Atara Biotherapeutics: Opportunity As They Sell Off Their Approved Asset For Longer Runway

Core Viewpoint - Atara Biotherapeutics (NASDAQ:ATRA) is a commercial-stage biotech focused on cell therapies for Epstein-Barr virus-related diseases and cancer, showing potential for valuation appreciation despite recent trial failures and cash burn uncertainties [1] Pipeline Overview - The most advanced product, Tabelecleucel (tab-cel), is an allogeneic CAR T-cell therapy targeting EBV, approved for EBV-associated PTLD in Europe, with an FDA application planned for Q2 2024 [2][3] - Tab-cel demonstrated a 51.2% response rate and an 84.4% one-year overall survival rate in patients with EBV-positive PTLD [3] - Pierre Fabre will take over tab-cel's global development and commercialization, providing ATRA with upfront cash and future milestone payments [3] Product Development - ATA188, another EBV-directed T cell therapy for multiple sclerosis, failed its phase 2 EMBOLD study, showing only a 6% improvement in disability compared to a prior 33% reduction in phase 1 [4] - ATA3219, targeting CD19, is in early development with an IND cleared for studies in non-Hodgkin's lymphoma and systemic lupus, but no clinical data is available yet [5] Financial Overview - ATRA reported $118.7 million in total current assets, including $64.8 million in cash and equivalents, and recognized $2.1 million in revenues [6] - Total operating expenses were $71.8 million, resulting in a net loss of $69.8 million for the quarter [6] - The company received $15 million from a direct offering and $27 million from the agreement with Pierre Fabre, which may extend their cash runway [7] Strengths and Risks - Strengths include revenues from an approved product and a significant partnership with Pierre Fabre, which could drive revenue growth as tab-cel sales expand [8] - Risks involve uncertainty regarding cash runway and the lack of late-stage drugs in the pipeline, particularly after the failure of the MS drug [9][10] Bottom-Line Summary - ATRA's market cap of $122 million presents potential for significant upside if cash burn can be managed effectively, with opportunities for trial wind-downs, increasing sales, and new approvals for tab-cel [11]