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NEW YORK, April 17, 2024 (GLOBE NEWSWIRE) -- Intra-Cellular Therapies, Inc. (NASDAQ:ITCI) ("Intra-Cellular Therapies"), a biopharmaceutical company focused on the development and commercialization of therapeutics for central nervous system (CNS) disorders, today announced the pricing of its previously announced underwritten public offering of 6,849,316 shares of its common stock at a public offering price of $73.00 per share. All of the shares in the offering will be sold by Intra-Cellular Therapies, with g ...

Intra-Cellular Therapies, Inc. (ITCI) announced positive top-line results from its late-stage study evaluating lumateperone 42 mg for the treatment of major depressive disorder (MDD). The stock climbed 23.3% on Apr 16 following the encouraging news. The stock hit a new 52-week high on Tuesday, driven by the significant pipeline development.The phase III study, called Study 501, evaluating lumateperone 42 mg given once daily as an adjunctive therapy to antidepressants for MDD, met the primary endpoint. A sta ...

Intra-Cellular Therapies (ITCI) shares rallied 23.3% in the last trading session to close at $79.84. This move can be attributable to notable volume with a higher number of shares being traded than in a typical session. This compares to the stock's 0.9% loss over the past four weeks.The sudden soaring of the share price was observed after the company announced meeting primary and key secondary endpoints in its phase III Study 501 evaluating lumateperone 42 mg as an adjunctive therapy to antidepressants for ...

NEW YORK, April 16, 2024 (GLOBE NEWSWIRE) -- Intra-Cellular Therapies, Inc. (NASDAQ:ITCI) ("Intra-Cellular Therapies"), a biopharmaceutical company focused on the development and commercialization of therapeutics for central nervous system (CNS) disorders, today announced that it has commenced an underwritten public offering of $500 million of shares of its common stock. In connection with the offering, Intra-Cellular Therapies intends to grant the underwriters a 30-day option to purchase up to an additiona ...

Lumateperone 42 mg achieved statistically significant and clinically meaningful results in both the primary and the key secondary endpoints Lumateperone 42 mg met the primary endpoint of change from baseline at Week 6 on the Montgomery-Åsberg Depression Rating Scale (MADRS) total score versus placebo (4.9 point reduction v. placebo; p<0.0001; Cohen's d effect size (ES)= 0.61) Lumateperone 42 mg also met the key secondary endpoint of change from baseline at Week 6 on the Clinical Global Impression Scale for ...

Part I [Business](index=5&type=section&id=Item%201.%20Business) Intra-Cellular Therapies, Inc. is a biopharmaceutical company focused on CNS disorders, commercializing CAPLYTA for schizophrenia and bipolar depression while advancing a pipeline for various neurological conditions - The company's core commercial product is **CAPLYTA (lumateperone)**, approved by the **FDA** for the treatment of **schizophrenia** in adults (since December 2019) and **bipolar depression** in adults (since December 2021)[17](index=17&type=chunk)[18](index=18&type=chunk) Therapeutic Pipeline Overview | Product Candidate | Indication(s) | Development Stage | | :--- | :--- | :--- | | **Lumateperone (CAPLYTA)** | Schizophrenia, Bipolar Depression | Approved & Commercialized | | Lumateperone | Major Depressive Disorder (MDD) | Phase 3 | | Lumateperone LAI | Mental Illness | Phase 1 | | ITI-1284-ODT-SL | GAD, Dementia-related Psychosis/Agitation | Phase 2 | | Lenrispodun (ITI-214) | Parkinson's Disease | Phase 2 | | ITI-1020 | Cancer Immunotherapy | Phase 1 | | ITI-333 | Substance Use Disorders, Pain | Phase 1 | | ITI-1549 | Mood/Anxiety Disorders (Non-hallucinogenic psychedelic) | IND-enabling studies | - The company holds exclusive, worldwide commercialization rights to lumateperone from Bristol-Myers Squibb, with remaining milestone payments of **$5.0 million** and tiered **single-digit royalty obligations**[29](index=29&type=chunk)[61](index=61&type=chunk)[62](index=62&type=chunk) - The company operates without its own manufacturing facilities, relying on **third-party contract manufacturers** such as **Siegfried** and **Lonza** for the production of CAPLYTA's **Active Pharmaceutical Ingredient (API)**[64](index=64&type=chunk)[65](index=65&type=chunk)[66](index=66&type=chunk) [Risk Factors](index=26&type=section&id=Item%201A.%20Risk%20Factors) The company faces substantial risks from its sole product CAPLYTA's commercial success, clinical trial outcomes, competition, manufacturing reliance, reimbursement challenges, and a history of net losses - The company's prospects are highly dependent on the successful commercialization of **CAPLYTA**, its **only approved drug**, for schizophrenia and bipolar depression in the U.S[125](index=125&type=chunk) - There is no guarantee that ongoing clinical trials for lumateperone in other indications, such as **Major Depressive Disorder (MDD)**, will be successful, which could limit future revenue growth[122](index=122&type=chunk)[129](index=129&type=chunk)[137](index=137&type=chunk) - The company has a history of significant net losses, with an accumulated deficit of approximately **$1.6 billion** as of December 31, 2023, and expects losses to continue[140](index=140&type=chunk) - Reliance on third-party manufacturers like **Siegfried** and **Lonza** poses risks related to **supply chain disruptions**, quality control, and compliance with cGMP requirements, which could jeopardize clinical trials and commercial supply[175](index=175&type=chunk)[176](index=176&type=chunk) - The company's ability to generate revenue is contingent on obtaining **adequate coverage and reimbursement** from third-party payers, who are implementing increasingly sophisticated cost-control methods[179](index=179&type=chunk)[181](index=181&type=chunk) [Unresolved Staff Comments](index=58&type=section&id=Item%201B.%20Unresolved%20Staff%20Comments) The company reports no unresolved staff comments from the Securities and Exchange Commission - There are no unresolved staff comments[262](index=262&type=chunk) [Cybersecurity](index=58&type=section&id=Item%201C.%20Cybersecurity) The company manages cybersecurity risks using the NIST Framework, with Board oversight, and has reported no material incidents in the last three years - The company's cybersecurity strategy is based on the **National Institute of Standards and Technology (NIST) Cybersecurity Framework (CSF)** to manage and mitigate risks[263](index=263&type=chunk) - The **Board of Directors' audit committee** is responsible for overseeing cybersecurity risks, receiving updates from management at least **semi-annually**[273](index=273&type=chunk)[274](index=274&type=chunk) - The company has not experienced any **material cybersecurity incidents** in the last three years[271](index=271&type=chunk) [Properties](index=61&type=section&id=Item%202.%20Properties) The company leases its headquarters and laboratory in New York, NY, and an additional office in Towson, Maryland - The company leases approximately **32,000 square feet** for its headquarters and laboratory in **New York, NY**, with the lease term expiring in **March 2029**[280](index=280&type=chunk) - An additional office of approximately **4,000 square feet** is leased in **Towson, Maryland**, with the lease expiring in **August 2026**[280](index=280&type=chunk) [Legal Proceedings](index=61&type=section&id=Item%203.%20Legal%20Proceedings) In February 2024, the company received notices from seven generic drug manufacturers challenging CAPLYTA patents, which it intends to defend - In **February 2024**, the company received notices of ANDA filings from **seven generic drug manufacturers** seeking approval to market generic versions of **CAPLYTA**[281](index=281&type=chunk) - The ANDA filers allege that certain **patents** covering CAPLYTA are invalid and/or will not be infringed by their proposed generic products[281](index=281&type=chunk) [Mine Safety Disclosures](index=61&type=section&id=Item%204.%20Mine%20Safety%20Disclosures) This item is not applicable to the company - Not applicable[283](index=283&type=chunk) Part II [Market for Registrant's Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities](index=62&type=section&id=Item%205.%20Market%20for%20Registrant%27s%20Common%20Equity%2C%20Related%20Stockholder%20Matters%20and%20Issuer%20Purchases%20of%20Equity%20Securities) The company's common stock trades on the Nasdaq Global Select Market under "ITCI", with 96,807,191 shares outstanding as of February 20, 2024 - The company's common stock is traded on the **Nasdaq Global Select Market** under the ticker symbol "**ITCI**"[286](index=286&type=chunk) - As of February 20, 2024, there were **96,807,191 shares** of common stock outstanding[286](index=286&type=chunk)[8](index=8&type=chunk) [Management's Discussion and Analysis of Financial Condition and Results of Operations](index=63&type=section&id=Item%207.%20Management%27s%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operations) In 2023, CAPLYTA net product sales grew significantly to $462.2 million, reducing the net loss to $139.7 million despite increased R&D and SG&A expenses, supported by a strong $499.7 million liquidity position Financial Performance Summary (2023 vs. 2022) | Metric | 2023 (in millions) | 2022 (in millions) | YoY Change | | :--- | :--- | :--- | :--- | | Net Product Sales | $462.2 | $249.1 | +85.5% | | Total Revenues, Net | $464.4 | $250.3 | +85.5% | | Total Operating Expenses | $623.8 | $513.9 | +21.4% | | Loss from Operations | ($159.4) | ($263.6) | +39.5% | | Net Loss | ($139.7) | ($256.3) | +45.5% | - As of December 31, 2023, the company had **$499.7 million** in cash, cash equivalents, investment securities, and restricted cash, which management believes is sufficient to fund operations for **at least the next 12 months**[317](index=317&type=chunk)[319](index=319&type=chunk) - Net cash used in operating activities decreased to **$124.2 million** in 2023 from **$270.2 million** in 2022, primarily due to increased cash receipts from higher product sales[318](index=318&type=chunk) [Results of Operations](index=65&type=section&id=Results%20of%20Operations) Net product sales of CAPLYTA increased by 85.5% to $462.2 million in 2023, while SG&A and R&D expenses rose due to increased commercialization and clinical program costs Net Product Sales (YoY) | Year | Net Product Sales (in millions) | | :--- | :--- | | 2023 | $462.2 | | 2022 | $249.1 | - Cost of product sales remains favorably impacted by the use of **API** and **drug product** that was **expensed to R&D** prior to CAPLYTA's FDA approval, with this benefit expected to continue in the near term[305](index=305&type=chunk)[308](index=308&type=chunk)[309](index=309&type=chunk) Operating Expenses Breakdown (2023 vs. 2022) | Expense Category | 2023 (in millions) | 2022 (in millions) | YoY Change | Key Drivers | | :--- | :--- | :--- | :--- | :--- | | **SG&A** | $409.9 | $358.8 | +14% | Increased salaries, benefits, marketing, and advertising | | **R&D** | $180.1 | $134.7 | +34% | Increased costs for lumateperone programs and outsourced clinical/manufacturing activities | [Liquidity and Capital Resources](index=68&type=section&id=Liquidity%20and%20Capital%20Resources) The company held $499.7 million in liquidity as of December 31, 2023, with net cash used in operations significantly decreasing to $124.2 million, sufficient to fund operations for at least the next 12 months - The company's cash, cash equivalents, available-for-sale investment securities, and restricted cash totaled **$499.7 million** at December 31, 2023[317](index=317&type=chunk) Net Cash Used in Operating Activities (YoY) | Year | Net Cash Used in Operating Activities (in millions) | | :--- | :--- | | 2023 | $124.2 | | 2022 | $270.2 | - The company has long-term contractual commitments including **operating leases**, **licensing and royalty payments to BMS**, and **minimum purchase obligations** under manufacturing service agreements through **2029**[327](index=327&type=chunk)[328](index=328&type=chunk)[329](index=329&type=chunk) [Quantitative and Qualitative Disclosures About Market Risk](index=71&type=section&id=Item%207A.%20Quantitative%20and%20Qualitative%20Disclosures%20About%20Market%20Risk) The company faces market risks including interest rate sensitivity, inflation, capital market access, and foreign currency fluctuations, though inflation and currency have not had a material impact to date - The company's primary market risks are **interest rate sensitivity**, **inflation**, **capital market access**, and **foreign currency fluctuations**[337](index=337&type=chunk)[338](index=338&type=chunk)[339](index=339&type=chunk)[340](index=340&type=chunk) - The investment portfolio consists of **high-grade corporate bonds, commercial paper, and U.S. Treasury securities**, and the company does not believe it has material exposure to interest rate changes as it intends to hold investments to maturity[337](index=337&type=chunk) - Inflation has not had a material impact to date, but future increases could raise clinical trial, labor, and other operating costs[338](index=338&type=chunk) [Financial Statements and Supplementary Data](index=72&type=section&id=Item%208.%20Financial%20Statements%20and%20Supplementary%20Data) This section presents the company's audited financial statements and the independent auditor's report, highlighting critical audit matters related to clinical trial expense estimation and variable consideration reserves - The independent auditor's report identified the estimation of **clinical trial expenses** as a **critical audit matter**, noting the high degree of subjectivity required by management to determine costs incurred at period end for active Phase 3 studies[391](index=391&type=chunk)[392](index=392&type=chunk) - A second **critical audit matter** identified was the estimation of **reserves for variable consideration**, specifically for **Medicaid and Managed Care payer rebates**, which requires significant judgment regarding inventory in the distribution channel, payer mix, and complex government pricing calculations[394](index=394&type=chunk)[395](index=395&type=chunk)[396](index=396&type=chunk) [Changes in and Disagreements with Accountants on Accounting and Financial Disclosure](index=73&type=section&id=Item%209.%20Changes%20in%20and%20Disagreements%20with%20Accountants%20on%20Accounting%20and%20Financial%20Disclosure) This item is not applicable to the company - Not applicable[343](index=343&type=chunk) [Controls and Procedures](index=73&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, 2023, with an unqualified audit opinion and no material changes reported - Management concluded that the company's disclosure controls and procedures were **effective** as of December 31, 2023[344](index=344&type=chunk) - Management's assessment concluded that the company's internal control over financial reporting was **effective** as of December 31, 2023, based on the **COSO framework**[347](index=347&type=chunk) - The independent registered public accounting firm, Ernst & Young LLP, issued an **unqualified opinion** on the effectiveness of the company's internal control over financial reporting as of December 31, 2023[352](index=352&type=chunk) [Other Information](index=75&type=section&id=Item%209B.%20Other%20Information) This item is not applicable to the company - Not applicable[359](index=359&type=chunk) Part III [Directors, Executive Officers and Corporate Governance](index=76&type=section&id=Item%2010.%20Directors%2C%20Executive%20Officers%20and%20Corporate%20Governance) Information for this item is incorporated by reference from the company's 2024 Annual Meeting of Stockholders Proxy Statement - Information is incorporated by reference from the Registrant's Proxy Statement for the 2024 Annual Meeting of Stockholders[363](index=363&type=chunk) [Executive Compensation](index=76&type=section&id=Item%2011.%20Executive%20Compensation) Information for this item is incorporated by reference from the company's 2024 Annual Meeting of Stockholders Proxy Statement - Information is incorporated by reference from the Registrant's Proxy Statement for the 2024 Annual Meeting of Stockholders[364](index=364&type=chunk) [Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters](index=76&type=section&id=Item%2012.%20Security%20Ownership%20of%20Certain%20Beneficial%20Owners%20and%20Management%20and%20Related%20Stockholder%20Matters) Information for this item is incorporated by reference from the company's 2024 Annual Meeting of Stockholders Proxy Statement - Information is incorporated by reference from the Registrant's Proxy Statement for the 2024 Annual Meeting of Stockholders[365](index=365&type=chunk) [Certain Relationships and Related Transactions, and Director Independence](index=76&type=section&id=Item%2013.%20Certain%20Relationships%20and%20Related%20Transactions%2C%20and%20Director%20Independence) Information for this item is incorporated by reference from the company's 2024 Annual Meeting of Stockholders Proxy Statement - Information is incorporated by reference from the Registrant's Proxy Statement for the 2024 Annual Meeting of Stockholders[366](index=366&type=chunk) [Principal Accountant Fees and Services](index=76&type=section&id=Item%2014.%20Principal%20Accountant%20Fees%20and%20Services) Information for this item is incorporated by reference from the company's 2024 Annual Meeting of Stockholders Proxy Statement - Information is incorporated by reference from the Registrant's Proxy Statement for the 2024 Annual Meeting of Stockholders[367](index=367&type=chunk) Part IV [Exhibits and Financial Statement Schedules](index=77&type=section&id=Item%2015.%20Exhibits%20and%20Financial%20Statement%20Schedules) This section provides an index to the financial statements, schedules, and exhibits filed with the Form 10-K, including key agreements - This section contains the index to financial statements and a list of all exhibits filed with the Form 10-K[370](index=370&type=chunk)[371](index=371&type=chunk) [Form 10-K Summary](index=80&type=section&id=Item%2016.%20Form%2010-K%20Summary) This item is not applicable to the company - Not applicable[377](index=377&type=chunk)

Financial Performance - Full year 2023 total revenues reached $464.4 million, a significant increase from $250.3 million in 2022[1] - CAPLYTA net product sales for 2023 were $462.2 million, reflecting an 86% year-over-year growth, with fourth quarter sales of $131.5 million, up 50% from Q4 2022[4] - Total revenues for the year 2023 were $464.370 million, up 85.5% from $250.314 million in 2022[28] - Product sales for Q4 2023 reached $131.506 million, a 50.5% increase from $87.433 million in Q4 2022[28] - The net loss for Q4 2023 was $28.579 million, an improvement from a net loss of $44.026 million in Q4 2022[28] Expenses - SG&A expenses for 2023 were $409.9 million, up from $358.8 million in 2022, primarily due to increased commercialization and marketing costs[4] - R&D expenses for 2023 totaled $180.1 million, compared to $134.7 million in 2022, driven by higher costs associated with lumateperone and other projects[7] - Operating expenses for Q4 2023 totaled $166.196 million, compared to $135.281 million in Q4 2022, reflecting a 22.8% increase[28] - Research and development expenses for the year 2023 were $180.142 million, up 33.8% from $134.715 million in 2022[28] Cash Position - Cash and cash equivalents stood at $499.7 million as of December 31, 2023, down from $593.7 million a year earlier[7] - Cash and cash equivalents as of December 31, 2023, were $147.767 million, slightly down from $148.615 million at the end of 2022[30] - The company reported a total stockholders' equity of $591.424 million as of December 31, 2023, down from $656.070 million in 2022[30] Clinical Development and Pipeline - The company is advancing multiple clinical programs, including Phase 3 trials for lumateperone in major depressive disorder, with topline results expected in 2024[10] - The company is focused on expanding its pipeline, including new formulations and indications for lumateperone, with several studies expected to report results in 2024[11] - The company has plans for further commercialization of CAPLYTA, with ongoing clinical trials and regulatory submissions to the FDA[25] Market Access and Growth - CAPLYTA's market access now covers approximately 90% of commercially insured lives and over 99% of Medicare Part D and Medicaid lives[8] - CAPLYTA's acceptance among patients and physicians remains a key focus for future growth and market expansion[25] - The company projects CAPLYTA net product sales for 2024 to be between $645 million and $675 million[6] Risks - The company faces risks related to supply chain challenges and potential safety issues with CAPLYTA post-commercial launch[25]

[PART I: FINANCIAL INFORMATION](index=4&type=section&id=PART%20I%3A%20FINANCIAL%20INFORMATION) [FINANCIAL STATEMENTS](index=4&type=section&id=Item%201.%20FINANCIAL%20STATEMENTS) The company presents its unaudited condensed consolidated financial statements for the periods ended September 30, 2023 Condensed Consolidated Balance Sheet Highlights (in thousands) | Account | September 30, 2023 | December 31, 2022 | | :--- | :--- | :--- | | **Assets** | | | | Cash and cash equivalents | $99,402 | $148,615 | | Investment securities, available-for-sale | $393,619 | $443,290 | | Total current assets | $702,425 | $737,957 | | Total assets | $717,664 | $754,780 | | **Liabilities & Stockholders' Equity** | | | | Total current liabilities | $103,092 | $83,236 | | Total liabilities | $116,983 | $98,710 | | Total stockholders' equity | $600,681 | $656,070 | Condensed Consolidated Statements of Operations (in thousands, except per share data) | Metric | Q3 2023 | Q3 2022 | 9 Months 2023 | 9 Months 2022 | | :--- | :--- | :--- | :--- | :--- | | Product sales, net | $125,810 | $71,870 | $330,669 | $161,699 | | Total revenues, net | $126,173 | $71,870 | $332,271 | $162,445 | | Total operating expenses | $155,886 | $127,499 | $457,555 | $378,659 | | Loss from operations | ($29,713) | ($55,629) | ($125,284) | ($216,214) | | Net loss | ($24,258) | ($53,508) | ($111,095) | ($212,230) | | Net loss per share (Basic & Diluted) | ($0.25) | ($0.57) | ($1.16) | ($2.26) | Condensed Consolidated Statements of Cash Flows (in thousands) | Cash Flow Activity | Nine Months Ended Sep 30, 2023 | Nine Months Ended Sep 30, 2022 | | :--- | :--- | :--- | | Net cash used in operating activities | ($122,138) | ($230,993) | | Net cash provided by (used in) investing activities | $58,119 | ($178,636) | | Net cash provided by financing activities | $14,806 | $452,972 | | Net (decrease) increase in cash | ($49,213) | $43,343 | - The company's primary commercial product is **CAPLYTA® (lumateperone)**, approved for treating schizophrenia and bipolar depression in adults[22](index=22&type=chunk) - For the nine-month period ended September 30, 2023, **97% of product sales** were concentrated among three major wholesalers[29](index=29&type=chunk) [MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS](index=18&type=section&id=Item%202.%20MANAGEMENT'S%20DISCUSSION%20AND%20ANALYSIS%20OF%20FINANCIAL%20CONDITION%20AND%20RESULTS%20OF%20OPERATIONS) Management analyzes financial results, focusing on CAPLYTA® performance, operating expenses, and pipeline progress [Overview](index=18&type=section&id=Overview) The company focuses on commercializing CAPLYTA® while advancing its clinical pipeline for MDD and other indications - Lumateperone is in Phase 3 clinical development for Major Depressive Disorder (MDD), with topline results from Study 501 expected in **Q1 2024** and Study 502 in **Q2 2024**[50](index=50&type=chunk) - **Positive topline results** were announced in March 2023 from Study 403, evaluating lumateperone for major depressive episodes with mixed features[51](index=51&type=chunk) - The development pipeline includes a long-acting injectable (LAI) formulation of lumateperone, ITI-1284-ODT-SL, lenrispodun, and ITI-333[54](index=54&type=chunk)[55](index=55&type=chunk)[56](index=56&type=chunk)[58](index=58&type=chunk) [Results of Operations](index=20&type=section&id=Results%20of%20Operations) CAPLYTA® sales drove strong revenue growth, though operating expenses also increased to support commercialization and R&D Financial Performance Comparison (in thousands) | Metric | Q3 2023 | Q3 2022 | 9 Months 2023 | 9 Months 2022 | | :--- | :--- | :--- | :--- | :--- | | Product sales, net | $125,810 | $71,870 | $330,669 | $161,699 | | Cost of product sales | $9,129 | $5,850 | $23,043 | $13,655 | | SG&A Expenses | $105,207 | $88,375 | $305,144 | $264,151 | | R&D Expenses | $41,550 | $33,274 | $129,368 | $100,853 | | Net loss | ($24,258) | ($53,508) | ($111,095) | ($212,230) | - Net product sales of CAPLYTA® increased to **$125.8 million in Q3 2023** from $71.9 million in Q3 2022, and to **$330.7 million for the first nine months of 2023**[71](index=71&type=chunk) - Cost of product sales remains favorably low because drug product manufactured prior to FDA approval is still being sold, an impact **expected to continue in the near-term**[72](index=72&type=chunk)[73](index=73&type=chunk) - SG&A expenses **increased 19% YoY for Q3 2023**, primarily due to higher marketing, advertising, and sales force labor costs[74](index=74&type=chunk)[75](index=75&type=chunk) - R&D expenses **increased 25% YoY for Q3 2023**, driven by higher costs for lumateperone clinical trials and other projects[82](index=82&type=chunk) [Liquidity and Capital Resources](index=24&type=section&id=Liquidity%20and%20Capital%20Resources) The company holds sufficient capital to fund operations for at least 12 months, supported by strong product sales - As of September 30, 2023, the company had **$494.8 million in cash**, cash equivalents, and available-for-sale investment securities[86](index=86&type=chunk) - Management expects existing cash, securities, and product sales will be **sufficient to fund operations for at least the next 12 months**[88](index=88&type=chunk) - Net cash used in operating activities **decreased by $108.9 million** to $122.1 million for the nine months ended September 30, 2023, primarily due to higher sales[87](index=87&type=chunk) [QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK](index=28&type=section&id=Item%203.%20QUANTITATIVE%20AND%20QUALITATIVE%20DISCLOSURES%20ABOUT%20MARKET%20RISK) The company faces market risks from interest rates, inflation, and capital market volatility - The company's primary investment objective is **capital preservation** and it does not believe it has material exposure to interest rate changes[106](index=106&type=chunk) - **Inflation** is expected to cause appreciable increases in clinical trial, selling, labor, and other operating costs if global trends continue[107](index=107&type=chunk) - **Capital market risk** is identified, as the ability to raise additional funds through equity offerings depends on market forces[108](index=108&type=chunk) [CONTROLS AND PROCEDURES](index=28&type=section&id=Item%204.%20CONTROLS%20AND%20PROCEDURES) Management concluded that disclosure controls and procedures were effective with no material changes to internal controls - The principal executive officer and principal financial officer concluded that the company's disclosure controls and procedures were **effective as of September 30, 2023**[109](index=109&type=chunk) - There were **no changes in internal control over financial reporting** during the quarter that have materially affected, or are likely to materially affect, internal controls[110](index=110&type=chunk) [PART II: OTHER INFORMATION](index=29&type=section&id=PART%20II%3A%20OTHER%20INFORMATION) [LEGAL PROCEEDINGS](index=29&type=section&id=Item%201.%20LEGAL%20PROCEEDINGS) A shareholder complaint regarding director compensation was settled with no damages paid by the company - A shareholder derivative complaint alleging excessive director compensation was **settled**, with the court approving the stipulation on July 17, 2023[112](index=112&type=chunk) - The settlement requires the board to amend its compensation policies but does **not require any damages payments** from the company or defendants[112](index=112&type=chunk) [RISK FACTORS](index=29&type=section&id=Item%201A.%20RISK%20FACTORS) No material changes to the risk factors disclosed in the company's Annual Report on Form 10-K have occurred - There have been **no material changes** to the risk factors discussed in the company's Annual Report on Form 10-K for the year ended December 31, 2022[113](index=113&type=chunk) [UNREGISTERED SALES OF EQUITY SECURITIES, USE OF PROCEEDS, AND ISSUER PURCHASES OF EQUITY SECURITIES](index=29&type=section&id=Item%202.%20UNREGISTERED%20SALES%20OF%20EQUITY%20SECURITIES%2C%20USE%20OF%20PROCEEDS%2C%20AND%20ISSUER%20PURCHASES%20OF%20EQUITY%20SECURITIES) The company reports no unregistered sales or repurchases of its equity securities during the quarter - The company **did not repurchase any of its equity securities** during the quarter ended September 30, 2023[115](index=115&type=chunk) [DEFAULTS UPON SENIOR SECURITIES](index=29&type=section&id=Item%203.%20DEFAULTS%20UPON%20SENIOR%20SECURITIES) This section is not applicable to the company - Not applicable[116](index=116&type=chunk) [MINE SAFETY DISCLOSURES](index=29&type=section&id=Item%204.%20MINE%20SAFETY%20DISCLOSURES) This section is not applicable to the company - Not applicable[117](index=117&type=chunk) [OTHER INFORMATION](index=29&type=section&id=Item%205.%20OTHER%20INFORMATION) An executive officer modified a Rule 10b5-1 trading plan on August 11, 2023 - On August 11, 2023, Michael I. Halstead, an executive officer, **modified his Rule 10b5-1 Trading Plan** to change the start date and increase the number of shares to be sold[118](index=118&type=chunk) [EXHIBITS](index=30&type=section&id=Item%206.%20EXHIBITS) This section lists all exhibits filed with the Form 10-Q, including officer certifications and Inline XBRL data

Table of Contents UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 _______________________ FORM 10-Q _______________________ (Mark One) x QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the quarterly period ended June 30, 2023 or o TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the transition period from_________to_________ Commission File Number: 001-36274 _______________________ INTRA-CELLULAR ...