What changed in this filing

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Item 2. Management’s Discussion and Analysis

2023-11-07 compared with 2023-08-08 · 63 added, 78 removed, 199 unchanged (41% of the section changed)

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Our strategy is to focus our efforts on the development of immune modulator product candidates with the potential to treat solid cancers, T cell lymphomas, autoimmune, allergic and infectious diseases.

We have three product candidates which are in clinical development for treatment of various solid tumors.

Our lead product candidate, soquelitinib (formerly CPI-818), is an investigational selective, orally bioavailable, covalent inhibitor of ITK.

We have three product candidates which are in clinical development for treatment of various solid tumors and lymphomas.

Our lead product candidate, soquelitinib (CPI-818), is an investigational selective, orally bioavailable, covalent inhibitor of ITK.

ITK, an enzyme that functions in T cell signaling and differentiation, is expressed predominantly in T cells, which are lymphocytes that play a vital role in immune responses.

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During the dose escalation phase of the study, and with longer follow up, it became clear that the patients receiving the 200mg twice per day dose were demonstrating higher response rates as well as longer disease control.

This dose was determined to be the optimal dose and was consistent with dose-response effects seen in in vitro experiments.

This dose was determined to be the optimal dose and was consistent with dose-response effects seen in in vitro preclinical experiments.

In December 2022 at the American Society of Hematology Annual Meeting (“ASH”), we presented preliminary Phase 1/1b clinical data with soquelitinib in refractory T cell lymphomas.

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Data from the 200 mg cohort in the Phase 1/1b clinical trial indicates that a minimum absolute lymphocyte count (“ALC”) above 900 cells per cubic milliliter of blood may be required for potential tumor response and disease control.

As of May 18, 2023, for patients with ALC above 900 per cubic milliliter of blood, objective responses (CR plus PR) were seen in 6 of 14 patients with disease control (CR, PR and stable disease) in 12 of 14 patients.

As of May 18, 2023, for patients with ALC above 900 per cubic milliliter of blood, objective responses (CR plus PR)

were seen in 6 of 14 patients with disease control (CR, PR and stable disease) in 12 of 14 patients.

No objective responses were seen in six patients (0 for 6) with ALC below 900.

The ALC biomarker is routinely measured, is consistent with soquelitinib’s presumed mechanism of action and is present in about 70% of patients based on the Company’s experience to-date.

In addition, as presented at the 10 th Whistler Global Summit on Hematologic Malignancies, which took place March 29 to April 2, 2023 in Whistler British Columbia, Canada, data from our Phase 1/1b clinical trial also showed that this biomarker did not select for more favorable patients based on response to their last treatment regimen prior to receiving soquelitinib.

This biomarker has been incorporated as an eligibility criterion in the ongoing Phase 1/1b clinical trial.

Waterfall Plot for Patients with ALC above 900 in the 200 mg Dose Cohort of the soquelitinib Phase 1/1b Clinical Trial for T Cell Lymphoma.

The plot shows the best percent change in tumor volume in the 14 patients (out of 20 total evaluable patients) that were measurable by CT scan with the exception of one patient measured by Modified Severity-Weighted Assessment Tool (“mSWAT”) as indicated in the plot below.

Based on the current enrollment rate of our Phase 1/1b clinical trial, we believe that the number of patients treated in the clinical trial would provide adequate safety and preliminary efficacy data to inform the design of a registration clinical trial.

We expect such a trial to enroll patients with relapsed T cell lymphomas whose prognosis is poor with currently available therapies.

Although there are single agents approved for this disease, the current National Cooperative Cancer Network guidelines recommend that patients be enrolled in experimental therapies indicating a serious unmet need for improved therapies to treat T cell lymphomas.

We have received a communication from the U.S.

Food and Drug Administration (“FDA”) regarding our clinical development plans for soquelitinib.

As recommended by the FDA, we have requested a meeting with the FDA to discuss the design of a registrational Phase 3 clinical trial.

We anticipate that this meeting will take place in the third quarter of this year.

In August 2023, we completed an End-of-Phase/Pre-Phase 3 meeting with the Food and Drug Administration (“FDA”) regarding our plans to conduct a potentially registrational Phase 3 clinical trial of soquelitinib in relapsed PTCL.

The FDA provided feedback on our plans and proposed registration trial and we anticipate that we will be able to initiate this clinical trial in early 2024.

The clinical trial is designed to enroll a total of 150 patients with relapsed PTCL that have received ≥ 1 prior therapy and ≤ 3 prior therapies.

Number of prior therapies in this range selects for immunocompetent patients.

Patients will be randomized 1:1 to soquelitinib 200 mg two-times a day or standard of care chemotherapy.

The standard of care agent will be based on physicians choice of either gemcitabine, belinostat or pralatrexate.

The primary endpoint will be progression-free survival.

Secondary endpoints will include objective response rate and overall survival.

We are recruiting investigators and anticipate that leading academic and private medical centers with significant experience in lymphoma research will participate in the trial, including a principal investigator who has conducted other Phase 3 clinical trials in T cell lymphoma and authored many peer-reviewed articles on lymphomas.

As reported at the International Conference of Malignant Lymphoma in June 2023, preclinical data suggest that ITK inhibition with soquelitinib has the potential to treat solid and hematological cancers through a novel mechanism of action that has modulated T cell differentiation and enhanced the anti-tumor immune response via Th1 skewing, increased T cell cytolytic capacity and reduced of T cell exhaustion in preclinical models.

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We are collaborating with the Kidney Cancer Research Consortium to evaluate ciforadenant in an open label Phase 1b/2 clinical trial as a first line therapy for metastatic renal cell cancer (“RCC”) in combination with ipilimumab (anti-CTLA-4) and nivolumab (anti-PD-1).

The clinical trial is expected to enroll up to 60 patients and interim data are anticipated before the end of 2023.

The clinical trial is expected to enroll up to 60 patients and interim data are anticipated in early 2024.

This study has fully enrolled patients in the Phase 1b safety portion of the trial and is now enrolling patients in the Phase 2 portion of the trial.

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We expect to continue to incur significant research and development and general and administrative expenses related to our operations.

Our net loss for the three and six months ended June 30, 2023 was $6.5 million and $14.4 million, respectively.

As of June 30, 2023, we had an accumulated deficit of $322.1 million.

We expect to continue to incur losses for the foreseeable future, and we anticipate these losses will increase as we continue our development of, seek regulatory approval for and begin to commercialize soquelitinib, ciforadenant and mupadolimab, and as we develop other product candidates.

Our net loss for the three and nine months ended September 30, 2023 was $6.0 million and $20.4 million, respectively.

As of September 30, 2023, we had an accumulated deficit of $328.1 million.

We expect our losses will increase as we continue our development of, seek regulatory approval for and begin to commercialize soquelitinib, ciforadenant and mupadolimab, and as we develop other product candidates.

Even if we achieve profitability in the future, we may not be able to sustain profitability in subsequent periods.

Since our inception and through June 30, 2023, we have funded our operations primarily through the sale and issuance of stock, including through our initial public offering (“IPO”) in March 2016, in which we raised net proceeds of approximately $70.6 million, a follow-on offering of our common stock in March 2018, in which we raised net proceeds of approximately $64.9 million and a follow on offering in February 2021, in which we raised net proceeds of approximately $32.0 million, in each case net of underwriting discounts and commissions and offering expenses.

Since our inception and through September 30, 2023, we have funded our operations primarily through the sale and issuance of stock, including through our initial public offering (“IPO”) in March 2016, in which we raised net proceeds of approximately $70.6 million, a follow-on offering of our common stock in March 2018, in which we raised net proceeds of approximately $64.9 million and a follow on offering in February 2021, in which we raised net proceeds of approximately $32.0 million, in each case net of underwriting discounts and commissions and offering expenses.

Immediately prior to the consummation of the IPO, all of our outstanding shares of redeemable convertible preferred stock were converted into 14.3 million shares of our common stock.

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Jefferies is entitled to compensation for its services equal to 3.0% of the gross proceeds of any shares of common stock sold through Jefferies under the 2023 Sales Agreement.

During the six months ended June 30, 2023, we sold 2,329,851 shares of common stock under our at-the-market offering program resulting in net proceeds of $7.5 million.

As of June 30, 2023, $82.3 million remained available for sale under the 2023 Sales Agreement.

As of June 30, 2023, we had capital resources consisting of cash, cash equivalents and marketable securities of approximately $37.0 million.

financial statements, we do not expect our existing capital resources to be sufficient to enable us to fund the completion of all of our ongoing or planned clinical trials and remaining development program of any of soquelitinib, ciforadenant or mupadolimab through commercialization.

During the nine months ended September 30, 2023, we sold 2,461,903 shares of common stock under our at-the-market offering program resulting in net proceeds of $7.8 million.

As of September 30, 2023, $81.9 million remained available for sale under the 2023 Sales Agreement.

As of September 30, 2023, we had capital resources consisting of cash, cash equivalents and marketable securities of approximately $32.2 million.

While we believe that our current cash, cash equivalents and short-term marketable securities will be sufficient to fund our planned operations for at least 12 months from the date of the issuance of these financial statements, we do not expect our existing capital resources to be sufficient to enable us to fund the completion of all of our ongoing or planned clinical trials and remaining development program of any of soquelitinib, ciforadenant or mupadolimab through commercialization.

In addition, our operating plan may change as a result of many factors, including those described in the section of this report entitled “Risk Factors” and others currently unknown to us, and we may need to seek additional funds sooner than planned, through public or private equity, debt financings or other sources, such as strategic collaborations.

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As such, we are dependent on third parties to supply our product candidates according to our specifications, in sufficient quantities, on time, in compliance with appropriate regulatory standards and at competitive prices.

Impact of COVID-19

COVID-19 has placed strains on the providers of healthcare services, including the healthcare institutions where we conduct our clinical trials.

These strains have resulted in institutions prohibiting the initiation of new clinical trials, enrollment in existing clinical trials and restricting the on-site monitoring of clinical trials.

We also follow FDA guidance on clinical trial conduct during the COVID-19 pandemic, including the remote monitoring of clinical data.

In alignment with public health guidance designed to slow the spread of COVID-19, as of mid-March 2020, we implemented a reduced onsite staffing model and transitioned to a remote work plan for all employees other than those providing essential services, such as our laboratory staff.

In July 2021, we started transitioning back to office work for employees not providing essential services.

For our onsite employees, we have implemented heightened health and safety measures designed to comply with applicable federal, state and local guidelines in response to the COVID-19 pandemic.

We are further supporting all of our employees by leveraging virtual meeting technology and encouraging employees to follow local health authority guidance.

We may need to undertake additional actions that could impact our operations if required by applicable laws or regulations or if we determine such actions to be in the best interests of our employees.

Significant Accounting Policies

Our significant accounting policies are described in Note 2 to our consolidated financial statements for the year ended December 31, 2022 included in our Annual Report on Form 10-K.

There have been no material changes to our significant accounting policies during the six months ended June 30, 2023.

There have been no material changes to our significant accounting policies during the nine months ended September 30, 2023.

Components of Results of Operations

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● enrollment and completion of our ongoing Phase 1/1b clinical trial of soquelitinib;

● a potential registrational clinical trial for soquelitinib;

● a potential Phase 3 registrational clinical trial for soquelitinib in PTCL;

● enrollment and completion of our Phase 1b/2 clinical trial with ciforadenant in collaboration with the Kidney Cancer Research Consortium;

● a potential clinical trial of soquelitinib in solid tumors;

● a potential clinical trial of soquelitinib in atopic dermatitis;

● process development and manufacturing of drug supply of soquelitinib and ciforadenant;

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Three Months Ended

Six Months Ended

Nine Months Ended

September 30,

Operating expenses:

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Research and Development Expenses

Research and development expenses for the three and six months ended June 30, 2023 and 2022 consisted of the following costs by program as well as unallocated employee costs and overhead costs (specific program costs consist solely of external costs) (in thousands):

Research and development expenses for the three and nine months ended September 30, 2023 and 2022 consisted of the following costs by program as well as unallocated employee costs and overhead costs (specific program costs consist solely of external costs) (in thousands):

Three Months Ended

Six Months Ended

Soquelitinib (formerly CPI-818)

Nine Months Ended

September 30,

Soquelitinib (CPI-818)

Unallocated employee and overhead costs

For the three months ended June 30, 2023, the increase in soquelitinib costs of $0.3 million as compared to the three months ended June 30, 2022, primarily consisted of an increase of $0.1 million in clinical trial expenses and an increase of $0.3 million in other outside service costs, which were partially offset by a decrease of $1.0 million in drug manufacturing costs.

For the six months ended June 30, 2023, the increase in soquelitinib costs of $1.6 million as compared to the six months ended June 30, 2022, primarily consisted of an increase of $0.6 million in drug manufacturing costs, an increase of $0.5 million in clinical trial expenses and an increase of $0.5 million in other outside service costs.

For the three months ended June 30, 2023, the decrease in ciforadenant costs of $0.1 million as compared to the three months ended June 30, 2022, primarily consisted of a decrease of $0.2 million in drug manufacturing costs, which were partially offset by an increase of $0.1 million in clinical trial expenses.

For the six months ended June 30, 2023, the decrease in ciforadenant costs of $0.4 million as compared to the six months ended June 30, 2022, primarily consisted of a decrease of $0.3 million in drug manufacturing costs and a decrease of $0.1 million in other outside service costs.

For the three months ended June 30, 2023, the decrease in mupadolimab costs of $1.2 million as compared to the three months ended June 30, 2022, primarily consisted of a decrease of $0.9 million in drug manufacturing costs and a decrease of $0.3 million in clinical trial expenses as a result of pausing development of this product candidate.

For the six months ended June 30, 2023, the decrease in mupadolimab costs of $2.8 million as compared to the six months ended June 30, 2022, primarily consisted of a decrease of $1.5 million in drug manufacturing costs, a decrease of $1.1 million in clinical trial expenses and a decrease of $0.2 million in other outside service costs as a result of pausing development of this product candidate.

For the three months ended June 30, 2023, the increase in unallocated costs of less than $0.1 million as compared to the three months ended June 30, 2022, primarily consisted of an increase of $0.2 million in outside service costs, which were partially offset by a decrease of $0.2 million in personnel and related costs.

For the six months ended June 30, 2023, the increase in unallocated costs of $0.2 million as compared to the six months ended June 30, 2022, primarily consisted of an increase of $0.4 million in outside costs, which were partially offset by a decrease of $0.2 million in personnel and related costs.

For the three months ended September 30, 2023, the increase in soquelitinib costs of $0.3 million as compared to the three months ended September 30, 2022, primarily consisted of an increase of $0.1 million in clinical trial expenses and an increase of $0.5 million in other outside service costs, which were partially offset by a decrease of $0.3 million in drug manufacturing costs.

For the nine months ended September 30, 2023, the increase in soquelitinib costs of $1.9 million as compared to the nine months ended September 30, 2022, primarily consisted of an increase of $0.4 million in drug manufacturing costs, an increase of $0.6 million in clinical trial expenses and an increase of $0.9 million in other outside service costs.

For the three months ended September 30, 2023, the increase in ciforadenant costs of $0.1 million as compared to the three months ended September 30, 2022, primarily consisted of an increase of $0.3 million in clinical trial expenses, which was partially offset by a decrease of $0.2 million other outside service costs.

For the nine months ended September 30, 2023, the decrease in ciforadenant costs of $0.3 million as compared to the nine months ended September 30, 2022, primarily consisted of a decrease of $0.3 million in drug manufacturing costs and a decrease of $0.2 million in other outside service costs, which were partially offset by an increase of $0.2 million in clinical trial expenses.

For the three months ended September 30, 2023, the decrease in mupadolimab costs of $6.5 million as compared to the three months ended September 30, 2022, primarily consisted of a decrease of $6.3 million in drug manufacturing costs and a decrease of $0.2 million in clinical trial expenses as a result of pausing development of this product candidate.

For the nine months ended September 30, 2023, the decrease in mupadolimab costs of $9.3 million as compared to the nine months ended September 30, 2022, primarily consisted of a decrease of $7.7 million in drug manufacturing costs, a decrease of $1.3 million in clinical trial expenses and a decrease of $0.3 million in other outside service costs as a result of pausing development of this product candidate.

For the three months ended September 30, 2023, the decrease in unallocated costs of $0.3 million as compared to the three months ended September 30, 2022, primarily consisted of a decrease in personnel and related costs.

For the nine months ended September 30, 2023, the decrease in unallocated costs of $0.1 million as compared to the nine months ended September 30, 2022, primarily consisted of a decrease of $0.6 million in personnel and related costs, which was partially offset by an increase of $0.5 million in other outside costs.

General and Administrative Expense

For the three months ended June 30, 2023, the decrease in general and administrative expenses of $0.4 million as compared to the three months ended June 30, 2022, primarily consisted of a decrease of $0.2 million in personnel and related costs and an decrease of $0.2 million in outside costs.

For the six months ended June 30, 2023, the decrease in general and administrative expenses of $0.8 million as compared to the six months ended June 30, 2022, primarily consisted of a decrease of $0.5 million in personnel and related costs and a decrease of $0.3 million in outside costs.

For the three months ended September 30, 2023, the decrease in general and administrative expenses of $0.5 million as compared to the three months ended September 30, 2022, primarily consisted of a decrease of $0.1 million in personnel and related costs and a decrease of $0.4 million in outside costs.

For the nine months ended September 30, 2023, the decrease in general and administrative expenses of $1.3 million as compared to the nine months ended September 30, 2022, primarily consisted of a decrease of $0.6 million in personnel and related costs and a decrease of $0.7 million in outside costs.

Interest Income and Other Expense, net

For the three months ended June 30, 2023, the increase in interest income and other expense, net of $0.3 million as compared to the three months ended June 30, 2022, primarily consisted of an increase in interest income earned due to an increase in interest rates.

For the six months ended June 30, 2023, the increase in interest income and other expense, net of $0.7 million as compared to the six months ended June 30, 2022, primarily consisted of an increase in interest income earned due to an increase in interest rates.

For the three months ended September 30, 2023, the increase in interest income and other expense, net of $0.2 million as compared to the three months ended September 30, 2022, primarily consisted of an increase in interest income earned due to an increase in interest rates.

For the nine months ended September 30, 2023, the increase in interest income and other expense, net of $0.9 million as compared to the nine months ended September 30, 2022, primarily consisted of an increase in interest income earned due to an increase in interest rates.

Sublease Income – Related Party

For the three months ended June 30, 2023, the decrease in sublease income of less than $0.1 million was due to the expiration of the building sublease agreement with Angel Pharmaceuticals in January 2023.

For the six months ended June 30, 2023, the decrease in sublease income of $0.2 million was due to the expiration of the building sublease agreement with Angel Pharmaceuticals in January 2023.

For the three months ended September 30, 2023, the decrease in sublease income of $0.1 million was due to the expiration of the building sublease agreement with Angel Pharmaceuticals in January 2023.

For the nine months ended September 30, 2023, the decrease in sublease income of $0.4 million was due to the expiration of the building sublease agreement with Angel Pharmaceuticals in January 2023.

Loss from equity method investment

For the three months ended June 30, 2023, the decrease in loss from equity method investment of $0.3 million as compared to the three months ended June 30, 2022, primarily consisted of an decrease in our share of Angel Pharmaceutical’s loss for the three months ended June 30, 2023.

For the six months ended June 30, 2023, the increase in loss from equity method investment of $0.4 million as compared to the six months ended June 30, 2022, primarily consisted of an increase in our share of Angel Pharmaceutical’s loss for the six months ended June 30, 2023.

For the three months ended September 30, 2023, the decrease in loss from equity method investment of $1.9 million as compared to the three months ended September 30, 2022, primarily consisted of a decrease in Angel Pharmaceuticals’ loss for the three months ended September 30, 2023.

For the nine months ended September 30, 2023, the decrease in loss from equity method investment of $1.5 million as compared to the nine months ended September 30, 2022, primarily consisted of a decrease in Angel Pharmaceuticals’ loss for the nine months ended September 30, 2023.

Liquidity and Capital Resources

As of June 30, 2023, we had cash, cash equivalents and marketable securities of $37.0 million, and an accumulated deficit of $322.1 million, compared to cash and cash equivalents and marketable securities of $42.3 million and an accumulated deficit of $307.7 million as of December 31, 2022.

As of September 30, 2023, we had cash, cash equivalents and marketable securities of $32.2 million, and an accumulated deficit of $328.1 million, compared to cash and cash equivalents and marketable securities of $42.3 million and an accumulated deficit of $307.7 million as of December 31, 2022.

We have financed our operations primarily through the sale of common stock and the private placements of redeemable convertible preferred stock.

Since our inception and through June 30, 2023, we have funded our operations primarily through the sale and issuance of stock, including through our IPO in March 2016, in which we raised net proceeds of approximately $70.6 million, a follow-on offering of our common stock in March 2018, in which we raised net proceeds of approximately $64.9 million and a follow on offering in February 2021, in which we raised net proceeds of approximately $32.0 million, in each case net of underwriting discounts and commissions and offering expenses.

In March 2020, we entered into an open market sale agreement (the “2020 Sales Agreement”) with Jefferies LLC (“Jefferies”) to sell shares of our common stock, from time-to-time, with aggregate gross sales proceeds of up to $50,000,000, through an at-the-market equity offering program under which Jefferies will act as our sales agent.

In November 2021, we entered into another Sale Agreement (“2021 Sales Agreement”) with Jefferies to sell shares of our common stock from time-to-time, with aggregate gross sales proceeds of up to $40,000,000.

On March 28, 2023, we terminated both the 2020 Sales Agreement and the 2021 Sales Agreement and concurrently entered into a new open market sale agreement (the “2023 Sales Agreement”) with Jefferies to sell shares of our common stock, from time-to-time, with aggregate gross sales proceeds of up to $90,000,000, through an at-the-market equity offering program under which Jefferies will act as our sales agent.

The issuance and sale of shares of common stock pursuant to the 2023 Sales Agreement are deemed an “at-the-market” offering under the Securities Act of 1933, as amended.

Jefferies is entitled to compensation for its services equal to 3.0% of the gross proceeds of any shares of common stock sold through Jefferies under the 2023 Sales Agreement.

During the six months ended June 30, 2023, we sold 2,329,851 shares of common stock under our at-the-market offering program resulting in net proceeds of $7.5 million.

As of June 30, 2023, $82.3 million remained available for sale under the 2023 Sales Agreement.

We believe our current cash, cash equivalents and marketable securities will be sufficient to fund our planned expenditures and meet our obligations through at least the next twelve months from the issuance of our financial statements as of and for the three months ended June 30, 2023.

Since our inception and through September 30, 2023, we have funded our operations primarily through the sale and issuance of stock, including through our IPO in March 2016, in which we raised net proceeds of approximately $70.6 million, a follow-on offering of our common stock in March 2018, in which we raised net proceeds of approximately $64.9 million, a follow on offering in February 2021, in which we raised net proceeds of approximately $32.0 million, and the sale of common stock through at-the-market equity offering programs, in which we raised approximately $38.0 million, in each case net of underwriting discounts and commissions and offering expenses.

The amounts and timing of our actual expenditures depend on numerous factors, including:

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The following table summarizes our cash flows for the periods indicated (in thousands):

Six Months Ended

Nine Months Ended

September 30,

Net cash provided by (used in):

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Cash Flows from Operating Activities

Cash used in operating activities during the six months ended June 30, 2023 was $13.3 million, which primarily consisted of a net loss of $14.4 million, adjusted by non-cash charges of $3.6 million, that primarily consisted of $1.0 million of stock compensation expense and $3.0 million of loss from equity method investment;

an increase of $0.1 million in prepaid and other current assets, an increase of $0.1 million in accounts payable, a decrease of $3.1 million in accrued and other current liabilities and a decrease of $0.6 million in accounts receivable – related party.

Cash used in operating activities during the six months ended June 30, 2022 was $12.5 million, which primarily consisted of a net loss of $16.7 million, adjusted by non-cash charges of $4.3 million, that primarily consisted of $1.4 million of stock compensation expense and $2.6 million of loss from equity method investment;

an increase of $0.4 million in prepaid and other current assets, a decrease of $0.1 million in accounts receivable, an increase of $0.8 million in accounts payable and a decrease of $0.7 million in accrued and other current liabilities.

Cash used in operating activities during the nine months ended September 30, 2023 was $18.8 million, which primarily consisted of a net loss of $20.4 million, adjusted by non-cash charges of $4.8 million, that primarily consisted of $1.6 million of stock compensation expense and $3.9 million of loss from equity method investment;

an increase of $0.1 million in prepaid and other current assets, a decrease of $0.6 million in accounts payable, a decrease of $3.0 million in accrued and other current liabilities, a decrease of $0.6 million in accounts receivable – related party and a decrease of $0.1 million in operating lease liability net of operating lease right-of-use assets amortization.

Cash used in operating activities during the nine months ended September 30, 2022 was $19.5 million, which primarily consisted of a net loss of $31.5 million, adjusted by non-cash charges of $7.7 million, that primarily consisted of $2.1 million of stock compensation expense and $5.4 million of loss from equity method investment, a decrease of $0.2 million in prepaid and other current assets, an increase of $2.7 million in accounts payable, an increase of $1.5 million in accrued and other current liabilities and a decrease of $0.1 million in operating lease liability net of operating lease right-of-use asset amortization.

Cash Flows from Investing Activities

During the six months ended June 30, 2023, cash provided by investing activities was $0.3 million, which primarily consisted of proceeds from maturities of marketable securities of $34.2 million, which were partially offset by purchases of marketable securities of $33.8 million.

During the six months ended June 30, 2022, cash used in investing activities was $22.4 million, that consisted of purchases of marketable securities of $29.4 million, which were partially offset by proceeds from maturities of marketable securities of $7.0 million.

During the nine months ended September 30, 2023, cash provided by investing activities was $17.9 million, which primarily consisted of proceeds from maturities of marketable securities of $53.5 million, which were partially offset by purchases of marketable securities of $35.6 million.

During the nine months ended September 30, 2022, cash used in investing activities was $19.4 million, which primarily consisted of purchases of marketable securities of $46.9 million and purchases of property and equipment of $0.3 million, which were partially offset by proceeds from maturities of marketable securities of $27.8 million.

Cash Flows from Financing Activities

During the six months ended June 30, 2023, the cash provided by financing activities of $7.5 million primarily consisted of net proceeds from the issuance of common stock through our at-the-market offering program.

During the six months ended June 30, 2022, there were no cash flows from financing activities.

During the nine months ended September 30, 2023, the cash provided by financing activities of $7.9 million primarily consisted of net proceeds from the issuance of common stock through our at-the-market offering program.

During the nine months ended September 30, 2022, there were no cash flows from financing activities.

Contractual Obligations

There have been no material changes outside the ordinary course of our business to our contractual obligations during the six months ended June 30, 2023, as compared to those disclosed in our Annual Report on Form 10-K.

There have been no material changes outside the ordinary course of our business to our contractual obligations during the nine months ended September 30, 2023, as compared to those disclosed in our Annual Report on Form 10-K.

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