Atara Biotherapeutics(ATRA) - 2019 Q3 - Quarterly Report

PART I. FINANCIAL INFORMATION Financial Statements (Unaudited) The company reported a Q3 2019 net loss of $71.9 million and held $282.9 million in cash and investments amid significant R&D spending Condensed Consolidated Balance Sheets Total assets were $364.8 million as of September 30, 2019, with total stockholders' equity at $318.4 million Condensed Consolidated Balance Sheet Highlights (in thousands) | Account | Sep 30, 2019 | Dec 31, 2018 | | :--- | :--- | :--- | | Assets | | | | Cash and cash equivalents | $94,431 | $60,698 | | Short-term investments | $188,491 | $248,933 | | Total current assets | $293,418 | $321,489 | | Total assets | $364,785 | $391,839 | | Liabilities & Equity | | | | Total current liabilities | $30,706 | $39,979 | | Total liabilities | $46,343 | $52,982 | | Total stockholders' equity | $318,442 | $338,857 | | Total liabilities and stockholders' equity | $364,785 | $391,839 | Condensed Consolidated Statements of Operations and Comprehensive Loss The company's net loss increased to $71.9 million in Q3 2019, driven by higher research, development, and administrative expenses Statement of Operations Highlights (in thousands, except per share data) | Metric | Q3 2019 | Q3 2018 | Nine Months 2019 | Nine Months 2018 | | :--- | :--- | :--- | :--- | :--- | | Research and development | $53,538 | $43,355 | $154,457 | $105,202 | | General and administrative | $19,018 | $16,865 | $61,525 | $50,093 | | Loss from operations | ($72,556) | ($60,220) | ($215,982) | ($155,295) | | Net loss | ($71,895) | ($58,361) | ($212,480) | ($150,687) | | Net loss per share | ($1.31) | ($1.29) | ($4.32) | ($3.49) | Condensed Consolidated Statements of Cash Flows Net cash used in operations was $176.9 million for the nine-month period, offset by $151.3 million raised from financing activities Cash Flow Summary (Nine Months Ended Sep 30, in thousands) | Activity | 2019 | 2018 | | :--- | :--- | :--- | | Net cash used in operating activities | ($176,936) | ($122,353) | | Net cash provided by (used in) investing activities | $59,332 | ($242,357) | | Net cash provided by financing activities | $151,337 | $351,515 | | Net increase (decrease) in cash | $33,733 | ($13,195) | Notes to Condensed Consolidated Financial Statements Notes detail the company's operating losses, reliance on equity financing, and adoption of the new lease standard ASC 842 - Atara is a clinical-stage allogeneic T-cell immunotherapy company developing treatments for cancer, autoimmune, and viral diseases with an accumulated deficit of $739.5 million as of September 30, 2019[17][19] - The company adopted the new lease accounting standard (ASU 2016-02, Topic 842) on January 1, 2019, recognizing operating lease assets of $14.3 million and liabilities of $15.3 million[33][34] - In July 2019, the company raised gross proceeds of $150.0 million ($140.7 million net) through an underwritten public offering of common stock and pre-funded warrants[77] - The company utilizes an "at the market" (ATM) facility, selling 686,131 shares for net proceeds of $12.6 million during the first nine months of 2019[80] Management's Discussion and Analysis of Financial Condition and Results of Operations Management discusses its focus on key T-cell programs, rising R&D costs, and its belief that cash is sufficient into 2021 - The company's strategic priorities are its most advanced T-cell immunotherapy programs: Tab-cel® (Phase 3), ATA188, and next-generation CAR T programs[98] - Atara plans to initiate a Biologics License Application (BLA) submission for Tab-cel® for patients with EBV+ PTLD in the second half of 2020[103] - The company expects its existing cash, cash equivalents, and short-term investments of $282.9 million (as of Sep 30, 2019) will be sufficient to fund planned operations into 2021[133][141] Research & Development Expenses by Program (in thousands) | Program | Nine Months 2019 | Nine Months 2018 | Change | | :--- | :--- | :--- | :--- | | Tab-cel® expenses | $34,006 | $33,748 | $258 | | ATA188, ATA190, CAR T & other | $24,060 | $11,753 | $12,307 | | Employee and overhead | $96,391 | $59,701 | $36,690 | | Total R&D Expenses | $154,457 | $105,202 | $49,255 | Quantitative and Qualitative Disclosures about Market Risk The company reports no material changes to its market risk disclosures during the nine months ended September 30, 2019 - There were no material changes to the company's market risk disclosures, including interest rate and foreign currency exchange rate risks, during the nine months ended September 30, 2019[148] Controls and Procedures Management concluded that disclosure controls and procedures were effective with no material changes to internal controls - The CEO and CFO concluded that the company's disclosure controls and procedures were effective as of September 30, 2019[150] - No changes in internal control over financial reporting occurred during the quarter that materially affected, or are reasonably likely to materially affect, the company's internal controls[153] PART II. OTHER INFORMATION Legal Proceedings The company is not currently involved in any material legal proceedings - The company reports no material legal proceedings[155] Risk Factors The company faces significant financial, developmental, manufacturing, commercialization, and intellectual property risks - Financial Risks: The company has a history of substantial losses ($739.5 million accumulated deficit) and expects to incur increasing losses, requiring substantial additional financing[158][165] - Development & Regulatory Risks: Product candidates are in early development and represent new therapeutic approaches (allogeneic T-cell therapy), facing heightened regulatory scrutiny and potential trial failures[171][181] - Manufacturing & Supply Risks: The company is subject to significant manufacturing risks, including process scale-up and reliance on its ATOM facility and third-party CMOs[223][229][237] - Commercialization Risks: Success depends on market acceptance, obtaining adequate reimbursement, and competing with established therapies and companies with greater resources[274][276][288] - Intellectual Property Risks: The company relies heavily on in-licensed patents and know-how from partners like MSK, and losing these rights could significantly harm the business[246][266] Unregistered Sales of Equity Securities and Use of Proceeds The company reports no unregistered sales of equity securities during the period - None reported[343] Defaults Upon Senior Securities The company reports no defaults upon senior securities - None reported[343] Mine Safety Disclosures This item is not applicable to the company - Not applicable[344] Other Information The company reports no other information - None reported[344] Exhibits This section lists exhibits filed with the Form 10-Q, including corporate documents and required certifications