DUBLIN--(BUSINESS WIRE)---- $PRTA #Prothena--PRTA announced that BMS communicated that the FDA granted Fast Track Designation to BMS-986446, an anti-tau antibody in P2 for Alzheimer's disease. ...

Core Insights - Prothena Corporation's shares have decreased by 40% year-to-date, contrasting with a 6.6% gain in the industry, primarily due to pipeline setbacks [1][8] - The company is working to advance other pipeline projects after halting the development of birtamimab, but challenges persist [1] Pipeline Updates - Prothena provided an update on PRX012, a candidate for early symptomatic Alzheimer's disease, showing promising results in a phase I program [3][4] - PRX012 demonstrated a mean reduction in amyloid PET to 27.47 centiloids at the 400 mg dose level after 12 months, which is favorable compared to FDA-approved anti-Aβ antibodies [4] - However, PRX012 exhibited higher overall ARIA-E rates, raising concerns about its suitability for the studied patient population [5] - The company plans to seek partnerships to advance PRX012 and its preclinical PRX012-TfR antibody, which may reduce ARIA risks and enhance amyloid clearance [6][8] Recent Developments - Novo Nordisk will advance coramitug, an amyloid depleter antibody, into a phase III program for ATTR amyloidosis with cardiomyopathy in 2025, which Prothena initially developed [9] - Prothena is eligible for up to $1.2 billion in milestone payments from Novo Nordisk, having already earned $100 million [10] Setbacks and Workforce Changes - The discontinuation of birtamimab's development was announced in May 2025 after it failed to meet primary endpoints in a late-stage study [11] - Following this, Prothena implemented a 63% workforce reduction to streamline costs and support ongoing programs [12] Partnered Programs - Roche is advancing prasinezumab into phase III development for early-stage Parkinson's disease, with initiation expected by the end of 2025 [13][14] - Prothena will receive double-digit teen royalties on net sales of prasinezumab [14] - Bristol Myers is conducting phase II and phase I trials for potential Alzheimer's treatments, with Prothena collaborating on several early-stage programs [15][16] Overall Outlook - Despite progress in partnered programs, setbacks in wholly owned programs present significant challenges for Prothena [17]

Summary of Prothena's Conference Call Company Overview - **Company**: Prothena - **Industry**: Biotechnology, specifically focused on neurodegenerative diseases and amyloidosis Key Points and Arguments 1. **Pipeline Updates**: Prothena has made significant progress in its pipeline, with Roche advancing prasinezumab for Parkinson's disease into a phase three study and Novo moving Kuramitug for ATTR cardiomyopathy into a phase three study as well [4][5] 2. **Restructuring**: The company underwent a restructuring to align its resources with ongoing partnership obligations and to focus on shareholder-friendly activities [13][14] 3. **Financial Milestones**: Prothena anticipates up to $105 million in clinical milestone payments in 2026, contingent on the progress of its partnered programs with Novo and Bristol Myers Squibb [8][16] 4. **Shareholder Returns**: Plans for a share repurchase program are in place, supported by the establishment of distributable reserves through an extraordinary general meeting [11][20] 5. **PRXO12 Data**: The recent data for PRXO12 indicated higher than expected ARIA events, prompting consideration of a transferrin-based approach to mitigate these issues while retaining the drug's efficacy [21][24] 6. **Partnerships**: Prothena has four partnership programs, with two in phase three and one in phase two, which are crucial for the company's future value creation [12][19] 7. **Roche Partnership**: The deal with Roche is valued at $755 million, with $135 million received to date. Roche sees a peak sales opportunity for prasinezumab exceeding $4 billion [32][33] 8. **Novo Partnership**: The partnership with Novo for Kuramitug is valued at $1.23 billion, with $100 million received so far. The next milestone payment is expected to be around $50 million [60][63] 9. **Clinical Development**: Prothena is focused on the clinical development of its partnered assets, with expectations for data releases from ongoing studies [39][70] Additional Important Content 1. **Market Potential**: The market for treatments targeting neurodegenerative diseases and amyloidosis is significant, with increasing demand for effective therapies [43][58] 2. **Competitive Landscape**: The competitive environment is intensifying, with multiple companies developing similar therapies, which could impact Prothena's market positioning [21][22] 3. **Regulatory Considerations**: The timeline for potential partnerships and clinical trials is uncertain, with ongoing discussions expected to take time [29][30] 4. **Scientific Insights**: Prothena's approach to targeting alpha-synuclein in Parkinson's disease is based on empirical data, focusing on the carboxy terminus of the protein for better efficacy [44][46] This summary encapsulates the critical insights from Prothena's conference call, highlighting the company's strategic direction, financial outlook, and ongoing clinical developments.

Core Viewpoint - Prothena's recent earnings report indicates significant losses and revenue misses, but the company is focusing on key pipeline developments that could drive future growth [2][12]. Financial Performance - Prothena reported a second-quarter adjusted loss per share of $1.86, which was wider than the Zacks Consensus Estimate of a loss of $1.11 [2]. - Revenues for the quarter totaled $4.4 million, missing the Zacks Consensus Estimate of $21 million, compared to $132 million in the previous year [2]. - Research and development expenses decreased by 29.5% year-over-year to $40.5 million, attributed to lower clinical trial and manufacturing costs [3]. - General and administrative expenses were slightly reduced to $15.9 million from $16.1 million in the prior year [3]. - As of June 30, 2025, Prothena had $372.3 million in cash and equivalents, with no debt [3]. Pipeline Developments - Prothena is collaborating with Roche on prasinezumab for Parkinson's disease, with phase III development expected to start by the end of 2025 [4]. - The company is evaluating PRX012 for Alzheimer's disease, which has received Fast Track designation from the FDA, with initial data from phase I trials expected soon [5]. - Prothena is advancing several early-stage programs in collaboration with Bristol Myers, including BMS-986446 for Alzheimer's disease [6]. - PRX019, a potential treatment for neurodegenerative diseases, is undergoing a phase I clinical trial, expected to complete in 2026 [8]. - The dual Aβ-Tau vaccine, PRX123, has also received Fast Track designation and is being advanced through efficient funding structures [9][10]. Guidance and Estimates - Prothena expects a net cash burn of $170 to $178 million for 2025, with a projected year-end cash balance of approximately $298 million [12]. - The company anticipates a net loss in the range of $240 to $248 million for 2025 [12]. - Since the earnings release, consensus estimates have shifted upward by 29.35% [13]. Market Position - Prothena holds a Zacks Rank of 3 (Hold), indicating an expectation of in-line returns in the coming months [15]. - The company has an average Growth Score of C, a Momentum Score of A, but a low value score of F, placing it in the bottom 20% for value investors [14].

Company Performance - Prothena reported a quarterly loss of $1.86 per share, which was worse than the Zacks Consensus Estimate of a loss of $1.11, and a significant decline from earnings of $1.22 per share a year ago, indicating an earnings surprise of -67.57% [1] - The company posted revenues of $4.42 million for the quarter ended June 2025, missing the Zacks Consensus Estimate by 79.2%, and a stark decrease from year-ago revenues of $132.01 million [2] - Over the last four quarters, Prothena has only surpassed consensus EPS estimates once and has not beaten consensus revenue estimates during the same period [2] Stock Performance - Prothena shares have declined approximately 50.8% since the beginning of the year, contrasting with the S&P 500's gain of 6.1% [3] - The current consensus EPS estimate for the upcoming quarter is -$0.96 on revenues of $24.8 million, and for the current fiscal year, it is -$3.94 on revenues of $39.34 million [7] Industry Outlook - The Medical - Biomedical and Genetics industry, to which Prothena belongs, is currently ranked in the bottom 43% of over 250 Zacks industries, suggesting that the industry outlook could negatively impact stock performance [8] - Empirical research indicates a strong correlation between near-term stock movements and trends in earnings estimate revisions, which could be a useful metric for investors [5]

[PART I. FINANCIAL INFORMATION](index=6&type=section&id=PART%20I.%20FINANCIAL%20INFORMATION) This section provides the unaudited condensed consolidated financial statements and related notes, along with management's discussion and analysis of financial condition and results of operations [Item 1. Financial Statements (unaudited)](index=6&type=section&id=Item%201.%20Financial%20Statements%20(unaudited)) This section presents the unaudited condensed consolidated financial statements, including balance sheets, statements of operations, cash flows, and shareholders' equity, along with detailed notes explaining the company's business, accounting policies, significant agreements, and recent restructuring activities [Condensed Consolidated Balance Sheets](index=6&type=section&id=Condensed%20Consolidated%20Balance%20Sheets) The balance sheet shows a decrease in total assets and shareholders' equity, primarily driven by a reduction in cash and cash equivalents and an accumulated deficit increase. Current liabilities increased significantly due to a restructuring liability | Metric | June 30, 2025 (in thousands) | December 31, 2024 (in thousands) | Change (in thousands) | | :----------------------------- | :----------------------------- | :------------------------------- | :-------------------- | | Cash and cash equivalents | $371,435 | $471,388 | $(99,953) | | Total current assets | $385,475 | $485,412 | $(99,937) | | Total assets | $399,066 | $547,108 | $(148,042) | | Total current liabilities | $67,807 | $48,501 | $19,306 | | Restructuring liability | $30,330 | $— | $30,330 | | Total liabilities | $74,735 | $60,182 | $14,553 | | Accumulated deficit | $(1,288,303) | $(1,102,341) | $(185,962) | | Total shareholders' equity | $324,331 | $486,926 | $(162,595) | [Condensed Consolidated Statements of Operations](index=7&type=section&id=Condensed%20Consolidated%20Statements%20of%20Operations) The company experienced a significant net loss for the three and six months ended June 30, 2025, primarily due to a substantial decrease in collaboration revenue and the recognition of restructuring costs, despite a reduction in R&D expenses | Metric | Three Months Ended June 30, 2025 (in thousands) | Three Months Ended June 30, 2024 (in thousands) | Six Months Ended June 30, 2025 (in thousands) | Six Months Ended June 30, 2024 (in thousands) | | :-------------------------------- | :------------------------------------ | :------------------------------------ | :---------------------------------- | :---------------------------------- | | Total revenue | $4,420 | $132,014 | $7,248 | $132,064 | | Research and development | $40,517 | $57,510 | $91,328 | $121,624 | | General and administrative | $15,910 | $16,127 | $33,508 | $33,591 | | Restructuring costs | $32,609 | $— | $32,609 | $— | | Net Income (loss) | $(125,767) | $66,886 | $(185,962) | $(5,353) | | Basic net income (loss) per share | $(2.34) | $1.24 | $(3.45) | $(0.10) | | Diluted net income (loss) per share | $(2.34) | $1.22 | $(3.45) | $(0.10) | [Condensed Consolidated Statements of Cash Flows](index=8&type=section&id=Condensed%20Consolidated%20Statements%20of%20Cash%20Flows) The company experienced a significant net decrease in cash, cash equivalents, and restricted cash for the six months ended June 30, 2025, primarily driven by cash used in operating activities, which increased compared to the prior year | Metric | Six Months Ended June 30, 2025 (in thousands) | Six Months Ended June 30, 2024 (in thousands) | | :-------------------------------------- | :------------------------------------ | :------------------------------------ | | Net cash used in operating activities | $(99,703) | $(57,092) | | Net cash used in investing activities | $(128) | $(246) | | Net cash provided by (used in) financing activities | $(122) | $1,280 | | Net decrease in cash, cash equivalents and restricted cash | $(99,953) | $(56,058) | | Cash, cash equivalents and restricted cash, end of period | $372,295 | $564,984 | [Condensed Consolidated Statements of Shareholders' Equity](index=10&type=section&id=Condensed%20Consolidated%20Statements%20of%20Shareholders'%20Equity) Total shareholders' equity decreased significantly from December 31, 2024, to June 30, 2025, primarily due to a substantial net loss incurred during the period, partially offset by share-based compensation | Metric | December 31, 2024 (in thousands) | June 30, 2025 (in thousands) | Change (in thousands) | | :----------------------- | :------------------------------- | :--------------------------- | :-------------------- | | Total Shareholders' Equity | $486,926 | $324,331 | $(162,595) | | Accumulated Deficit | $(1,102,341) | $(1,288,303) | $(185,962) | | Share-based compensation | N/A | $23,367 (6 months) | N/A | [Notes to Condensed Consolidated Financial Statements](index=11&type=section&id=Notes%20to%20Condensed%20Consolidated%20Financial%20Statements) These notes provide detailed disclosures on the company's business, significant accounting policies, financial instrument fair values, balance sheet item composition, net loss per share calculations, commitments, significant collaboration agreements, shareholders' equity, share-based compensation, income taxes, and recent restructuring activities [1. Organization](index=11&type=section&id=1.Organization) Prothena is a late-stage clinical biotechnology company focused on neurodegenerative and rare peripheral amyloid diseases, advancing a pipeline of therapeutic candidates through wholly-owned and partnered programs. The company reported an accumulated deficit of $1.3 billion and $371.4 million in cash and cash equivalents as of June 30, 2025, and anticipates needing additional capital for future operations and product development - Prothena is a late-stage clinical biotechnology company specializing in protein dysregulation for neurodegenerative and rare peripheral amyloid diseases[29](index=29&type=chunk) - Wholly-owned programs include PRX012 (amyloid beta) and PRX123 (dual Aβ-tau vaccine) for Alzheimer's disease[30](index=30&type=chunk) - Partnered programs include prasinezumab with Roche for Parkinson's disease, BMS-986446 and PRX019 with BMS for Alzheimer's and neurodegenerative diseases, and potential milestones from Novo Nordisk for ATTR amyloidosis business[30](index=30&type=chunk) - As of June 30, 2025, the company had an accumulated deficit of **$1.3 billion** and cash and cash equivalents of **$371.4 million**[32](index=32&type=chunk) - Management believes existing cash is sufficient for the next twelve months but anticipates needing additional capital for increased R&D, potential licenses/acquisitions, and regulatory approvals[33](index=33&type=chunk) [2. Summary of Significant Accounting Policies](index=11&type=section&id=2.%20Summary%20of%20Significant%20Accounting%20Policies) The financial statements are prepared in accordance with U.S. GAAP and Form 10-Q instructions, using estimates that may differ from actual results. A new accounting policy for restructuring charges was added in June 2025 following a corporate restructuring. The company operates as a single segment focused on protein dysregulation - Financial statements are prepared in accordance with U.S. GAAP and Form 10-Q, relying on management estimates[34](index=34&type=chunk)[36](index=36&type=chunk) - A new accounting policy for restructuring charges was adopted in June 2025 due to a corporate restructuring[37](index=37&type=chunk)[42](index=42&type=chunk) - The company manages its operations as a single segment focused on discovery and development of novel therapies for protein dysregulation[45](index=45&type=chunk) | Program | Three Months Ended June 30, 2025 (in thousands) | | :-------- | :------------------------------------ | | Birtamimab | $19,433 | | PRX012 | $15,093 | | PRX019 | $1,824 | - Recent accounting pronouncements include ASU 2024-03 (Income Statement — Reporting Comprehensive Income — Expense Disaggregation Disclosures) effective 2027/2028 and ASU 2023-09 (Income Taxes) effective 2025[48](index=48&type=chunk)[50](index=50&type=chunk) [3. Fair Value Measurements](index=14&type=section&id=3.Fair%20Value%20Measurements) The company measures certain financial assets and liabilities at fair value on a recurring basis, primarily classifying cash equivalents within Level 1 of the fair value hierarchy due to the use of quoted market prices - Fair value measurements are categorized into a three-tier hierarchy: Level 1 (quoted prices), Level 2 (observable inputs), and Level 3 (unobservable inputs)[51](index=51&type=chunk)[55](index=55&type=chunk) - Cash equivalents, primarily money market funds, are classified within Level 1[53](index=53&type=chunk) - Money market funds held: **$349.5 million** at June 30, 2025, down from **$440.3 million** at December 31, 2024[53](index=53&type=chunk) [4. Composition of Certain Balance Sheet Items](index=14&type=section&id=4.%20Composition%20of%20Certain%20Balance%20Sheet%20Items) This note details the composition of prepaid expenses and other current assets, property and equipment (net), and other current liabilities, showing changes between June 30, 2025, and December 31, 2024 - Prepaid R&D expenses decreased from **$12.0 million** (Dec 2024) to **$8.8 million** (June 2025)[54](index=54&type=chunk) - Property and equipment, net, decreased from **$3.1 million** (Dec 2024) to **$2.7 million** (June 2025)[56](index=56&type=chunk) - Other current liabilities decreased from **$15.8 million** (Dec 2024) to **$6.4 million** (June 2025), primarily due to a reduction in payroll and related expenses[57](index=57&type=chunk) [5. Net Loss Per Ordinary Share](index=15&type=section&id=5.%20Net%20Loss%20Per%20Ordinary%20Share) The company reported a basic and diluted net loss per ordinary share of $(2.34) for Q2 2025 and $(3.45) for the six months ended June 30, 2025, compared to net income in Q2 2024 and a smaller net loss for the six months ended June 30, 2024. Potentially issuable shares were anti-dilutive due to the net loss | Metric | Three Months Ended June 30, 2025 | Three Months Ended June 30, 2024 | Six Months Ended June 30, 2025 | Six Months Ended June 30, 2024 | | :-------------------------------- | :------------------------------- | :------------------------------- | :----------------------------- | :----------------------------- | | Net income (loss) | $(125,767) | $66,886 | $(185,962) | $(5,353) | | Basic net income (loss) per share | $(2.34) | $1.24 | $(3.45) | $(0.10) | | Diluted net income (loss) per share | $(2.34) | $1.22 | $(3.45) | $(0.10) | - Potentially issuable ordinary shares (stock options, RSUs) were not included in diluted EPS calculations for periods with net loss as their effect would be anti-dilutive[59](index=59&type=chunk) [6. Commitments and Contingencies](index=16&type=section&id=6.%20Commitments%20and%20Contingencies) The company has lease commitments for facilities in the U.S. and Ireland, with total operating lease liabilities of $9.8 million as of June 30, 2025. Other commitments include non-cancelable purchase obligations, restructuring plan obligations, and contractual obligations under license agreements, totaling $44.7 million - Total operating lease liability as of June 30, 2025: **$9.781 million**[65](index=65&type=chunk) | Year Ended December 31, | Operating Leases (in thousands) | | :---------------------- | :------------------------------ | | 2025 (6 months) | $1,678 | | 2026 | $3,301 | | 2027 | $3,269 | | 2028 | $2,523 | | Thereafter | $— | | Total | $10,771 | - Non-cancelable purchase commitments: **$3.3 million**[67](index=67&type=chunk) - Obligations under restructuring plan: **$30.3 million**, with **$30.0 million** expected in H2 2025[67](index=67&type=chunk) - Contractual obligations under license agreements: **$0.3 million**[67](index=67&type=chunk) [7. Significant Agreements](index=18&type=section&id=7.%20Significant%20Agreements) This section details the company's key collaboration and license agreements with Roche, Bristol Myers Squibb (BMS), and Novo Nordisk, outlining payment structures, performance obligations, and revenue recognition [Roche License Agreement](index=18&type=section&id=Roche%20License%20Agreement) Prothena has an exclusive worldwide license agreement with Roche for α-synuclein antibodies, including prasinezumab. Roche is responsible for development and commercialization, with Prothena eligible for milestones up to $620 million and tiered royalties. Roche announced advancement of prasinezumab into Phase 3 development for early-stage Parkinson's disease in June 2025, citing positive Phase 2b PADOVA study data - Roche is obligated to pay Prothena up to **$290.0 million** for development, regulatory, and first commercial sales milestones, up to **$155.0 million** for U.S. commercial sales milestones, and up to **$175.0 million** for ex-U.S. commercial sales milestones[73](index=73&type=chunk) - Prothena is eligible for tiered, high single-digit to high double-digit royalties in the teens based on U.S. and ex-U.S. annual net sales[73](index=73&type=chunk) - In June 2025, Roche announced advancement of prasinezumab into Phase 3 development for early-stage Parkinson's disease, based on Phase 2b PADOVA study data suggesting clinical benefit[161](index=161&type=chunk) - Phase 2b PADOVA trial results (Dec 2024): potential clinical effect on time to confirmed motor progression (HR=0.84, p=0.0657), more pronounced in levodopa-treated population (HR=0.79, p=0.0431)[162](index=162&type=chunk) - No milestones were achieved under the Roche License Agreement during the three and six months ended June 30, 2025 and 2024[80](index=80&type=chunk) [Collaboration Agreement with Bristol Myers Squibb](index=19&type=section&id=Collaboration%20Agreement%20with%20Bristol%20Myers%20Squibb) Prothena's collaboration with BMS involves exclusive licenses for antibodies targeting tau (BMS-986446) and an undisclosed target (PRX019). BMS exercised global rights for both, with Prothena receiving option exercise fees and eligible for significant regulatory and sales milestones, plus tiered royalties. Revenue for H1 2025 was from PRX019 Phase 1 clinical trial obligation - BMS exercised Global Rights for tau/BMS-986446 in July 2023, paying a **$55.0 million** option exercise fee. Prothena is eligible for up to **$562.5 million** in regulatory and commercial milestones and tiered royalties[98](index=98&type=chunk) - BMS exercised Global Rights for undisclosed/PRX019 in May 2024, paying an **$80.0 million** option exercise fee. Prothena is eligible for up to **$617.5 million** in development, regulatory, and sales milestones and tiered royalties[100](index=100&type=chunk)[189](index=189&type=chunk) - Collaboration revenue from BMS for Q2 2025 was **$4.4 million** and for H1 2025 was **$7.2 million**, related to partial performance of the PRX019 Phase 1 Clinical Trial Obligation[111](index=111&type=chunk)[198](index=198&type=chunk) - Deferred revenue of **$5.1 million** as of June 30, 2025, relates to the outstanding PRX019 Phase 1 Clinical Trial Obligation[95](index=95&type=chunk)[114](index=114&type=chunk) - BMS initiated a Phase 2 clinical trial for BMS-986446 in Q1 2024 for early Alzheimer's disease, with primary outcome measuring change in brain tau deposition[180](index=180&type=chunk) [Novo Nordisk Share Purchase Agreement](index=24&type=section&id=Novo%20Nordisk%20Share%20Purchase%20Agreement) Novo Nordisk acquired Prothena's ATTR amyloidosis business, including coramitug, in July 2021 for an upfront payment and potential development and sales milestones up to $1.13 billion. Prothena has earned $100 million to date, but no additional milestones were achieved in H1 2025 or H1 2024 - Novo Nordisk acquired Prothena's ATTR amyloidosis business and pipeline, including coramitug, in July 2021[118](index=118&type=chunk)[171](index=171&type=chunk) - Aggregate purchase price includes an upfront payment and development/sales milestone payments totaling up to **$1.23 billion**. Prothena has earned approximately **$100 million** to date[172](index=172&type=chunk) - No revenue was recognized from this agreement during the three and six months ended June 30, 2025 and 2024[124](index=124&type=chunk) - Novo Nordisk is conducting a Phase 2 clinical trial of coramitug in patients with ATTR amyloidosis with cardiomyopathy[173](index=173&type=chunk) [8. Shareholders' Equity](index=25&type=section&id=8.%20Shareholders'%20Equity) As of June 30, 2025, Prothena had 53,826,982 ordinary shares outstanding. The company has equity incentive plans with 17,193,490 ordinary shares reserved for issuance. The company also has an Amended Distribution Agreement for at-the-market offerings, but no shares were sold under it in H1 2025 or H1 2024 - Ordinary shares outstanding: **53,826,982** as of June 30, 2025[124](index=124&type=chunk) - **17,193,490** ordinary shares are reserved for issuance under equity incentive plans[124](index=124&type=chunk) - No ordinary shares were sold or issued under the Amended Distribution Agreement for at-the-market offerings during the three and six months ended June 30, 2025 and 2024[128](index=128&type=chunk) [9. Share-Based Compensation](index=25&type=section&id=9.%20Share-Based%20Compensation) Share-based compensation expense for H1 2025 was $23.4 million, slightly down from $24.4 million in H1 2024. This includes $2.1 million related to accelerated vesting of executive stock options due to restructuring in Q2 2025. The weighted-average grant date fair value of options decreased significantly from $19.21 in H1 2024 to $9.49 in H1 2025 | Metric | Three Months Ended June 30, 2025 (in thousands) | Three Months Ended June 30, 2024 (in thousands) | Six Months Ended June 30, 2025 (in thousands) | Six Months Ended June 30, 2024 (in thousands) | | :-------------------------------- | :------------------------------------ | :------------------------------------ | :---------------------------------- | :---------------------------------- | | Total share-based compensation expense | $12,418 | $12,041 | $23,367 | $24,424 | | R&D share-based compensation | $4,674 | $5,634 | $9,519 | $11,089 | | G&A share-based compensation | $5,663 | $6,407 | $11,767 | $13,335 | | Restructuring costs (share-based) | $2,081 | $— | $2,081 | $— | - Weighted average grant date fair value of stock options decreased from **$19.21** (H1 2024) to **$9.49** (H1 2025)[138](index=138&type=chunk) - Unearned share-based compensation related to unvested stock options at June 30, 2025, is **$72.2 million**, expected to be recognized over **2.79 years**[135](index=135&type=chunk) [10. Income Taxes](index=27&type=section&id=10.%20Income%20Taxes) The company recorded an income tax expense of $44.8 million for Q2 2025 and $43.6 million for H1 2025, a significant increase from prior year benefits, primarily due to establishing a full valuation allowance of $44.9 million against federal deferred tax assets following the birtamimab clinical trial outcome and corporate restructuring | Metric | Three Months Ended June 30, 2025 (in thousands) | Three Months Ended June 30, 2024 (in thousands) | Six Months Ended June 30, 2025 (in thousands) | Six Months Ended June 30, 2024 (in thousands) | | :-------------------------------- | :------------------------------------ | :------------------------------------ | :---------------------------------- | :---------------------------------- | | Provision for (benefit from) income taxes | $44,802 | $(2,039) | $43,624 | $(4,240) | - The increase in income tax expense is primarily due to recording a **$44.9 million** valuation allowance against federal deferred tax assets in Q2 2025[147](index=147&type=chunk)[214](index=214&type=chunk) - The valuation allowance was established due to uncertainty in realizing benefits from federal DTAs, influenced by the Phase 3 AFFIRM-AL clinical trial outcome for birtamimab and the announced corporate restructuring[147](index=147&type=chunk) - No tax benefit is recognized for Irish net operating losses due to a full valuation allowance[144](index=144&type=chunk)[215](index=215&type=chunk) [11. Restructuring](index=28&type=section&id=11.%20Restructuring) In June 2025, Prothena commenced a restructuring plan, incurring $32.6 million in charges for Q2 and H1 2025, primarily for employee termination benefits and contract termination costs, following the discontinuation of birtamimab development and a 63% workforce reduction - Restructuring plan commenced in June 2025 following the discontinuation of birtamimab development[150](index=150&type=chunk)[192](index=192&type=chunk) - Aggregate restructuring charges: **$32.6 million** for the three and six months ended June 30, 2025[151](index=151&type=chunk)[209](index=209&type=chunk) - Charges primarily consist of employee termination benefits (including **$2.1 million** share-based compensation) and contract termination costs for birtamimab commercial supplies[151](index=151&type=chunk)[136](index=136&type=chunk) - Workforce reduction of approximately **63%** announced in June 2025[193](index=193&type=chunk) - Restructuring liability of **$30.3 million** is included in current liabilities as of June 30, 2025, with most cash payments expected by Q4 2025[153](index=153&type=chunk)[210](index=210&type=chunk) [Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations](index=29&type=section&id=Item%202.%20Management's%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operations) This section provides an overview of Prothena's business, detailed updates on its clinical pipeline, and an analysis of its financial performance, liquidity, and capital resources for the three and six months ended June 30, 2025, compared to 2024 [Overview](index=29&type=section&id=Overview) Prothena is a late-stage clinical biotechnology company focused on neurodegenerative and rare peripheral amyloid diseases, leveraging its expertise in protein dysregulation to advance a pipeline of wholly-owned and partnered therapeutic candidates - Prothena is a late-stage clinical biotechnology company with expertise in protein dysregulation, developing therapeutics for neurodegenerative and rare peripheral amyloid diseases[156](index=156&type=chunk) - Wholly-owned programs include PRX012 (amyloid beta) and PRX123 (dual Aβ-tau vaccine) for Alzheimer's disease[157](index=157&type=chunk) - Partnered programs include prasinezumab with Roche for Parkinson's disease, BMS-986446 and PRX019 with BMS for Alzheimer's and neurodegenerative diseases, and potential milestones from Novo Nordisk for ATTR amyloidosis business[157](index=157&type=chunk) [Prasinezumab for the Potential Treatment of Parkinson's Disease and Other Synucleinopathies](index=29&type=section&id=Prasinezumab%20for%20the%20Potential%20Treatment%20of%20Parkinson's%20Disease%20and%20Other%20Synucleinopathies) Prasinezumab, an anti-alpha-synuclein antibody partnered with Roche, is advancing to Phase 3 development for early-stage Parkinson's disease. This decision follows positive trends and potential clinical benefit observed in the Phase 2b PADOVA study, particularly in levodopa-treated patients, and supported by long-term follow-up data from the PASADENA trial - Prasinezumab is an investigational humanized monoclonal antibody that targets alpha-synuclein for Parkinson's disease and other synucleinopathies[159](index=159&type=chunk) - In June 2025, Roche announced advancement of prasinezumab into Phase 3 development for early-stage Parkinson's disease, citing data from the Phase 2b PADOVA study and longer-term follow-up[161](index=161&type=chunk) - Phase 2b PADOVA trial (Dec 2024 topline results): showed potential clinical effect on the primary endpoint of time to confirmed motor progression (HR=0.84, p=0.0657), with a more pronounced effect in levodopa-treated patients (HR=0.79, p=0.0431)[162](index=162&type=chunk) - Consistent positive trends across multiple secondary and exploratory clinical endpoints were observed, including **30-40%** relative reduction in motor progression at **104 weeks**[162](index=162&type=chunk) [Coramitug (formerly PRX004) for the Potential Treatment of ATTR Amyloidosis](index=30&type=section&id=Coramitug%20(formerly%20PRX004)%20for%20the%20Potential%20Treatment%20of%20ATTR%20Amyloidosis) Coramitug, an investigational antibody designed to deplete amyloid in ATTR amyloidosis, was acquired by Novo Nordisk in July 2021. Novo Nordisk is conducting a Phase 2 clinical trial for coramitug in ATTR cardiomyopathy, building on positive Phase 1 safety and tolerability data - Coramitug is an investigational antibody designed to deplete amyloid associated with disease pathology in hereditary and wild-type ATTR amyloidosis[164](index=164&type=chunk)[169](index=169&type=chunk) - Proposed mechanism of action: deplete circulating non-native TTR and promote clearance of insoluble amyloid fibrils[169](index=169&type=chunk) - In July 2021, Novo Nordisk acquired Prothena's ATTR amyloidosis business, including coramitug[171](index=171&type=chunk) - Novo Nordisk is conducting a Phase 2 clinical trial of coramitug in **105** patients with ATTR amyloidosis with cardiomyopathy[173](index=173&type=chunk) [BMS-986446 (formerly PRX005) for the Potential Treatment of Alzheimer's Disease](index=31&type=section&id=BMS-986446%20(formerly%20PRX005)%20for%20the%20Potential%20Treatment%20of%20Alzheimer's%20Disease) BMS-986446, an anti-tau antibody partnered with BMS, is designed to target MTBR-tau in Alzheimer's disease. BMS initiated a Phase 2 clinical trial in Q1 2024 to evaluate its efficacy, safety, and tolerability in early Alzheimer's, following positive Phase 1 safety and pharmacokinetic results - BMS-986446 is an anti-tau antibody targeting the MTBR region of tau, implicated in Alzheimer's disease pathology[174](index=174&type=chunk) - In July 2023, Prothena entered into an exclusive global license agreement for BMS-986446 with BMS, receiving a **$55 million** option exercise fee[175](index=175&type=chunk) - Phase 1 SAD trial showed BMS-986446 to be generally safe and well tolerated, with dose-proportional plasma drug concentrations and robust CSF exposure[177](index=177&type=chunk) - In Q1 2024, BMS initiated a Phase 2 clinical trial (NCT06268886) to evaluate efficacy, safety, and tolerability in approximately **310** participants with early Alzheimer's disease, with brain tau deposition as the primary outcome[180](index=180&type=chunk) - In Q2 2025, BMS initiated a Phase 1 clinical trial to assess pharmacokinetics, tolerability, and absolute bioavailability of subcutaneous BMS-986446[179](index=179&type=chunk) [PRX012 for the Potential Treatment of Alzheimer's Disease](index=32&type=section&id=PRX012%20for%20the%20Potential%20Treatment%20of%20Alzheimer's%20Disease) PRX012 is Prothena's wholly-owned investigational anti-Aβ antibody for Alzheimer's disease, designed for subcutaneous administration. It has FDA Fast Track designation, and ongoing Phase 1 trial data from initial multiple dose cohorts supports once-monthly subcutaneous treatment and dose escalation, with initial data expected in August 2025 - PRX012 is a wholly-owned investigational antibody targeting amyloid beta (Aβ) for Alzheimer's disease, designed for subcutaneous administration[181](index=181&type=chunk)[183](index=183&type=chunk) - Preclinical studies showed PRX012 has higher binding strength to amyloid than aducanumab and neutralizes soluble, toxic Aβ species[182](index=182&type=chunk) - FDA granted Fast Track designation for PRX012 in April 2022[183](index=183&type=chunk) - Phase 1 data from single ascending dose and initial multiple dose cohort (**70 mg**) supports single-injection once-monthly subcutaneous treatment and dose escalation[184](index=184&type=chunk) - Initial data from the ongoing Phase 1 trial is expected in August 2025[184](index=184&type=chunk) [PRX123, a Dual Aβ-Tau Vaccine for the Potential Treatment and Prevention of Alzheimer's Disease](index=33&type=section&id=PRX123,%20a%20Dual%20A%CE%B2-Tau%20Vaccine%20for%20the%20Potential%20Treatment%20and%20Prevention%20of%20Alzheimer's%20Disease) PRX123 is Prothena's wholly-owned dual vaccine candidate for Alzheimer's disease, targeting both Aβ and tau proteins. It has received FDA Fast Track designation, and preclinical data demonstrated its ability to generate polyclonal responses for amyloid clearance and tau transmission blockade - PRX123 is a wholly-owned dual vaccine targeting key epitopes within both Aβ and tau proteins for Alzheimer's disease[185](index=185&type=chunk) - Preclinical studies showed PRX123 generated polyclonal responses against Aβ and tau, promoting amyloid clearance and blocking tau transmission[186](index=186&type=chunk)[187](index=187&type=chunk) - FDA cleared the IND application and granted Fast Track designation for PRX123 in January 2024[187](index=187&type=chunk) [PRX019 for the Potential Treatment of Neurodegenerative Diseases](index=33&type=section&id=PRX019%20for%20the%20Potential%20Treatment%20of%20Neurodegenerative%20Diseases) PRX019 is an investigational antibody for neurodegenerative diseases, developed in collaboration with BMS. The FDA cleared its IND in December 2023, and Prothena entered a global license agreement with BMS in May 2024, receiving an $80 million option exercise fee and eligibility for significant milestones. A Phase 1 clinical trial was initiated in November 2024 - PRX019 is an investigational antibody for neurodegenerative diseases, developed in collaboration with BMS[188](index=188&type=chunk) - FDA cleared the IND application for PRX019 in December 2023[189](index=189&type=chunk) - In May 2024, Prothena entered an exclusive global license agreement for PRX019 with BMS, receiving an **$80.0 million** option exercise fee[189](index=189&type=chunk) - Prothena is eligible for up to **$617.5 million** in development, regulatory, and sales milestones, plus tiered royalties[189](index=189&type=chunk) - A Phase 1 first-in-human clinical trial for PRX019 was initiated in November 2024[190](index=190&type=chunk) [Our Discovery and Preclinical Programs](index=33&type=section&id=Our%20Discovery%20and%20Preclinical%20Programs) Prothena is advancing several discovery and preclinical-stage programs for neurological diseases, with a focus on internal expertise for new target discovery and potential partnering or out-licensing for existing late discovery/preclinical programs - Advancing several discovery and preclinical-stage programs for neurological diseases with unmet medical needs[191](index=191&type=chunk) - New target discovery will focus on internal expertise and resources[191](index=191&type=chunk) - Existing late discovery-stage or preclinical-stage programs may be partnered or out-licensed[191](index=191&type=chunk) [Discontinuation of Birtamimab Development](index=33&type=section&id=Discontinuation%20of%20Birtamimab%20Development) In May 2025, Prothena discontinued the development of birtamimab for AL amyloidosis, following the failure of its Phase 3 AFFIRM-AL clinical trial to meet primary or secondary endpoints - Discontinuation of birtamimab development announced in May 2025[192](index=192&type=chunk) - Decision based on Phase 3 AFFIRM-AL clinical trial results, which did not meet primary or secondary endpoints[192](index=192&type=chunk) [Workforce Reduction](index=33&type=section&id=Workforce%20Reduction) In June 2025, Prothena announced an approximate 63% reduction in its workforce to significantly cut operating costs, focusing resources on remaining wholly-owned programs, partnered obligations, and anticipated business development - Approximate **63%** reduction in workforce announced in June 2025[193](index=193&type=chunk) - Purpose: substantially reduce operating costs to support remaining wholly-owned programs, partnered obligations, and business development[193](index=193&type=chunk) [Critical Accounting Policies and Estimates](index=34&type=section&id=Critical%20Accounting%20Policies%20and%20Estimates) The company's financial statements rely on estimates and assumptions in accordance with U.S. GAAP. There were no significant changes to critical accounting policies or estimates during the six months ended June 30, 2025, except for the addition of the restructuring accounting policy - Financial statements prepared in accordance with U.S. GAAP require judgments, estimates, and assumptions[194](index=194&type=chunk) - No significant changes to critical accounting policies or estimates during H1 2025, except for the new restructuring accounting policy[195](index=195&type=chunk) [Recent Accounting Pronouncements](index=34&type=section&id=Recent%20Accounting%20Pronouncements) The company is evaluating the impact of new FASB ASUs: ASU 2024-03 (Income Statement — Reporting Comprehensive Income — Expense Disaggregation Disclosures) effective 2027/2028, and ASU 2023-09 (Income Taxes) effective 2025 - Evaluating ASU 2024-03 (Income Statement — Reporting Comprehensive Income — Expense Disaggregation Disclosures), effective for annual periods ending December 31, 2027, and interim periods beginning January 1, 2028[48](index=48&type=chunk)[49](index=49&type=chunk) - Evaluating ASU 2023-09 (Income Taxes), effective for annual periods ending December 31, 2025[50](index=50&type=chunk) [Results of Operations](index=34&type=section&id=Results%20of%20Operations) This section provides a comparative analysis of the company's revenue, operating expenses, and other income/expense for the three and six months ended June 30, 2025, versus 2024, highlighting significant changes in collaboration revenue, restructuring costs, and income tax expense [Revenue](index=34&type=section&id=Revenue) Total revenue significantly decreased by 97% for Q2 2025 and 95% for H1 2025 compared to the prior year, primarily due to a substantial reduction in collaboration revenue from BMS, which recognized large license fees in H1 2024 | Metric | Three Months Ended June 30, 2025 (in thousands) | Three Months Ended June 30, 2024 (in thousands) | Six Months Ended June 30, 2025 (in thousands) | Six Months Ended June 30, 2024 (in thousands) | Change (QoQ) | Change (YoY) | | :----------------------------- | :------------------------------------ | :------------------------------------ | :---------------------------------- | :---------------------------------- | :----------- | :----------- | | Collaboration revenue | $4,420 | $132,014 | $7,198 | $132,014 | (97)% | (95)% | | Total revenue | $4,420 | $132,014 | $7,248 | $132,064 | (97)% | (95)% | - Collaboration revenue for H1 2025 was from partial performance of the PRX019 Phase 1 Clinical Trial Obligation[198](index=198&type=chunk) - Collaboration revenue for H1 2024 included **$107.0 million** from the PRX019 Global License Agreement and PRX019 Phase 1 Clinical Trial Obligation, and **$25.0 million** related to BMS's material rights for the TDP-43 Collaboration Target[198](index=198&type=chunk) - Deferred revenue of **$5.1 million** as of June 30, 2025, relates to remaining PRX019 Phase 1 Clinical Trial Obligations[199](index=199&type=chunk) [Operating Expenses](index=35&type=section&id=Operating%20Expenses) Total operating expenses increased by 21% for Q2 2025 and 1% for H1 2025 compared to the prior year, primarily driven by $32.6 million in restructuring costs, which offset decreases in R&D and G&A expenses | Metric | Three Months Ended June 30, 2025 (in thousands) | Three Months Ended June 30, 2024 (in thousands) | Six Months Ended June 30, 2025 (in thousands) | Six Months Ended June 30, 2024 (in thousands) | Change (QoQ) | Change (YoY) | | :---------------------- | :------------------------------------ | :------------------------------------ | :---------------------------------- | :---------------------------------- | :----------- | :----------- | | Total operating expenses | $89,036 | $73,637 | $157,445 | $155,215 | 21% | 1% | - Restructuring costs of **$32.6 million** were incurred in Q2 and H1 2025, with none in the prior year periods[201](index=201&type=chunk) [Research and Development Expenses](index=35&type=section&id=Research%20and%20Development%20Expenses) R&D expenses decreased by 30% for Q2 2025 and 25% for H1 2025 compared to the prior year, primarily due to lower clinical trial expenses for PRX012, reduced manufacturing expenses, and lower personnel costs | Program | Three Months Ended June 30, 2025 (in thousands) | Three Months Ended June 30, 2024 (in thousands) | Six Months Ended June 30, 2025 (in thousands) | Six Months Ended June 30, 2024 (in thousands) | Change (QoQ) | Change (YoY) | | :-------------------- | :------------------------------------ | :------------------------------------ | :---------------------------------- | :---------------------------------- | :----------- | :----------- | | Total R&D | $40,517 | $57,510 | $91,328 | $121,624 | (30)% | (25)% | | Birtamimab (NEOD001) | $19,433 | $21,565 | $45,347 | $42,749 | (10)% | 6% | | PRX012 | $15,093 | $31,994 | $33,168 | $69,807 | (53)% | (53)% | | PRX019 | $1,824 | $676 | $3,926 | $1,457 | 170% | 170% | - Decrease in R&D primarily due to lower clinical trial expenses for PRX012, lower manufacturing expense, and lower personnel expenses[205](index=205&type=chunk) [General and Administrative Expenses](index=36&type=section&id=General%20and%20Administrative%20Expenses) General and administrative expenses remained relatively stable, with a slight decrease of 1% for Q2 2025 and less than 1% for H1 2025 compared to the same periods in the prior year | Metric | Three Months Ended June 30, 2025 (in thousands) | Three Months Ended June 30, 2024 (in thousands) | Six Months Ended June 30, 2025 (in thousands) | Six Months Ended June 30, 2024 (in thousands) | Change (QoQ) | Change (YoY) | | :-------------------------- | :------------------------------------ | :------------------------------------ | :---------------------------------- | :---------------------------------- | :----------- | :----------- | | General and administrative | $15,910 | $16,127 | $33,508 | $33,591 | (1)% | (0.2)% | [Restructuring Costs](index=36&type=section&id=Restructuring%20Costs) The company incurred $32.6 million in restructuring costs for Q2 and H1 2025, with no comparable costs in the prior year, following the discontinuation of birtamimab development and a workforce reduction | Metric | Three Months Ended June 30, 2025 (in thousands) | Three Months Ended June 30, 2024 (in thousands) | Six Months Ended June 30, 2025 (in thousands) | Six Months Ended June 30, 2024 (in thousands) | | :---------------------- | :------------------------------------ | :------------------------------------ | :---------------------------------- | :---------------------------------- | | Restructuring costs | $32,609 | $— | $32,609 | $— | - Restructuring charges primarily consist of employee termination benefits and contract termination costs[210](index=210&type=chunk) - Substantially all cash payments are expected by the end of Q4 2025[210](index=210&type=chunk) [Other Income (Expense)](index=36&type=section&id=Other%20Income%20(Expense)) Total other income, net, decreased by 44% for Q2 2025 and 42% for H1 2025 compared to the prior year, primarily due to lower interest income from cash and money market accounts resulting from lower yields and cash balances. Foreign exchange losses also increased | Metric | Three Months Ended June 30, 2025 (in thousands) | Three Months Ended June 30, 2024 (in thousands) | Six Months Ended June 30, 2025 (in thousands) | Six Months Ended June 30, 2024 (in thousands) | Change (QoQ) | Change (YoY) | | :-------------------- | :------------------------------------ | :------------------------------------ | :---------------------------------- | :---------------------------------- | :----------- | :----------- | | Interest income | $3,794 | $6,521 | $8,142 | $13,686 | (42)% | (41)% | | Other expense, net | $(143) | $(51) | $(283) | $(128) | 180% | 121% | | Total other income, net | $3,651 | $6,470 | $7,859 | $13,558 | (44)% | (42)% | - Decrease in interest income due to lower yields and lower cash balances[211](index=211&type=chunk) - Other expense, net, primarily foreign exchange losses from euro-denominated transactions[212](index=212&type=chunk) [Provision for (benefit from) Income Taxes](index=37&type=section&id=Provision%20for%20(benefit%20from)%20Income%20Taxes) The company recorded a significant income tax expense of $44.8 million for Q2 2025 and $43.6 million for H1 2025, a substantial increase from prior year benefits. This was primarily due to establishing a $44.9 million valuation allowance against federal deferred tax assets in Q2 2025, influenced by the birtamimab clinical trial outcome and corporate restructuring | Metric | Three Months Ended June 30, 2025 (in thousands) | Three Months Ended June 30, 2024 (in thousands) | Six Months Ended June 30, 2025 (in thousands) | Six Months Ended June 30, 2024 (in thousands) | | :-------------------------------- | :------------------------------------ | :------------------------------------ | :---------------------------------- | :---------------------------------- | | Provision for (benefit from) income taxes | $44,802 | $(2,039) | $43,624 | $(4,240) | - Increase in income tax expense primarily due to recording a **$44.9 million** valuation allowance for federal deferred tax assets in Q2 2025[214](index=214&type=chunk) - The valuation allowance was established due to the outcome of the Phase 3 AFFIRM-AL clinical trial for birtamimab and the announced corporate restructuring[147](index=147&type=chunk) [Liquidity and Capital Resources](index=37&type=section&id=Liquidity%20and%20Capital%20Resources) Prothena's working capital decreased by $119.2 million to $317.7 million as of June 30, 2025, with cash and cash equivalents at $371.4 million. The company expects existing cash to cover obligations for at least 12 months but anticipates needing additional capital for future R&D and commercialization, to be financed through collaborations or equity/debt [Overview (Liquidity)](index=37&type=section&id=Overview%20(Liquidity)) Working capital decreased by $119.2 million to $317.7 million as of June 30, 2025, primarily due to $99.7 million cash used in operating activities. Cash and cash equivalents stood at $371.4 million. The company believes current cash is sufficient for the next 12 months but will require additional capital for future R&D and commercialization, potentially through collaborations or financings | Metric | June 30, 2025 (in thousands) | December 31, 2024 (in thousands) | Change (in thousands) | | :---------------------- | :----------------------------- | :------------------------------- | :-------------------- | | Working capital | $317,668 | $436,911 | $(119,243) | | Cash and cash equivalents | $371,435 | $471,388 | $(99,953) | - Existing cash and cash equivalents are believed sufficient for at least the next twelve months[217](index=217&type=chunk) - Additional capital will be required for future R&D, potential licenses/acquisitions, and regulatory approvals, expected to be financed through collaborations or equity/debt financings[217](index=217&type=chunk) [Cash Flows](index=38&type=section&id=Cash%20Flows) Net cash used in operating activities significantly increased to $99.7 million for H1 2025 from $57.1 million in H1 2024, primarily due to ongoing R&D and G&A expenses. Net cash used in investing activities remained low, while financing activities shifted from a net cash provider to a net cash user | Metric | Six Months Ended June 30, 2025 (in thousands) | Six Months Ended June 30, 2024 (in thousands) | | :-------------------------------------- | :------------------------------------ | :------------------------------------ | | Net cash used in operating activities | $(99,703) | $(57,092) | | Net cash used in investing activities | $(128) | $(246) | | Net cash provided by (used in) financing activities | $(122) | $1,280 | | Net decrease in cash, cash equivalents and restricted cash | $(99,953) | $(56,058) | | Cash, cash equivalents and restricted cash, end of period | $372,295 | $564,984 | - Net cash used in operating activities for H1 2025 was primarily due to ongoing R&D and G&A activities[223](index=223&type=chunk) [Off-Balance Sheet Arrangements](index=39&type=section&id=Off-Balance%20Sheet%20Arrangements) As of June 30, 2025, Prothena was not a party to any material off-balance sheet arrangements - No material off-balance sheet arrangements as of June 30, 2025[227](index=227&type=chunk) [Contractual Obligations](index=39&type=section&id=Contractual%20Obligations) As of June 30, 2025, Prothena's total contractual obligations amounted to $44.7 million, primarily comprising obligations under its restructuring plan ($30.3 million), operating leases ($10.8 million), and purchase obligations ($3.3 million) | Obligation Type | Total (in thousands) | 2025 (in thousands) | 2026 (in thousands) | 2027 (in thousands) | 2028 (in thousands) | 2029 (in thousands) | Thereafter (in thousands) | | :------------------------------ | :------------------- | :------------------ | :------------------ | :------------------ | :------------------ | :------------------ | :------------------------ | | Operating leases | $10,771 | $1,678 | $3,301 | $3,269 | $2,523 | $— | $— | | Purchase obligations | $3,339 | $3,216 | $123 | $— | $— | $— | $— | | Obligations under restructuring plan | $30,330 | $30,039 | $291 | $— | $— | $— | $— | | Contractual obligations under license agreements | $309 | $59 | $70 | $70 | $55 | $55 | $— | | **Total** | **$44,749** | **$34,992** | **$3,785** | **$3,339** | **$2,578** | **$55** | **$—** | - Expected full year 2025 net cash used in operating and investing activities: approximately **$170 million** to **$178 million**[231](index=231&type=chunk) [Item 3. Quantitative and Qualitative Disclosures About Market Risk](index=40&type=section&id=Item%203.%20Quantitative%20and%20Qualitative%20Disclosures%20About%20Market%20Risk) Prothena is exposed to market risks from foreign currency exchange rates and interest rates. Foreign currency losses increased in H1 2025, while interest rate risk is limited due to investments in money market funds. The company also faces credit risk from cash and cash equivalents held in financial institutions [Foreign Currency Risk](index=40&type=section&id=Foreign%20Currency%20Risk) The company's business is primarily in U.S. dollars, but agreements with contract manufacturers for drug supplies are mainly in euros, leading to foreign currency exchange rate losses - Foreign currency exchange rate losses: approximately **$283,000** for H1 2025, up from **$128,000** for H1 2024[233](index=233&type=chunk) - Increased exposure to losses if the euro strengthens against the U.S. dollar[233](index=233&type=chunk) [Interest Rate Risk](index=40&type=section&id=Interest%20Rate%20Risk) Prothena's interest rate risk is limited to cash equivalents in money market funds, which fluctuate with prevailing interest rates. The company's investment policy prioritizes principal preservation and liquidity - Exposure to interest rate risk is limited to cash equivalents in money market funds[234](index=234&type=chunk) - Money market funds are generally not subject to interest rate risk as interest fluctuates with prevailing rates[234](index=234&type=chunk) - Investment policy objectives: preserve principal and maintain proper liquidity[235](index=235&type=chunk) [Credit Risk](index=40&type=section&id=Credit%20Risk) The company faces credit risk from cash and cash equivalents held in high-credit-quality financial institutions, with deposits exceeding federally insured limits - Credit risk primarily from cash and cash equivalents held with high credit quality financial institutions[236](index=236&type=chunk) - Deposits exceed federally insured limits, exposing the company to risk in case of financial institution default[236](index=236&type=chunk) [Item 4. Controls and Procedures](index=40&type=section&id=Item%204.%20Controls%20and%20Procedures) Management, including the CEO and CFO, concluded that disclosure controls and procedures were effective as of June 30, 2025, providing reasonable assurance for timely and accurate financial reporting. No material changes in internal control over financial reporting were identified [Evaluation of Disclosure Controls and Procedures](index=40&type=section&id=Evaluation%20of%20Disclosure%20Controls%20and%20Procedures) As of June 30, 2025, management, with CEO and CFO participation, concluded that disclosure controls and procedures are designed and effective to provide reasonable assurance for timely and accurate reporting of required information - CEO and CFO evaluated disclosure controls and procedures as of June 30, 2025[237](index=237&type=chunk) - Conclusion: disclosure controls and procedures are designed and effective to provide reasonable assurance for timely and accurate reporting[237](index=237&type=chunk) [Changes in Internal Control over Financial Reporting](index=40&type=section&id=Changes%20in%20Internal%20Control%20over%20Financial%20Reporting) No changes in internal control over financial reporting were identified during Q2 2025 that materially affected, or are reasonably likely to materially affect, the company's internal control over financial reporting - No material changes in internal control over financial reporting identified during Q2 2025[238](index=238&type=chunk) [Limitations on Effectiveness of Controls and Procedures](index=41&type=section&id=Limitations%20on%20Effectiveness%20of%20Controls%20and%20Procedures) Internal control over financial reporting has inherent limitations, including human diligence, judgment lapses, collusion, and management override, which mean there is a risk that material misstatements may not be prevented or detected timely - Internal controls have inherent limitations, subject to human diligence, judgment lapses, and breakdowns[239](index=239&type=chunk) - Risk of material misstatements not being prevented or detected timely due to inherent limitations[239](index=239&type=chunk) - Controls are designed to provide reasonable assurance, considering resource constraints and cost-benefit evaluations[240](index=240&type=chunk) [PART II. OTHER INFORMATION](index=42&type=section&id=PART%20II.%20OTHER%20INFORMATION) This section covers legal proceedings, risk factors, equity sales, defaults, mine safety disclosures, other information, and exhibits [Item 1. Legal Proceedings](index=42&type=section&id=Item%201.%20Legal%20Proceedings) Prothena is not currently a party to any material legal proceedings but may be involved in ordinary routine litigation incidental to its business - Not currently a party to any material legal proceedings[243](index=243&type=chunk) - May be party to ordinary routine litigation incidental to business[243](index=243&type=chunk) [Item 1A. Risk Factors](index=42&type=section&id=Item%201A.%20Risk%20Factors) This section outlines significant risks to Prothena's business, including financial position, need for additional capital, challenges in drug development and regulatory approval, commercialization hurdles, dependence on third parties, intellectual property protection, and risks related to its ordinary shares [Risks Relating to Our Financial Position, Our Need for Additional Capital, and Our Business](index=42&type=section&id=Risks%20Relating%20to%20Our%20Financial%20Position,%20Our%20Need%20for%20Additional%20Capital,%20and%20Our%20Business) Prothena anticipates incurring losses and requiring substantial additional capital for the foreseeable future, with existing cash sufficient for only the next 12 months. The company faces risks from global economic conditions, business disruptions (e.g., public health crises, geopolitical turmoil, natural disasters), and cybersecurity threats, all of which could adversely impact its operations and financial stability - Anticipates incurring losses for the foreseeable future; accumulated deficit of **$1.3 billion** as of June 30, 2025[245](index=245&type=chunk) - Requires additional capital beyond the next **12 months** to fund operations, R&D, and commercialization[247](index=247&type=chunk) - Ability to raise capital may be adversely impacted by global economic conditions, geopolitical conflicts, and pandemics[251](index=251&type=chunk) - Business disruptions (e.g., public health crises, geopolitical turmoil, natural disasters) can adversely affect operations, clinical trials, manufacturing, and financial markets[259](index=259&type=chunk)[260](index=260&type=chunk) - Information technology systems are vulnerable to cyberattacks, potentially leading to business disruption, loss of intellectual property, or unauthorized data disclosure[261](index=261&type=chunk) - Subject to evolving U.S. and foreign privacy and data protection laws (e.g., HIPAA, CCPA, EU GDPR), increasing compliance costs and potential liability[262](index=262&type=chunk)[267](index=267&type=chunk) [Risks Related to the Discovery, Development, and Regulatory Approval of Drug Candidates](index=47&type=section&id=Risks%20Related%20to%20the%20Discovery,%20Development,%20and%20Regulatory%20Approval%20of%20Drug%20Candidates) Prothena's success is highly dependent on its R&D programs, which face inherent risks of failure, delays, or termination in clinical trials. Regulatory approval processes are lengthy and unpredictable, and even if approved, drug candidates may face limitations or post-approval requirements. Side effects or environmental compliance issues could further hinder development and commercialization - Success depends on successful discovery, development, regulatory approval, and commercialization of drug candidates, which is highly uncertain[271](index=271&type=chunk) - Clinical trials are prone to difficulties, delays, or failures due to efficacy, safety, enrollment, or design issues[271](index=271&type=chunk)[283](index=283&type=chunk) - Positive nonclinical or early clinical results may not predict success in later stages[275](index=275&type=chunk) - Regulatory approval processes are lengthy, time-consuming, and unpredictable, with no assurance of approval for any drug candidate[293](index=293&type=chunk) - Undesirable side effects could interrupt/delay clinical trials, result in restrictive labels, or lead to withdrawal from the market[302](index=302&type=chunk) - Compliance with environmental laws for hazardous materials in R&D is required, with risks of accidental contamination or injury[304](index=304&type=chunk) [Risks Related to the Commercialization of Our Drug Candidates](index=54&type=section&id=Risks%20Related%20to%20Our%20Commercialization%20of%20Our%20Drug%20Candidates) Even if approved, Prothena's drug candidates may not achieve broad market acceptance due to competition, pricing, or reimbursement issues. The company's revenue from prasinezumab is highly dependent on Roche's development and commercialization efforts, and its own ability to establish sales and marketing capabilities for other products is crucial. Healthcare reforms and intense market competition pose significant threats to profitability - Approved drug candidates may not gain broad market acceptance due to factors like efficacy, safety, reimbursement, and competition[308](index=308&type=chunk)[309](index=309&type=chunk) - Success of prasinezumab in the U.S. is dependent on Roche's development and commercialization efforts, with risks of termination or insufficient resource commitment[310](index=310&type=chunk)[311](index=311&type=chunk)[319](index=319&type=chunk) - Prothena lacks a fully-scaled sales, marketing, and distribution organization and must build or partner for commercialization[323](index=323&type=chunk)[325](index=325&type=chunk) - Government and third-party payers may not provide adequate coverage and reimbursement, impacting revenue and profitability[326](index=326&type=chunk) - U.S. and other governments propose legislation (e.g., ACA, IRA) to reduce healthcare costs, potentially leading to lower drug prices and reduced reimbursement[329](index=329&type=chunk)[332](index=332&type=chunk)[336](index=336&type=chunk) - Markets for drug candidates are subject to intense competition from companies with greater resources and more advanced pipelines[338](index=338&type=chunk)[339](index=339&type=chunk) - Biologic products may face biosimilar competition sooner than anticipated if exclusivity periods are shortened or FDA interpretations change[343](index=343&type=chunk)[346](index=346&type=chunk) - Orphan Drug Designation benefits (e.g., market exclusivity) may not be maintained or may be waived[347](index=347&type=chunk)[348](index=348&type=chunk) - Fast Track designation does not guarantee faster development, regulatory review, or marketing approval[349](index=349&type=chunk)[350](index=350&type=chunk) - Subject to healthcare laws (e.g., Anti-Kickback Statute, False Claims Act, HIPAA, Physician Payments Sunshine Act), with non-compliance risking sanctions, penalties, and reputational harm[351](index=351&type=chunk)[352](index=352&type=chunk) - Product liability and clinical trial claims could result in substantial uninsured liabilities, decreased demand, and reputational damage[353](index=353&type=chunk)[354](index=354&type=chunk) [Risks Related to Our Dependence on Third Parties](index=62&type=section&id=Risks%20Related%20to%20Our%20Dependence%20on%20Third%20Parties) Prothena heavily relies on third parties for clinical trials, manufacturing, and raw material supply. Failure of these third parties to perform satisfactorily, meet deadlines, or comply with regulations could cause significant delays, increased costs, and harm to business operations. Establishing new collaborations or finding alternative suppliers/manufacturers can be challenging and costly - Reliance on third parties (CROs, medical institutions, clinical investigators) to conduct clinical trials, leading to reduced control and potential delays if they fail to perform[358](index=358&type=chunk)[359](index=359&type=chunk) - Dependence on Roche, Novo Nordisk, and BMS for further development and manufacturing of partnered drug candidates (prasinezumab, coramitug, BMS-986446)[287](index=287&type=chunk)[288](index=288&type=chunk)[368](index=368&type=chunk)[369](index=369&type=chunk)[370](index=370&type=chunk) - No internal manufacturing capacity; reliance on third-party manufacturers for nonclinical, clinical, and commercial supplies of drug candidates[362](index=362&type=chunk)[363](index=363&type=chunk) - Risks associated with third-party manufacturers include failure to scale up, facility damage, non-compliance with cGMPs, and supply interruptions[364](index=364&type=chunk)[365](index=365&type=chunk)[366](index=366&type=ch

[Press Release Overview](index=1&type=section&id=Press%20Release%20Overview) Prothena announced Q2 and H1 2025 financial results, highlighting progress in neurodegenerative and amyloidosis programs, and outlining future milestones and financial guidance [Introduction and CEO Statement](index=1&type=section&id=Introduction%20and%20CEO%20Statement) Prothena reported Q2 and H1 2025 financial results and business highlights, with CEO emphasizing prasinezumab's Phase III entry and upcoming PRX012 data - Prothena's partner Roche expects to advance prasinezumab into Phase III clinical development for early Parkinson's disease by late 2025, potentially becoming the first disease-modifying therapy for 10 million Parkinson's patients worldwide[3](index=3&type=chunk) - The company plans to share preliminary data from its wholly-owned PRX012 program's Phase I ASCENT clinical trial in Alzheimer's disease in August 2025[3](index=3&type=chunk) - Prothena anticipates up to **$105 million** in clinical milestone payments in 2026, contingent on Novo Nordisk advancing coramitug and Bristol Myers Squibb advancing PRX019[3](index=3&type=chunk) [Second Quarter 2025 Business Highlights](index=1&type=section&id=Second%20Quarter%202025%20Business%20Highlights) Prothena's Q2 2025 net cash used in operating and investing activities was **$46.4 million**, with **$372.3 million** in cash and restricted cash at quarter-end 2025 Second Quarter and First Half Cash Usage | Metric | Second Quarter (million USD) | First Half (million USD) | | :-------------------------------- | :--------------------------- | :----------------------- | | Net cash used in operating and investing activities | 46.4 | 99.8 | - Prothena expects to convene an Extraordinary General Meeting of Shareholders by late 2025 to propose a capital reduction to create distributable reserves, supporting a potential share redemption program[4](index=4&type=chunk) - Roche will advance prasinezumab into Phase III development for early Parkinson's disease, expected to commence by late 2025[4](index=4&type=chunk) - Preliminary data from the PRX012 Phase I ASCENT clinical trial is anticipated in August 2025[4](index=4&type=chunk) [Business Highlights and Upcoming Milestones](index=2&type=section&id=Business%20Highlights%20and%20Upcoming%20Milestones) Prothena's pipeline includes programs for neurodegenerative and rare peripheral amyloid diseases, with key milestones expected for prasinezumab, PRX012, and coramitug [Neurodegenerative Diseases Portfolio](index=2&type=section&id=Neurodegenerative%20Diseases%20Portfolio) Prothena's neurodegenerative portfolio includes therapies for Parkinson's, Alzheimer's, and other diseases, featuring collaborations with Roche and Bristol Myers Squibb [Parkinson's Disease](index=2&type=section&id=Parkinson%27s%20Disease) Prasinezumab, a potential first-in-class antibody for Parkinson's disease developed with Roche, is expected to enter Phase III development by late 2025 with over **$3 billion** peak sales potential - Partner Roche expects to advance prasinezumab into Phase III development for early Parkinson's disease by late 2025[10](index=10&type=chunk) - Roche indicates prasinezumab has a peak sales potential exceeding **$3 billion** and could be the first disease-modifying therapy for 10 million Parkinson's patients globally[10](index=10&type=chunk) [Alzheimer's Disease](index=2&type=section&id=Alzheimer%27s%20Disease) Prothena's Alzheimer's pipeline includes PRX012 (Fast Track, Phase I data in August), BMS-986446 (Phase II/I with Bristol Myers Squibb), and PRX123 (Fast Track, IND approved) - PRX012 has received U.S. FDA Fast Track designation, with preliminary data from its Phase I ASCENT clinical trial expected in August 2025[6](index=6&type=chunk)[10](index=10&type=chunk) - Bristol Myers Squibb is conducting a Phase II TargetTau-1 clinical trial for BMS-986446 (expected completion 2027) and a Phase I subcutaneous formulation clinical trial (expected completion H2 2025)[10](index=10&type=chunk) - PRX123 has received FDA IND approval and Fast Track designation, with Prothena planning to advance the program through non-dilutive and capital-efficient structures[8](index=8&type=chunk) [Other Neurodegenerative Diseases (PRX019)](index=2&type=section&id=Other%20Neurodegenerative%20Diseases%20(PRX019)) PRX019, exclusively licensed to Bristol Myers Squibb in 2024, is in Phase I clinical trials expected to complete in 2026, with potential future milestone payments - Bristol Myers Squibb obtained exclusive worldwide rights to PRX019 in 2024 and is conducting a Phase I clinical trial, expected to complete in 2026[9](index=9&type=chunk)[15](index=15&type=chunk) - Prothena is eligible for clinical milestone payments in 2026 if Bristol Myers Squibb decides to further develop PRX019[15](index=15&type=chunk) [Rare Peripheral Amyloid Disease](index=3&type=section&id=Rare%20Peripheral%20Amyloid%20Disease) Prothena's primary program in rare peripheral amyloid disease is coramitug, a potential first-in-class amyloid-clearing antibody for ATTR amyloidosis with cardiomyopathy, developed by Novo Nordisk [ATTR Amyloidosis (Coramitug)](index=3&type=section&id=ATTR%20Amyloidosis%20(Coramitug)) Novo Nordisk completed a Phase II trial for coramitug, with results expected in H2 2025, and Prothena is eligible for milestone payments upon advancement to Phase IIb or III - Novo Nordisk has completed the Phase II clinical trial for coramitug, with results expected in the second half of 2025[16](index=16&type=chunk) - Coramitug is currently undergoing an open-label extension study[16](index=16&type=chunk) - Prothena is eligible for clinical milestone payments in 2026 when Novo Nordisk meets pre-specified enrollment criteria in Phase IIb or Phase III clinical trials[16](index=16&type=chunk) [Second Quarter and First Six Months of 2025 Financial Results](index=3&type=section&id=Second%20Quarter%20and%20First%20Six%20Months%20of%202025%20Financial%20Results) Prothena reported net losses of **$125.8 million** and **$186.0 million** for Q2 and H1 2025, primarily due to restructuring and non-cash income tax expenses [Overview of Financial Performance](index=3&type=section&id=Overview%20of%20Financial%20Performance) Prothena reported Q2 and H1 2025 net losses of **$125.8 million** and **$186.0 million**, respectively, impacted by restructuring and non-cash income tax expenses 2025 Second Quarter and First Half Net Income (Loss) | Metric | Q2 2025 (million USD) | Q2 2024 (million USD) | H1 2025 (million USD) | H1 2024 (million USD) | | :-------------------- | :-------------------- | :-------------------- | :-------------------- | :-------------------- | | Net income (loss) | (125.8) | 66.9 | (186.0) | (5.4) | | Net income (loss) per share | (2.34) | 1.22 | (3.45) | (0.10) | - Q2 and H1 2025 net losses primarily include **$32.6 million** in restructuring costs (related to birtamimab program termination and workforce reduction) and **$44.9 million** in non-cash income tax expense (for full valuation allowance against federal deferred tax assets)[12](index=12&type=chunk) [Revenue](index=3&type=section&id=Revenue) Prothena's total revenue for Q2 and H1 2025 was **$4.4 million** and **$7.2 million**, a significant decrease from 2024, primarily from PRX019 clinical trial performance 2025 Second Quarter and First Half Total Revenue | Metric | Q2 2025 (million USD) | Q2 2024 (million USD) | H1 2025 (million USD) | H1 2024 (million USD) | | :----------- | :-------------------- | :-------------------- | :-------------------- | :-------------------- | | Total revenue | 4.4 | 132.0 | 7.2 | 132.1 | - Total revenue for Q2 and H1 2025 primarily resulted from partial performance under the PRX019 Phase I clinical trial collaboration with Bristol Myers Squibb[13](index=13&type=chunk) [Operating Expenses](index=3&type=section&id=Operating%20Expenses) Prothena's operating expenses in Q2 and H1 2025 saw reduced R&D costs due to lower clinical and manufacturing expenses, offset by a significant increase in restructuring costs [Research and Development (R&D) Expenses](index=3&type=section&id=Research%20and%20Development%20(R%26D)%20Expenses) R&D expenses for Q2 and H1 2025 were **$40.5 million** and **$91.3 million**, respectively, a decrease from 2024, mainly due to lower clinical trial and manufacturing costs 2025 Second Quarter and First Half R&D Expenses | Metric | Q2 2025 (million USD) | Q2 2024 (million USD) | H1 2025 (million USD) | H1 2024 (million USD) | | :----------- | :-------------------- | :-------------------- | :-------------------- | :-------------------- | | R&D expenses | 40.5 | 57.5 | 91.3 | 121.6 | - The decrease in R&D expenses was primarily due to lower clinical trial expenses, manufacturing expenses, and personnel costs[14](index=14&type=chunk) [General and Administrative (G&A) Expenses](index=3&type=section&id=General%20and%20Administrative%20(G%26A)%20Expenses) G&A expenses for Q2 and H1 2025 were **$15.9 million** and **$33.5 million**, respectively, remaining relatively consistent with the prior year 2025 Second Quarter and First Half G&A Expenses | Metric | Q2 2025 (million USD) | Q2 2024 (million USD) | H1 2025 (million USD) | H1 2024 (million USD) | | :-------------------- | :-------------------- | :-------------------- | :-------------------- | :-------------------- | | G&A expenses | 15.9 | 16.1 | 33.5 | 33.6 | [Restructuring Costs](index=4&type=section&id=Restructuring%20Costs) Restructuring costs for Q2 and H1 2025 were **$32.6 million**, primarily from employee termination benefits and contract termination fees related to the birtamimab program 2025 Second Quarter and First Half Restructuring Costs | Metric | Q2 2025 (million USD) | Q2 2024 (million USD) | H1 2025 (million USD) | H1 2024 (million USD) | | :-------------------- | :-------------------- | :-------------------- | :-------------------- | :-------------------- | | Restructuring costs | 32.6 | 0 | 32.6 | 0 | - Restructuring costs primarily include employee termination benefits related to the June 2025 workforce reduction and contract termination fees with a third-party manufacturer for birtamimab commercial supply[18](index=18&type=chunk) [Cash Position and Shares Outstanding](index=4&type=section&id=Cash%20Position%20and%20Shares%20Outstanding) As of June 30, 2025, Prothena held **$372.3 million** in cash, cash equivalents, and restricted cash, with approximately **53.8 million** common shares outstanding as of July 25, 2025 Cash Position and Shares Outstanding | Metric | Amount | | :------------------------------------------------ | :-------------------- | | Cash, cash equivalents, and restricted cash as of June 30, 2025 | **$372.3 million** | | Common shares outstanding as of July 25, 2025 | Approximately **53.8 million** shares | [2025 Financial Guidance](index=4&type=section&id=2025%20Financial%20Guidance) Prothena projects full-year 2025 net cash used in operating and investing activities between **$170 million** and **$178 million**, with an estimated year-end cash balance of **$298 million** 2025 Full-Year Financial Guidance | Metric | Projected Amount (million USD) | | :------------------------------------------ | :----------------------------- | | Net cash used in operating and investing activities | 170 - 178 | | Year-end cash, cash equivalents, and restricted cash | Approximately 298 (midpoint) | | Projected net loss | 240 - 248 | | Non-cash share-based compensation expense | Approximately 36 | | Non-cash income tax expense | 44.9 | [Share Redemption Program](index=4&type=section&id=Share%20Redemption%20Program) Prothena plans an Extraordinary General Meeting by late 2025 to approve a capital reduction, creating distributable reserves to support a potential share redemption program - Prothena expects to convene an Extraordinary General Meeting of Shareholders by late 2025 to propose a capital reduction to create distributable reserves, supporting a potential share redemption program[21](index=21&type=chunk) - The Board aims to gain flexibility to return capital to shareholders through open market purchases or other permitted means[21](index=21&type=chunk) [About Prothena](index=4&type=section&id=About%20Prothena) Prothena is a late-stage clinical biotechnology company focused on protein dysregulation, developing therapies for neurodegenerative and rare peripheral amyloid diseases - Prothena is a late-stage clinical biotechnology company focused on protein dysregulation, dedicated to developing therapies for neurodegenerative and rare peripheral amyloid diseases[22](index=22&type=chunk) - The company's pipeline includes wholly-owned and partnered programs covering ATTR amyloidosis with cardiomyopathy, Alzheimer's disease, Parkinson's disease, and other neurodegenerative conditions[22](index=22&type=chunk) [Forward-Looking Statements](index=5&type=section&id=Forward-Looking%20Statements) This press release contains forward-looking statements regarding financial outlook, pipeline progress, clinical milestones, and potential share redemption, subject to various risks and uncertainties - This press release contains forward-looking statements regarding the company's cash position, R&D pipeline progress, clinical trial milestones, therapeutic potential of investigational drugs, financial guidance, and potential share redemption program[23](index=23&type=chunk) - These statements are based on estimates, forecasts, and assumptions, and actual results may differ materially due to known and unknown risks, uncertainties, and other factors[23](index=23&type=chunk) - The company undertakes no obligation to publicly update any forward-looking statements[23](index=23&type=chunk) [Condensed Consolidated Financial Statements](index=6&type=section&id=Condensed%20Consolidated%20Financial%20Statements) This section presents Prothena's condensed consolidated financial statements, including statements of operations and balance sheets for specified periods [Condensed Consolidated Statements of Operations](index=6&type=section&id=Condensed%20Consolidated%20Statements%20of%20Operations) Prothena's condensed consolidated statements of operations for Q2 and H1 2025 and 2024 detail collaboration revenue, operating expenses, and net income (loss) Condensed Consolidated Statements of Operations (Unaudited - Amounts in thousands, except per share data) | | Three Months Ended | | | Six Months Ended | | | :----------------------------------- | :---------------- | :---------------- | :---------------- | :---------------- | | | June 30, 2025 | June 30, 2024 | June 30, 2025 | June 30, 2024 | | Collaboration revenue | 4,420 | 132,014 | 7,198 | 132,014 | | License and intellectual property revenue | — | — | 50 | 50 | | **Total revenue** | **4,420** | **132,014** | **7,248** | **132,064** | | Operating expenses: | | | | | | Research and development | 40,517 | 57,510 | 91,328 | 121,624 | | General and administrative | 15,910 | 16,127 | 33,508 | 33,591 | | Restructuring costs | 32,609 | — | 32,609 | — | | **Total operating expenses** | **89,036** | **73,637** | **157,445** | **155,215** | | Operating income (loss) | (84,616) | 58,377 | (150,197) | (23,151) | | Other income, net | 3,651 | 6,470 | 7,859 | 13,558 | | Income (loss) before income taxes | (80,965) | 64,847 | (142,338) | (9,593) | | Income tax provision (benefit) | 44,802 | (2,039) | 43,624 | (4,240) | | **Net income (loss)** | **(125,767)** | **66,886** | **(185,962)** | **(5,353)** | | Basic net income (loss) per share | (2.34) | 1.24 | (3.45) | (0.10) | | Diluted net income (loss) per share | (2.34) | 1.22 | (3.45) | (0.10) | | Shares used in computing basic net income (loss) per share | 53,827 | 53,767 | 53,827 | 53,740 | | Shares used in computing diluted net income (loss) per share | 53,827 | 55,043 | 53,827 | 53,740 | [Condensed Consolidated Balance Sheets](index=7&type=section&id=Condensed%20Consolidated%20Balance%20Sheets) Prothena's condensed consolidated balance sheets as of June 30, 2025, and December 31, 2024, present assets, liabilities, and stockholders' equity Condensed Consolidated Balance Sheets (Unaudited - Amounts in thousands) | | June 30, 2025 | December 31, 2024 | | :----------------------------------- | :-------------- | :---------------- | | **Assets** | | | | Cash and cash equivalents | 371,435 | 471,388 | | Prepaid expenses and other current assets | 14,040 | 14,024 | | **Total current assets** | **385,475** | **485,412** | | Property, plant and equipment, net | 2,690 | 3,081 | | Operating lease right-of-use assets | 9,563 | 10,708 | | Restricted cash, noncurrent | 860 | 860 | | Other noncurrent assets | 478 | 47,047 | | **Total noncurrent assets** | **13,591** | **61,696** | | **Total assets** | **399,066** | **547,108** | | **Liabilities and Stockholders' Equity** | | | | Accrued research and development | 10,929 | 13,428 | | Deferred revenue, current | 5,100 | 8,850 | | Restructuring liability | 30,330 | — | | Lease liabilities, current | 2,853 | 2,610 | | Other current liabilities | 18,595 | 23,613 | | **Total current liabilities** | **67,807** | **48,501** | | Deferred revenue, noncurrent | — | 3,448 | | Lease liabilities, noncurrent | 6,928 | 8,233 | | **Total noncurrent liabilities** | **6,928** | **11,681** | | **Total liabilities** | **74,735** | **60,182** | | **Total stockholders' equity** | **324,331** | **486,926** | | **Total liabilities and stockholders' equity** | **399,066** | **547,108** | [Contact Information](index=7&type=section&id=Contact%20Information) Mark Johnson, CFA, Vice President of Investor Relations, serves as Prothena's contact for investor inquiries - Investor Relations Contact: Mark Johnson, CFA, Vice President, Investor Relations[26](index=26&type=chunk)

Core Viewpoint - Prothena Corporation (PRTA) has faced significant challenges, including a 53.5% decline in shares year-to-date, primarily due to pipeline setbacks and a major workforce reduction of 63% to cut operating costs [1][2]. Financial Outlook - PRTA has revised its annual guidance, expecting a net cash burn of $170-$178 million for 2025, with an estimated cash position of approximately $298 million [3]. - The company anticipates a net loss between $240 million and $248 million for 2025, an increase from previous estimates of $197-$205 million [3]. - The estimated loss includes $105-$110 million in operating expenses related to the discontinued birtamimab program and reorganization costs [4]. Pipeline Developments - The discontinuation of birtamimab, a key pipeline candidate, followed the failure of the phase III AFFIRM-AL study to meet its primary endpoint [6][7]. - Despite the setback with birtamimab, partner Roche is advancing the pipeline candidate prasinezumab into phase III development for early-stage Parkinson's disease, which could provide financial benefits to PRTA through royalties and milestone payments [11][12]. Future Programs - PRTA is expecting initial data from a phase I study on its PRX012 program for Alzheimer's disease in August [13]. - The company is also collaborating with Novo Nordisk on Coramitug for ATTR amyloidosis and with Bristol Myers on several early-stage neurological programs, including BMS-986446 for Alzheimer's disease [13][14][15].

Pipeline and Milestones - Prothena has multiple clinical programs ongoing, including one partnered Phase 3 program, two partnered Phase 2 programs, one partnered Phase 1 program, and one wholly-owned Phase 1 program[13] - Prothena is eligible to receive up to $1.23 billion in total consideration from Novo Nordisk for coramitug and the broader ATTR amyloidosis program[13, 16] - Prothena anticipates up to $105 million in clinical milestones in 2026, including completion of Phase 3 development for prasinezumab and initial data from the Phase 1 ASCENT trial for PRX012[18] Partnerships and Financials - Prothena's partnerships are expected to generate meaningful value, with up to $755 million in total milestones and royalties for prasinezumab, up to $1.23 billion for coramitug, and up to $1.55 billion across two clinical-stage programs (BMS-986446 and PRX019)[20] - Bristol Myers Squibb (BMS) owns approximately 2.2% of Prothena's outstanding shares as of March 3, 2025[21] Alzheimer's Disease Programs - PRX012, Prothena's anti-Aβ candidate, has approximately 10X greater binding potency to fibrillar Aβ vs aducanumab and approximately 20X greater binding potency against protofibrils vs lecanemab[24] - BMS-986446 (formerly PRX005), an anti-tau candidate, has the potential to reduce pathogenic tau spread in Alzheimer's disease[27] - PRX123, a dual Aβ/tau vaccine candidate, is designed for both treatment and prevention of Alzheimer's disease, and its IND has been cleared[27] Parkinson's Disease Program - Roche will initiate Phase 3 development for prasinezumab in early-stage Parkinson's disease[15, 111] - The Parkinson's disease affects >10 million people worldwide and represents an overall economic burden of $52 billion in the US[5] ATTR Amyloidosis Program - Coramitug (formerly PRX004) is in Phase 2 development for ATTR amyloidosis with cardiomyopathy (ATTR-CM)[15, 142] - An estimated 450,000 patients worldwide have wtATTR or ATTRv[8]

Core Viewpoint - Prothena (PRTA) shares fell 22.5% after the company announced the discontinuation of birtamimab development due to the failure of the AFFIRM-AL clinical study to meet its primary endpoint [1][5]. Group 1: Birtamimab Development - Birtamimab was a potential best-in-class anti-amyloid antibody aimed at treating AL amyloidosis, evaluated in a phase III global clinical trial with 207 newly diagnosed patients [3][4]. - The primary endpoint of time to all-cause mortality was not met, nor were the secondary endpoints, including the 6-minute walk test and Short Form-36 Physical Component Score [5]. - Despite the failure, birtamimab was reported to be generally safe and well-tolerated [5]. Group 2: Future Plans and Pipeline - Following the discontinuation of birtamimab, Prothena will reduce ongoing operating expenses and organizational size, with further updates expected in June [6]. - The company is also evaluating prasinezumab for Parkinson's disease in collaboration with Roche, which has reported mixed results from the phase IIb PADOVA study [7][8]. - Prothena is advancing early-stage programs for neurological indications, including BMS-986446 for Alzheimer's disease and PRX019 for neurodegenerative diseases, with ongoing clinical trials expected to complete in 2027 and 2026, respectively [9][10].