Y-mAbs Therapeutics, Inc. (NASDAQ:YMAB) Q2 2022 Results Conference Call August 9, 2022 9:00 AM ET Company Participants Thomas Gad - Founder, Interim CEO and President Bo Kruse - CFO Sue Smith - Chief Commercial Officer Vignesh Rajah - Chief Medical Officer Conference Call Participants Alec Stranahan - Bank of America Robert Burns - HC Wainwright Charles Zhu - Guggenheim Joseph Thome - Cowen & Company Tessa Romero - JP Morgan Mike Ulz - Morgan Stanley William Maughan - Canaccord Genuity Operator Good morning ...

mAbs herapeutics, Inc. Company Presentation August 2022 Disclaimer This presentation contains forward-looking statements within the meaning of the US Private Securities Litigation Reform Act of 1995. The forward-looking statements involve substantial risks and uncertainties. All statements, other than statements of historical facts, contained in this presentation, including statements regarding our strategy, future operations, future financial position, future revenue, projected costs, prospects, plans and ...

PART I — FINANCIAL INFORMATION This part provides the company's financial information, including consolidated statements, management's analysis, market risk, and controls [Item 1. Consolidated Financial Statements](index=9&type=section&id=Item%201.%20Consolidated%20Financial%20Statements) This section presents the unaudited consolidated financial statements, including balance sheets, income statements, equity changes, cash flows, and detailed notes [Consolidated Balance Sheets](index=9&type=section&id=Consolidated%20Balance%20Sheets) This section provides a snapshot of the company's financial position, detailing assets, liabilities, and equity as of June 30, 2022, and December 31, 2021 | Metric | June 30, 2022 (in thousands) | December 31, 2021 (in thousands) | | :------------------------- | :----------------------------- | :----------------------------- | | Cash and cash equivalents | $133,665 | $181,564 | | Total current assets | $153,920 | $202,261 | | TOTAL ASSETS | $165,178 | $212,783 | | Total current liabilities | $29,450 | $27,875 | | TOTAL LIABILITIES | $33,782 | $32,677 | | TOTAL STOCKHOLDERS' EQUITY | $131,396 | $180,106 | [Consolidated Statements of Net Income / (Loss) and Comprehensive Income / (Loss)](index=10&type=section&id=Consolidated%20Statements%20of%20Net%20Income%20%2F%20%28Loss%29%20and%20Comprehensive%20Income%20%2F%20%28Loss%29) This section details the company's financial performance, including revenues, expenses, and net income or loss for the specified periods | Metric (in thousands) | Three months ended June 30, 2022 | Three months ended June 30, 2021 | Six months ended June 30, 2022 | Six months ended June 30, 2021 | | :-------------------- | :------------------------------- | :------------------------------- | :----------------------------- | :----------------------------- | | Product revenue, net | $9,797 | $8,951 | $20,283 | $14,334 | | License revenue | $1,000 | $2,000 | $1,000 | $2,000 | | Total revenues | $10,797 | $10,951 | $21,283 | $16,334 | | Cost of goods sold | $1,140 | $200 | $2,972 | $293 | | R&D expenses | $26,420 | $19,778 | $49,332 | $41,357 | | SG&A expenses | $23,082 | $13,475 | $36,520 | $25,445 | | Loss from operations | $(39,945) | $(22,712) | $(67,641) | $(50,971) | | Net income / (loss) | $(41,131) | $(22,937) | $(69,199) | $10,476 | | Basic EPS | $(0.94) | $(0.53) | $(1.58) | $0.25 | [Consolidated Statements of Changes in Stockholders' Equity](index=11&type=section&id=Consolidated%20Statements%20of%20Changes%20in%20Stockholders%27%20Equity) This section outlines the changes in the company's equity, including accumulated deficit and additional paid-in capital, over the reporting periods - The accumulated deficit increased significantly from **$(340,475) thousand** at December 31, 2021, to **$(409,674) thousand** at June 30, 2022, primarily due to net losses incurred during the period[31](index=31&type=chunk) - Additional paid-in capital increased by **$18,756 thousand**, driven by stock-based compensation expense and proceeds from exercised stock options[31](index=31&type=chunk) [Consolidated Statements of Cash Flows](index=13&type=section&id=Consolidated%20Statements%20of%20Cash%20Flows) This section presents the cash inflows and outflows from operating, investing, and financing activities for the six-month periods | Cash Flow Activity (in thousands) | Six months ended June 30, 2022 | Six months ended June 30, 2021 | | :-------------------------------- | :----------------------------- | :----------------------------- | | Net cash used in operating activities | $(48,025) | $(50,617) | | Net cash provided by investing activities | $0 | $61,569 | | Net cash provided by financing activities | $32 | $107,966 | | Net increase / (decrease) in cash and cash equivalents | $(47,899) | $118,953 | | Cash and cash equivalents at end of period | $133,665 | $233,587 | [Notes to Consolidated Financial Statements](index=14&type=section&id=Notes%20to%20Consolidated%20Financial%20Statements) This section provides detailed explanations and disclosures supporting the consolidated financial statements and accounting policies [NOTE 1—ORGANIZATION AND DESCRIPTION OF BUSINESS](index=14&type=section&id=NOTE%201%E2%80%94ORGANIZATION%20AND%20DESCRIPTION%20OF%20BUSINESS) This note describes Y-mAbs Therapeutics, Inc. as a commercial-stage biopharmaceutical company focused on cancer therapeutics - Y-mAbs Therapeutics, Inc. is a commercial-stage biopharmaceutical company focused on developing and commercializing novel, antibody-based therapeutic products for cancer, leveraging proprietary antibody platforms and deep expertise[37](index=37&type=chunk) [NOTE 2—BASIS OF PRESENTATION](index=14&type=section&id=NOTE%202%E2%80%94BASIS%20OF%20PRESENTATION) This note details the company's financial condition, including accumulated deficit and cash position, and its going concern considerations - The Company has incurred losses since inception (except for Q1 2021) and had an accumulated deficit of **$409,674,000** as of June 30, 2022, and **$340,475,000** as of December 31, 2021[41](index=41&type=chunk) - DANYELZA (naxitamab-gqgk) was approved by the FDA in November 2020, but other drug candidates require significant R&D, clinical testing, and regulatory approval prior to commercialization[40](index=40&type=chunk) - As of June 30, 2022, the Company had cash and cash equivalents of **$133,665,000**, which are expected to fund operating expenses and capital expenditure requirements through at least the next 12 months[43](index=43&type=chunk)[45](index=45&type=chunk) [NOTE 3—SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES](index=16&type=section&id=NOTE%203%E2%80%94SUMMARY%20OF%20SIGNIFICANT%20ACCOUNTING%20POLICIES) This note outlines the company's significant accounting policies, including revenue recognition, fair value measurements, and inventory valuation - The Company recognizes revenue from DANYELZA sales when the customer obtains control, generally upon receipt at the end-user hospital, with estimates for rebates, chargebacks, and discounts[66](index=66&type=chunk)[67](index=67&type=chunk) - License revenue includes a **$1,000,000** non-refundable milestone payment received in April 2022 from Adium Pharma S.A. for the updated FDA BLA dossier for DANYELZA[70](index=70&type=chunk) Fair Value Measurements at June 30, 2022 (in thousands): | | Level 1 | Level 2 | Level 3 | Total | | : | :------ | :--------- | :------ | :--------- | | Money market funds | $— | $111,857 | $— | $111,857 | Fair Value Measurements at December 31, 2021 (in thousands): | | Level 1 | Level 2 | Level 3 | Total | | : | :------ | :--------- | :------ | :--------- | | Money market funds | $— | $166,729 | $— | $166,729 | [NOTE 4—PRODUCT REVENUE](index=24&type=section&id=NOTE%204%E2%80%94PRODUCT%20REVENUE) This note provides a breakdown of product revenue, net of allowances, and identifies major customers for DANYELZA sales | Metric (in thousands) | Three months ended June 30, 2022 | Three months ended June 30, 2021 | Six months ended June 30, 2022 | Six months ended June 30, 2021 | | :-------------------- | :------------------------------- | :------------------------------- | :----------------------------- | :----------------------------- | | Product revenue, net | $9,797 | $8,951 | $20,283 | $14,334 | - Product sales are recorded net of allowances for rebates, chargebacks, discounts, and distribution-related fees. As of June 30, 2022, accounts receivable allowances were **$797,000** and accrued liabilities were **$3,082,000**[75](index=75&type=chunk)[77](index=77&type=chunk) - Major customers (Mckesson, AmerisourceBergen, Cardinal Health) accounted for a significant portion of gross product revenue (**71%**, **10%**, and **11%** respectively for Q2 2022; **64%**, **17%**, and **11%** respectively for H1 2022)[78](index=78&type=chunk) [NOTE 5—NET LOSS PER SHARE](index=26&type=section&id=NOTE%205%E2%80%94NET%20LOSS%20PER%20SHARE) This note presents the calculation of basic and diluted net loss per share, including the treatment of potentially dilutive securities | Metric | Three months ended June 30, 2022 | Three months ended June 30, 2021 | Six months ended June 30, 2022 | Six months ended June 30, 2021 | | :------------------------------------------------ | :------------------------------- | :------------------------------- | :----------------------------- | :----------------------------- | | Net income / (loss) (numerator) (in thousands) | $(41,131) | $(22,937) | $(69,199) | $10,476 | | Weighted-average shares outstanding, basic | 43,719 | 43,569 | 43,714 | 42,725 | | Basic net income / (loss) per share | $(0.94) | $(0.53) | $(1.58) | $0.25 | | Weighted-average shares outstanding, diluted | 43,719 | 43,569 | 43,714 | 45,080 | | Diluted net income / (loss) per share | $(0.94) | $(0.53) | $(1.58) | $0.23 | - Potentially dilutive securities (stock options and RSUs) totaling **6,972,558 shares** as of June 30, 2022, were excluded from diluted EPS calculation due to the net loss, making their effect antidilutive[79](index=79&type=chunk) [NOTE 6—INVENTORIES](index=28&type=section&id=NOTE%206%E2%80%94INVENTORIES) This note details the composition of inventories, including raw material, work in progress, and finished goods, and their classification | Inventory Category (in thousands) | June 30, 2022 | December 31, 2021 | | :-------------------------------- | :------------ | :---------------- | | Raw Material | $1,500 | $0 | | Work In Progress | $9,306 | $4,741 | | Finished Goods | $1,276 | $771 | | Total Inventories | $12,082 | $5,512 | - The Company classified **$1,500,000** of raw material and **$3,788,000** of work in progress inventories as noncurrent assets, expecting their utilization beyond one year from the balance sheet date[81](index=81&type=chunk) [NOTE 7—INTANGIBLE ASSETS, NET](index=28&type=section&id=NOTE%207%E2%80%94INTANGIBLE%20ASSETS%2C%20NET) This note describes the company's intangible assets, primarily related to DANYELZA commercialization, and their amortization - Intangible assets, net, totaled **$1,574,000** as of June 30, 2022, primarily related to capitalized milestone payments following DANYELZA's FDA approval and commercialization, amortized over a 10-year useful life[82](index=82&type=chunk)[83](index=83&type=chunk) [NOTE 8—ACCRUED LIABILITIES](index=29&type=section&id=NOTE%208%E2%80%94ACCRUED%20LIABILITIES) This note provides a breakdown of accrued liabilities, including licensing, clinical, compensation, manufacturing, and sales reserves | Accrued Liability (in thousands) | June 30, 2022 | December 31, 2021 | | :------------------------------- | :------------ | :---------------- | | Accrued licensing, milestone and royalty payments | $2,438 | $3,090 | | Accrued clinical costs | $872 | $915 | | Accrued compensation and board fees | $4,151 | $1,877 | | Accrued manufacturing costs | $6,251 | $2,622 | | Accrued sales reserves | $3,082 | $2,615 | | Other | $273 | $1,421 | | Total | $17,067 | $12,540 | [NOTE 9—LICENSE AGREEMENTS AND COMMITMENTS](index=29&type=section&id=NOTE%209%E2%80%94LICENSE%20AGREEMENTS%20AND%20COMMITMENTS) This note outlines significant license agreements and commitments, including potential milestone payments to MSK and MIT - The Company has significant license agreements with Memorial Sloan Kettering Cancer Center (MSK) and Massachusetts Institute of Technology (MIT), including MSK License, CD33 License, SADA License, and MabVax Agreement, involving contingent milestone and royalty payments[85](index=85&type=chunk) Maximum Potential Milestone Payments (in thousands): | Agreement | Clinical Milestones | Regulatory Milestones | Sales-based Milestones | | :-------- | :------------------ | :-------------------- | :--------------------- | | MSK | $2,450 | $9,000 | $20,000 | | CD33 | $550 | $500 | $7,500 | | MabVax | $200 | $1,200 | $0 | | SADA | $4,730 | $18,125 | $23,750 | - A **$10,714,000** charge related to the former CEO's departure was recorded in SG&A expenses for the three and six months ended June 30, 2022, including a **$9,286,000** non-cash stock-based compensation expense[100](index=100&type=chunk) [NOTE 10—STOCKHOLDERS' EQUITY](index=35&type=section&id=NOTE%2010%E2%80%94STOCKHOLDERS%27%20EQUITY) This note details the company's common stock, authorized shares, and significant equity transactions, including a public offering - As of June 30, 2022, the Company had **43,720,038 shares** of common stock issued, with **100,000,000 shares** authorized. No preferred stock has been issued[102](index=102&type=chunk)[103](index=103&type=chunk)[104](index=104&type=chunk) - In April 2020, **213,996 shares** were issued to non-employee researchers for the SADA Technology, with **80%** vested by June 30, 2022. A **$7,376,000** fair value was recognized as R&D expense[105](index=105&type=chunk) - In February 2021, the Company completed a public offering, issuing **2,804,878 shares** of common stock for aggregate net proceeds of approximately **$107,725,000**[107](index=107&type=chunk)[108](index=108&type=chunk) [NOTE 11—SHARE-BASED COMPENSATION](index=37&type=section&id=NOTE%2011%E2%80%94SHARE-BASED%20COMPENSATION) This note presents the stock-based compensation expense and unrecognized compensation for employee stock options and RSUs Stock-Based Compensation Expense (in thousands): | Category | Three months ended June 30, 2022 | Three months ended June 30, 2021 | Six months ended June 30, 2022 | Six months ended June 30, 2021 | | :------- | :------------------------------- | :------------------------------- | :----------------------------- | :----------------------------- | | Stock options | $13,549 | $4,752 | $18,566 | $9,380 | | Restricted Stock Units | $84 | $75 | $158 | $145 | - Stock-based compensation for Q2 2022 includes **$9,286,000** related to the former CEO's departure, recorded in SG&A expenses[111](index=111&type=chunk)[112](index=112&type=chunk) - As of June 30, 2022, unrecognized compensation expense for employee stock options was **$27,608,000** (expected to vest over **2.65 years**) and for RSUs was **$575,000** (expected to vest over **2.20 years**)[121](index=121&type=chunk)[124](index=124&type=chunk) [NOTE 12—RELATED PARTY TRANSACTIONS](index=41&type=section&id=NOTE%2012%E2%80%94RELATED%20PARTY%20TRANSACTIONS) This note discloses related party transactions, primarily with MSK, including costs incurred and amounts owed - MSK is a shareholder, and the Company incurred **$1,434,000** and **$2,808,000** in costs (milestones, royalties, R&D) under agreements with MSK for the three and six months ended June 30, 2022, respectively[125](index=125&type=chunk) - As of June 30, 2022, the Company owed MSK a total of **$5,686,000** (**$345,000** in accounts payable and **$5,341,000** in accrued liabilities)[125](index=125&type=chunk) [NOTE 13—INCOME TAXES](index=43&type=section&id=NOTE%2013%E2%80%94INCOME%20TAXES) This note explains the company's income tax position, including the absence of current/deferred taxes and the full valuation allowance - The Company provided no current and deferred income taxes on net losses for the three and six months ended June 30, 2022, and maintains a full valuation allowance on its U.S. and foreign deferred tax assets due to cumulative and forecasted losses[127](index=127&type=chunk)[129](index=129&type=chunk) [NOTE 14—OTHER BENEFITS](index=43&type=section&id=NOTE%2014%E2%80%94OTHER%20BENEFITS) This note describes the company's 401(k) savings plan and confirms no matching contributions were made during the periods - The Company offers a 401(k) savings plan for U.S. employees but made no matching contributions for the three or six months ended June 30, 2022 and 2021[130](index=130&type=chunk) [NOTE 15 —GAIN FROM SALE OF PRIORITY REVIEW VOUCHER](index=43&type=section&id=NOTE%2015%20%E2%80%94GAIN%20FROM%20SALE%20OF%20PRIORITY%20REVIEW%20VOUCHER) This note details the gain recognized from the sale of the DANYELZA Priority Review Voucher in the prior year - In the six months ended June 30, 2021, the Company recognized a net gain of **$62,010,000** from the sale of its DANYELZA Priority Review Voucher (PRV) to United Therapeutics Corporation, retaining **60%** of the net proceeds[132](index=132&type=chunk) - No corresponding gain from PRV sales was recognized during the three and six months ended June 30, 2022[133](index=133&type=chunk) [Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations](index=45&type=section&id=Item%202.%20Management%27s%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operations) This section provides management's perspective on the company's financial condition, operational results, liquidity, and critical accounting policies [Overview](index=45&type=section&id=Overview) This section provides an overview of Y-mAbs as a biopharmaceutical company, its key products, and its financial outlook - Y-mAbs is a commercial-stage biopharmaceutical company focused on antibody-based cancer therapeutics, with DANYELZA® (naxitamab-gqgk) approved by the FDA in November 2020 for relapsed/refractory high-risk neuroblastoma[136](index=136&type=chunk)[137](index=137&type=chunk) - The company resubmitted its Biologics License Application (BLA) for omburtamab in March 2022, which was accepted for priority review by the FDA in May 2022 with an action date of November 30, 2022[139](index=139&type=chunk) - The company has an accumulated deficit of **$409.7 million** as of June 30, 2022, and expects to continue incurring significant net operating losses due to ongoing R&D and commercialization efforts[150](index=150&type=chunk) [Recent Developments](index=51&type=section&id=Recent%20Developments) This section highlights recent operational impacts from global events and updates on regulatory submissions for product candidates - The COVID-19 pandemic and geopolitical events, including the Russia-Ukraine conflict, have adversely impacted operations, leading to the termination of DANYELZA clinical trials in Russia and suspension of regulatory activities there[160](index=160&type=chunk)[162](index=162&type=chunk)[167](index=167&type=chunk) - The FDA accepted the BLA for omburtamab for Priority Review with a PDUFA action date of November 30, 2022, and an advisory committee meeting is planned for October 2022[169](index=169&type=chunk) [Components of Our Results of Operations](index=53&type=section&id=Components%20of%20Our%20Results%20of%20Operations) This section explains the key components of the company's revenues and expenses, including product sales, license fees, and R&D costs - Product revenue is derived from DANYELZA sales, recognized upon customer control, net of rebates, chargebacks, and discounts[170](index=170&type=chunk)[188](index=188&type=chunk)[190](index=190&type=chunk) - License revenue includes payments for licensing rights to DANYELZA and omburtamab, such as the **$1.0 million** milestone from Adium Pharma S.A. in Q2 2022[171](index=171&type=chunk)[172](index=172&type=chunk)[203](index=203&type=chunk) - Research and development expenses are expensed as incurred and are expected to increase significantly due to advancing product candidates, clinical trials, and regulatory submissions[175](index=175&type=chunk)[178](index=178&type=chunk) [Critical Accounting Policies and Significant Judgments and Estimates](index=59&type=section&id=Critical%20Accounting%20Policies%20and%20Significant%20Judgments%20and%20Estimates) This section details the critical accounting policies and significant management estimates impacting financial reporting, such as revenue recognition and stock option valuation - Management makes significant estimates for net product revenues, R&D accruals, milestone/royalty payments, and stock option valuations, which are periodically reviewed and adjusted[186](index=186&type=chunk) - Revenue recognition for product sales involves estimating deductions for rebates, chargebacks, and discounts based on contracts, government programs, and payor mix[190](index=190&type=chunk) - Stock options are valued using the Black-Scholes model, with expected volatility estimated from peer companies and historical Y-mAbs data, and a 'simplified' method for expected term due to limited historical data[198](index=198&type=chunk)[201](index=201&type=chunk) [Results of Operations](index=64&type=section&id=Results%20of%20Operations) This section analyzes the company's financial performance by comparing key revenue and expense metrics across different reporting periods [Comparison of the Three Months Ended June 30, 2022 and 2021](index=64&type=section&id=Comparison%20of%20the%20Three%20Months%20Ended%20June%2030%2C%202022%20and%202021) This section compares the company's financial performance, including revenues, expenses, and net loss, for the three-month periods | Metric (in thousands) | June 30, 2022 | June 30, 2021 | Amount Change | Percentage Change | | :-------------------- | :------------ | :------------ | :------------ | :---------------- | | Product revenue, net | $9,797 | $8,951 | $846 | 9% | | License revenue | $1,000 | $2,000 | $(1,000) | (50%) | | Total revenues | $10,797 | $10,951 | $(154) | (1%) | | Cost of goods sold | $1,140 | $200 | $940 | 470% | | R&D expenses | $26,420 | $19,778 | $6,642 | 34% | | SG&A expenses | $23,082 | $13,475 | $9,607 | 71% | | Net Loss | $(41,131) | $(22,937) | $(18,194) | 79% | - The **71%** increase in SG&A expenses was primarily due to a **$10.7 million** charge related to the departure of the former Chief Executive Officer[211](index=211&type=chunk) - R&D expenses increased by **$6.6 million**, driven by a **$5.3 million** increase in outsourced manufacturing (including **$2.9 million** for naxitamab clinical trial vials) and an **$0.8 million** increase in clinical trials, mainly for omburtamab[210](index=210&type=chunk) [Comparison of the Six Months Ended June 30, 2022 and 2021](index=68&type=section&id=Comparison%20of%20the%20Six%20Months%20Ended%20June%2030%2C%202022%20and%202021) This section compares the company's financial performance, including revenues, expenses, and net income/loss, for the six-month periods | Metric (in thousands) | June 30, 2022 | June 30, 2021 | Amount Change | Percentage Change | | :-------------------- | :------------ | :------------ | :------------ | :---------------- | | Product revenue, net | $20,283 | $14,334 | $5,949 | 42% | | License revenue | $1,000 | $2,000 | $(1,000) | (50%) | | Total revenues | $21,283 | $16,334 | $4,949 | 30% | | Cost of goods sold | $2,972 | $293 | $2,679 | 914% | | R&D expenses | $49,332 | $41,357 | $7,975 | 19% | | SG&A expenses | $36,520 | $25,445 | $11,075 | 44% | | Net income / (loss) | $(69,199) | $10,476 | $(79,675) | (761%) | - Net income shifted to a significant net loss of **$(69,199) thousand** in H1 2022 from a net income of **$10,476 thousand** in H1 2021, primarily due to the absence of the **$62.0 million** gain from the PRV sale in 2021[214](index=214&type=chunk)[227](index=227&type=chunk) - SG&A expenses increased by **$11.1 million**, mainly due to the **$10.7 million** charge related to the former CEO's departure[224](index=224&type=chunk) [Liquidity and Capital Resources](index=72&type=section&id=Liquidity%20and%20Capital%20Resources) This section discusses the company's cash position, operating cash flows, and future funding requirements for its ongoing operations and development programs - As of June 30, 2022, cash and cash equivalents were **$133.7 million**, down from **$181.6 million** at December 31, 2021. The company expects current cash to fund operations through mid-2024[229](index=229&type=chunk)[241](index=241&type=chunk) - Net cash used in operating activities decreased by **$2.6 million** to **$48.0 million** for the six months ended June 30, 2022, primarily due to improved accounts receivable collections[234](index=234&type=chunk) - The company will require substantial additional funding for DANYELZA commercialization, omburtamab development, and other pipeline programs, with capital raising potentially through equity, debt, or collaborations[237](index=237&type=chunk)[245](index=245&type=chunk) [Recent Accounting Pronouncements](index=82&type=section&id=Recent%20Accounting%20Pronouncements) This section outlines the adoption of recent accounting standards and their immaterial impact on the company's financial statements - The Company adopted ASU 2020-10, ASU 2021-04, and ASU 2020-06 effective January 1, 2022, with no material impact on its consolidated financial statements or disclosures[72](index=72&type=chunk) [Item 3. Quantitative and Qualitative Disclosures About Market Risk](index=82&type=section&id=Item%203.%20Quantitative%20and%20Qualitative%20Disclosures%20About%20Market%20Risk) This section outlines the company's exposure to market risks, specifically interest rate and foreign currency exchange risks, and their immaterial impact - The company's exposure to interest rate risk is considered immaterial, as cash equivalents are primarily held in highly rated securities, including a Treasury money market fund, with short-term maturities[260](index=260&type=chunk) - Primary foreign currency exchange risk is to the Danish Kroner (DKK); an immediate **10%** change in the DKK to USD exchange rate would not materially affect cash balances[261](index=261&type=chunk) [Item 4. Controls and Procedures](index=82&type=section&id=Item%204.%20Controls%20and%20Procedures) This section details the evaluation of disclosure controls and procedures, confirming their effectiveness and noting internal control modifications - Management, including the Interim CEO and CFO, concluded that disclosure controls and procedures were effective at a reasonable assurance level as of June 30, 2022[262](index=262&type=chunk) - A new cloud-based accounting and general ledger system was implemented during Q2 2022 to improve financial close processes, resulting in modified internal controls[264](index=264&type=chunk) PART II — OTHER INFORMATION This part provides additional information, including legal proceedings, risk factors, equity sales, defaults, and exhibits [Item 1. Legal Proceedings](index=84&type=section&id=Item%201.%20Legal%20Proceedings) This section discloses a pending stockholder lawsuit against the President and Interim CEO, alleging short swing profits - A stockholder lawsuit was filed against Mr. Thomas Gad, President and Interim CEO, alleging short swing profits from a transaction on March 10, 2021[267](index=267&type=chunk) - Mr. Gad's motion to dismiss the lawsuit was denied on August 8, 2022, moving the case into the discovery phase[267](index=267&type=chunk) - The Company and Mr. Gad believe the claim is without merit and do not expect a probable gain or liability to be realized by the Company[267](index=267&type=chunk) [Item 1A. Risk Factors](index=84&type=section&id=Item%201A.%20Risk%20Factors) This comprehensive section details numerous risks that could materially and adversely affect the company's business, financial condition, and future growth [Risks Related to Our Financial Condition and Need for Additional Capital](index=84&type=section&id=Risks%20Related%20to%20Our%20Financial%20Condition%20and%20Need%20for%20Additional%20Capital) This section highlights risks associated with the company's limited operating history, accumulated losses, and ongoing need for substantial additional funding - The company has a limited operating history, incurred significant losses (**$409.7 million** accumulated deficit as of June 30, 2022), and expects continued losses, with DANYELZA being its only approved product[269](index=269&type=chunk)[270](index=270&type=chunk)[274](index=274&type=chunk) - Significant payment obligations to MSK and MIT under license agreements (e.g., **$2.5M** clinical, **$9.0M** regulatory, **$20.0M** sales-based for MSK License) may strain cash resources or necessitate additional funding[279](index=279&type=chunk)[283](index=283&type=chunk) - Substantial additional funding will be required for ongoing R&D and commercialization efforts; failure to obtain it could lead to delays, reductions, or termination of programs and license agreements[284](index=284&type=chunk)[286](index=286&type=chunk) [Risks related to product development and commercialization](index=92&type=section&id=Risks%20related%20to%20product%20development%20and%20commercialization) This section addresses risks inherent in drug development, clinical trials, regulatory approvals, and market acceptance of products - Drug development is lengthy, expensive, and uncertain; clinical trials may fail to demonstrate safety/efficacy, leading to delays or inability to obtain marketing approval[291](index=291&type=chunk)[293](index=293&type=chunk) - The COVID-19 pandemic and the Russia-Ukraine conflict have adversely impacted clinical trials, manufacturing, and commercialization efforts, causing delays and potential long-term disruptions[303](index=303&type=chunk)[308](index=308&type=chunk)[318](index=318&type=chunk) - Commercial success of DANYELZA and future products depends on market acceptance by physicians, patients, and payors, which is influenced by efficacy, safety, pricing, and competition[324](index=324&type=chunk)[326](index=326&type=chunk) [Risks related to our dependence on third parties](index=124&type=section&id=Risks%20related%20to%20our%20dependence%20on%20third%20parties) This section outlines risks arising from reliance on third parties for clinical trials, manufacturing, and strategic collaborations - The company relies heavily on third parties (CROs, CMOs, MSK) for clinical trials, manufacturing, and R&D; failures in their performance or compliance could delay development and commercialization[382](index=382&type=chunk)[386](index=386&type=chunk)[398](index=398&type=chunk) - High dependence on CMOs like EMD/Merck for omburtamab production and SpectronRx for radiolabeling poses risks, including manufacturing difficulties, supply shortages, and regulatory compliance issues[389](index=389&type=chunk)[390](index=390&type=chunk)[396](index=396&type=chunk) - Strategic collaborations for DANYELZA and omburtamab in certain jurisdictions (e.g., Takeda Israel, Swixx BioPharma, SciClone, Adium) carry risks of insufficient resource allocation, disagreements, or termination, impacting revenue generation[409](index=409&type=chunk)[411](index=411&type=chunk) [Risks related to government regulation; market approval and other legal compliance matters](index=138&type=section&id=Risks%20related%20to%20government%20regulation%3B%20market%20approval%20and%20other%20legal%20compliance%20matters) This section details risks associated with regulatory approval processes, post-approval compliance, and healthcare fraud and abuse laws - The FDA regulatory approval process is lengthy, unpredictable, and costly; failure to obtain or delays in marketing approval for omburtamab or other candidates would significantly harm the business[414](index=414&type=chunk)[419](index=419&type=chunk)[429](index=429&type=chunk) - Compliance with post-approval regulatory requirements is ongoing and costly; non-compliance or unanticipated problems could lead to withdrawn approvals, marketing restrictions, or substantial penalties[451](index=451&type=chunk)[455](index=455&type=chunk)[456](index=456&type=chunk)[458](index=458&type=chunk) - Relationships with healthcare providers and payors are subject to anti-kickback, fraud and abuse, and other healthcare laws (e.g., Anti-Kickback Statute, False Claims Act, HIPAA, GDPR), with potential for significant penalties for non-compliance[475](index=475&type=chunk)[476](index=476&type=chunk)[479](index=479&type=chunk)[482](index=482&type=chunk) [Risks related to our intellectual property](index=168&type=section&id=Risks%20related%20to%20our%20intellectual%20property) This section covers challenges in protecting intellectual property, dependence on in-licensed IP, and potential litigation risks - Protecting intellectual property (patents, trademarks, trade secrets) is difficult and costly; patents may not be broad enough, challenged, or expire, allowing competitors to use similar technologies[504](index=504&type=chunk)[505](index=505&type=chunk)[515](index=515&type=chunk)[523](index=523&type=chunk) - Dependence on in-licensed IP from MSK and MIT means loss of licenses or inability to acquire additional rights could hinder product development[506](index=506&type=chunk)[509](index=509&type=chunk)[511](index=511&type=chunk) - Litigation related to patent infringement or trade secret misappropriation is costly, time-consuming, and could result in substantial damages, injunctions, or loss of valuable IP rights[524](index=524&type=chunk)[529](index=529&type=chunk)[532](index=532&type=chunk)[537](index=537&type=chunk) [Risks related to employee matters and managing growth](index=184&type=section&id=Risks%20related%20to%20employee%20matters%20and%20managing%20growth) This section discusses risks related to key personnel dependence, management challenges, and the need for organizational growth - The company is highly dependent on its executive officers and key personnel; the recent departure of the CEO and challenges in attracting/retaining qualified talent could harm the business[549](index=549&type=chunk)[550](index=550&type=chunk)[551](index=551&type=chunk) - Anticipated significant growth in employees and operations (sales, marketing, clinical, regulatory) requires improved managerial, operational, and financial systems, posing management challenges[554](index=554&type=chunk)[556](index=556&type=chunk) [Risks related to our common stock](index=186&type=section&id=Risks%20related%20to%20our%20common%20stock) This section addresses risks concerning significant stockholder influence, anti-takeover provisions, and potential stock dilution - Executive officers, directors, and principal stockholders collectively own **~30.11%** of common stock, enabling significant influence over stockholder approval matters and potentially delaying acquisitions[557](index=557&type=chunk) - Provisions in corporate charter documents and Delaware law (e.g., classified board, advance notice requirements, preferred stock issuance) could discourage or prevent changes in control or management[558](index=558&type=chunk)[560](index=560&type=chunk) - The company has never paid cash dividends and does not anticipate doing so, making capital appreciation the sole source of investment gain. Future sales of common stock could dilute existing stockholders and depress market price[562](index=562&type=chunk)[563](index=563&type=chunk)[568](index=568&type=chunk) [General risk factors](index=191&type=section&id=General%20risk%20factors) This section covers broader risks including macroeconomic conditions, geopolitical events, business disruptions, and product liability - Macroeconomic conditions, including inflation, and geopolitical events like the Russia-Ukraine conflict, have adversely affected the business, leading to suspended clinical trials in Russia and market volatility[571](index=571&type=chunk)[572](index=572&type=chunk)[574](index=574&type=chunk) - Business disruptions from natural disasters, epidemics (e.g., COVID-19), cyberattacks, or other events could seriously harm revenue, financial condition, and increase costs, as the company relies on third parties for critical operations[582](index=582&type=chunk)[585](index=585&type=chunk)[609](index=609&type=chunk)[610](index=610&type=chunk) - Product liability lawsuits pose an inherent risk, potentially leading to substantial liabilities, decreased demand, reputational damage, and financial strain, with insurance coverage possibly being inadequate[586](index=586&type=chunk)[588](index=588&type=chunk) [Item 2. Unregistered Sales of Equity Securities and Use of Proceeds](index=209&type=section&id=Item%202.%20Unregistered%20Sales%20of%20Equity%20Securities%20and%20Use%20of%20Proceeds) This section states that there were no unregistered sales of equity securities or use of proceeds to report for the period - No unregistered sales of equity securities or use of proceeds were reported for the period[616](index=616&type=chunk) [Item 3. Defaults Upon Senior Securities](index=209&type=section&id=Item%203.%20Defaults%20Upon%20Senior%20Securities) This section indicates that there were no defaults upon senior securities during the reporting period - No defaults upon senior securities were reported for the period[617](index=617&type=chunk) [Item 4. Mine Safety Disclosures](index=209&type=section&id=Item%204.%20Mine%20Safety%20Disclosures) This section states that mine safety disclosures are not applicable to the company's operations - Mine safety disclosures are not applicable to the company[618](index=618&type=chunk) [Item 5. Other Information](index=211&type=section&id=Item%205.%20Other%20Information) This section indicates that there is no other information to report for the period - No other information was reported for the period[620](index=620&type=chunk) [Item 6. Exhibits](index=211&type=section&id=Item%206.%20Exhibits) This section lists all exhibits filed as part of the Quarterly Report on Form 10-Q, including corporate governance documents, stock option and retention bonus agreements, certifications, and XBRL interactive data files - Exhibits include Amended and Restated Certificate of Incorporation and Bylaws, Form of Stock Option Grant Notice, Retention Bonus Agreements, Certifications of Principal Executive and Financial Officers, and Inline XBRL Instance Document[623](index=623&type=chunk)

mAbs Therapeutics, Inc. Company Presentation May 2022 Disclaimer This presentation contains forward-looking statements within the meaning of the US Private Securities Litigation Reform Act of 1995. The forward-looking statements involve substantial risks and uncertainties. All statements, other than statements of historical facts, contained in this presentation, including statements regarding our strategy, future operations, future financial position, future revenue, projected costs, prospects, plans and ob ...

mAbs Therapeutics, Inc. Company Presentation May 2022 Disclaimer This presentation contains forward-looking statements within the meaning of the US Private Securities Litigation Reform Act of 1995. The forward-looking statements involve substantial risks and uncertainties. All statements, other than statements of historical facts, contained in this presentation, including statements regarding our strategy, future operations, future financial position, future revenue, projected costs, prospects, plans and ob ...

Y-mAbs Therapeutics, Inc. (NASDAQ:YMAB) Q1 2022 Results Conference Call May 10, 2022 9:00 AM ET Company Participants Thomas Gad - Founder, Interim CEO and President Bo Kruse - CFO Sue Smith - Chief Commercial Officer Vignesh Rajah - Chief Medical Officer Dr. Steen Lisby - Chief Scientific Officer Conference Call Participants Alec Stranahan - Bank of America Joseph Thome - Cowen & Company Charles Zhu - Guggenheim Mike Ulz - Morgan Stanley Tessa Romero - JP Morgan Sebastiaan van der Schoot - Kempen Operator G ...

PART I — FINANCIAL INFORMATION This section covers the unaudited consolidated financial statements, management's analysis, market risk, and internal controls for the reporting period [Item 1. Consolidated Financial Statements](index=7&type=section&id=Item%201.%20Consolidated%20Financial%20Statements) This section presents Y-mAbs Therapeutics' unaudited consolidated financial statements and detailed notes for Q1 2022 and 2021 [Consolidated Balance Sheets](index=8&type=section&id=Consolidated%20Balance%20Sheets) Consolidated Balance Sheets | ASSETS (in thousands) | March 31, 2022 | December 31, 2021 | | :-------------------- | :------------- | :---------------- | | **Cash and cash equivalents** | **$156,724** | **$181,564** | | **Accounts receivable**, net | **$9,324** | **$7,712** | | **Inventories** | **$5,588** | **$5,512** | | Other current assets | **$6,103** | **$7,473** | | **Total current assets** | **$177,739** | **$202,261** | | Property and equipment, net | **$1,697** | **$1,847** | | Operating lease right-of-use assets | **$3,155** | **$3,842** | | Intangible assets, net | **$1,618** | **$1,663** | | Other assets | **$6,838** | **$3,170** | | **TOTAL ASSETS** | **$191,047** | **$212,783** | | | | | | LIABILITIES AND **STOCKHOLDERS' EQUITY** (in thousands) | March 31, 2022 | December 31, 2021 | | :---------------------------------- | :------------- | :---------------- | | **Accounts payable** | **$14,661** | **$13,552** | | **Accrued liabilities** | **$12,930** | **$12,540** | | Operating lease liabilities, current portion | **$1,451** | **$1,783** | | **Total current liabilities** | **$29,042** | **$27,875** | | **Accrued milestone** and royalty payments | **$2,100** | **$2,100** | | Operating lease liabilities, long-term portion | **$1,598** | **$1,851** | | Other liabilities | **$835** | **$851** | | **TOTAL LIABILITIES** | **$33,575** | **$32,677** | | **STOCKHOLDERS' EQUITY** | | | | **Common stock** | **$4** | **$4** | | Additional paid in capital | **$524,329** | **$519,206** | | **Accumulated other comprehensive income** | **$1,682** | **$1,371** | | **Accumulated deficit** | **$(368,543)** | **$(340,475)** | | **TOTAL STOCKHOLDERS' EQUITY** | **$157,472** | **$180,106** | | **TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY** | **$191,047** | **$212,783** | [Consolidated Statements of Net Income/(Loss) and Comprehensive Income/(Loss)](index=9&type=section&id=Consolidated%20Statements%20of%20Net%20Income%2F%28Loss%29%20and%20Comprehensive%20Income%2F%28Loss%29) Consolidated Statements of Net Income/(Loss) and Comprehensive Income/(Loss) | (in thousands, except share and per share data) | Three months ended March 31, 2022 | Three months ended March 31, 2021 | | :---------------------------------------------- | :-------------------------------- | :-------------------------------- | | **Product revenue**, net | **$10,486** | **$5,383** | | **Total revenues** | **$10,486** | **$5,383** | | **Cost of goods sold** | **$1,831** | **$93** | | **Research and development** | **$22,912** | **$21,579** | | **Selling, general, and administrative** | **$13,438** | **$11,970** | | **Total operating costs and expenses** | **$38,181** | **$33,642** | | **Loss from operations** | **$(27,695)** | **$(28,259)** | | **Gain from sale of priority review voucher**, net | **$—** | **$62,010** | | Interest and other **loss** | **$(373)** | **$(338)** | | **NET INCOME / (LOSS)** | **$(28,068)** | **$33,413** | | Foreign currency translation | **$311** | **$435** | | **COMPREHENSIVE INCOME / (LOSS)** | **$(27,757)** | **$33,848** | | **Net income / (loss) per share**, basic | **$(0.64)** | **$0.80** | | Weighted average **common shares** outstanding, basic | **43,709,238** | **41,870,759** | | **Net income / (loss) per share**, diluted | **$(0.64)** | **$0.75** | | Weighted average **common shares** outstanding, diluted | **43,709,238** | **44,383,791** | [Consolidated Statements of Changes in Stockholders' Equity](index=10&type=section&id=Consolidated%20Statements%20of%20Changes%20in%20Stockholders%27%20Equity) Consolidated Statements of Changes in Stockholders' Equity | (in thousands, except share data) | **Common Stock Shares** | **Common Stock Amount** | Additional Paid-in Capital | **Accumulated Other Comprehensive Income / (Loss)** | **Accumulated Deficit** | **Stockholders' Equity** | | :-------------------------------- | :------------------ | :------------------ | :------------------------- | :---------------------------------------------- | :------------------ | :------------------- | | Balance December 31, 2021 | **43,694,716** | **$4** | **$519,206** | **$1,371** | **$(340,475)** | **$180,106** | | Exercise of **stock options** | **16,000** | **$—** | **$32** | **$—** | **$—** | **$32** | | **Stock-based compensation expense** | **7,449** | **$—** | **$5,091** | **$—** | **$—** | **$5,091** | | Foreign currency translation | — | **$—** | **$—** | **$311** | **$—** | **$311** | | **Net loss** | — | **$—** | **$—** | **$—** | **$(28,068)** | **$(28,068)** | | Balance March 31, 2022 | **43,718,165** | **$4** | **$524,329** | **$1,682** | **$(368,543)** | **$157,472** | [Consolidated Statements of Cash Flows](index=11&type=section&id=Consolidated%20Statements%20of%20Cash%20Flows) Consolidated Statements of Cash Flows | (in thousands) | Three months ended March 31, 2022 | Three months ended March 31, 2021 | | :------------- | :-------------------------------- | :-------------------------------- | | **Net cash used in operating activities** | **$(24,925)** | **$(31,861)** | | **Net cash provided by investing activities** | **$—** | **$61,610** | | **Net cash provided by financing activities** | **$32** | **$107,835** | | Effect of exchange rates on **cash and cash equivalents** | **$53** | **$53** | | **Net increase / (decrease) in cash and cash equivalents** | **$(24,840)** | **$137,637** | | **Cash and cash equivalents** at the beginning of period | **$181,564** | **$114,634** | | **Cash and cash equivalents** at the end of period | **$156,724** | **$252,271** | [Notes to Consolidated Financial Statements](index=12&type=section&id=Notes%20to%20Consolidated%20Financial%20Statements) [NOTE 1—ORGANIZATION AND DESCRIPTION OF BUSINESS](index=12&type=section&id=NOTE%201%E2%80%94ORGANIZATION%20AND%20DESCRIPTION%20OF%20BUSINESS) - **Y-mAbs Therapeutics, Inc.** is a **commercial-stage biopharmaceutical company** focused on developing and commercializing novel, antibody-based therapeutic products for cancer treatment, leveraging proprietary antibody platforms[36](index=36&type=chunk) - The Company was incorporated on April 30, 2015, in Delaware and is headquartered in New York[37](index=37&type=chunk) [NOTE 2—BASIS OF PRESENTATION](index=12&type=section&id=NOTE%202%E2%80%94BASIS%20OF%20PRESENTATION) - The Company has incurred **net loss** since inception, except for the quarter ended March 31, 2021, and faces risks including drug candidate development uncertainty, regulatory **FDA approval**, market acceptance, and the need for additional financing[38](index=38&type=chunk) - **DANYELZA** (naxitamab-gqgk) received U.S. **FDA approval** in November 2020, but other drug candidates require significant R&D, clinical testing, and regulatory **FDA approval**[39](index=39&type=chunk) - As of March 31, 2022, the Company had an **accumulated deficit** of **$368.5 million**, funded primarily by **common stock** sales and **net proceeds** from **DANYELZA** sales and its Priority Review Voucher (PRV)[40](index=40&type=chunk) - **Cash and cash equivalents** were **$156.7 million** as of March 31, 2022, and **$181.6 million** as of December 31, 2021, expected to fund operations for at least the next **12 months**[42](index=42&type=chunk)[44](index=44&type=chunk) [NOTE 3—SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES](index=14&type=section&id=NOTE%203%E2%80%94SUMMARY%20OF%20SIGNIFICANT%20ACCOUNTING%20POLICIES) - The Company considers highly liquid instruments with original maturities of **three months** or less as **cash equivalents**, held in highly rated securities including a Treasury money market fund[48](index=48&type=chunk) - Trade **accounts receivable** are from **DANYELZA** sales, recorded net of allowances for chargebacks, rebates, returns, and discounts, with **94%** of **receivables** from **three national specialty distributors** as of March 31, 2022[49](index=49&type=chunk)[51](index=51&type=chunk) - **Inventory** is valued at the lower of cost or net realizable value (FIFO basis), including materials, manufacturing, packaging, freight, labor, and overhead. Capitalization of **DANYELZA** **inventory** began upon **FDA approval**[52](index=52&type=chunk)[53](index=53&type=chunk) NOTE 3—SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | Fair Value Measurements (in thousands) | Level 1 | Level 2 | Level 3 | Total | | :------------------------------------- | :------ | :--------- | :------ | :--------- | | **At March 31, 2022:** | | | | | | Money market funds | **$—** | **$141,739** | **$—** | **$141,739** | | Total | **$—** | **$141,739** | **$—** | **$141,739** | | **At December 31, 2021:** | | | | | | Money market funds | **$—** | **$166,729** | **$—** | **$166,729** | | Total | **$—** | **$166,729** | **$—** | **$166,729** | - Operating lease right-of-use assets and liabilities are recognized at lease commencement based on the present value of lease payments, using the estimated incremental borrowing rate[58](index=58&type=chunk) - **Revenue** from **DANYELZA** sales is recognized when the customer obtains control, generally upon receipt at the end-user hospital, and is net of estimated rebates, chargebacks, and discounts[64](index=64&type=chunk)[65](index=65&type=chunk) - The Company operates in **one segment**: discovery, development, distribution, and commercialization of antibody-based therapeutic products for cancer[67](index=67&type=chunk) [NOTE 4—PRODUCT REVENUE](index=22&type=section&id=NOTE%204%E2%80%94PRODUCT%20REVENUE) NOTE 4—PRODUCT REVENUE | **Product Revenue** (in thousands) | Three months ended March 31, 2022 | Three months ended March 31, 2021 | | :----------------------------- | :-------------------------------- | :-------------------------------- | | **Product revenue**, net | **$10,486** | **$5,383** | - **Product revenue** is net of allowances for rebates, chargebacks, discounts, and distribution-related fees. As of March 31, 2022, **accounts receivable allowances** were **$668,000** and **accrued liabilities** were **$2,921,000**[71](index=71&type=chunk) NOTE 4—PRODUCT REVENUE | Allowances and Discounts (in thousands) | Balance, December 31, 2021 | Current provisions | Payments/credits | Balance, March 31, 2022 | | :-------------------------------------- | :------------------------- | :----------------- | :--------------- | :---------------------- | | Contractual Allowances and Discounts | **$13** | **$24** | **$(14)** | **$23** | | Government Rebates | **$3,027** | **$1,085** | **$(546)** | **$3,566** | | Returns | **$61** | **$126** | **$(187)** | **$—** | | Total | **$3,101** | **$1,235** | **$(747)** | **$3,589** | - For **Q1 2022**, McKesson, AmerisourceBergen, and Cardinal Health accounted for **60%**, **25%**, and **11%** of gross **product revenue**, respectively. For **Q1 2021**, McKesson and Cardinal Health accounted for **80%** and **16%**, respectively[73](index=73&type=chunk) [NOTE 5—NET LOSS PER SHARE](index=24&type=section&id=NOTE%205%E2%80%94NET%20LOSS%20PER%20SHARE) NOTE 5—NET LOSS PER SHARE | (in thousands, except per share amounts) | Three months ended March 31, 2022 | Three months ended March 31, 2021 | | :--------------------------------------- | :-------------------------------- | :-------------------------------- | | **Net income /(loss)** | **$(28,068)** | **$33,413** | | Weighted-average **shares** (denominator), basic | **43,709** | **41,871** | | Basic **net income / (loss) per share** | **$(0.64)** | **$0.80** | | Weighted-average **shares** (denominator), diluted | **43,709** | **44,384** | | Diluted **net income / (loss) per share** | **$(0.64)** | **$0.75** | - Potentially dilutive securities (**stock options** and RSUs) excluded from diluted EPS due to antidilutive effect totaled **6,686,168 shares** as of March 31, 2022, and **1,177,600 shares** as of March 31, 2021[74](index=74&type=chunk) [NOTE 6—INVENTORIES](index=24&type=section&id=NOTE%206%E2%80%94INVENTORIES) NOTE 6—INVENTORIES | **Inventories** (in thousands) | March 31, 2022 | December 31, 2021 | | :------------------------- | :------------- | :---------------- | | Work In Progress | **$8,747** | **$4,741** | | Finished Goods | **$541** | **$771** | | **Total inventories** | **$9,288** | **$5,512** | NOTE 6—INVENTORIES | **Inventory Classification** (in thousands) | March 31, 2022 | December 31, 2021 | | :------------------------------------ | :------------- | :---------------- | | CURRENT ASSETS - **Inventories** | **$5,588** | **$5,512** | | NONCURRENT ASSETS - Other assets | **$3,700** | **$—** | | **Total Inventories** | **$9,288** | **$5,512** | - The Company classified **$3.7 million** of work in progress **inventory** as noncurrent assets, expecting its utilization beyond **one year** from the balance sheet date[75](index=75&type=chunk) [NOTE 7—INTANGIBLE ASSETS](index=26&type=section&id=NOTE%207%E2%80%94INTANGIBLE%20ASSETS) - **Intangible assets** totaled **$1.618 million** as of March 31, 2022, related to capitalized **milestone payments** for **DANYELZA**, net of **$182,000** accumulated amortization[76](index=76&type=chunk) - Annual amortization expense for **intangible assets** is expected to be **$180,000** each year from 2022 to 2026, based on a **10-year** useful life[77](index=77&type=chunk) [NOTE 8—ACCRUED LIABILITIES](index=26&type=section&id=NOTE%208%E2%80%94ACCRUED%20LIABILITIES) NOTE 8—ACCRUED LIABILITIES | **Accrued Short-Term Liabilities** (in thousands) | March 31, 2022 | December 31, 2021 | | :-------------------------------------------- | :------------- | :---------------- | | **Accrued licensing**, **milestone** and royalty payments | **$3,768** | **$3,090** | | **Accrued clinical costs** | **$1,533** | **$915** | | **Accrued compensation** and board fees | **$2,119** | **$1,877** | | **Accrued manufacturing costs** | **$1,153** | **$2,622** | | **Accrued sales reserves** | **$2,921** | **$2,615** | | Other | **$1,436** | **$1,421** | | Total | **$12,930** | **$12,540** | [NOTE 9—LICENSE AGREEMENTS AND COMMITMENTS](index=26&type=section&id=NOTE%209%E2%80%94LICENSE%20AGREEMENTS%20AND%20COMMITMENTS) - The Company has **license agreements** with Memorial Sloan Kettering Cancer Center (MSK) and Massachusetts Institute of Technology (MIT), including the MSK License, CD33 License Agreement, and **SADA Technology License Agreement**, granting patent and intellectual property rights[79](index=79&type=chunk) NOTE 9—LICENSE AGREEMENTS AND COMMITMENTS | **License Agreements** (in thousands) | Cash paid (Q1 2022) | Cash paid (Q1 2021) | Expense (Q1 2022) | Expense (Q1 2021) | **Accrued liabilities Current** (Mar 31, 2022) | **Accrued liabilities Non-current** (Mar 31, 2022) | **Accrued liabilities Current** (Dec 31, 2021) | **Accrued liabilities Non-current** (Dec 31, 2021) | | :-------------------------------- | :------------------ | :------------------ | :---------------- | :---------------- | :------------------------------------------- | :--------------------------------------------- | :------------------------------------------- | :--------------------------------------------- | | MSK | **$—** | **$450** | **$677** | **$—** | **$2,163** | **$1,650** | **$1,486** | **$1,650** | | CD33 | — | **100** | — | — | — | **450** | — | **450** | | MabVax | — | — | — | — | — | — | — | — | | **SADA** | — | — | — | — | **1,605** | — | **1,605** | — | NOTE 9—LICENSE AGREEMENTS AND COMMITMENTS | **Maximum Milestones** (in thousands) | Clinical Milestones | Regulatory Milestones | Sales-based milestones | | :-------------------------------- | :------------------ | :-------------------- | :--------------------- | | MSK | **$2,450** | **$9,000** | **$20,000** | | CD33 | **$550** | **$500** | **$7,500** | | MabVax | **$200** | **$1,200** | **$—** | | **SADA** | **$4,730** | **$18,125** | **$23,750** | - The Company incurred **$697,000** and **$948,000** in **R&D expenses** for **Q1 2022** and **Q1 2021**, respectively, under various support agreements with MSK, including sponsored research and data services[84](index=84&type=chunk)[85](index=85&type=chunk) - **Total operating lease costs** were **$704,000** for **Q1 2022** and **$646,000** for **Q1 2021**, primarily for manufacturing space, laboratory, and office facilities in New Jersey, New York, and Denmark[90](index=90&type=chunk) NOTE 9—LICENSE AGREEMENTS AND COMMITMENTS | **Operating Lease Liabilities** (in thousands) | March 31, 2022 | December 31, 2021 | | :--------------------------------------- | :------------- | :---------------- | | Remainder of 2022 | **$1,341** | **$1,953** | | 2023 | **$1,016** | **$1,025** | | 2024 | **$540** | **$550** | | 2025 | **$436** | **$445** | | **Total lease payments** | **$3,333** | **$3,973** | | Less: Imputed interest | **$(284)** | **$(339)** | | **Total operating lease liabilities** | **$3,049** | **$3,634** | - The Company is a nominal defendant in a lawsuit regarding alleged short swing profits by Mr. Thomas Gad, but believes the claim is without merit and has not recorded any **loss** or gain contingencies[93](index=93&type=chunk) [NOTE 10—STOCKHOLDERS' EQUITY](index=31&type=section&id=NOTE%2010%E2%80%94STOCKHOLDERS%20%27%20EQUITY) - As of March 31, 2022, the Company had **105,500,000 authorized shares** (**100,000,000 common**, **5,500,000 preferred**)[94](index=94&type=chunk) - **43,718,165 shares** of **common stock** were issued as of March 31, 2022. No preferred stock has been issued[95](index=95&type=chunk)[96](index=96&type=chunk) - In April 2020, **213,996 shares** were issued to non-employee researchers for **SADA technology** development, vesting over **three years**. Loans totaling **$2.61 million** were provided to cover associated tax payments[97](index=97&type=chunk)[98](index=98&type=chunk) - On February 22, 2021, the Company completed a public offering of **2,804,878 common shares** at **$41.00/share**, generating **net proceeds** of approximately **$107.7 million**[99](index=99&type=chunk) [NOTE 11—SHARE-BASED COMPENSATION](index=33&type=section&id=NOTE%2011%E2%80%94SHARE-BASED%20COMPENSATION) - The 2015 Equity Incentive Plan reserved **4,500,000 shares**, with no further grants after the 2018 Plan became effective[101](index=101&type=chunk) - The 2018 Equity Incentive Plan reserved **5,500,000 shares** (inclusive of 2015 Plan awards), with an annual **increase** equal to **4%** of outstanding **common stock**[102](index=102&type=chunk) - **Stock-based compensation** for **stock options** was **$5.017 million** for **Q1 2022** and **$4.629 million** for **Q1 2021**, allocated to **R&D** and **SG&A expenses**[103](index=103&type=chunk) NOTE 11—SHARE-BASED COMPENSATION | **Stock Options** | Options | Weighted average exercise price | Aggregate intrinsic value (in thousands) | Weighted average remaining contractual life (years) | | :------------ | :---------- | :------------------------------ | :--------------------------------------- | :-------------------------------------------------- | | Outstanding and expected to vest at December 31, 2021 | **6,687,128** | **$22.43** | **$26,412** | **7.21** | | Exercised | **(16,000)** | **$2.00** | | | | Forfeited | **(22,167)** | **$28.67** | | | | Outstanding and expected to vest at March 31, 2022 | **6,648,961** | **$22.46** | **$15,726** | **6.96** | | Exercisable at March 31, 2022 | **4,083,593** | **$17.23** | **$15,720** | **5.78** | - Unrecognized **compensation** for employee **stock options** was **$44.592 million** as of March 31, 2022, expected to vest over **2.79 years**[106](index=106&type=chunk) - **Stock-based compensation** for restricted **stock units** (RSUs) was **$74,000** for **Q1 2022** and **$69,000** for **Q1 2021**[107](index=107&type=chunk) NOTE 11—SHARE-BASED COMPENSATION | **Restricted Stock Units** | **Restricted Stock Units** | Weighted average grant price | Weighted average remaining vesting life (years) | | :--------------------- | :--------------------- | :--------------------------- | :---------------------------------------------- | | Outstanding and expected to vest at December 31, 2021 | **28,907** | **$28.04** | **1.82** | | Granted | **16,283** | **$9.31** | | | Vested | **(7,450)** | **$21.05** | | | Forfeited | **(534)** | **$28.89** | | | Outstanding and expected to vest at March 31, 2022 | **37,206** | **$20.74** | **2.38** | - Unrecognized **compensation** for employee RSUs was **$650,000** as of March 31, 2022, expected to vest over **2.38 years**[110](index=110&type=chunk) [NOTE 12—RELATED PARTY TRANSACTIONS](index=36&type=section&id=NOTE%2012%E2%80%94RELATED%20PARTY%20TRANSACTIONS) - The Company expensed **$1.374 million** in **Q1 2022** and **$948,000** in **Q1 2021** for milestones and **R&D costs** under agreements with MSK[111](index=111&type=chunk) - Liabilities due to MSK totaled **$6.455 million** as of March 31, 2022, including **$335,000** in **accounts payable** and **$6.120 million** in **accrued liabilities**[111](index=111&type=chunk) [NOTE 13—INCOME TAXES](index=36&type=section&id=NOTE%2013%E2%80%94INCOME%20TAXES) - No current or deferred **income taxes** were provided for **net loss** of **$28.068 million** in **Q1 2022** and **net income** of **$33.413 million** in **Q1 2021**[112](index=112&type=chunk) - Unrecognized tax benefits were **$0** as of March 31, 2022, down from **$304,000** at December 31, 2021. The Company maintains a full valuation allowance on its U.S. and foreign deferred tax assets[113](index=113&type=chunk)[114](index=114&type=chunk) [NOTE 14—OTHER BENEFITS](index=36&type=section&id=NOTE%2014%E2%80%94OTHER%20BENEFITS) - The Company offers a **401(k) savings plan** for U.S. employees but made no matching contributions in **Q1 2022** or **Q1 2021**[115](index=115&type=chunk) - The Danish subsidiary has a retirement program for employees but made no contributions in **Q1 2022** or **Q1 2021**[116](index=116&type=chunk) [NOTE 15—GAIN FROM SALE OF PRIORITY REVIEW VOUCHER](index=38&type=section&id=NOTE%2015%E2%80%94GAIN%20FROM%20SALE%20OF%20PRIORITY%20REVIEW%20VOUCHER) - In **Q1 2021**, the Company recognized a **net gain** of **$62.010 million** from the sale of its **DANYELZA Priority Review Voucher** (PRV) to United Therapeutics Corporation for **$105 million**, retaining **60% of net proceeds**[118](index=118&type=chunk) - No corresponding **gain** was recognized in **Q1 2022**[119](index=119&type=chunk) [NOTE 16—SUBSEQUENT EVENT](index=38&type=section&id=NOTE%2016%E2%80%94SUBSEQUENT%20EVENT) - Effective April 22, 2022, Dr. Claus Møller stepped down as CEO and Board member. Thomas Gad assumed the role of Interim CEO[120](index=120&type=chunk) - This executive change is expected to result in a **total charge** of **$10.714 million** in 2022, including **$1.428 million** in **cash compensation** and a **$9.286 million non-cash share-based compensation expense**[120](index=120&type=chunk) [Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations](index=38&type=section&id=Item%202.%20Management%27s%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operations) Management discusses financial condition, operational results, liquidity, critical accounting policies, and external impacts [Overview](index=38&type=section&id=Overview) - **Y-mAbs** is a **commercial-stage biopharmaceutical company** developing antibody-based cancer therapies, leveraging proprietary platforms[122](index=122&type=chunk) - **DANYELZA®** (naxitamab-gqgk) was **FDA-approved** in November 2020 for relapsed/refractory high-risk neuroblastoma (NB) in bone or bone marrow and launched in February 2021[123](index=123&type=chunk) - **DANYELZA** is being investigated in **three Phase 2 clinical studies** for first-line NB, third-line NB, and relapsed osteosarcoma. The **GD2-GD3 Vaccine** is in a **Phase 2 trial** for Stage 4 high-risk NB[124](index=124&type=chunk)[125](index=125&type=chunk) - The BLA for **omburtamab** for CNS leptomeningeal metastases from NB was resubmitted in March 2022 after a **Refusal to File** letter in October 2020[126](index=126&type=chunk) - The company is advancing **SADA technology** (Liquid Radiation™) for GD2-SADA (IND filed Dec 2021) and **Y-BiClone platform** for T cell engaging bispecific antibodies, including a **CD33 BsAb** (IND filed, clinical trials expected **mid-2022**)[128](index=128&type=chunk)[129](index=129&type=chunk) - The company had an **accumulated deficit** of **$368.5 million** as of March 31, 2022, with a **net loss** of **$28.1 million** for **Q1 2022**, compared to a **net income** of **$33.4 million** for **Q1 2021** (due to PRV sale)[135](index=135&type=chunk) - The company has various **license agreements** with MSK and MIT, including the MSK License, **SADA License Agreement**, and others, involving **milestone payments**, royalties, and funding for research and clinical trials[136](index=136&type=chunk)[137](index=137&type=chunk)[141](index=141&type=chunk) - The COVID-19 pandemic has caused slower initiation and fluctuating recruitment rates in clinical trials, marginally delaying clinical development **activities**, but the aggregate impact has not been significant[146](index=146&type=chunk) [Components of Our Results of Operations](index=46&type=section&id=Components%20of%20Our%20Results%20of%20Operations) - **Product revenue** consists solely of sales from **DANYELZA**[148](index=148&type=chunk) - **Cost of goods sold** includes direct and indirect manufacturing and distribution costs for **DANYELZA**, such as materials, third-party manufacturing, packaging, freight, labor, and third-party royalties[149](index=149&type=chunk) - **Research and development expenses** are expensed as incurred and include costs for sponsored research, clinical trials, outsourced manufacturing, personnel, regulatory **activities**, and facility-related costs[150](index=150&type=chunk) - **Selling, general, and administrative expenses** primarily cover employee-related costs (salaries, benefits, **stock-based compensation**) for executive, commercial, finance, and administrative functions, along with facility costs, legal fees, and consulting services[157](index=157&type=chunk) - Other **income/(loss)**, net, includes the **gain from the sale of the DANYELZA Priority Review Voucher** (PRV) in 2021[159](index=159&type=chunk) [Critical Accounting Policies and Significant Judgments and Estimates](index=50&type=section&id=Critical%20Accounting%20Policies%20and%20Significant%20Judgments%20and%20Estimates) - The preparation of financial statements requires management to make significant estimates and assumptions, particularly for **net product revenues**, **R&D expenses**, **milestone/royalty accruals**, and **stock option valuation**[162](index=162&type=chunk)[163](index=163&type=chunk) - **Revenue recognition** for **DANYELZA** sales is based on customer control (receipt at hospital), with estimates for rebates, chargebacks, and discounts based on contracts and payor mix[166](index=166&type=chunk)[168](index=168&type=chunk) - **R&D costs** are expensed as incurred, with accruals for estimated ongoing costs based on study progress and contracted terms. **Milestone** and royalty payments are recorded when probable and estimable[169](index=169&type=chunk) - **Stock options** are measured at fair value on the grant date using the Black-Scholes model, with volatility estimated from peer companies and the Company's historical data, and expense recognized over the vesting period[174](index=174&type=chunk)[175](index=175&type=chunk)[176](index=176&type=chunk) [Results of Operations](index=56&type=section&id=Results%20of%20Operations) Results of Operations | (in thousands) | Three Months Ended March 31, 2022 | Three Months Ended March 31, 2021 | Change Amount | Change Percentage | | :------------- | :-------------------------------- | :-------------------------------- | :------------ | :---------------- | | **Product revenue**, net | **$10,486** | **$5,383** | **$5,103** | **95%** | | **Total revenues** | **$10,486** | **$5,383** | **$5,103** | **95%** | | **Cost of goods sold** | **$1,831** | **$93** | **$1,738** | **1,869%** | | **Research and development** | **$22,912** | **$21,579** | **$1,333** | **6%** | | **Selling, general, and administrative** | **$13,438** | **$11,970** | **$1,468** | **12%** | | **Total operating costs and expenses** | **$38,181** | **$33,642** | **$4,539** | **13%** | | **Loss from operations** | **$(27,695)** | **$(28,259)** | **$564** | **(2)%** | | **Gain from sale of priority review voucher** | **$—** | **$62,010** | **$(62,010)** | **(100)%** | | Interest and other **loss** | **$(373)** | **$(338)** | **$(35)** | **10%** | | **Net income / (loss)** | **$(28,068)** | **$33,413** | **$(61,481)** | **(184)%** | - **Net product revenue** **increased** by **95%** to **$10.5 million** in **Q1 2022** from **$5.4 million** in **Q1 2021**, driven by **DANYELZA** sales[180](index=180&type=chunk) - **Cost of goods sold** significantly **increased** to **$1.8 million** in **Q1 2022** from **$93,000** in **Q1 2021**, as all **inventory** sold in **Q1 2022** was produced after **FDA approval**, unlike **Q1 2021** which included previously expensed **inventory**[181](index=181&type=chunk) - **Research and development expenses** rose by **6%** to **$22.9 million** in **Q1 2022**, primarily due to **increased employee-related costs** and clinical trials (**omburtamab**), partially offset by reduced outsourced manufacturing[184](index=184&type=chunk) - **Selling, general, and administrative expenses** **increased** by **12%** to **$13.4 million** in **Q1 2022**, mainly due to growth in the commercialization team's **employee-related costs**, commercial expenses, and travel[185](index=185&type=chunk) - **Net income/(loss)** shifted from a **$33.4 million net income** in **Q1 2021** (due to a **$62.0 million PRV sale**) to a **$28.1 million net loss** in **Q1 2022**, as no PRV sales occurred in the latter period[186](index=186&type=chunk) [Liquidity and Capital Resources](index=60&type=section&id=Liquidity%20and%20Capital%20Resources) - The Company has incurred significant **net operating losses** since inception, except for **Q1 2021**, and expects continued **net loss**[188](index=188&type=chunk) - Operations have been financed primarily through **common stock** sales (**$378.8 million** by 2019, **$115.0 million** in 2021), **DANYELZA** sales, and the **DANYELZA PRV sale**[188](index=188&type=chunk) - **Cash and cash equivalents** were **$156.7 million** as of March 31, 2022, down from **$181.6 million** at December 31, 2021[188](index=188&type=chunk) Liquidity and Capital Resources | **Cash Flows** (in thousands) | Three Months Ended March 31, 2022 | Three Months Ended March 31, 2021 | Change Amount | Change Percentage | | :------------------------ | :-------------------------------- | :-------------------------------- | :------------ | :---------------- | | **Net cash used in operating activities** | **$(24,925)** | **$(31,861)** | **$6,936** | **(22)%** | | **Net cash provided by investing activities** | **$—** | **$61,610** | **$(61,610)** | **(100)%** | | **Net cash provided by financing activities** | **$32** | **$107,835** | **$(107,803)** | **(100)%** | | Effect of exchange rates on **cash and cash equivalents** | **$53** | **$53** | **$—** | **—%** | | **Net increase / (decrease) in cash and cash equivalents** | **$(24,840)** | **$137,637** | **$(162,477)** | **(118)%** | - **Net cash used in operating activities** **decreased** by **$7.0 million** to **$24.9 million** in **Q1 2022**, primarily due to **decreased cash used for working capital** (**$6.1 million**) and a smaller **net loss** (excluding non-cash adjustments)[193](index=193&type=chunk) - **Net cash provided by investing activities** was **$0** in **Q1 2022**, compared to **$61.6 million** in **Q1 2021**, which was primarily from the sale of the **DANYELZA PRV**[194](index=194&type=chunk) - **Net cash provided by financing activities** was **$32,000** in **Q1 2022** (from **stock options**), significantly down from **$107.8 million** in **Q1 2021** (driven by a public offering)[195](index=195&type=chunk) - The Company expects current **cash and cash equivalents** (**$156.7 million**) to fund operations through **mid-2024**, but anticipates needing substantial additional funding for **DANYELZA commercialization**, **omburtamab development**, and other pipeline programs[196](index=196&type=chunk)[199](index=199&type=chunk) [Off-Balance Sheet Arrangements](index=63&type=section&id=Off-Balance%20Sheet%20Arrangements) - The Company did not have any off-balance sheet arrangements during the periods presented[205](index=205&type=chunk) [Contractual Obligations and Commitments](index=65&type=section&id=Contractual%20Obligations%20and%20Commitments) - The Company has material outstanding contractual commitments and potential **milestone payments** under various **license agreements** with MSK and MIT, as detailed in Note 9[206](index=206&type=chunk)[208](index=208&type=chunk)[209](index=209&type=chunk)[210](index=210&type=chunk) - Contracts with CROs, CMOs, and other third parties are generally cancelable and do not include minimum purchase commitments, with payments limited to services provided or expenses incurred up to cancellation[207](index=207&type=chunk) - Under the MSK License and CD33 License, obligations include **milestone payments** (clinical, regulatory, sales-based) and mid-to-high single-digit royalties. **Total potential milestones** are **$2.45 million clinical**, **$9 million regulatory**, and **$20 million sales-based** for MSK License, and **$550,000 clinical**, **$500,000 regulatory**, and **$7.5 million sales-based** for CD33 License[209](index=209&type=chunk) - The **SADA License Agreement** requires mid-to-high single-digit royalties and potential clinical, regulatory, and sales-based milestones totaling **$4.73 million**, **$18.125 million**, and **$23.75 million** respectively, plus up to **$60 million** for sublicensee sales[210](index=210&type=chunk) - The Company is also responsible for potential downstream payment obligations to MSK related to the **GD2-GD3 Vaccine**, including development milestones and royalties[212](index=212&type=chunk) [Recent Accounting Pronouncements](index=67&type=section&id=Recent%20Accounting%20Pronouncements) - Refer to Note 3 for a discussion of recent accounting pronouncements[214](index=214&type=chunk) [Item 3. Quantitative and Qualitative Disclosures About Market Risk](index=67&type=section&id=Item%203.%20Quantitative%20and%20Qualitative%20Disclosures%20About%20Market%20Risk) This section outlines the company's exposure to market risks, including interest rate and foreign currency exchange risks [Interest Rate Risk](index=67&type=section&id=Interest%20Rate%20Risk) - The Company's exposure to **interest rate risk** is considered immaterial due to its **cash and cash equivalents** being primarily held in highly rated, short-term Treasury money market funds[215](index=215&type=chunk) - An immediate **100 basis point change** in **interest rates** would not significantly affect the fair market value of **cash balances**[215](index=215&type=chunk) [Foreign Currency Exchange Risk](index=69&type=section&id=Foreign%20Currency%20Exchange%20Risk) - The primary foreign currency exposure is to the Danish Kroner (DKK) due to its Danish subsidiary[217](index=217&type=chunk) - **Cash and cash equivalents** denominated in DKK were **$0.6 million** as of March 31, 2022, and **$0.9 million** as of December 31, 2021. A **10% change** in DKK exchange rate would not materially affect these balances[217](index=217&type=chunk) [Item 4. Controls and Procedures](index=69&type=section&id=Item%204.%20Controls%20and%20Procedures) This section details the evaluation of disclosure controls and procedures and reports on changes in internal control [Evaluation of Disclosure Controls and Procedures](index=69&type=section&id=Evaluation%20of%20Disclosure%20Controls%20and%20Procedures) - Management, with the Interim CEO and CFO, concluded that disclosure controls and procedures were effective at a reasonable assurance level as of March 31, 2022[218](index=218&type=chunk) - Controls and procedures provide reasonable, not absolute, assurance, acknowledging inherent limitations in all control systems[219](index=219&type=chunk) [Changes in Internal Control over Financial Reporting](index=69&type=section&id=Changes%20in%20Internal%20Control%20over%20Financial%20Reporting) - There were no material changes in internal control over financial reporting during **Q1 2022**[220](index=220&type=chunk) PART II — OTHER INFORMATION This section includes legal proceedings, risk factors, equity sales, and other required disclosures [Item 1. Legal Proceedings](index=69&type=section&id=Item%201.%20Legal%20Proceedings) This section discloses legal proceedings, including a lawsuit against a Board Member for alleged short swing profits - The Company is a nominal defendant in a lawsuit against Board Member Thomas Gad for alleged short swing profits, but believes the claim is without merit and has not recorded any **loss** or gain contingencies[221](index=221&type=chunk) [Item 1A. Risk Factors](index=69&type=section&id=Item%201A.%20Risk%20Factors) This section details significant risks and uncertainties impacting the company's business, financial condition, and future growth [Risks Related to Our Financial Condition and Need for Additional Capital](index=71&type=section&id=Risks%20Related%20to%20Our%20Financial%20Condition%20and%20Need%20for%20Additional%20Capital) - The Company has a limited operating history, incurred significant **net loss** since inception (**$368.5 million accumulated deficit** as of March 31, 2022), and expects to continue incurring **net loss**, with **DANYELZA** being its only **FDA-approved product**[225](index=225&type=chunk)[226](index=226&type=chunk)[228](index=228&type=chunk) - Profitability depends on successful commercialization of **DANYELZA** and other product candidates, obtaining regulatory **FDA approval**, market acceptance, and managing manufacturing and intellectual property[228](index=228&type=chunk) - Payment obligations to MSK and MIT for **license agreements**, including milestones and royalties, could be significant and may require additional funding, potentially through debt or equity, leading to dilution[233](index=233&type=chunk)[237](index=237&type=chunk)[239](index=239&type=chunk) - The Company will need substantial additional funding for **R&D**, commercialization, and **operating as a public company**. Failure to obtain funding could delay or eliminate programs and terminate **license agreements**[240](index=240&type=chunk)[242](index=242&type=chunk)[244](index=244&type=chunk) - Raising additional capital may dilute **stockholders**, impose restrictive covenants through debt financing, or require relinquishing valuable rights to products or technologies[245](index=245&type=chunk)[246](index=246&type=chunk) - Focusing resources on specific products or indications (e.g., **DANYELZA**, **omburtamab**) may cause the Company to miss other potentially more profitable opportunities[247](index=247&type=chunk)[248](index=248&type=chunk) [Risks related to product development and commercialization](index=79&type=section&id=Risks%20related%20to%20product%20development%20and%20commercialization) - **DANYELZA** and product candidates are novel cancer treatments facing significant development and commercialization challenges, with **revenue** highly dependent on successful commercialization and regulatory **FDA approval**[250](index=250&type=chunk)[251](index=251&type=chunk) - The success of product candidates depends on timely completion of clinical trials, satisfactory safety/efficacy profiles, regulatory/reimbursement **FDA approval**, manufacturing capacity, and market acceptance[252](index=252&type=chunk) - Safety or efficacy problems with **DANYELZA** or **omburtamab** could harm development plans for other similar technology-based candidates[256](index=256&type=chunk) - The COVID-19 pandemic has and could continue to adversely affect operations, including clinical trial delays, patient enrollment issues, manufacturing disruptions, and impacts on sales and regulatory processes[257](index=257&type=chunk)[258](index=258&type=chunk)[262](index=262&type=chunk) - Russia's invasion of Ukraine led to the termination of clinical trials and regulatory **activities** for **DANYELZA** in Russia, negatively impacting commercialization plans and potentially global financial markets[267](index=267&type=chunk) - The Company has limited experience as a commercial company; successful marketing and sales of **DANYELZA** and future products depend on establishing and expanding sales/marketing capabilities or successful third-party collaborations[268](index=268&type=chunk)[270](index=270&type=chunk)[276](index=276&type=chunk) - Commercial success relies on market acceptance by physicians, patients, and payors, influenced by efficacy, safety, competitive advantages, pricing, and ease of administration[271](index=271&type=chunk)[273](index=273&type=chunk) - Market opportunities for **DANYELZA** and product candidates may be limited to specific patient populations (e.g., relapsed/refractory), potentially hindering profitability without broader indications[289](index=289&type=chunk)[291](index=291&type=chunk)[292](index=292&type=chunk) - Difficulties in patient enrollment for clinical trials due to population size, eligibility criteria, competition, or patient/physician reluctance could delay development and regulatory **FDA approval**[293](index=293&type=chunk)[296](index=296&type=chunk)[297](index=297&type=chunk) - **DANYELZA** and product candidates may cause serious adverse events (SAEs) or undesirable side effects, potentially halting clinical development, delaying/withdrawing **FDA approval**, limiting commercial potential, or requiring restrictive labeling (e.g., **DANYELZA's boxed warning** for infusion reactions and neurotoxicity)[298](index=298&type=chunk)[299](index=299&type=chunk)[303](index=303&type=chunk)[304](index=304&type=chunk)[305](index=305&type=chunk) - Pre-clinical and early clinical trial results may not predict later success, and interim data are subject to change. Adverse safety issues or clinical holds in one trial could affect others[307](index=307&type=chunk)[308](index=308&type=chunk)[309](index=309&type=chunk)[311](index=311&type=chunk) [Risks related to our dependence on third parties](index=106&type=section&id=Risks%20related%20to%20our%20dependence%20on%20third%20parties) - The Company has relied heavily on third parties (e.g., MSK) to sponsor most clinical trials for **DANYELZA** and **omburtamab**, limiting control over design and conduct[328](index=328&type=chunk) - Assuming control over clinical and regulatory development will incur substantial expenses and may face delays, and past trial data may not be sufficient for **FDA acceptance**[329](index=329&type=chunk)[330](index=330&type=chunk)[331](index=331&type=chunk) - Reliance on third-party CROs for clinical trials carries risks of non-compliance with GCPs, missed deadlines, compromised data quality, and potential need to repeat trials[333](index=333&type=chunk)[334](index=334&type=chunk) - The Company relies on third-party CMOs for **DANYELZA commercial supply** and product candidate manufacturing, facing risks of insufficient quantities, quality issues, non-compliance with cGMP, and limited manufacturers[336](index=336&type=chunk)[338](index=338&type=chunk)[339](index=339&type=chunk)[340](index=340&type=chunk)[341](index=341&type=chunk)[344](index=344&type=chunk) - **FDA** and EMA inspections of manufacturing facilities (e.g., EMD/Merck, Patheon/Thermo Fisher) are critical for **FDA approval**, and delays or non-compliance could significantly impact the **FDA approval process** for **omburtamab**[345](index=345&type=chunk)[348](index=348&type=chunk) - Dependence on outside scientists and third-party research institutions for **R&D** and early clinical testing means limited control, potential conflicts of interest, and risks to IND filings and clinical trial timing[349](index=349&type=chunk)[350](index=350&type=chunk)[353](index=353&type=chunk) - Termination of agreements with MSK could suspend **R&D** and commercialization, requiring additional resources or new collaborations[354](index=354&type=chunk) - Manufacturing biologics is complex, highly regulated, and costly, with risks of product **loss**, contamination, equipment failure, and supply disruptions, especially for sole-source vendors[355](index=355&type=chunk)[356](index=356&type=chunk)[357](index=357&type=chunk)[358](index=358&type=chunk) - Strategic collaborations for **DANYELZA** and **omburtamab** (e.g., SciClone, Takeda, Swixx, Adium) carry risks of collaborators not dedicating sufficient resources, abandoning projects, or competing, potentially delaying development and commercialization[360](index=360&type=chunk)[361](index=361&type=chunk) - Failure to establish additional collaborations could force the Company to curtail development, delay commercialization, or **increase expenditures**, requiring more capital[365](index=365&type=chunk) - Market acceptance and sales depend on adequate coverage and reimbursement from third-party payors, which is uncertain for new cancer treatments and could be inadequate for profitability[366](index=366&type=chunk)[369](index=369&type=chunk) [Risks related to government regulation; market approval and other legal compliance matters](index=121&type=section&id=Risks%20related%20to%20government%20regulation%3B%20market%20approval%20and%20other%20legal%20compliance%20matters) - The **FDA** issued a **Refusal to File** letter for **omburtamab's BLA** in October 2020, requiring further detail in CMC and Clinical Modules. The BLA was resubmitted in March 2022, but **FDA approval** is not assured and could be delayed[370](index=370&type=chunk)[371](index=371&type=chunk)[372](index=372&type=chunk)[373](index=373&type=chunk)[375](index=375&type=chunk) - **FDA inspections** of manufacturing facilities are required for **FDA approval**, and any delays (e.g., due to COVID-19 travel restrictions) or non-compliance could prevent or delay BLA **FDA approval** for **omburtamab**[376](index=376&type=chunk)[377](index=377&type=chunk) - The EMA also requires manufacturing facility inspections for **omburtamab's MAA**, with similar risks of delays or non-compliance impacting **FDA approval** in Europe[379](index=379&type=chunk) - The regulatory **FDA approval process** is lengthy, expensive, and unpredictable, requiring extensive pre-clinical and clinical data, manufacturing information, and facility inspections. **FDA approval** for **DANYELZA** in the US does not guarantee foreign approvals[380](index=380&type=chunk)[381](index=381&type=chunk)[383](index=383&type=chunk)[386](index=386&type=chunk)[399](index=399&type=chunk) - The **FDA** may require **two Phase 3 studies** for regular **FDA approval**, or accelerated **FDA approval** based on surrogate endpoints with post-marketing studies. The **FDA** may disagree with the Company's strategy or require additional trials[382](index=382&type=chunk) - Clinical trials can be delayed or terminated due to various factors, including patient enrollment difficulties, regulatory **FDA approval**, funding, site issues, safety concerns, and manufacturing challenges[387](index=387&type=chunk)[388](index=388&type=chunk)[390](index=390&type=chunk) - Failure to obtain regulatory **FDA approval** for product candidates would significantly harm the business, results of operations, and prospects[392](index=392&type=chunk)[393](index=393&type=chunk)[395](index=395&type=chunk)[396](index=396&type=chunk)[408](index=408&type=chunk) - **Breakthrough Therapy Designation** (BTD) for **omburtamab** (granted in 2017) does not guarantee faster development or **FDA approval**, and the **FDA** may revoke it or not grant it for other candidates[409](index=409&type=chunk)[410](index=410&type=chunk)[411](index=411&type=chunk) - The Company's product candidates may not obtain or maintain **Orphan Drug Designation** (ODD) or **Rare Pediatric Disease Designation** (RPDD), losing associated financial incentives and market exclusivity[412](index=412&type=chunk)[413](index=413&type=chunk)[415](index=415&type=chunk)[416](index=416&type=chunk)[417](index=417&type=chunk)[418](index=418&type=chunk) - Post-approval, **DANYELZA** and other **FDA-approved drugs** are subject to extensive ongoing regulation, including post-marketing studies (e.g., Study 201 for **DANYELZA**), safety reporting, cGMP compliance, and promotional restrictions[419](index=419&type=chunk)[422](index=422&type=chunk) - Failure to comply with post-approval requirements or changes in regulatory policies could lead to withdrawn **FDA approval**, marketing limitations, and substantial penalties[423](index=423&type=chunk)[424](index=424&type=chunk)[425](index=425&type=chunk)[426](index=426&type=chunk)[427](index=427&type=chunk)[429](index=429&type=chunk) - Healthcare reform measures (e.g., ACA) and government price controls could **increase costs**, reduce demand, and negatively impact pricing and reimbursement for **DANYELZA** and future products[430](index=430&type=chunk)[431](index=431&type=chunk)[432](index=432&type=chunk)[435](index=435&type=chunk)[436](index=436&type=chunk)[437](index=437&type=chunk)[438](index=438&type=chunk)[439](index=439&type=chunk)[440](index=440&type=chunk)[442](index=442&type=chunk)[443](index=443&type=chunk) - Relationships with healthcare providers are subject to anti-kickback, fraud and abuse, and other healthcare laws (e.g., Anti-Kickback Statute, False Claims Act, HIPAA, Sunshine Act, GDPR), risking penalties and reputational harm[444](index=444&type=chunk)[445](index=445&type=chunk)[447](index=447&type=chunk)[448](index=448&type=chunk)[452](index=452&type=chunk) - Radioimmunotherapy product candidates have very limited shelf lives, making them susceptible to damage and **loss** during transportation and distribution, which could adversely affect business and financial results[462](index=462&type=chunk)[463](index=463&type=chunk)[464](index=464&type=chunk) - Non-compliance with environmental, health, and safety laws (e.g., handling hazardous materials, radioactive elements) could lead to fines, penalties, and **increased costs**, impairing **R&D** and production[465](index=465&type=chunk)[466](index=466&type=chunk)[467](index=467&type=chunk) - International operations (US, Denmark, CMOs in Europe) are subject to diverse laws and regulations, including FCPA and anti-corruption laws, requiring costly compliance programs and risking penalties for non-compliance[468](index=468&type=chunk)[469](index=469&type=chunk)[470](index=470&type=chunk)[472](index=472&type=chunk)[473](index=473&type=chunk)[474](index=474&type=chunk) [Risks related to our intellectual property](index=153&type=section&id=Risks%20related%20to%20our%20intellectual%20property) - Protecting intellectual property (patents, trademarks, trade secrets) is difficult and costly. Patent applications may not result in issued patents, or patents may not be broad enough to prevent competition[475](index=475&type=chunk)[476](index=476&type=chunk) - Dependence on in-licensed technology from MSK and MIT means limited control over patent prosecution and enforcement, and potential **loss** of licenses if obligations are not met[477](index=477&type=chunk)[478](index=478&type=chunk)[483](index=483&type=chunk) - Uncertainty in patent issuance, scope, validity, and enforceability, coupled with changes in patent laws (e.g., America Invents Act), **increases costs** and risks of inadequate protection or infringement claims[484](index=484&type=chunk)[486](index=486&type=chunk)[487](index=487&type=chunk) - Patents may not cover all threats, competitors may circumvent them, and patent terms may expire before or shortly after commercialization, limiting competitive advantage[488](index=488&type=chunk)[489](index=489&type=chunk) - Reliance on trade secrets is risky due to potential unintentional or willful disclosure by employees or independent development by competitors[494](index=494&type=chunk) - Litigation related to patents or other intellectual property is costly, time-consuming, and unpredictable, potentially leading to substantial damages, injunctions, or **loss** of rights[496](index=496&type=chunk)[497](index=497&type=chunk)[498](index=498&type=chunk)[499](index=499&type=chunk)[500](index=500&type=chunk)[504](index=504&type=chunk)[508](index=508&type=chunk)[509](index=509&type=chunk)[512](index=512&type=chunk) - Protecting intellectual property globally is expensive and challenging, as foreign legal systems may not offer the same level of protection as the U.S[513](index=513&type=chunk)[514](index=514&type=chunk) - Failure to comply with procedural requirements for patent agencies can lead to abandonment or lapse of patent rights[515](index=515&type=chunk) - Failure to secure trademark registrations or **FDA approval** for proprietary names could hinder brand recognition and competitive positioning[516](index=516&type=chunk)[517](index=517&type=chunk)[519](index=519&type=chunk)[520](index=520&type=chunk) [Risks related to employee matters and managing growth](index=169&type=section&id=Risks%20related%20to%20employee%20matters%20and%20managing%20growth) - The Company heavily depends on executive officers and consultants. **Loss** of senior management (e.g., CEO stepping down in April 2022) or key personnel could materially harm the business[521](index=521&type=chunk)[527](index=527&type=chunk) - Recruiting and retaining qualified scientific, clinical, manufacturing, and sales/marketing personnel is critical, especially in competitive regions like New York City[522](index=522&type=chunk) - Equity grants to employees may not always be sufficient to retain talent against more lucrative offers[523](index=523&type=chunk) - Expected significant growth in employees and operations (sales, marketing, clinical, regulatory, **R&D**) may be difficult to manage due to limited financial resources and management experience, potentially disrupting operations[528](index=528&type=chunk) [Risks related to our common stock](index=171&type=section&id=Risks%20related%20to%20our%20common%20stock) - Executive officers, directors, and principal **stockholders** collectively own approximately **33.38% of common stock**, allowing them significant influence over **stockholder approval** matters[529](index=529&type=chunk) - Provisions in corporate charter documents and Delaware law (Section 203 DGCL) could discourage or delay acquisitions and make it difficult for **stockholders** to replace management or board members[530](index=530&type=chunk)[533](index=533&type=chunk) - An active trading market for **common stock** may not be sustained, potentially making it difficult for **stockholders** to sell **shares**[534](index=534&type=chunk) - As of December 31, 2020, the Company became a large accelerated filer, subjecting it to **increased disclosure** and compliance requirements (e.g., Section 404(b) SOX, executive **compensation** disclosures), **increasing costs** and management time[535](index=535&type=chunk)[537](index=537&type=chunk)[539](index=539&type=chunk) - The ability to use **net operating loss carryforwards** and other tax attributes may be limited by ownership changes under Section 382 of the Code[540](index=540&type=chunk) - The Company does not anticipate paying **cash dividends**, making capital appreciation the sole source of gain for **stockholders**[541](index=541&type=chunk) - Future sales of **common stock** by existing **stockholders** (including those with registration rights or under Rule 144) could dilute existing **stockholders** and depress the mar

Table of Contents UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM 10-K (Mark One) ☒ ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the fiscal year ended December 31, 2021. OR ☐ 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 001-38650 Y-mAbs Therapeutics, Inc. (Exact name of registrant as specified in its charter) Delaware 47-4619612 (State ...

Y-MAbs Therapeutics, Inc. (NASDAQ:YMAB) Q4 2021 Earnings Conference Call February 25, 2022 9:00 AM ET Company Participants Thomas Gad - Founder, Chairman & President Claus Møller - Chief Executive Officer Bo Kruse - Chief Financial Officer Conference Call Participants Alec Stranahan - Bank of America Charles Zhu - Guggenheim Securities Mike Ulz - Morgan Stanley Joseph Thome - Cowen & Company Tessa Romero - JPMorgan Sebastiaan van der Schoot - Kempen Operator Good day and welcome to the Y-mAbs Therapeutics, ...

mAbs herapeutics, Inc. Company Presentation February 2022 Disclaimer This presentation contains forward-looking statements within the meaning of the US Private Securities Litigation Reform Act of 1995. The forward-looking statements involve substantial risks and uncertainties. All statements, other than statements of historical facts, contained in this presentation, including statements regarding our strategy, future operations, future financial position, future revenue, projected costs, prospects, plans an ...