What changed in this filing

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Item 2. Management’s Discussion and Analysis

2021-11-03 compared with 2021-07-29 · 83 added, 76 removed, 187 unchanged (46% of the section changed)

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Forward-looking Information

The following discussion of our financial condition and results of operations should be read with our unaudited condensed consolidated financial statements as of June 30, 2021 and for the three and six months ended June 30, 2021 and 2020, and related notes included in Part I, Item 1 of this Quarterly Report on Form 10-Q, as well as the audited consolidated financial statements and notes and Management’s Discussion and Analysis of Financial Condition and Results of Operations, included in our Annual Report on Form 10-K for the year ended December 31, 2020 filed with the SEC on February 25, 2021.

The following discussion of our financial condition and results of operations should be read with our unaudited condensed consolidated financial statements as of September 30, 2021 and for the three and nine months ended September 30, 2021 and 2020, and related notes included in Part I, Item 1 of this Quarterly Report on Form 10-Q, as well as the audited consolidated financial statements and notes and Management’s Discussion and Analysis of Financial Condition and Results of Operations, included in our Annual Report on Form 10-K for the year ended December 31, 2020 filed with the SEC on February 25, 2021.

This Management’s Discussion and Analysis of Financial Condition and Results of Operations contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995.

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A more complete description of our business prior to the consummation of the transaction is included in Item 1.

“Business”, in Part I of the Annual Report on Form 10-K for the year ended December 31, 2020 that was previously filed with the Securities and Exchange Commission (“SEC”) on February 25, 2021.

“Business”, in Part I of the Annual Report on Form 10-K for the year ended December 31, 2020 that was previously filed with the Securities and Exchange Commission, or SEC, on February 25, 2021.

Our primary focus in the GDD area relates to therapeutic categories where we believe we have differentiated expertise and demonstrated capabilities (e.g., -enzyme stabilizers, pyruvate kinase, phenylalanine hydroxylase).

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This trial has completed enrollment and we are conducting an extension study for previously enrolled patients, which is designed to evaluate the long-term safety, tolerability and efficacy of treatment with mitapivat.

• Pivotal trials in pediatric PK deficiency, which we expect to initiate in 2022.

• ENERGIZE and ENERGIZE-T, phase 3 trials of mitapivat in not-regularly-transfused and regularly-transfused adults with thalassemia, which we expect to initiate in the second half of 2021.

• A phase 2/3 trial of mitapivat in patients with SCD, which we expect to initiate by the end of 2021.

• Pivotal trials of mitapivat in pediatric PK deficiency, which we expect to initiate in 2022.

• ENERGIZE and ENERGIZE-T, phase 3 trials of mitapivat in not-regularly-transfused and regularly-transfused adults with thalassemia, have been initiated.

• RISE UP, a phase 2/3 trial of mitapivat in patients with SCD, is expected to initiate by the end of 2021.

We have worldwide development and commercial rights to mitapivat and expect to fund the future development and commercialization costs related to this program.

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In June 2021, we submitted an NDA for mitapivat to the FDA for the treatment of adults with PK deficiency in the United States and a marketing authorization application, or MAA, to the EMA for the treatment of adults with PK deficiency the European Union.

We anticipate a potential commercial launch of mitapivat in the United States and the European Union in 2022 if we receive regulatory approvals.

Our NDA was accepted with priority review and granted a Prescription Drug User Fee Act, or PDUFA, action date of February 17, 2022.

The MAA has passed validation, and both regulatory review processes are ongoing.

We also expect to continue to grow our U.S.

commercial infrastructure and evaluate all options to maximize the patient impact and value of mitapivat globally, including strategic transactions.

We are also developing AG-946, a next-generation activator of both the PKR and PKM2 isoforms of pyruvate kinase.

We are also developing AG-946, a novel activator of both the PKR and PKM2 isoforms of pyruvate kinase, in an ongoing phase 1 trial which is currently enrolling healthy volunteers.

PKR activation is specific to red blood cells and hemolytic anemias, while PKM2 activation occurs in other tissues which express this isoform, and is potentially important in a variety of disease indications.

In addition to these development programs, we are seeking to advance a number of early-stage discovery programs for GDDs.

Drug candidates for PK activation and other mechanisms, while primarily targeting GDD may also have utility in nongenetically defined disease indications.

Drug candidates for PK activation and other mechanisms, while primarily targeting GDD may also have utility in nongenetically defined disease, or non-GDD indications.

Where differentiated, nonclinical proof of concept emerges for these non-GDD indications, appropriate partnership may be used to drive the best patient benefit.

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Impact of COVID-19 on our Business

As of June 30, 2021, we have not experienced a significant financial or supply chain impact directly related to the COVID-19 pandemic but have experienced some disruptions to clinical operations, including timelines to complete patient enrollment in some of our clinical trials, as further described below.

We are continuing to serve our customers while taking precautions to provide a safe work environment for our employees and customers.

As of September 30, 2021, we have not experienced a significant financial or supply chain impact directly related to the COVID-19 pandemic but have experienced some disruptions to clinical operations, including timelines to complete patient enrollment in some of our clinical trials, as further described below.

We are continuing to serve third parties while taking precautions to provide a safe work environment for our employees and third parties.

Our lab-based employees who need to be onsite to fulfill their job responsibilities have been onsite since late May 2020, and we have opened our Cambridge office to employees who prefer to work onsite.

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We are conducting our return to work program under strict guidelines as required by federal, state, and local authorities.

Effective November 8, 2021, we will require all employees, regardless of role or work location, to be fully vaccinated against COVID-19, as defined by the Center of Disease Control and Prevention's guidelines, subject to limited exceptions.

We have been monitoring our supply chain network for disruptions due to the COVID-19 pandemic, and our third-party manufacturers remain largely unaffected, with any campaign delays experienced to date being limited to a few days in duration.

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The extent of the pandemic’s effect on our operational and financial performance will depend in large part on future developments, which cannot be predicted with confidence at this time.

Future developments include changes in the duration, scope and severity of the pandemic, including and variant strains of the COVID-19 virus, the actions taken to contain or mitigate its impact, the impact on governmental programs and budgets, the supply, distribution and efficacy of vaccines, and the resumption of widespread economic activity.

Any prolonged material disruption of our employees, suppliers, manufacturing, or customers could negatively impact our consolidated financial position, consolidated results of operations and consolidated cash flows.

Future developments include changes in the duration, scope and severity of the pandemic, including any variant strains of the COVID-19 virus, the actions taken to contain or mitigate its impact, the impact on governmental programs and budgets, the supply, distribution and efficacy of vaccines, and the resumption of widespread economic activity.

Any prolonged material disruption of our employees, suppliers, manufacturing, or third parties could negatively impact our consolidated financial position, consolidated results of operations and consolidated cash flows.

As a result, we may have to take further actions that we determine are in the best interests of our employees or as required by federal, state, or local authorities.

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Following the sale of our oncology business to Servier on March 31, 2021, we expect to finance our operations primarily through cash on hand, royalty payments from Servier with respect to U.S.

net sales of TIBSOVO®, a potential milestone payment from Servier if vorasidenib is approved by the FDA, and future potential sales of mitapivat if approved for marketing by regulatory authorities and successfully launched by us and, potentially, collaborations, strategic alliances, licensing arrangements and other nondilutive strategic transactions.

net sales of TIBSOVO®, the potential milestone payment from Servier if vorasidenib is approved by the FDA, and future potential sales of mitapivat if approved for marketing by regulatory authorities and successfully launched by us and, potentially, collaborations, strategic alliances, licensing arrangements and other nondilutive strategic transactions.

We have historically incurred operating losses.

Our net income for the six months ended June 30, 2021 was $1,788.1 million and our net loss for the six months ended June 30, 2020 was $130.7 million.

As of June 30, 2021, we had an accumulated deficit of $55.4 million.

The net income we generated in the six months ended June 30, 2021 was primarily due to the sale of our oncology business to Servier, which was consummated on March 31, 2021.

Our net income for the nine months ended September 30, 2021 was $1,699.3 million and our net loss for the nine months ended September 30, 2020 was $229.7 million.

As of September 30, 2021, we had an accumulated deficit of $144.1 million.

The net income we generated in the nine months ended September 30, 2021 was primarily due to the sale of our oncology business to Servier, which was consummated on March 31, 2021.

Following the consummation of the sale of our oncology business, we expect to incur significant expenses and net losses until such time we are able to report profitable results.

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As such, at this time, we cannot reasonably estimate or know the nature, timing and estimated costs of the efforts that will be necessary to complete the remainder of the development and to commercialize these product candidates.

We are also unable to positively predict when future net cash inflows will commence from mitapivat, AG-946 or any of our other product candidates.

We are also unable to predict when future net cash inflows will commence from

mitapivat, AG-946 or any of our other product candidates.

This is due to the numerous risks and uncertainties associated with developing medicines, including the uncertainty of:

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• DRIVE PK, a global phase 2, first-in-patient, open-label safety and efficacy clinical trial of mitapivat in adult, transfusion-independent patients with PK deficiency.

This trial has completed enrollment.

• ACTIVATE-T, a single arm, global, pivotal trial of mitapivat in regularly-transfused patients with PK deficiency.

The trial has completed enrollment.

We reported in June 2021, in a full analysis of updated data, that this trial met its primary endpoint of a statistically significant and clinically meaningful reduction in transfusion burden and that improvements were also observed for certain patient reported outcomes.

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• ACTIVATE, a 1:1 randomized, placebo-controlled, global, pivotal trial of mitapivat in patients with PK deficiency who do not receive regular transfusions.

The trial has completed enrollment.

We reported in June 2021, in a full analysis of updated data, that this trial met its primary endpoint of a statistically significant, sustained increase in hemoglobin compared to placebo.

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• A phase 2, open-label safety and efficacy clinical trial of mitapivat in adult patients with non-transfusion-dependent α- and β-thalassemia.

The trial has completed enrollment We reported in June 2020 that this trial met its primary endpoint of hemoglobin increase of greater than or equal to 1.0 gram per deciliter from baseline at one or more assessments during weeks 4-12 of the trial.

We reported in June 2021 that this trial met its primary endpoint of hemoglobin increase of greater than or equal to 1.0 gram per deciliter from baseline at one or more assessments during weeks 4-12 of the trial.

The trial has completed enrollment and we are conducting an extension study for previously enrolled patients, which is designed to evaluate the long-term safety, tolerability and efficacy of treatment with mitapivat.

• In collaboration with the National Institutes of Health, or NIH, we are evaluating mitapivat in a phase 1 trial in patients with SCD pursuant to a cooperative research and development agreement.

The trial is ongoing and enrolling patients, although the NIH experienced disruptions related to the COVID-19 pandemic.

Enrollment has been completed in the core trial period, and patients are enrolling in an ongoing long-term extension study.

In June 2020, clinical proof of concept was established based on a preliminary analysis of the data from this trial.

• In collaboration with UMC Utrecht, or UMC, we are evaluating mitapivat in patients with SCD pursuant to an investigator sponsored trial agreement.

The trial is ongoing and enrolling patients, although UMC experienced disruptions related to the COVID-19 pandemic.

We expect to initiate two phase 3 trials of mitapivat, ENERGIZE and ENERGIZE-T, in not regularly transfused and regularly transfused adults with thalassemia in the second half of 2021, and we expect to initiate a phase 2/3 trial of mitapivat in patients with SCD by the end of 2021.

We expect to initiate pivotal trials in pediatric PK deficiency in 2022.

Next-generation PKR Activator

In the third quarter of 2021, we initiated two phase 3 trials of mitapivat, ENERGIZE and ENERGIZE-T, in not regularly transfused and regularly transfused adults with thalassemia.

We expect to initiate RISE UP, a phase 2/3 trial of mitapivat in patients with SCD, by the end of 2021.

We expect to initiate pivotal trials of mitapivat in pediatric PK deficiency in 2022.

Novel PK Activator

• A phase 1 trial of AG-946 in healthy volunteers and in patients with SCD.

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Certain amounts in prior periods have been reclassified to reflect the impact of the discontinued operations treatment of the oncology business in order to conform to the current period presentation.

Comparison of the three and six months ended June 30, 2021 and 2020

Comparison of the three and nine months ended September 30, 2021 and 2020

Total Operating Expenses

Three Months Ended June 30, Six Months Ended June 30,

Three Months Ended September 30, Nine Months Ended September 30,

(In thousands) 2021 2020 2021 2020

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Total Operating Expenses $ 91,152 $ 80,290 $ 273,591 $ 250,584

Total Operating Expenses - Three Months ended June 30, 2021 vs.

Three Months ended June 30, 2020 - The increase in total operating expenses of $8.0 million for the three months ended June 30, 2021 compared to the three months ended June 30, 2020 was primarily due an increase in research and development expenses of $7.9 million which is described below under Research and Development Expenses.

Total Operating Expenses - Three Months ended September 30, 2021 vs.

Three Months ended September 30, 2020 - The increase in total operating expenses of $10.9 million for the three months ended September 30, 2021 compared to the three months ended September 30, 2020 was primarily due to an increase in research and development expenses of $12.1 million which is described below under Research and Development Expenses.

Included in selling, general and administrative expenses is approximately $1.3 million of reimbursable transition related services we provided to Servier related to the sale of the oncology business.

Total Operating Expenses - Six Months ended June 30, 2021 vs.

Six Months ended June 30, 2020 - The increase in total operating expenses of $12.1 million for the six months ended June 30, 2021 compared to the six months ended June 30, 2020 was primarily due an increase in research and development expenses of $10.2 million which is described below under Research and Development Expenses.

Total Operating Expenses - Nine Months ended September 30, 2021 vs.

Nine Months ended September 30, 2020 - The increase in total operating expenses of $23.0 million for the nine months ended September 30, 2021 compared to the nine months ended September 30, 2020 was primarily due to an increase in research and development expenses of $22.3 million which is described below under Research and Development Expenses.

Included in selling, general and administrative expenses is approximately $3.4 million of reimbursable transition related services we provided to Servier related to the sale of the oncology business.

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Our research and development expenses, by major program, are outlined in the table below:

Three Months Ended June 30, Six Months Ended June 30,

Three Months Ended September 30, Nine Months Ended September 30,

(In thousands) 2021 2020 2021 2020

Mitapivat (PKR activator) $ 20,130 $ 10,634 $ 49,543 $ 31,410

AG-946 (Next-Gen PKR activator) 2,258 2,432 4,029 4,838

AG-946 (Novel PK activator) 2,820 2,357 6,849 7,195

Other research and platform programs 6,109 3,522 14,684 9,478

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Total research and development expense $ 64,000 $ 51,943 $ 183,674 $ 161,388

Total Research and Development Expenses - Three Months ended June 30, 2021 vs.

Three Months ended June 30, 2020 - The increase in total research and development expenses of $7.9 million for the three months ended June 30, 2021 compared to the three months ended June 30, 2020 was primarily due to a $6.0 million increase in mitapivat costs due to start up costs for the planned phase 3 trials of mitapivat, ENERGIZE and ENERGIZE-T, the planned phase 2/3 trial of mitapivat in patients with SCD, and filing and launch preparation activities which includes $0.5 million in filing fees.

Total Research and Development Expenses - Three Months ended September 30, 2021 vs.

Three Months ended September 30, 2020 - The increase in total research and development expenses of $12.1 million for the three months ended September 30, 2021 compared to the three months ended September 30, 2020 was primarily due to a $9.5 million increase in mitapivat costs due to start up costs for the initiated phase 3 trials of mitapivat, ENERGIZE and ENERGIZE-T, and the planned phase 2/3 trial of mitapivat in patients with SCD, RISE UP, and launch preparation activities.

The increase in other research and platform programs of $2.6 million was primarily driven by planned increased activity on various exploratory and discovery activities.

Included in total indirect research and development expenses was $3.2 million of reimbursable transition related services we provided to Servier related to the sale of the oncology business for discovery, clinical development, technical operations, and commercial related activities which will continue for periods ranging from one month to approximately one year after March 31, 2021.

Total Research and Development Expenses - Six Months ended June 30, 2021 vs.

Six Months ended June 30, 2020 - The increase in total research and development expenses of $10.2 million for the six months ended June 30, 2021 compared to the six months ended June 30, 2020 was primarily due to a $8.6 million increase in mitapivat costs due to start up costs for the planned phase 3 trials of mitapivat, ENERGIZE and ENERGIZE-T, the planned phase 2/3 trial of mitapivat in patients with SCD, and filing and launch preparation activities which includes $0.5 million in filing fees.

Total Research and Development Expenses - Nine Months ended September 30, 2021 vs.

Nine Months ended September 30, 2020 - The increase in total research and development expenses of $22.3 million for the nine months ended September 30, 2021 compared to the nine months ended September 30, 2020 was primarily due to a $18.1 million increase in mitapivat costs due to start up costs for the initiated phase 3 trials of mitapivat, ENERGIZE and ENERGIZE-T, the planned phase 2/3 trial of mitapivat in patients with SCD, RISE UP, and filing and launch preparation activities which includes $0.5 million in filing fees.

The increase in other research and platform programs of $5.2 million was primarily driven by planned increased activity on various exploratory and discovery activities.

Included in total indirect research and development expenses was $7.6 million of reimbursable transition related services we provided to Servier related to the sale of the oncology business related to discovery, clinical development, technical operations, and commercial related activities which will continue for periods ranging from one month to approximately one year after March 31, 2021.

Other Income and Expense

Three Months Ended June 30, Six Months Ended June 30,

Three Months Ended September 30, Nine Months Ended September 30,

(In thousands) 2021 2020 2021 2020

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$ 1,996 $ — $ 3,996 $ —

Interest (expense) income, net (92) 1,769 248 4,705

Interest income, net 256 1,115 504 5,820

Other income, net 4,641 — 11,165 —

Other Income and Expense- Three Months ended June 30, 2021 vs.

Three Months ended June 30, 2020 - The increase in other income, net primarily relates to approximately $6.5 million of reimbursable transition related services and fees for the sale of the oncology business.

Other Income and Expense- Three Months ended September 30, 2021 vs.

Three Months ended September 30, 2020 - The increase in other income, net primarily relates to approximately $4.5 million of reimbursable transition related services for the sale of the oncology business for the three months ended September 30, 2021.

The increase in gain on sale of oncology business primarily relates to income from royalties on U.S.

net sales of TIBSOVO® by Servier of approximately $2.0 million in the second quarter of 2021.

net sales of TIBSOVO® by Servier of approximately $2.0 million in the third quarter of 2021.

The decrease in interest income, net is primarily attributable to a decrease in interest rates.

Other Income and Expense- Six Months ended June 30, 2021 vs.

Six Months ended June 30, 2020 - The increase in other income, net primarily relates to approximately $6.5 million of reimbursable transition related services and fees for the sale of the oncology business in the second quarter of 2021.

The increase in gain on sale of oncology business primarily relates to income from royalties on U.S.

net sales of TIBSOVO® by Servier of approximately $2.0 million in the second quarter of 2021.

Other Income and Expense- Nine Months ended September 30, 2021 vs.

Nine Months ended September 30, 2020 - The increase in other income, net primarily relates to approximately $11.0 million of reimbursable transition related services and fees for the sale of the oncology business for the nine months ended September 30, 2021.

The increase in gain on sale of oncology business

primarily relates to income from royalties on U.S.

net sales of TIBSOVO® by Servier of approximately $4.0 million for the nine months ended September 30, 2021.

The decrease in interest income, net is primarily attributable to a decrease in interest rates.

Loss from Operations and Net Income (Loss)

Three Months Ended June 30, Six Months Ended June 30,

Loss from Operations and Net (Loss) Income

Three Months Ended September 30, Nine Months Ended September 30,

(In thousands) 2021 2020 2021 2020

Net loss from continuing operations $ (84,259) $ (79,175) $ (257,926) $ (244,764)

Net income (loss) from discontinued operations (3,427) (8,983) 1,961,775 34,855

Net income (loss) (86,217) (90,478) 1,788,108 (130,734)

Loss from Operations and Net Income (Loss) – Three Months ended June 30, 2021 vs.

Three Months ended June 30, 2020 – The increase in net loss from continuing operations for the three months ended June 30, 2021 compared to the three months ended June 30, 2020 was primarily driven by the higher research and development expenses discussed above under Research and Development Expenses, partially offset by $6.5 million of reimbursable transition related services and fees related to the sale of the oncology business and a $2.0 million gain on sale of oncology business related to income from royalties on U.S.

net sales of TIBSOVO® by Servier, both occurring in the second quarter of 2021.

The change in net loss from discontinued operations for the three months ended June 30, 2021 compared to the three months ended June 30, 2020 was primarily driven by the sale of our oncology business to Servier in the first quarter of 2021, which significantly reduced revenues and expenses related to our oncology programs.

The decrease in net income (loss) for the three months ended June 30, 2021 compared to the three months ended June 30, 2020 was primarily driven by the increase in net loss from continuing operations discussed above, partially offset by a lower net loss from discontinued operations for the three months ended June 30, 2021 on the sale of the oncology business discussed above.

Loss from Operations and Net Income (Loss) – Six Months ended June 30, 2021 vs.

Six Months ended June 30, 2020 – The increase in loss from continuing operations for the six months ended June 30, 2021 compared to the six months ended June 30, 2020 was primarily driven by the higher research and development expenses discussed above under Research and Development Expenses, partially offset by $6.5 million of reimbursable transition related services and fees related to the sale of the oncology business and a $2.0 million gain on sale of oncology business related to income from royalties on U.S.

net sales of TIBSOVO® by Servier, both occurring in the second quarter of 2021.

The change in net income from discontinued operations and net income (loss) for the six months ended June 30, 2021 compared to the six months ended June 30, 2020 was primarily driven by the sale of our oncology business to Servier for approximately $1.8 billion in cash in the first quarter of 2021, which is included within net income from discontinued operations.

Net (loss) income from discontinued operations (4,507) (19,804) 1,957,268 15,051

Net (loss) income (88,766) (98,979) 1,699,342 (229,713)

Loss from Operations and Net (Loss) Income – Three Months ended September 30, 2021 vs.

Three Months ended September 30, 2020 – The increase in net loss from continuing operations for the three months ended September 30, 2021 compared to the three months ended September 30, 2020 was primarily driven by the higher research and development expenses discussed above under Research and Development Expenses, partially offset by $4.5 million of reimbursable transition related services related to the sale of the oncology business and a $2.0 million gain on sale of oncology business related to income from royalties on U.S.

net sales of TIBSOVO® by Servier, both occurring in the third quarter of 2021.

The change in net loss from discontinued operations for the three months ended September 30, 2021 compared to the three months ended September 30, 2020 was primarily driven by the sale of our oncology business to Servier in the first quarter of 2021, which significantly reduced revenues and expenses related to our oncology programs.

The decrease in net (loss) income for the three months ended September 30, 2021 compared to the three months ended September 30, 2020 was primarily driven by the increase in net loss from continuing operations discussed above, partially offset by a lower net loss from discontinued operations for the three months ended September 30, 2021 on the sale of the oncology business discussed above.

Loss from Operations and Net (Loss) Income – Nine Months ended September 30, 2021 vs.

Nine Months ended September 30, 2020 – The increase in loss from continuing operations for the nine months ended September 30, 2021 compared to the nine months ended September 30, 2020 was primarily driven by the higher research and development expenses discussed above under Research and Development Expenses, partially offset by $11.0 million of reimbursable transition related services and fees related to the sale of the oncology business and a $4.0 million gain on sale of oncology business related to income from royalties on U.S.

net sales of TIBSOVO® by Servier, both occurring in the nine months ended September 30, 2021.

The change in net income from discontinued operations and net (loss) income for the nine months ended September 30, 2021 compared to the nine months ended September 30, 2020 was primarily driven by the sale of our oncology business to Servier for approximately $1.8 billion in cash in the first quarter of 2021, which is included within net income from discontinued operations.

Liquidity and Capital Resources

Sources of liquidity

Since our inception, and through June 30, 2021, we have funded our operations through proceeds from the sale of our oncology business, commercial sales of TIBSOVO®, upfront, milestone, extension, cost reimbursement and royalty payments related to our collaboration agreements, product sales, proceeds from the sale of our royalty rights, proceeds received from our issuance of preferred stock, our initial public offering and concurrent private placement of common stock to an affiliate of Celgene, and our follow-on public offerings.

As of June 30, 2021, we had cash, cash equivalents and marketable securities of $1.7 billion.

Since our inception, and through September 30, 2021, we have funded our operations through proceeds from the sale of our oncology business, commercial sales of TIBSOVO®, upfront, milestone, extension, cost reimbursement and royalty payments related to our collaboration agreements, product sales, proceeds from the sale of our royalty rights, proceeds received from our issuance of preferred stock, our initial public offering and concurrent private placement of common stock to an affiliate of Celgene, and our follow-on public offerings.

As of September 30, 2021, we had cash, cash equivalents and marketable securities of $1.4 billion.

On March 25, 2021, we announced that our board of directors authorized the repurchase of up to $1.2 billion of our outstanding shares of common stock, or the Repurchase Program, using the proceeds from the sale of our oncology business to Servier.

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Further, on April 2, 2021, in connection with the Repurchase Program, we entered into a Rule 10b5-1 repurchase plan pursuant to which we may repurchase up to $600 million of shares of our common stock.

As of June 30, 2021, we have repurchased approximately 3.4 million shares of common stock for $184.5 million, or $54.71 per share, under the plan with approximately $415.5 million remaining under the plan for additional repurchases.

As of September 30, 2021, we have repurchased approximately 8.7 million shares of common stock for $438.9 million, or $50.57 per share, under the plan.

On October 5, 2021, we terminated our Rule 10b5-1 share repurchase program and on October 13, 2021 entered into a Rule 10b-18 repurchase plan that allows us to conduct open market repurchases over time up to our remaining authorization under the Repurchase Program.

We have paused our share repurchases and for the foreseeable future, we expect that our capital allocation will be prioritized towards

opportunities to accelerate programs in our development pipeline and/or pursue potential complementary business development opportunities.

In addition to our existing cash, cash equivalents and marketable securities, under the purchase agreement we are eligible to receive a $200 million milestone payment upon regulatory approval of vorasidenib, and royalty payments with respect to U.S.

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Whether the regulatory approval milestone for vorasidenib will be achieved is subject to various risks and uncertainties, many of which are outside our control, including adverse clinical developments with respect to vorasidenib.

Furthermore, we cannot predict what success, if any, Servier may have in the United States with respect to sales of TIBSOVO®

and, if approved, vorasidenib and consequently we cannot estimate the amount of royalty payments that we can expect to receive from Servier under the purchase agreement prior to the loss of exclusivity of these products.

The following table provides information regarding our cash flows for the six months ended June 30, 2021 and 2020:

Six Months Ended June 30,

Furthermore, we cannot predict what success, if any, Servier may have in the United States with respect to sales of TIBSOVO® and, if approved, vorasidenib, and consequently we cannot estimate the amount of royalty payments that we can expect to receive from Servier under the purchase agreement prior to the loss of exclusivity of these products.

The following table provides information regarding our cash flows for the nine months ended September 30, 2021 and 2020:

Nine Months Ended September 30,

(In thousands) 2021 2020

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Net cash used in operating activities.

Cash used in operating activities of $238.0 million during the six months ended June 30, 2021, of which $159.2 million was used by continuing operations and $78.8 million was used by discontinued operations, was primarily due to cash received of $39.5 million from sales of TIBSOVO®, and $1.2 million in cost reimbursements related to our collaboration agreements with Celgene.

These amounts were offset by operating expenses primarily driven by research and development costs described above under Research and Development Expenses.

Cash used in operating activities of $173.2 million during the six months ended June 30, 2020, of which $136.2 million was used by continuing operations and $37.0 million was used by discontinued operations, was primarily due to cash received $52.3 million from sales of TIBSOVO®, $9.6 million in royalty payments and cost reimbursements under our collaboration agreements with Celgene, $4.8 million in interest received, and $1.8 million in cost reimbursement related to our collaboration agreement with CStone.

These amounts were offset by decreased operating expenses driven by lower research and development costs described above in Research and Development Expenses partially offset by increased staffing needs due to our expanding operations.

Cash used in operating activities of $323.2 million during the nine months ended September 30, 2021, of which $234.1 million was used by continuing operations and $89.1 million was used by discontinued operations, was primarily driven by research and development costs described above under Research and Development Expenses, offset by cash received of $39.5 million from sales of TIBSOVO®, and $1.2 million in cost reimbursements related to our collaboration agreements with Celgene.

Cash used in operating activities of $241.4 million during the nine months ended September 30, 2020, of which $192.8 million was used by continuing operations and $48.6 million was used by discontinued operations, was primarily due to operating expenses driven by research and development costs described above in Research and Development Expenses and increased staffing needs due to our expanding operations, offset by cash received of $83.3 million from sales of TIBSOVO®, $12.6 million in royalty payments and cost reimbursements under our collaboration agreements with Celgene, $6.1 million in interest received, and $2.7 million in cost reimbursement related to our collaboration agreement with CStone Pharmaceuticals.

Net cash provided by investing activities .

Cash provided by investing activities of $1.6 billion for the six months ended June 30, 2021, of which $227.0 million was used by operating activities and $1.8 billion was provided by discontinued operations, was primarily due to the approximately $1.8 billion in cash proceeds received from the sale of our oncology business to Servier that was completed on March 31, 2021, partially offset by lower proceeds from maturities and sales of marketable securities than purchases of marketable securities.

Cash provided by investing activities of $130.6 million for six months ended June 30, 2020, of which approximately all was provided by operating activities and $348.0 thousand was used by discontinued operations, was primarily the result of higher proceeds from maturities and sales of marketable securities than purchases of marketable securities, offset by $8.7 million in purchases of property and equipment.

Cash provided by investing activities of $1.3 billion for the nine months ended September 30, 2021, of which $459.7 million was used by continuing operations and $1.8 billion was provided by discontinued operations, was primarily due to the approximately $1.8 billion in cash proceeds received from the sale of our oncology business to Servier that was completed on March 31, 2021, partially offset by lower proceeds from maturities and sales of marketable securities than purchases of marketable securities.

Cash provided by investing activities of $4.4 million for nine months ended September 30, 2020, of which approximately all was provided by continuing operations and $348.0 thousand was used by discontinued operations, was primarily the result of higher proceeds from maturities and sales of marketable securities than purchases of marketable securities, offset by $13.9 million in purchases of property and equipment.

Net cash (used in) provided by financing activities .

Cash used in financing activities for the six months ended June 30, 2021, of which all was provided by operating activities and none was used by discontinued operations, was primarily the result of $529.0 million in common stock repurchases in the second quarter of 2021 under our Repurchase Program, partially offset by the $33.0 million of proceeds received from stock option exercises and purchases made pursuant to our 2013 ESPP.

Cash provided by financing activities for the six months ended June 30, 2020, of which $7.0 million was provided by continuing operations and $250.5 million was provided by discontinued operations, was primarily the result of net proceeds of $250.5 million from the sale of our tiered, sales-based royalty rights on worldwide net sales of IDHIFA® (enasidenib) and our ex-US regulatory milestones to Royalty Pharma in June 2020 and $7.1 million of proceeds received from stock option exercises and purchases made pursuant to our 2013 ESPP.

Cash used in financing activities of $747.2 million for the nine months ended September 30, 2021, of which all was provided by continuing operations and none was used by discontinued operations, was primarily the result of $783.4 million in common stock repurchases in the nine months ended September 30, 2021 under our Repurchase Program, partially offset by the $37.0 million of proceeds received from stock option exercises and purchases made pursuant to our 2013 ESPP.

Cash provided by financing activities of $260.9 million for the nine months ended September 30, 2020, of which $10.4 million was provided by continuing operations and $250.5 million was provided by discontinued operations, was primarily the result of net proceeds of $250.5 million from the sale of our tiered, sales-based royalty rights on worldwide net sales of IDHIFA® (enasidenib) and our ex-US regulatory milestones to Royalty Pharma in June 2020 and $10.6 million of proceeds received from stock option exercises and purchases made pursuant to our 2013 ESPP.

Funding requirements

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If we obtain marketing approval for any of our product candidates, we expect to incur significant commercialization expenses related to product sales, marketing, manufacturing and distribution.

We expect that our existing cash, cash equivalents and marketable securities as of June 30, 2021, will enable us to execute our operating plan through major catalysts and to cash-flow positivity without the need to raise additional equity.

We expect that our existing cash, cash equivalents and marketable securities as of September 30, 2021, will enable us to execute our operating plan through major catalysts and to cash-flow positivity without the need to raise additional equity.

Our future capital requirements will depend on many factors, including:

22 unchanged sentences

These contractual obligations are cancelable at any time by us, generally upon prior written notice to the vendor.

During the three and six months ended June 30, 2021, there were no significant changes to our contractual obligations and commitments described under Management’s Discussion and Analysis of Financial Condition and Results of Operations in our Annual Report on Form 10-K for the year ended December 31, 2020.

During the three and nine months ended September 30, 2021, there were no significant changes to our contractual obligations and commitments described under Management’s Discussion and Analysis of Financial Condition and Results of Operations in our Annual Report on Form 10-K for the year ended December 31, 2020.

Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-Q

Item 2. Management’s Discussion and Analysis