Diane Weiser – Senior Vice President-Corporate Communications and Investor Relations Robert Blum – President and Chief Executive Officer Fady Malik – Executive Vice President-Research and Development Stuart Kupfer – Senior Vice President and Chief Medical Officer Robert Wong – Vice President and Chief Accounting Officer Ching Jaw – Senior Vice President and Chief Financial Officer Andrew Cal ...

Research and Development - Research and development expenses for Q1 2021 were $31.6 million, up from $21.7 million in Q1 2020, representing a 45% increase[139] - Research and development revenues for Q1 2021 were $6.5 million, up from $3.8 million in Q1 2020, representing an increase of 71%[230] - Research and development expenses for Q1 2021 increased by $9.8 million to $31.6 million, primarily due to higher expenses related to the reldesemtiv program[238] - The company expects to incur increased costs in 2021 due to advancements in its pipeline and commercial planning activities for omecamtiv mecarbil[256] - The company anticipates significant research and development expenses as it advances its muscle biology programs through clinical development[258] - The company is engaging with regulatory authorities regarding potential NDA submission paths for omecamtiv mecarbil[261] - The company may need to reduce research and development expenses if internal financing prospects decline[264] Clinical Trials and Drug Development - The company is conducting the METEORIC-HF Phase 3 clinical trial to evaluate omecamtiv mecarbil's potential to increase exercise performance in heart failure patients[128] - CK-274 is being evaluated in the REDWOOD-HCM Phase 2 clinical trial for symptomatic obstructive hypertrophic cardiomyopathy[131] - Omecamtiv mecarbil is part of a collaboration with Amgen, which has conducted the GALACTIC-HF Phase 3 trial for heart failure outcomes[128] - Reldesemtiv is being developed for conditions like spinal muscular atrophy and amyotrophic lateral sclerosis, with ongoing Phase 2 trials[134] - The METEORIC-HF trial, a second Phase 3 clinical trial for omecamtiv mecarbil, is planned to enroll approximately 270 patients and is expected to report results in early 2022[166] - CK-136, a novel cardiac troponin activator, was discovered under the joint research program with Amgen and is expected to enhance myocardial contractility[169] - CK-271, a second cardiac myosin inhibitor, received FDA IND acceptance and began Phase 1 clinical trials in September 2020[184] - In a Phase 2 clinical study for SMA, reldesemtiv showed statistically significant increases in Six Minute Walk Distance (6MWD) and Maximal Expiratory Pressure (MEP) after 8 weeks of oral dosing[198] - In the FORTITUDE-ALS trial, 458 ALS patients were randomized to receive reldesemtiv or placebo, with the primary endpoint being the change in percent predicted slow vital capacity (SVC) at 12 weeks[202] - The planned Phase 3 trial, COURAGE-ALS, aims to enroll approximately 555 ALS patients, with a primary efficacy endpoint of change in ALSFRS-R from baseline to 24 weeks[210] Financial Performance and Projections - The company has not generated any revenue from commercial product sales to date, relying primarily on strategic alliances for revenue[225] - Future revenue is expected to fluctuate, with potential additional milestone payments upon the occurrence of specific events[226] - Cash and cash equivalents as of March 31, 2021, were $44.6 million, down from $83.0 million as of December 31, 2020[252] - Net cash used in operating activities for Q1 2021 was $29.5 million, primarily due to ongoing research and development activities[254] - Future revenues from collaborations with Amgen and Astellas are expected to decline due to the termination of respective agreements[228] - The company has incurred an accumulated deficit of $1,039.4 million since inception, with no assurance of achieving profitability in the future[263] - Existing cash and cash equivalents are projected to meet operating requirements for at least the next 12 months, but future funding may require strategic relationships or financing[264] Strategic Alliances and Collaborations - The strategic alliance with Amgen includes exclusive worldwide rights for the development and commercialization of omecamtiv mecarbil, with Amgen also collaborating with Servier for commercialization in Europe and CIS[143] - A strategic alliance with Ji Xing was established, resulting in a $25 million upfront payment and potential milestone payments up to $200 million for CK-274 development in China and Taiwan[183] - Following the termination of the Amgen Agreement, Cytokinetics plans to transition development and commercialization activities for omecamtiv mecarbil by May 20, 2021[147] - Cytokinetics entered into a Royalty Purchase Agreement with RPI Finance Trust, selling a 4.5% royalty on worldwide net sales of omecamtiv mecarbil for a one-time payment of $90 million[148] - The Astellas FSRA Agreement allows Cytokinetics exclusive control over the development of reldesemtiv, with Astellas contributing up to $12 million for Phase 3 trial costs[190] - The Astellas OSSA Agreement was terminated effective November 1, 2021, ending Astellas' rights to co-develop skeletal sarcomere activators[193] Safety and Efficacy Results - Amgen and Servier announced that treatment with omecamtiv mecarbil achieved a statistically significant reduction in cardiovascular death or heart failure events, with a hazard ratio of 0.92 (95% CI: 0.86, 0.99, p=0.025) in the GALACTIC-HF trial[144] - The GALACTIC-HF trial enrolled 8,256 patients with symptomatic chronic heart failure, demonstrating a primary endpoint event in 37.0% of the omecamtiv mecarbil group compared to 39.1% in the placebo group[156] - No significant reduction in the secondary endpoint of cardiovascular death was observed, with 19.6% of patients in the omecamtiv mecarbil group and 19.4% in the placebo group experiencing this outcome[159] - Omecamtiv mecarbil significantly decreased NT-proBNP concentrations by 10% (95% CI 6-14%) at Week 24 compared to placebo[160] - The overall safety profile of omecamtiv mecarbil was consistent with previous trials, with balanced rates of adverse events between treatment arms[161] - Interim analysis of REDWOOD-HCM Cohort 1 indicated significant reductions in average resting left ventricular outflow tract gradient (LVOT-G) with no serious adverse events reported[177] - The FDA granted orphan drug designation to CK-274 for symptomatic HCM treatment on January 11, 2021[178] - FORTITUDE-ALS did not achieve statistical significance for its primary endpoint (p=0.11), but post-hoc analyses showed a 27% difference in ALSFRS-R total score between reldesemtiv and placebo in faster progressing patients[203][209] Company Operations and Future Plans - The company focuses on small molecule modulation of muscle contractility, which may have applications in treating heart failure and muscle weakness[138] - The company expects to identify additional potential drug candidates suitable for clinical development based on its research in muscle biology[136] - The company continues to conduct preclinical research on skeletal muscle activators and their potential applications in diseases associated with muscle dysfunction[213] - Spending is anticipated to increase as commercialization plans for omecamtiv mecarbil advance, with a focus on building a fit-for-purpose commercial organization[260] - The company is subject to risks common to clinical-stage companies, including dependence on key personnel and the ability to obtain additional capital[263] - There are no off-balance sheet arrangements that could materially affect the company's financial condition or results[265]

Sarcomere Directed Therapies | --- | --- | --- | --- | |-------------------|-------|-------|-------| | | | | | | | | | | | EMPOWERING | | | | | MUSCLE EMPOWERING | | | | | LIVES | | | | John, diagnosed with heart failure Jillian, diagnosed with HCM Chuck, diagnosed with ALS Forward-Looking Statements This Presentation contains forward-looking statements for purposes of the Private Securities Litigation Reform Act of 1995 (the "Act"). Cytokinetics disclaims any intent or obligation to update these forward-lo ...

Cytokinetics, Inc. (NASDAQ:CYTK) Q4 2020 Results Earnings Conference Call February 25, 2021 4:00 PM ET Company Participants Diane Weiser - SVP, Corporate Communications & IR Robert Blum - CEO, President Fady Malik - EVP, Research & Development Stuart Kupfer - SVP & Chief Medical Officer Robert Wong - VP & CAO Ching Jaw - SVP & CFO Conference Call Participants Dane Leone - Raymond James Jason Butler - JMP Securities Joe Pantginis - H.C. Wainwright Salim Syed - Mizuho Charles Duncan - Cantor Fitzgerald Jeff ...

[Forward-Looking Statements](index=3&type=section&id=Forward%20Looking%20Statements%20Private%20Securities%20Litigation%20Reform%20act%20of%201995) [Forward-Looking Statements and Associated Risks](index=3&type=section&id=Forward%20Looking%20Statements%20Private%20Securities%20Litigation%20Reform%20act%20of%201995) This section outlines various forward-looking statements and associated risks, emphasizing that actual results may differ materially from projections - Key areas of uncertainty include capital requirements, clinical trial outcomes, regulatory approvals, strategic alliances, market acceptance, intellectual property, and the impact of the COVID-19 pandemic[11](index=11&type=chunk)[13](index=13&type=chunk) - Specific risks include Astellas' decisions on skeletal muscle activators, Ji Xing's decisions on **CK-274** development/commercialization in China/Taiwan, the ability to effectively transition **omecamtiv mecarbil** and **CK-136** programs from Amgen, and potential delays or limitations from **FDA** or foreign regulatory agencies[11](index=11&type=chunk)[13](index=13&type=chunk) [Summary of Principal Risk Factors](index=5&type=section&id=Summary%20of%20Principal%20Risk%20Factors) [Overview of Key Business Risks](index=5&type=section&id=Summary%20of%20Principal%20Risk%20Factors) This section summarizes key business risks: regulatory approval uncertainties, clinical trial failures, capital needs, and COVID-19 impacts - No guarantee of **FDA** approval for **omecamtiv mecarbil** despite **GALACTIC-HF** meeting its **primary efficacy endpoint**, as **secondary endpoints** were not met and subgroup analyses may not be sufficient for approval without additional trials[18](index=18&type=chunk) - All drug candidates (**CK-274**, **reldesemtiv**) are prone to failure in demonstrating desired safety and efficacy, potentially delaying or preventing regulatory approval[18](index=18&type=chunk) - The transition of manufacturing, development, regulatory, and commercial activities for **omecamtiv mecarbil** and **CK-136** from **Amgen** to Cytokinetics may not be effective or efficient, leading to substantial delays and increased costs[18](index=18&type=chunk) - The company has limited sales and marketing capabilities and depends on **CROs** and contract manufacturers, with success relying on intellectual property protection, market acceptance, and sufficient third-party payor coverage and reimbursement[18](index=18&type=chunk)[21](index=21&type=chunk)[22](index=22&type=chunk) - Cytokinetics has a history of **significant losses**, requires **substantial additional capital**, and faces ongoing adverse impacts from the **COVID-19 pandemic**[22](index=22&type=chunk)[23](index=23&type=chunk) [PART I](index=7&type=section&id=PART%20I) [Item 1. Business](index=7&type=section&id=Item%201.%20Business) Cytokinetics is a late-stage biopharmaceutical company developing muscle-directed medicines, focusing on regulatory approvals, commercialization, and pipeline expansion - Cytokinetics is a **late-stage biopharmaceutical company** focused on discovering, developing, and commercializing **first-in-class muscle activators** and **next-in-class muscle inhibitors** for debilitating diseases of impaired muscle function[27](index=27&type=chunk)[38](index=38&type=chunk) - Clinical-stage drug candidates include **omecamtiv mecarbil** (cardiac myosin activator), **CK-136** (cardiac troponin activator), **reldesemtiv** (fast skeletal muscle troponin activator), **CK-274**, and **CK-271** (cardiac myosin inhibitors)[28](index=28&type=chunk)[409](index=409&type=chunk) - The company's '**Vision 2025**' strategy includes achieving regulatory approvals for **at least two drugs**, building commercial capabilities, generating sustainable revenues, doubling the development pipeline to **ten therapeutic programs**, and expanding the discovery platform to muscle energetics, growth, and metabolism[39](index=39&type=chunk)[40](index=40&type=chunk)[42](index=42&type=chunk) Research and Development Expenses (2018-2020) | Year | Amount (Millions USD) | | :--- | :-------------------- | | 2020 | $97.0 | | 2019 | $86.1 | | 2018 | $89.1 | - **Amgen** elected to terminate its collaboration agreement effective **May 20, 2021**, transitioning development and commercialization rights for **omecamtiv mecarbil** and **CK-136** to Cytokinetics; **Servier** also terminated its sublicense for Europe/CIS, reverting rights to Amgen, then to Cytokinetics[52](index=52&type=chunk)[53](index=53&type=chunk)[55](index=55&type=chunk) - **GALACTIC-HF**, a **Phase 3** trial for **omecamtiv mecarbil** in heart failure, met its **primary composite efficacy endpoint** (**HR: 0.92**; **95% CI: 0.86, 0.99**, **p=0.025**) but **no secondary endpoints**; a potentially greater treatment effect was suggested in patients with lower left ventricular ejection fraction (**LVEF ≤28%**)[51](index=51&type=chunk)[64](index=64&type=chunk)[66](index=66&type=chunk)[67](index=67&type=chunk)[69](index=69&type=chunk) - **CK-274**, a **cardiac myosin inhibitor** for **hypertrophic cardiomyopathy (HCM)**, showed **substantial reductions in LVOT-G** in interim **Phase 2 REDWOOD-HCM** data; **FDA** granted **Orphan Drug Designation** for symptomatic HCM[31](index=31&type=chunk)[84](index=84&type=chunk)[86](index=86&type=chunk) - **Reldesemtiv**, a **fast skeletal muscle troponin activator**, received **orphan drug designation** for **SMA** and **ALS** from **FDA** and **EMA**; **Phase 2 FORTITUDE-ALS** showed numerical effects favoring reldesemtiv, especially in faster-progressing patients, leading to the planned **Phase 3 COURAGE-ALS** trial[100](index=100&type=chunk)[106](index=106&type=chunk)[108](index=108&type=chunk)[113](index=113&type=chunk)[114](index=114&type=chunk) - The company relies on **third-party contract manufacturers** for clinical trial materials and anticipates continued reliance for commercial supply, with ongoing efforts to transition manufacturing for **omecamtiv mecarbil**[119](index=119&type=chunk)[121](index=121&type=chunk)[122](index=122&type=chunk)[124](index=124&type=chunk) - As of **December 31, 2020**, Cytokinetics owned, co-owned, or licensed **71 issued U.S. patents**, over **550 foreign patents**, and over **280 additional pending U.S. and foreign patent applications**, with key drug candidate patents expiring between **2027 and 2039**[125](index=125&type=chunk)[127](index=127&type=chunk) - The company is subject to extensive **FDA** and foreign regulatory requirements throughout the drug development and commercialization process, including preclinical testing, **INDs**, multi-phase clinical trials, **NDAs**, and post-marketing obligations[139](index=139&type=chunk)[141](index=141&type=chunk)[144](index=144&type=chunk)[149](index=149&type=chunk)[151](index=151&type=chunk) - As of **December 31, 2020**, Cytokinetics had **184 employees** and **51 consultants**, with a low turnover rate of **3.4% in 2020**, and is committed to fostering a collaborative and inclusive culture[160](index=160&type=chunk)[161](index=161&type=chunk)[163](index=163&type=chunk) - The **COVID-19 pandemic** led to remote work for most employees and temporary suspension of enrollment in **METEORIC-HF** and **REDWOOD-HCM**, both of which have since resumed enrollment; the pandemic continues to pose risks to operations and financial markets[165](index=165&type=chunk)[166](index=166&type=chunk)[169](index=169&type=chunk)[170](index=170&type=chunk) [Item 1A. Risk Factors](index=27&type=section&id=Item%201A.%20Risk%20Factors) This section details significant risks that could materially and adversely affect Cytokinetics' business, financial condition, and stock value - The company has a history of **significant operating losses** since its inception in **1997** and expects increasing losses, requiring **substantial additional funding** which may not be available on favorable terms[176](index=176&type=chunk)[177](index=177&type=chunk)[178](index=178&type=chunk)[181](index=181&type=chunk) - The **COVID-19 pandemic** continues to adversely impact business operations, potentially causing disruptions in clinical trials, supply chains, and global financial markets[183](index=183&type=chunk)[185](index=185&type=chunk)[187](index=187&type=chunk) - As of **December 31, 2020**, Cytokinetics had **$183.0 million** in aggregate principal indebtedness, including a **$45.0 million Term Loan** and **$138.0 million** in convertible senior notes, which could limit cash flow and expose the company to financial risks[189](index=189&type=chunk)[192](index=192&type=chunk) - There is no guarantee of regulatory approval for **omecamtiv mecarbil** despite positive primary endpoint results from **GALACTIC-HF**, as secondary endpoints were not met, and the **FDA** may require additional clinical trials[212](index=212&type=chunk)[213](index=213&type=chunk) - All drug candidates, including **CK-274** and **reldesemtiv**, are subject to inherent risks of failure in clinical development, and preclinical or early-phase clinical results do not guarantee success in later, larger trials[198](index=198&type=chunk)[199](index=199&type=chunk)[203](index=203&type=chunk) - The transition of development and commercialization rights for **omecamtiv mecarbil** and **CK-136** from **Amgen** (and **Servier**) to Cytokinetics may not be completed effectively or efficiently, leading to substantial delays and increased costs[223](index=223&type=chunk)[224](index=224&type=chunk)[225](index=225&type=chunk)[228](index=228&type=chunk)[229](index=229&type=chunk)[230](index=230&type=chunk) - The company has no internal manufacturing capacity and relies on strategic partners and contract manufacturers, whose failure to perform satisfactorily could delay development or commercialization[246](index=246&type=chunk)[247](index=247&type=chunk)[249](index=249&type=chunk)[251](index=251&type=chunk)[252](index=252&type=chunk)[254](index=254&type=chunk)[256](index=256&type=chunk) - Success depends on obtaining and maintaining intellectual property protection for drug candidates and technologies, which is costly, complex, and subject to challenges, infringement claims, and evolving legal standards[259](index=259&type=chunk)[261](index=261&type=chunk)[262](index=262&type=chunk)[263](index=263&type=chunk)[265](index=265&type=chunk)[266](index=266&type=chunk)[267](index=267&type=chunk)[268](index=268&type=chunk)[269](index=269&type=chunk)[270](index=270&type=chunk)[272](index=272&type=chunk)[273](index=273&type=chunk)[274](index=274&type=chunk)[275](index=275&type=chunk)[277](index=277&type=chunk)[278](index=278&type=chunk) - Even if drug candidates obtain regulatory approval, commercial success is not guaranteed and depends on market acceptance by physicians and patients, as well as sufficient third-party payor coverage and reimbursement, which are uncertain and subject to cost-containment pressures[325](index=325&type=chunk)[328](index=328&type=chunk)[329](index=329&type=chunk)[330](index=330&type=chunk)[331](index=331&type=chunk)[332](index=332&type=chunk) - The company's stock price is expected to fluctuate significantly due to various factors, including clinical trial results, strategic alliances, market conditions, regulatory actions, and competition[366](index=366&type=chunk)[368](index=368&type=chunk)[372](index=372&type=chunk) [Item 1B. Unresolved Staff Comments](index=63&type=section&id=Item%201B.%20Unresolved%20Staff%20Comments) The company has no unresolved staff comments - No unresolved staff comments[389](index=389&type=chunk) [Item 2. Properties](index=63&type=section&id=Item%202.%20Properties) Cytokinetics leases 81,587 square feet of office and laboratory space in South San Francisco, California, with a new 234,892 square foot lease commencing in Q3 2021 - Current facilities consist of **81,587 square feet** of leased office and laboratory space in South San Francisco, California, with the lease expiring in **June 2021**[390](index=390&type=chunk) - An Expansion Lease for an additional **9,350 square feet** within the same office location commenced in **January 2020** with an initial term of **39 months**[390](index=390&type=chunk) - A new lease agreement for **234,892 square feet** of office and laboratory space at the Oyster Point facility in South San Francisco was entered into in **July 2019**, with an initial term of **12 years**, expected to commence in the **third quarter of 2021**[391](index=391&type=chunk) [Item 3. Legal Proceedings](index=63&type=section&id=Item%203.%20Legal%20Proceedings) The company is not currently subject to any material legal proceedings - The company is not currently subject to any material legal proceedings[393](index=393&type=chunk) [Item 4. Mine Safety Disclosures](index=63&type=section&id=Item%204.%20Mine%20Safety%20Disclosures) This item is not applicable to the company - This item is not applicable[394](index=394&type=chunk) [PART II](index=64&type=section&id=PART%20II) [Item 5. Market for Registrant's Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities](index=64&type=section&id=Item%205.%20Market%20for%20Registrant's%20Common%20Equity%2C%20Related%20Stockholder%20Matters%20and%20Issuer%20Purchases%20of%20Equity%20Securities) Cytokinetics' common stock is listed on Nasdaq under "CYTK," with no cash dividends paid, and its performance graph shows outperformance in 2020 - Cytokinetics' common stock is listed on the **Nasdaq Global Select Market** under the symbol "**CYTK**"[397](index=397&type=chunk) - As of **February 23, 2021**, the last reported sale price for common stock was **$20.26 per share**, with **49 holders of record**[397](index=397&type=chunk)[400](index=400&type=chunk) - The company has never declared or paid cash dividends and does not anticipate doing so in the foreseeable future[397](index=397&type=chunk)[402](index=402&type=chunk) Cumulative Total Return (12/31/2015 - 12/31/2020) | Index/Stock | 12/31/2015 | 12/31/2016 | 12/31/2017 | 12/31/2018 | 12/31/2019 | 12/31/2020 | | :---------- | :--------- | :--------- | :--------- | :--------- | :--------- | :--------- | | Cytokinetics, Inc. | $100.00 | $116.16 | $77.92 | $60.42 | $101.43 | $198.66 | | Nasdaq Composite Index | $100.00 | $107.50 | $137.86 | $132.51 | $179.19 | $257.38 | | Nasdaq Biotechnology Index | $100.00 | $78.32 | $94.81 | $85.97 | $106.95 | $134.42 | [Item 6. Selected Financial Data](index=65&type=section&id=Item%206.%20Selected%20Financial%20Data) This item is not required for the report - This item is not required[406](index=406&type=chunk) [Item 7. Management's Discussion and Analysis of Financial Condition and Results of Operations](index=66&type=section&id=Item%207.%20Management's%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operations) This section discusses the company's financial condition and results of operations for 2020, highlighting revenue growth, increased expenses, and improved liquidity - Cytokinetics is a **late-stage biopharmaceutical company** with clinical-stage drug candidates including **omecamtiv mecarbil**, **CK-136**, **reldesemtiv**, **CK-274**, and **CK-271**[408](index=408&type=chunk)[409](index=409&type=chunk) - Critical accounting policies include revenue recognition (**ASC 606**), accrued research and development expenditures, and the liability related to the sale of future royalties (treated as debt financing)[411](index=411&type=chunk)[412](index=412&type=chunk)[414](index=414&type=chunk)[416](index=416&type=chunk)[422](index=422&type=chunk)[423](index=423&type=chunk)[427](index=427&type=chunk) Total Revenues (2018-2020, in millions USD) | Year | Research & Development | License | Milestone | Total | | :--- | :--------------------- | :------ | :-------- | :---- | | 2020 | $16.5 | $36.5 | $2.8 | $55.8 | | 2019 | $26.9 | — | — | $26.9 | | 2018 | $26.4 | $5.1 | — | $31.5 | - Total revenues increased by **$28.9 million** in **2020**, primarily driven by **$36.5 million** in license revenues from **RTW Transactions** and **$2.8 million** in milestone revenues from **Ji Xing**[434](index=434&type=chunk)[436](index=436&type=chunk) Research and Development Expenses by Program (2018-2020, in millions USD) | Program | 2020 | 2019 | 2018 | | :-------------------------- | :--- | :--- | :--- | | Cardiac muscle contractility | $53.0 | $45.8 | $19.0 | | Skeletal muscle contractility | $17.1 | $14.6 | $50.9 | | All other research programs | $26.9 | $25.7 | $19.2 | | **Total R&D Expenses** | **$97.0** | **$86.1** | **$89.1** | - Research and development expenses increased by **$10.9 million** to **$97.0 million** in **2020**, mainly due to higher spending on **METEORIC-HF**, the cardiac myosin inhibitor program, and **reldesemtiv** (**COURAGE-ALS**)[439](index=439&type=chunk)[440](index=440&type=chunk) General and Administrative Expenses (2018-2020, in millions USD) | Year | Amount | | :--- | :----- | | 2020 | $52.8 | | 2019 | $39.6 | | 2018 | $31.3 | - General and administrative expenses increased by **$13.2 million** to **$52.8 million** in **2020**, primarily due to higher personnel-related costs and outside service spend[445](index=445&type=chunk)[446](index=446&type=chunk) Interest Expense (2018-2020, in millions USD) | Category | 2020 | 2019 | 2018 | | :--------------- | :--- | :--- | :--- | | Term loan | $4.9 | $5.2 | $3.8 | | Convertible notes | $10.8 | $1.4 | — | | Warrants | $0.2 | — | — | | Other | $0.1 | — | — | | **Total** | **$16.0** | **$6.6** | **$3.8** | - Total interest expense increased by **$9.4 million** to **$16.0 million** in **2020**, mainly due to the convertible notes issued in **November 2019**[447](index=447&type=chunk)[448](index=448&type=chunk) Cash, Cash Equivalents, Investments, Borrowings, and Working Capital (as of Dec 31, in millions USD) | Metric | Dec 31, 2020 | Dec 31, 2019 | | :----------------------------------- | :----------- | :----------- | | Cash and cash equivalents | $83.0 | $36.4 | | Short-term investments | $381.1 | $188.7 | | **Total cash, cash equivalents & marketable securities** | **$464.1** | **$225.1** | | Term loan, net | $46.2 | $45.1 | | Convertible notes, net | $89.5 | $84.2 | | **Total borrowings** | **$135.7** | **$129.3** | | Current assets | $474.2 | $233.8 | | Current liabilities | $31.2 | $26.0 | | **Working capital** | **$443.0** | **$207.8** | Cash Flows Summary (2018-2020, in millions USD) | Activity | 2020 | 2019 | 2018 | | :-------------------------------------------------- | :------- | :------- | :------- | | Net cash provided by (used in) operating activities | $8.9 | $(90.9) | $(101.2) | | Net cash (used in) provided by investing activities | $(196.5) | $(74.7) | $5.1 | | Net cash provided by financing activities | $234.1 | $159.8 | $13.1 | | **Net increase (decrease) in cash and cash equivalents** | **$46.5** | **$(5.8)** | **$(83.0)** | - Net cash provided by operating activities was **$8.9 million** in **2020**, a significant improvement from net cash used in **2019** and **2018**, largely due to **$87.0 million** in deferred revenues from **RTW Royalty Holdings**[454](index=454&type=chunk)[456](index=456&type=chunk) - Financing activities provided **$234.1 million** in **2020**, primarily from a **$188.9 million public offering** of common stock and **$50.0 million** from a private placement to **RTW Investors**[458](index=458&type=chunk)[460](index=460&type=chunk)[463](index=463&type=chunk) - The company entered into a Funding Agreement with **RTW Royalty Holdings** for up to **$90.0 million** to fund **CK-274** development, in exchange for future royalty payments[464](index=464&type=chunk)[465](index=465&type=chunk) Contractual Obligations (as of Dec 31, 2020, in millions USD) | Type | Total | Less than 1 Year | 1-3 Years | 3-5 Years | More than 5 Years | | :-------------------------- | :---- | :--------------- | :-------- | :-------- | :---------------- | | Operating lease obligations | $221.1 | $4.6 | $28.9 | $33.9 | $153.7 | | Long-term debt obligations | $57.1 | $3.7 | $53.4 | — | — | | Convertible notes (interest) | $33.0 | $5.5 | $11.0 | $11.0 | $5.5 | | Purchase obligations | $3.7 | $3.2 | $0.5 | — | — | | **Total** | **$314.9** | **$17.0** | **$93.8** | **$44.9** | **$159.2** | [Item 7A. Quantitative and Qualitative Disclosures About Market Risk](index=76&type=section&id=Item%207A.%20Quantitative%20and%20Qualitative%20Disclosures%20About%20Market%20Risk) The company is exposed to market risks, primarily interest rate and foreign currency, with limited material impact from hypothetical changes - As of **December 31, 2020**, cash and short-term investments totaled **$464.1 million**, primarily invested in U.S. Treasury securities, agency bonds, commercial paper, corporate debt, and money market funds[500](index=500&type=chunk) - A hypothetical **10%** relative change in interest rates would not have a material impact on the consolidated financial statements[500](index=500&type=chunk) - Foreign currency risk is primarily related to transactions denominated in **Euro** and **GBP**; a **10%** increase or decrease in current exchange rates would not have a material effect on financial results[501](index=501&type=chunk) [Item 8. Financial Statements and Supplementary Data](index=77&type=section&id=Item%208.%20Financial%20Statements%20and%20Supplementary%20Data) This section presents audited consolidated financial statements, with an unqualified opinion from Ernst & Young LLP, highlighting critical audit matters - **Ernst & Young LLP** issued an unqualified opinion on the consolidated financial statements and the effectiveness of internal control over financial reporting as of **December 31, 2020**[506](index=506&type=chunk)[507](index=507&type=chunk)[737](index=737&type=chunk) - Critical audit matters include the significant judgment required for estimates related to the sale of future royalties and the complex nature of accounting for revenues from collaborative and licensing arrangements[512](index=512&type=chunk)[514](index=514&type=chunk) Consolidated Balance Sheets (as of Dec 31, in thousands USD) | ASSETS | 2020 | 2019 | | :---------------------------------------------------------------------------------------------------------------- | :----- | :----- | | Current assets: | | | | Cash and cash equivalents | $82,985 | $36,433 | | Short-term investments | $381,075 | $188,679 | | Accounts receivable | $4,420 | $5,163 | | Prepaid expenses and other current assets | $5,741 | $3,477 | | **Total current assets** | **$474,221** | **$233,752** | | Long-term investments | $36,954 | $42,650 | | Property and equipment, net | $13,346 | $4,530 | | Operating lease right-of-use assets and other assets | $9,282 | $8,882 | | **Total assets** | **$533,803** | **$289,814** | | LIABILITIES AND STOCKHOLDERS' EQUITY (DEFICIT) | | | | Current liabilities: | | | | Accounts payable | $8,050 | $8,160 | | Accrued liabilities | $19,315 | $12,123 | | Short-term lease liability | $2,785 | $4,616 | | Other current liabilities | $1,049 | $1,124 | | **Total current liabilities** | **$31,199** | **$26,023** | | Term loan, net | $46,209 | $45,052 | | Convertible notes, net | $89,504 | $84,205 | | Liability related to the sale of future royalties, net | $166,068 | $143,276 | | Long-term deferred revenue | $87,000 | — | | Long-term lease and other non-current liabilities | $440 | $2,195 | | **Total liabilities** | **$420,420** | **$300,751** | | Total stockholders' equity (deficit) | $113,383 | $(10,937) | | **Total liabilities and stockholders' equity (deficit)** | **$533,803** | **$289,814** | Consolidated Statements of Operations and Comprehensive Loss (2018-2020, in thousands USD, except per share data) | Metric | 2020 | 2019 | 2018 | | :------------------------------------------------------------------------------------------------------------------- | :------- | :------- | :------- | | Revenues: | | | | | Research and development revenues | $16,527 | $26,868 | $26,368 | | License revenues | $36,501 | — | $5,133 | | Milestone revenues | $2,800 | — | — | | **Total revenues** | **$55,828** | **$26,868** | **$31,501** | | Operating expenses: | | | | | Research and development | $96,951 | $86,125 | $89,135 | | General and administrative | $52,820 | $39,610 | $31,282 | | **Total operating expenses** | **$149,771** | **$125,735** | **$120,417** | | **Operating loss** | **$(93,943)** | **$(98,867)** | **$(88,916)** | | Interest expense | $(15,963) | $(6,623) | $(3,797) | | Non-cash interest expense on liability related to sale of future royalties | $(22,713) | $(20,737) | $(17,767) | | Interest and other income, net | $5,329 | $4,535 | $4,191 | | **Net loss** | **$(127,290)** | **$(121,692)** | **$(106,289)** | | Net loss per share — basic and diluted | $(1.97) | $(2.11) | $(1.95) | | Weighted-average number of shares used in computing net loss per share — basic and diluted | 64,524 | 57,575 | 54,420 | | Other comprehensive loss: | | | | | Unrealized (losses) gains on available-for-sale securities, net | $(530) | $179 | $157 | | **Comprehensive loss** | **$(127,820)** | **$(121,513)** | **$(106,132)** | Consolidated Statements of Cash Flows (2018-2020, in thousands USD) | Activity | 2020 | 2019 | 2018 | | :-------------------------------------------------- | :------- | :------- | :------- | | Net cash provided by (used in) operating activities | $8,943 | $(90,907) | $(101,215) | | Net cash (used in) provided by investing activities | $(196,515) | $(74,707) | $5,133 | | Net cash provided by financing activities | $234,124 | $159,791 | $13,132 | | **Net increase (decrease) in cash and cash equivalents** | **$46,552** | **$(5,823)** | **$(82,950)** | | Cash and cash equivalents, end of period | $82,985 | $36,433 | $42,256 | - The company has incurred an accumulated deficit of **$992.3 million** since inception and anticipates operating losses and net cash outflows in future periods, relying on strategic collaborations and financings[535](index=535&type=chunk)[536](index=536&type=chunk) - The Term Loan Agreement provides **$45.0 million**, bearing interest at **8.05%** as of **December 31, 2020**, with monthly interest-only payments extended through **December 31, 2021**, followed by principal and interest payments until maturity in **December 2023**[659](index=659&type=chunk)[660](index=660&type=chunk) - The **$138.0 million** aggregate principal amount of **4.0% convertible senior notes due 2026** are unsecured obligations, convertible under certain circumstances, and were separated into liability and equity components for accounting purposes[664](index=664&type=chunk)[665](index=665&type=chunk)[669](index=669&type=chunk) - The liability related to the sale of future royalties to **RPI**, initially **$92.3 million**, is accounted for as a debt financing with an imputed interest rate of approximately **15%** as of **December 31, 2020**, and is amortized using the effective interest method[679](index=679&type=chunk)[681](index=681&type=chunk)[682](index=682&type=chunk) Deferred Tax Assets and Liabilities (as of Dec 31, in thousands USD) | Category | 2020 | 2019 | | :-------------------------------------------------------- | :------- | :------- | | Deferred tax assets: | | | | Net operating loss carryforwards | $162,514 | $143,228 | | Tax credits | $71,976 | $67,892 | | Liability related to sale of future royalties | $36,989 | $35,213 | | Reserves and accruals | $10,876 | $8,690 | | Capitalized R&D | $2,370 | $3,949 | | Long-term lease liability | $718 | $1,674 | | Depreciation and amortization | $746 | $722 | | Other | — | $58 | | **Total noncurrent deferred tax assets** | **$286,189** | **$261,426** | | Deferred tax liabilities: | | | | Accounting method change | $(927) | $(2,047) | | Operating lease right-of-use assets | $(651) | $(1,484) | | Convertible notes | $(9,832) | $(12,011) | | **Total noncurrent deferred tax liabilities** | **$(11,410)** | **$(15,542)** | | Less: Valuation allowance | $(274,779)** | $(245,884)** | | **Net deferred tax assets** | **—** | **—** | - The company maintained a **full valuation allowance** on net deferred tax assets as of **December 31, 2020** and **2019**, due to historical operating performance and expected future losses[720](index=720&type=chunk) [Item 9. Changes in and Disagreements with Accountants on Accounting and Financial Disclosure](index=109&type=section&id=Item%209.%20Changes%20in%20and%20Disagreements%20with%20Accountants%20on%20Accounting%20and%20Financial%20Disclosure) There have been no changes in or disagreements with accountants on accounting and financial disclosure - No changes in or disagreements with accountants on accounting and financial disclosure[730](index=730&type=chunk) [Item 9A. Controls and Procedures](index=109&type=section&id=Item%209A.%20Controls%20and%20Procedures) Management concluded that disclosure controls and internal control over financial reporting were effective as of December 31, 2020, with an unqualified opinion from Ernst & Young LLP - Management concluded that disclosure controls and procedures were effective at the reasonable assurance level as of **December 31, 2020**[731](index=731&type=chunk) - Management concluded that internal control over financial reporting was effective as of **December 31, 2020**, based on the **COSO 2013 Framework**[732](index=732&type=chunk) - **Ernst & Young LLP**, the independent registered public accounting firm, issued an unqualified opinion on the effectiveness of internal control over financial reporting[733](index=733&type=chunk)[737](index=737&type=chunk) - No material changes in internal controls over financial reporting were identified during the fiscal quarter ended **December 31, 2020**[734](index=734&type=chunk) [Item 9B. Other Information](index=113&type=section&id=Item%209B.%20Other%20Information) This item reports no other information - No other information to report[744](index=744&type=chunk) [PART III](index=114&type=section&id=PART%20III) [Item 10. Directors, Executive Officers and Corporate Governance](index=114&type=section&id=Item%2010.%20Directors%2C%20Executive%20Officers%20and%20Corporate%20Governance) Information on directors, executive officers, and corporate governance is incorporated by reference from the 2020 Proxy Statement, including the company's Code of Ethics - Information on directors, executive officers, and corporate governance is incorporated by reference from the **2020 Proxy Statement**[747](index=747&type=chunk) - The company has adopted a **Code of Ethics** applicable to all directors, officers, and employees, which is publicized on its website[748](index=748&type=chunk) [Item 11. Executive Compensation](index=114&type=section&id=Item%2011.%20Executive%20Compensation) Information on executive compensation is incorporated by reference from the 2020 Proxy Statement - Information on executive compensation is incorporated by reference from the **2020 Proxy Statement**[749](index=749&type=chunk) [Item 12. Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters](index=114&type=section&id=Item%2012.%20Security%20Ownership%20of%20Certain%20Beneficial%20Owners%20and%20Management%20and%20Related%20Stockholder%20Matters) Information on security ownership of certain beneficial owners and management, and related stockholder matters, is incorporated by reference from the 2020 Proxy Statement - Information on security ownership of certain beneficial owners and management and related stockholder matters is incorporated by reference from the **2020 Proxy Statement**[749](index=749&type=chunk) [Item 13. Certain Relationships and Related Transactions, and Director Independence](index=114&type=section&id=Item%2013.%20Certain%20Relationships%20and%20Related%20Transactions%2C%20and%20Director%20Independence) Information on certain relationships and related transactions, and director independence, is incorporated by reference from the 2020 Proxy Statement - Information on certain relationships and related transactions and director independence is incorporated by reference from the **2020 Proxy Statement**[750](index=750&type=chunk) [Item 14. Principal Accounting Fees and Services](index=114&type=section&id=Item%2014.%20Principal%20Accounting%20Fees%20and%20Services) Information on principal accounting fees and services is incorporated by reference from the 2020 Proxy Statement - Information on principal accounting fees and services is incorporated by reference from the **2020 Proxy Statement**[750](index=750&type=chunk) [PART IV](index=115&type=section&id=PART%20IV) [Item 15. Exhibits and Financial Statement Schedules](index=115&type=section&id=Item%2015.%20Exhibits%20and%20Financial%20Statement%20Schedules) This section lists all exhibits and financial statement schedules filed with the Form 10-K, confirming financial statements are included and schedules omitted as applicable - The consolidated financial statements are filed as part of this **Form 10-K** under **Part II, Item 8**[752](index=752&type=chunk) - Financial statement schedules have been omitted as they are not applicable, not required, or the information is already presented in the consolidated financial statements or related notes[752](index=752&type=chunk)[774](index=774&type=chunk) - The exhibit index includes various corporate documents, warrants, indentures, collaboration agreements (**Amgen**, **Astellas**, **Ji Xing**, **RTW**), lease agreements, and certifications (**Section 302**, **906**)[753](index=753&type=chunk)[754](index=754&type=chunk)[755](index=755&type=chunk)[756](index=756&type=chunk)[758](index=758&type=chunk)[759](index=759&type=chunk)[760](index=760&type=chunk)[761](index=761&type=chunk)[763](index=763&type=chunk)[764](index=764&type=chunk)[765](index=765&type=chunk)[766](index=766&type=chunk)[767](index=767&type=chunk)[768](index=768&type=chunk)[769](index=769&type=chunk)[770](index=770&type=chunk) [Item 16. Form 10-K Summary](index=120&type=section&id=Item%2016.%20Form%2010-K%20Summary) This item indicates that no Form 10-K Summary is provided - No Form 10-K Summary is provided[775](index=775&type=chunk) [Signatures](index=121&type=section&id=Signatures) [Signatures and Power of Attorney](index=121&type=section&id=Signatures) This section contains the required signatures of the registrant's authorized officers and directors, affirming the report's filing, and includes a Power of Attorney - The report is signed by **Robert I. Blum** (President, CEO, and Director), **Ching W. Jaw** (Senior VP, CFO), **Robert C. Wong** (VP, Chief Accounting Officer), **L. Patrick Gage** (Chairman of the Board), and other Directors[779](index=779&type=chunk)[783](index=783&type=chunk) - The signing date for the report is **February 26, 2021**[780](index=780&type=chunk)[783](index=783&type=chunk)

Sarcomere Directed Therapies | --- | --- | --- | --- | |------------------|-------|-------|-------| | | | | | | | | | | | EMPOWERING | | | | | MUSCLE | | | | | EMPOWERING LIVES | | | | John, diagnosed with heart failure Jillian, diagnosed with HCM Chuck, diagnosed with ALS Forward-Looking Statements This Presentation contains forward-looking statements for purposes of the Private Securities Litigation Reform Act of 1995 (the "Act"). Cytokinetics disclaims any intent or obligation to update these forward-loo ...

Cytokinetics, Inc. (NASDAQ:CYTK) Q3 2020 Earnings Conference Call November 4, 2020 4:30 PM ET Company Participants Diane Weiser - SVP, Corporate Communications & IR Robert Blum - CEO, President & Director Fady Malik - EVP, Research & Development Stuart Kupfer - SVP & Chief Medical Officer Robert Wong - VP & CAO Ching Jaw - SVP & CFO Conference Call Participants Salim Syed - Mizuho Securities Dane Leone - Raymond James & Associates Pete Stavropoulos - Cantor Fitzgerald & Co. Hannah Latimer - Morgan Stanley J ...

Sarcomere Directed Therapies | --- | --- | --- | --- | |------------------|-------|-------|-------| | | | | | | | | | | | EMPOWERING | | | | | MUSCLE | | | | | EMPOWERING LIVES | | | | John, diagnosed with heart failure Jillian, diagnosed with HCM Chuck, diagnosed with ALS Forward-Looking Statements This Presentation contains forward-looking statements for purposes of the Private Securities Litigation Reform Act of 1995 (the "Act"). Cytokinetics disclaims any intent or obligation to update these forward-loo ...

Cytokinetics, Incorporated (NASDAQ:CYTK) Q2 2020 Results Earnings Conference Call August 6, 2020 4:30 PM ET Company Participants Diane Weiser - VP, IR & Corporate Communications Robert Blum - President and Chief Executive Officer Fady Malik - EVP, Research and Development Stuart Kupfer - SVP, Chief Medical Officer Robert Wong - VP, Chief Accounting Officer Ching Jaw - SVP, Chief Financial Officer Conference Call Participants Dane Leone - Raymond James Jeff Hung - Morgan Stanley Charles Duncan - Cantor Fitzg ...

Sarcomere Directed Therapies | --- | --- | --- | --- | |------------------|-------|-------|-------| | | | | | | | | | | | EMPOWERING | | | | | MUSCLE | | | | | EMPOWERING LIVES | | | | John, diagnosed with heart failure Jillian, diagnosed with HCM Chuck, diagnosed with ALS Forward-Looking Statements This Presentation contains forward-looking statements for purposes of the Private Securities Litigation Reform Act of 1995 (the "Act"). Cytokinetics disclaims any intent or obligation to update these forward-loo ...