What changed in this filing

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Item 1. Financial Statements

2021-08-11 compared with 2021-05-14 · 100 added, 79 removed, 308 unchanged (37% of the section changed)

22 unchanged sentences

5,000,000 undesignated authorized shares;

Class X Convertible Preferred Stock issued and outstanding shares – 0 as of March 31, 2021 (unaudited) and December 31, 2020, respectively

Class X Convertible Preferred Stock issued and outstanding shares – 0 as of June 30, 2021 (unaudited) and December 31, 2020, respectively

Common stock, $ 0.001 par value per share;

21,425,000 authorized shares as of

March 31, 2021 and December 31, 2020, respectively;

issued and outstanding shares – 16,011,385 (unaudited) and 11,018,954 as of March 31, 2021 and December 31, 2020, respectively

42,500,000 and 21,425,000 authorized shares as of June 30, 2021 and December 31, 2020, respectively;

issued and outstanding shares – 16,307,370 (unaudited) and 11,018,954 as of June 30, 2021 and December 31, 2020, respectively

Additional paid-in capital

9 unchanged sentences

(in thousands, except share and per share data)

Three Months Ended March 31,

Three Months Ended June 30,

Six Months Ended June 30,

License and collaboration agreement revenues

4 unchanged sentences

Total operating expenses

Income (loss) from operations

Loss from operations

Total other income (expense), net

Consolidated net income (loss)

Consolidated net loss

Net loss attributable to noncontrolling interest in Pangu BioPharma Limited

Net income (loss) attributable to aTyr Pharma, Inc.

Basic, net income (loss) per share

Shares used in computing basic net income (loss) per share

Diluted net income (loss) per share

Shares used in computing diluted net income (loss) per share

Net loss attributable to aTyr Pharma, Inc.

Net loss per share, basic and diluted

Shares used in computing basic net loss per share, basic and diluted

See accompanying notes.

aTyr Pharma, Inc.

Condensed Consolidated Statements of Comprehensive Income (Loss)

Condensed Consolidated Statements of Comprehensive Loss

(in thousands)

Three Months Ended March 31,

Consolidated net income (loss)

Three Months Ended June 30,

Six Months Ended June 30,

Consolidated net loss

Other comprehensive loss:

Change in unrealized loss on available-for-sale investments, net of tax

Comprehensive income (loss)

Change in unrealized gain (loss) on available-for-sale investments, net of tax

Comprehensive loss

Comprehensive loss attributable to noncontrolling interest Pangu BioPharma Limited

Comprehensive income (loss) attributable to aTyr Pharma, Inc.

Comprehensive loss attributable to aTyr Pharma, Inc.

common stockholders

2 unchanged sentences

Condensed Consolidated Statements of Stockholders’ Equity

(in thousands)

Three Months Ended March 31,2021 (unaudited)

(in thousands, except share data)

Six Months Ended June 30, 2021 (unaudited)

Preferred Stock

9 unchanged sentences

Balance as of March 31, 2021

Three Months Ended March 31,2020 (unaudited)

Issuance of common stock upon exercise of stock options

Issuance of common stock pursuant to employee stock purchase plan

Issuance of common stock from at the market offerings, net of offering costs

Stock-based compensation

Net unrealized loss on investments, net of tax

Balance as of June 30, 2021

Six Months Ended June 30, 2020 (unaudited)

Preferred Stock

10 unchanged sentences

Balance as of March 31, 2020

Issuance of common stock upon release of restricted stock units

Issuance of common stock pursuant to employee stock purchase plan

Issuance of common stock from at the market offerings, net of offering costs

Stock-based compensation

Net unrealized gain on investments, net of tax

Balance as of June 30, 2020

See accompanying notes.

2 unchanged sentences

(in thousands)

Six Months Ended June 30,

Cash flows from operating activities:

Consolidated net income (loss)

Adjustments to reconcile net income (loss) to net cash provided by (used in) operating activities:

Consolidated net loss

Adjustments to reconcile net loss to net cash used in operating activities:

Depreciation and amortization

1 unchanged sentence

Debt discount accretion and non-cash interest expense

Amortization (accretion) of premium (discount) of available-for-sale investment securities

Accretion of discount of available-for-sale investment securities

Amortization of right-of-use assets

6 unchanged sentences

Operating lease liability

Net cash provided by (used in) operating activities

Net cash used in operating activities

Cash flows from investing activities:

5 unchanged sentences

Cash flows from financing activities:

Proceeds from issuance of common stock through option exercises

Proceeds from issuance of common stock through employee stock purchase plan

Proceeds from issuance of common stock from at the market offerings, net of offering costs

26 unchanged sentences

The impact of the COVID-19 pandemic has been and will likely continue to be extensive in many aspects of society, which has resulted in and will likely continue to result in significant disruptions to the global economy, as well as businesses and capital markets around the world.

Impacts to our business have included the delay in enrollment of our Phase 1b/2a clinical trial in patients with pulmonary sarcoidosis and the discontinuation of some patients in that trial, temporary closures of portions of our facilities and those of our licensees and collaborators, disruptions or restrictions on our employee's ability to travel and delays in certain research and development activities.

Impacts to our business have included delayed enrollment of our Phase 1b/2a clinical trial in patients with pulmonary sarcoidosis and the discontinuation of some patients in that trial, temporary closures of portions of our facilities and those of our licensees and collaborators, disruptions or restrictions on our employee's ability to travel and delays in certain research and development activities.

Other potential impacts to our business include, but are not limited to disruptions to or delays in other clinical trials, third-party manufacturing supply and other operations, inflation, the potential diversion of healthcare resources away from the conduct of clinical trials to focus on pandemic concerns, interruptions or delays in the operations of the FDA or other regulatory authorities, and our ability to raise capital and conduct business development activities.

Liquidity and Financial Condition

We have incurred net losses in each year since our inception in 2005, including a condensed consolidated net loss of $7.2 million for the three months ended March 31, 2021.

As of March 31, 2021, we had an accumulated deficit of $345.7 million.

We believe that our existing cash, cash equivalents and available-for-sale investments of $50.6 million as of March 31, 2021 will be sufficient to meet our anticipated cash requirements for a period of at least one year from the filing date of this Quarterly Report on Form 10-Q.

We have incurred net losses in each year since our inception in 2005, including a condensed consolidated net loss of $ 17.5 million for the six months ended June 30, 2021.

As of June 30, 2021, we had an accumulated deficit of $ 356.1 million.

We believe that our existing cash, cash equivalents and available-for-sale investments of $ 44.1 million as of June 30, 2021 will be sufficient to meet our anticipated cash requirements for a period of at least one year from the filing date of this Quarterly Report on Form 10-Q.

We do not expect to generate any revenues from product sales unless and until we successfully complete development and obtain regulatory approval for one or more of our product candidates, which we expect will take a number of years at a minimum.

7 unchanged sentences

Our condensed consolidated financial statements are prepared in accordance with GAAP.

The preparation of our condensed consolidated financial statements requires us to make estimates and assumptions that impact the reported amounts of assets, liabilities and expenses and the disclosure for these items in our condensed consolidated financial statements and accompanying notes.

The most significant estimates in our condensed consolidated financial statements relate to the fair value of equity issuances and awards, clinical trial and research and development expenses.

The preparation of our condensed consolidated financial statements requires us to make estimates and assumptions that impact the reported amounts of assets, liabilities

and expenses and the disclosure for these items in our condensed consolidated financial statements and accompanying notes.

The most significant estimates in our condensed consolidated financial statements relate to clinical trial and research and development expenses.

Although these estimates are based on our knowledge of current events and actions we may undertake in the future, actual results may ultimately differ materially from these estimates and assumptions.

28 unchanged sentences

For example, if a license to our intellectual property is determined to be distinct from the other performance obligations identified in the arrangement, we recognize revenues from non-refundable, up-front fees allocated to the license when the license is transferred to the licensee and the licensee is able to use and benefit from the license.

Basic and Diluted Net Income (Loss) Per Share

Basic net income (loss) per share is calculated by dividing the net income (loss) by the weighted average number of common shares outstanding for the period, without consideration for common stock equivalents.

Diluted Net Income (Loss) Per Share

For the three months ended March 31, 2021, common stock from the following would have had an anti-dilutive effect on net loss per share (in common share equivalents):

Common stock warrants

Common stock options and restricted stock units

Employee stock purchase plan

For the three months ended March 31, 2020, we had net income available to common stockholders.

As a result, we computed diluted net income per share using the weighted average number of common shares and dilutive common equivalent shares outstanding during the period.

Dilutive common equivalent shares outstanding included 3,006 shares of restricted stock units.

For the three months ended March 31, 2020, the calculation excluded the following common equivalent shares because the effect on diluted earnings per share was anti-dilutive:

Net Loss Per Share

Basic net loss per share is calculated by dividing the net loss by the weighted average number of common shares outstanding for the period.

Diluted net loss per share is calculated by dividing the net loss by the weighted average number of common stock equivalents outstanding for the period determined using the treasury-stock method.

Dilutive common stock equivalents are comprised of warrants for common stock, options and restricted stock units outstanding under our stock option plan and estimated shares to be purchased under our employee stock purchase plan.

For all periods presented, there is no difference in the number of shares used to calculate basic and diluted shares outstanding, as the assumed exercise or settlement of stock options, restricted stock units, and warrants, or the conversion of preferred stock are anti-dilutive.

Potentially dilutive securities not considered for the calculation of diluted net loss per share are as follows (in common stock equivalents):

Six Months Ended June 30,

Common stock warrants

34 unchanged sentences

for Identical

As of March 31, 2021

As of June 30, 2021

Cash equivalents

3 unchanged sentences

Corporate debt securities

Municipal bonds

Total available-for-sale investments

12 unchanged sentences

Total assets measured at fair value

As of March 31, 2021 and December 31, 2020, available-for-sale investments are detailed as follows (in thousands):

March 31, 2021

As of June 30, 2021 and December 31, 2020, available-for-sale investments are detailed as follows (in thousands):

June 30, 2021

Contractual Maturity

5 unchanged sentences

Corporate debt securities

Municipal bonds

Within 2 years

December 31, 2020

9 unchanged sentences

Factors considered in determining whether a loss is other-than-temporary include the length of time and extent to which fair value has been less than the cost basis, the financial condition of the issuer, and our intent and ability to hold the investment until recovery of its amortized cost basis.

We intend, and have the ability, to hold our investments in unrealized loss positions until their amortized cost basis has been recovered.

As of March 31, 2021, all of our available-for-sale investments had a variety of effective maturity dates of less than two years.

As of March 31, 2021, 15 out of 25 of the available-for-sale investments were in gross unrealized loss positions.

License, Collaboration and Other Agreements

We intend, and have the ability, to hold our investments in unrealized loss positions, if any, until their amortized cost basis has been recovered.

As of June 30, 2021, all of our available-for-sale investments have a variety of effective maturity dates of less than two years .

As of June 30, 2021, 17 out of 25 available-for-sale investments were in gross unrealized loss positions.

License and Other Agreements

Kyorin Pharmaceutical Co., Ltd.

5 unchanged sentences

The Phase 1 clinical trial, which was conducted and funded by Kyorin, is a placebo-controlled study to evaluate the safety, pharmacokinetics and immunogenicity of ATYR1923.

Results from this study are intended to enable Kyorin to initiate clinical trials in ILD in Japan.

ATYR1923 was observed to be generally safe and well-tolerated with no drug-related serious adverse events and pharmacokinetics findings were consistent with previous studies of ATYR1923.

We received an $ 8.0 million upfront payment in January 2020 and a $ 2.0 milestone payment in January 2021 upon completion of enrollment in the Phase 1 clinical trial, and we are eligible to receive up to an additional $ 165.0 million in the aggregate upon achievement of certain development, regulatory and sales milestones, as well as tiered royalties ranging from the mid-single digits to mid-teens on net sales in Japan.

Following the first anniversary of the effective date of the Kyorin Agreement, Kyorin has the right to terminate the agreement for any reason upon 90 days advance written notice.

Following the first anniversary of the effective date of the Kyorin Agreement, Kyorin had the right to terminate the agreement for any reason upon 90 days advance written notice.

Either party may terminate the Kyorin Agreement in the event that the other party breaches the agreement and fails to cure the breach, becomes insolvent or challenges certain of the intellectual property rights licensed under the agreement .

7 unchanged sentences

In December 2020, Kyorin completed the last subject visit in its Phase 1 clinical trial of ATYR1923.

This achievement triggered a $2.0

million milestone payment which we recognized as license and collaboration revenue in December 2020.

W e received the $ 2.0 million from Kyorin in January 2021.

For the three months ended March 31, 2021, there were no activities that triggered additional license and collaboration agreement revenue.

For the three months ended March 31, 2020, we recognized $7.9 million as license and collaboration agreement revenue for the upfront payment received.

Both the milestones and royalty payments under the Kyorin Agreement are variable consideration.

This achievement triggered a $ 2.0 million milestone payment which we recognized as license and collaboration revenue in December 2020.

We received the $ 2.0 million from Kyorin in January 2021.

For the six months ended June 30, 2021, there were no activities that triggered additional license and collaboration agreement revenue.

For the six months ended June 30, 2020, we recognized $ 8.0 million as license and collaboration agreement revenue for the upfront payment received.

Both the remaining milestones and royalty payments under the Kyorin Agreement are variable consideration.

Since milestone payments are binary in nature, we will use the “most-likely” method to evaluate whether the milestones should be included as revenue.

1 unchanged sentence

The royalties are dependent on future sales by Kyorin which are at the full discretion of Kyorin.

Accordingly, we will apply a constraint to these amounts until the future sale sales have occurred.

Accordingly, we will apply a constraint to these amounts until the future sales have occurred.

Hong Kong University of Science and Technology

2 unchanged sentences

The PRP aims to support research and development projects undertaken by companies in collaboration with local universities and public research institutions.

The grant will fund approximately 50% of the total estimated project cost, with aTyr contributing the remaining 50%.

The grant funded approximately 50% of the total estimated project cost and we contributed the remaining 50%.

The research grant agreement between Pangu BioPharma, HKUST and the Government of the Hong Kong Special Administration Region became effective April 1, 2020 .

All the contributions provided by the ITC are paid to HKUST and we record expenses under this grant award when incurred.

Expenses for the three months ended March 31, 2021 and 2020 were $0.2 million and $0, respectively.

Debt, Commitments and Contingencies

Expenses for the three months ended June 30, 2021 and 2020 were $ 0.1 million and $ 47,000 , respectively .

Expenses for the six months ended June 30, 2021 and 2020 were approximately $ 0.3 million and $ 47,000 , respectively .

Commitments and Contingencies

Facility Leases

Future minimum payments under the non-cancelable facility lease and reconciliation to the operating lease liability as of March 31, 2021 were as follows (in thousands):

Future minimum payments under the non-cancelable facility lease and reconciliation to the operating lease liability as of June 30, 2021 were as follows (in thousands):

Operating Lease

3 unchanged sentences

Long-term operating lease liability, net of current portion

For each of the three months ended March 31, 2021 and 2020, we recorded an operating lease expense of $0.2 million.

As of March 31, 2021, the weighted-average remaining lease term was 2.2 years and the weighted-average discount rate was 9.6%.

For each of the three months ended June 30, 2021 and 2020, we recorded an operating lease cost of $ 0.2 million.

For each of the six months ended June 30, 2021 and 2020, we recorded an operating lease cost of $ 0.5 million.

As of June 30, 2021, the weighted-average remaining lease term was 1 .9 years and the weighted-average discount rate was 9.6 %.

Stockholders’ Equity

1 unchanged sentence

In May 2019, we entered into a sales agreement with H.C.

Wainwright & Co., LLC (Wainwright) with respect to an at-the-market offering (ATM Offering Program) under which we could offer and sell shares of our common stock having an aggregate offering price of up to $10.0 million.

In November 2020, we amended our sales agreement with Wainwright to increase the amount of the ATM Offering Program up to $20.0 million.

Wainwright & Co., LLC (Wainwright) with respect to an at-the-market offering (ATM Offering Program) under which we may offer and sell shares of our common stock having an aggregate offering price of up to $ 10.0 million.

Wainwright was entitled to a commission at a fixed rate equal to 3 % of the gross proceeds.

In March 2021, the ATM Offering Program with Wainwright automatically terminated upon the issuance and sale of all of the shares of common stock having an aggregate offering price of $ 20.0 million.

For the three months ended March 31, 2021, we sold an aggregate of 1,988,254 shares of common stock at an average price of $4.99 per share for net proceeds of $9.6 million under the ATM Offering Program.

Prior to the termination of the sales agreement with Wainwright, in 2021, we sold an aggregate of 1,988,254 shares of common stock at an average price of $ 4.99 per share for net proceeds of $ 9.6 million under the ATM Offering Program.

In March 2021, we entered into a Capital on Demand TM Sales Agreement with JonesTrading Institutional Services LLC (JonesTrading) for a new ATM Offering Program, pursuant to which we can sell from time to time, at our option, up to an aggregate of $ 25.0 million of shares of our common stock through JonesTrading, as sales agent or principal.

JonesTrading is entitled to a

commission at a fixed rate equal of up to 3 % of the gross proceeds.

For the three months ended March 31, 2021, we did not issue any shares under this ATM Offering Program.

JonesTrading is entitled to a commission at a fixed rate equal of up to 3 % of the gross proceeds.

For the six months ended June 30, 2021, we sold an aggregate of 293,830 shares of common stock at an average price of $ 4.72 per share for net proceeds of $ 1.3 million under the ATM Offering Program .

Underwritten Follow-On Public Offering

1 unchanged sentence

In March 2020, the underwriters fully exercised their option to purchase additional shares resulting in the issuance of an additional 635,294 shares of common stock.

The total gross proceeds from the underwritten follow-on public offering, including the underwriters’ option to purchase additional shares, was approximately $20.7 million, before deducting underwriting discounts, commissions and offering expenses payable by us.

The total gross proceeds from the underwritten follow-on public offering, including the underwriters’ option to purchase additional shares, was approximately $ 18.8 million, after deducting underwriting discounts, commissions and offering expenses payable by us.

Purchase Agreement

1 unchanged sentence

Concurrently with entering into the Purchase Agreement, we also entered into a registration rights agreement with Aspire Capital, in which we agreed to file one or more registration statements, as permissible and necessary to register under the Securities Act of 1933, as amended, for the resale of the shares of our common stock that have been and may be issued to Aspire Capital under the Purchase Agreement.

For the three months ended March 31, 2021, we sold an aggregate of 3,000,000 shares of common stock at an average price of $5.09 per share for net proceeds of $15.2 million under this Purchase Agreement.

For the six months ended June 30, 2021, we sold an aggregate of 3,000,000 shares of common stock at an average price of $ 5.09 per share for net proceeds of $ 15.2 million under this Purchase Agreement.

Common Stock Reserved for Future Issuance

Common stock reserved for future issuance was as follows:

March 31, 2021

June 30, 2021

Common stock warrants

2 unchanged sentences

Shares available under the employee stock purchase plan

Equity Incentive Plans

The following table summarizes our stock option activity under all equity incentive plans for the three months ended March 31, 2021:

The following table summarizes our stock option activity under all equity incentive plans for the six months ended June 30, 2021:

Stock Options

2 unchanged sentences

Canceled/forfeited/expired

Outstanding as of March 31, 2021

Outstanding as of June 30, 2021

The assumptions used in the Black-Scholes option pricing model to determine the fair value of the employee stock option grants were as follows:

Three Months Ended June 30,

Six Months Ended June 30,

Expected term (in years)

2 unchanged sentences

87.41% – 88.29

103.3% – 109.7

88.3% – 104.8

102.2% – 109.7

Expected dividend yield

The following table summarizes our restricted stock unit activity under all equity incentive plans for the three months ended March 31, 2021:

The following table summarizes our restricted stock unit activity under all equity incentive plans for the six months ended June 30, 2021:

Number of Outstanding

2 unchanged sentences

Balance as of December 31, 2020

Balance as of March 31, 2021

Balance as of June 30, 2021

Stock-based Compensation

The allocation of stock-based compensation for all options, 2015 Employee Stock Purchase Plan and restricted stock units is as follows (in thousands):

The allocation of stock-based compensation for all options, including performance options with a market condition, employee stock purchase plan and restricted stock units is as follows (in thousands):

Three Months Ended June 30,

Six Months Ended June 30,

Research and development

1 unchanged sentence

Total stock-based compensation expense

Subsequent Events

From July 1, 2021 through August 9, 2021, we sold an aggregate of 610,442 shares of common stock at a weighted-average price of $ 4.76 per share through the ATM Offering Program for net proceeds of $ 2.8 million.

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 1. Financial Statements