What changed in this filing

/stocks — the workspaceLOADING

Item 4. Controls and Procedures

2024-11-07 compared with 2024-08-08 · 195 added, 134 removed, 697 unchanged (32% of the section changed)

54 unchanged sentences

(in thousands)

September 30,

Current assets:

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Additional paid-in capital

Accumulated other comprehensive (loss) income

Accumulated other comprehensive income

Accumulated deficit

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Three Months Ended

Six Months Ended

Nine Months Ended

September 30,

Operating expenses:

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Other (expense) income, net

Income (Loss) before income taxes

Income before income taxes

Provision for income taxes

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Other comprehensive income (loss):

Unrealized (loss) gain on investments, net of tax

Unrealized gain (loss) on investments, net of tax

Total comprehensive income (loss)

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Stock-based compensation

Other comprehensive loss

Other comprehensive income

Balance at June 30, 2024

Release of RSUs

Stock-based compensation

Other comprehensive income

Balance at September 30, 2024

Comprehensive

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Stock-based compensation

Other comprehensive loss

Other comprehensive income

Balance at June 30, 2023

Release of RSUs

Issuance pre-funded warrants and warrants, net of issuance cost

Stock-based compensation

Other comprehensive loss

Balance at September 30, 2023

See accompanying notes to condensed financial statements.

2 unchanged sentences

(in thousands)

Six Months Ended

Nine Months Ended

September 30,

Cash flows from operating activities:

Net income (loss)

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

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

Amortization of intangible assets

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Cash flows from financing activities:

Proceeds from issuance of pre-funded warrants and tranche warrants, net of issuance costs

Proceeds from issuance of common stock, net of issuance costs

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The accompanying interim condensed financial statements and related disclosures are unaudited, have been prepared on the same basis as the annual financial statements and, in the opinion of management, reflect all adjustments, which include only normal recurring adjustments, necessary for a fair statement of the results of operations for the periods presented.

The condensed results of operations for the three and six months ended June 30, 2024 are not necessarily indicative of the results to be expected for the full year or for any other future year or interim period.

The condensed results of operations for the three and nine months ended September 30, 2024 are not necessarily indicative of the results to be expected for the full year or for any other future year or interim period.

The accompanying condensed financial statements should be read in conjunction with the audited financial statements and the related notes thereto included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2023 filed with the SEC.

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The Company considers all highly liquid investments purchased with original maturities of three months or less at the date of purchase to be cash equivalents.

Restricted cash represents a standby letter of credit issued pursuant to an office lease.

Restricted cash represents a standby letter of credit issued pursuant to an office lease and value added tax return.

Revenue Recognition

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Payments to the Company under these arrangements typically include one or more of the following:

nonrefundable upfront and license fees, research funding, milestone and other contingent payments to the Company for the achievement of defined collaboration objectives and certain preclinical, clinical, regulatory and sales-based events, as well as royalties on sales of any commercialized products.

non-refundable upfront and license fees, research funding, milestone and other contingent payments to the Company for the achievement of defined collaboration objectives and certain preclinical, clinical, regulatory and sales-based events, as well as royalties on sales of any commercialized products.

The Company assesses whether the promises in its arrangements with customers are distinct performance obligations that should be accounted for separately.

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Amounts payable to the Company are recorded as accounts receivable when the Company’s right to consideration is unconditional.

Recently Issued Accounting Standards Not Yet Adopted

The Company derives revenues through its collaboration and license agreements and determined that it operates as a single reportable segment which primarily focus on clinical and pre-clinical research programs.

The Chief Operating Decision Maker ("CODM") primarily reviews the Company’s financial information on an aggregate basis.

All long-lived assets are maintained in the United States of America.

Recent Accounting Pronouncements

In November 2023, the FASB issued ASU 2023-07, Segment Reporting - Improvements to Reportable Segment Disclosures ("ASU 2023-07"), which enhances transparency in income tax disclosures.

ASU 2023-07 requires entities to provide incremental disclosures, if applicable, related to a public entity's reportable segments but does not change the definition of a segment, the method for determining segments, or the criteria for aggregating operating segments into reportable segment.

ASU 2023-07 improves reportable segment disclosure requirements, primarily through enhanced disclosures about significant segment expenses, which enable users of financial statements to better understand

CytomX Therapeutics, Inc.

Notes to Condensed Financial Statements (Unaudited)

the entity's measurement and assessment of segment performance and resource allocation.

The new guidance is effective for public entities for fiscal years beginning after December 15, 2023, and interim periods in fiscal years beginning after December 15, 2024.

The Company will adopt the ASU for its 2024 Form 10-K.

The ASU is required to be applied on a retrospective basis.

The Company is evaluating the impact on its financial statements.

In December 2023, the FASB issued ASU 2023-09, Income Taxes (Topic 740):

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ASU 2023-09 also requires entities to disclose their income tax payments to international, federal, state and local jurisdictions, among other changes.

CytomX Therapeutics, Inc.

Notes to Condensed Financial Statements (Unaudited)

amendments are set to be effective for fiscal years beginning after December 15, 2024, and are required to be applied on a prospective basis.

The Company is evaluating the impact on our financial statements.

The Company will adopt the ASU for its 2025 Form 10-K on a prospective basis.

The Company is evaluating the impact on its financial statements.

Net Income (Loss) Per Share

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Diluted net income (loss) per share is calculated using the weighted-average number of common shares outstanding, plus potential dilutive common stock during the period.

Diluted net loss per share is the same as basic net loss per share since the effect of the potentially dilutive securities is anti-dilutive.

Diluted net loss per share is the same as basic net loss per share in the period when the effect of the potentially dilutive securities is anti-dilutive.

The pre-funded warrants are included in both the basic and diluted EPS calculation.

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Three Months Ended

Six Months Ended

Nine Months Ended

September 30,

(in thousands, except share and per share data)

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Net income (loss) per share

CytomX Therapeutics, Inc.

Notes to Condensed Financial Statements (Unaudited)

The following weighted-average outstanding shares of potentially dilutive securities are excluded from the computation of diluted net income (loss) per share for the periods presented, because including them would have been anti-dilutive:

Three Months Ended

Six Months Ended

Nine Months Ended

September 30,

Options and ESPP to purchase common stock

Common stock warrants

CytomX Therapeutics, Inc.

Notes to Condensed Financial Statements (Unaudited)

Fair Value Measurements and Investments

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The following tables set forth the fair value of the Company’s investments subject to fair value measurements on a recurring basis and the level of inputs used in such measurements:

June 30, 2024

September 30, 2024

(in thousands)

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Treasury Securities

As of June 30, 2024 , the remaining contractual terms of those investments are less than a year.

As of September 30, 2024 , the remaining contractual terms of those investments are less than a year.

CytomX Therapeutics, Inc.

2 unchanged sentences

Accrued liabilities consisted of the following:

September 30,

(in thousands)

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Three Months Ended

Six Months Ended

Nine Months Ended

September 30,

(in thousands)

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Amgen is eligible to receive up to $ 203.0 million in development, regulatory, and commercial milestone payments for the CytomX Product, and tiered mid-single digit to low double-digit percentage royalties.

As of June 30, 2024 and December 31, 2023, deferred revenue related to the EGFR Products performance obligation was $ 10.5 million and $ 12.8 million, respectively.

Deferred revenue related to the Amgen Other Products performance obligation was immaterial as of June 30, 2024 and December 31, 2023.

As of September 30, 2024 and December 31, 2023, deferred revenue related to the EGFR Products performance obligation was $ 11.3 million and $ 12.8 million, respectively.

Revenue is recognized over the estimated research period using an input measure based on our actual full-time employee ("FTE") hours incurred as a percentage of projected FTE hours for completing the performance obligation.

We evaluate the measure of progress each reporting period and, if necessary, we adjust the measure of performance and related revenue recognition.

In the three months ended September 30, 2024, we revised the estimated FTE hours-to-completion for the EGFR Products performance obligation which resulted in a cumulative adjustment to revenue which was a $ 0.8 m illion reduction of revenue in the period.

Such adjustments have

CytomX Therapeutics, Inc.

Notes to Condensed Financial Statements (Unaudited)

impacted and will continue to impact the amounts and timing of our revenue recognized.

Deferred revenue related to the Amgen Other Products performance obligation was immaterial as of September 30, 2024 and December 31, 2023.

Astellas Pharma Inc.

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The Company does not consider the Cost Share Option as a performance obligation at the inception of the agreement as participation is at the Company’s discretion.

Pursuant to the Astellas Agreement, the consideration from Astellas is comprised of an upfront fee of $ 80.0 million and contingent payments for development, regulatory and sales milestones of up to an aggregate of approximately $ 1.6 billion.

Pursuant to the Astellas Agreement, the consideration from Astellas is comprised of a n upfront fee of $ 80.0 million and contingent payments for development, regulatory and sales milestones of up to an aggregate of approximately $ 1.6 billion.

The Company is also entitled to tiered royalties from high-single digit to mid-teen percentage royalties from potential future sales.

6 unchanged sentences

The $ 5.0 million milestone payment was fully recognized in the first quarter of 2024 as the Company had completed its related performance obligation of the collaboration target which resulted in the clinical candidate nomination for further development.

As of June 30, 2024 and December 31, 2023, deferred revenue relating to the Astellas Agreement was $ 23.6 million and $ 31.0 million, respectively.

The amount due from Astellas under the Astellas Agreement wa s $ 1.5 million as of June 30, 2024 and $ 2.2 million as of December 31, 2023.

As of September 30, 2024 and December 31, 2023, deferred revenue relating to the Astellas Agreement was $ 22.2 million and $ 31.0 million, respectively.

The amount due from Astellas under the Astellas Agreement was $ 1.1 million as of September 30, 2024 and $ 2.2 million as of December 31, 2023.

Bristol Myers Squibb Company

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The research term for each collaboration target could be extended in one year increments up to three times.

Pursuant to the BMS Agreement, the financial consideration from Bristol Myers Squibb was comprised of an upfront payment of $ 50.0 million and estimated research and development service fees, and the Company was initially entitled to receive contingent payments of up to $ 25.0 million for additional targets and contingent payments for development, regulatory and sales milestones.

In addition, the Company was entitled to royalty payments in the mid-single digits to low double-digit percentages from potential future sales.

CytomX Therapeutics, Inc.

Notes to Condensed Financial Statements (Unaudited)

$ 25.0 million for additional targets and contingent payments for development, regulatory and sales milestones.

In addition, the Company was entitled to royalty payments in the mid-single digits to low double-digit percentages from potential future sales.

On March 17, 2017, the Company and Bristol Myers Squibb amended the BMS agreement and entered into Amendment Number 1 to Extend Collaboration and License Agreement (“Amendment 1”).

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The Company continues to be obligated to perform research work under Amendment 2 executed in February 2021 for multiple ongoing research programs.

As of June 30, 2024, the Company is eligible to receive approximately $ 1.3 billion in contingent payments for development, regulatory and sales milestones for the ongoing collaboration programs.

The Company reevaluated the remaining potential milestone payments and determined that significant revenue reversal was probable as the achievement of such milestones was highly dependent on factors outside the Company’s control.

As a result, these payments continued to be fully constrained and were not included in the transaction price as of June 30, 2024.

As of September 30, 2024, the Company is eligible to receive approximately $ 1.3 billion in contingent payments for development, regulatory and sales milestones for the ongoing collaboration programs.

CytomX Therapeutics, Inc.

Notes to Condensed Financial Statements (Unaudited)

As of June 30, 2024 and December 31, 2023, deferred revenue relating to the BMS Agreement was $ 86.8 million and $ 119.9 million, respectively.

As a result, these payments continued to be fully constrained and were not included in the transaction price as of September 30, 2024.

As of September 30, 2024 and December 31, 2023, deferred revenue relating to the BMS Agreement was $ 63.9 million a nd $ 119.9 million, respectively.

ModernaTX, Inc.

6 unchanged sentences

The Company is also eligible to receive tiered royalties from high-single digit to low-teen percentage rates of annual global net sales of any products that are commercialized under the Moderna Agreement.

As of June 30, 2024 and December 31, 2023, deferred revenue relating to the Moderna Agreement was $ 19.1 million and $ 24.2 million, respectively.

The amount due from Moderna under the Moderna Agreement wa s $ 0.2 million as of June 30, 2024 and $ 0 as of December 31, 2023.

As of September 30, 2024 and December 31, 2023, deferred revenue relating to the Moderna Agreement was $ 14.2 million and $ 24.2 million, respectively.

The amount due from Moderna under the Moderna Agreement wa s $ 1.1 million a s of September 30, 2024 and $ 0 as of December 31, 2023.

Regeneron Pharmaceuticals, Inc.

8 unchanged sentences

In addition, the Company will receive research and development service fees based on a prescribed FTE rate.

As of June 30, 2024 and December 31, 2023, deferred revenue relating to the Regeneron Agreement was $ 20.4 million and $ 24.4 million, respectively.

The amount due from Regeneron under the Regeneron Agreement was $ 1.0 million and $ 1.1 million as of June 30, 2024 and December 31, 2023, respectively.

As of September 30, 2024 and December 31, 2023, deferred revenue relating to the Regeneron Agreement was $ 18.0 million a nd $ 24.4 million, respectively.

The amount due from Regeneron under the Regeneron Agreement was $ 1.0 million and $ 1.1 million as of September 30, 2024 and December 31, 2023, respectively.

CytomX Therapeutics, Inc.

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Contract Liabilities

The following table presents changes in the Company’s total contract liabilities during the six months ended June 30, 2024 and 2023:

The following table presents changes in the Company’s total contract liabilities during the nine months ended September 30, 2024 and 2023:

Deferred Revenue

2 unchanged sentences

Revenue recognized

June 30, 2024

September 30, 2024

December 31, 2022

Revenue recognized

June 30, 2023

The Company expects that the $ 160.5 million of deferred revenue related to the following contracts as of June 30, 2024 will be recognized as revenue based on actual FTE effort and estimated program progress as set forth below.

September 30, 2023

The Company expects that the $ 129.6 million of deferred revenue related to the following contracts as of September 30, 2024 will be recognized as revenue based on actual FTE effort and estimated program progress as set forth below.

However, the timing of revenue recognition could differ from the estimates depending on facts and circumstances impacting the various contracts, including progress of research and development, resources assigned to the contracts by the Company or its collaboration partners or other factors outside of the Company’s control.

• The $ 10.5 million of deferred revenue related to the Amgen EGFR Products is expected to be recognized until 2026 .

• The $ 11.3 million of deferred revenue related to the Amgen EGFR Products is expected to be recognized unti l 2027 .

• The $ 22.2 million of deferred revenue related to the Astellas Agreement is expected to be recognized until 2026 .

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• The $ 18.0 million of deferred revenue related to the Regeneron Agreement, together with research and development service fees, is expected to be recognized until 2026 .

In February 2020, the Company entered into the Open Market Sale Agreement (the “Sales Agreement”) with Jefferies LLC (“Jefferies”), to sell its common stock, at par value $ 0.00001 per share, with aggregate gross sales proceeds of up to $ 75,000,000 , from time to time upon the Company’s request, through an at the market offering under which Jefferies will act as sales agent.

In February 2020, the Company entered into the Open Market Sale Agreement (as amended on each of March 4, 2022 and August 9, 2024, the “Sales Agreement”) with Jefferies LLC (“Jefferies”), to sell its common stock, at par value $ 0.00001 per share, with aggregate gross sales proceeds of up to $ 75,000,000 , from time to time upon the Company’s request, through an at the market offering under which Jefferies will act as sales agent.

Pursuant to the Sales Agreement, Jefferies as the sales agent will receive a commission of 3.0 % of the gross sales price for shares of common stock sold under the Sales Agreement.

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Notes to Condensed Financial Statements (Unaudited)

The following table summarizes the Company's outstanding warrants as of June 30, 2024:

The following table summarizes the Company's outstanding warrants as of September 30, 2024:

Pre-funded Warrants

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Stock Options

Activities for the Company’s stock option plans for the six months ended June 30, 2024 were as follows:

Activities for the Company’s stock option plans for the nine months ended September 30, 2024 were as follows:

Options Outstanding

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Option forfeited/expired

Balance at June 30, 2024

The Company recorded $ 1.5 million and $ 1.7 million of stock-based compensation expense related to the stock options for the three months ended June 30, 2024 and 2023, respectively.

The Company recorded $ 2.9 million and $ 3.6 million of stock-based compensation expense related to the stock option plans for the six months ended June 30, 2024 and 2023, respectively.

Balance at September 30, 2024

The Company recorded $ 1.5 m illion and $ 0.5 million of stock-based compensation expense related to the stock options for the three months ended September 30, 2024 and 2023, respectively.

The Company recorded $ 4.4 million and $ 4.1 million of stock-based compensation expense related to the stock option plans for the nine months ended September 30, 2024 and 2023, respectively.

Time-based RSUs ("TRSU")

Activities for the Company’s TRSUs for the six months ended June 30, 2024 were as follows:

Activities for the Company’s TRSUs for the nine months ended September 30, 2024 were as follows:

Weighted Average Grant Date Fair Value Per Share

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RSU's cancelled

Balance at June 30, 2024

The Company recorded $ 0.4 million and $ 0.5 million of stock-based compensation expense related to the TRSUs for the three months ended June 30, 2024 and 2023, respectively.

The Company recorded $ 0.8 million and $ 1.0 million of stock-based compensation expense related to the TRSUs for the six months ended June 30, 2024 and 2023, respectively.

Balance at September 30, 2024

The Company recorded $ 0.4 mi llion and $ 0.5 million of stock-based compensation expense related to the TRSUs for the three months ended September 30, 2024 and 2023, respectively.

The Company recorded $ 1.1 m illion and $ 1.5 million of stock-based compensation expense related to the TRSUs for the nine months ended September 30, 2024 and 2023, respectively.

CytomX Therapeutics, Inc.

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In December 2023, the Company determined that the performance conditions for 2022-Tranche 1 was satisfied and the award was vested in December 2023.

As a result, the Company recorded $ 55,000 and the remaining $ 128,000 compensation cost for the 2022-Tranche 1 award for the year ended December 31, 2022 and 2023, respectively.

As of June 30, 2024 and December 31, 2023, the Company determined that it is probable that the performance conditions for the 2022-Tranche 2 will be satisfied and recorded $ 19,000 , $ 38,000 and $ 106,000 compensation cost for these awards for the three and six months ended June 30, 2024 and for the fiscal year 2023, respectively.

As a result, the Company recorded $ 55,000 and the remaining $ 128,000 c ompensation cost for the 2022-Tranche 1 award for the year ended December 31, 2022 and 2023, respectively.

In August 2024, the Company determined that the performance conditions for the 2022-Tranche 2 had been satisfied and the award was vested in August 2024.

As a result the Company recorded $ 38,000 and $ 77,000 compensation cost for the three and nine months ended September 30, 2024 and $ 106,000 for the fiscal year 2023, respectively.

In February 2023, the Company granted 760,000 PSUs to executive employees with an aggregated grant date fair value of approximately $ 1.9 million.

Vesting for 50% of the PSUs granted will occur upon attaining certain specific milestones by December 2024 (“2023-Tranche 1”), and the remaining 50% will vest upon attaining certain specific milestones by December 2025 (“2023-Tranche 2”).

The Company determined that it is not probable that the performance conditions will be satisfied for each of these tranches and hence no compensation cost was recorded for these awards through June 30, 2024.

In January 2024, the Company granted 810,000 PSUs to executive employees with an aggregated grant date fair value of approximately $ 1.3 million.

Vesting for 50% of the PSUs granted will occur upon attaining certain specific milestones by December 2025 (“2024-Tranche 1”), and the remaining 50% will vest upon attaining certain specific milestones by December 2026 (“2024-Tranche 2”).

Activities for the Company’s PSUs for the six months ended June 30, 2024, were as follows:

Activities for the Company’s PSUs for the nine months ended September 30, 2024, were as follows:

Weighted Average Grant Date Fair Value Per Share

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PSU's awarded

Balance at June 30, 2024

PSU's released

Balance at September 30, 2024

Stock-based Compensation

1 unchanged sentence

Three Months Ended

Six Months Ended

Nine Months Ended

September 30,

(in thousands)

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Legal Proceedings

On March 4, 2020 , Vytacera Bio, LLC filed a patent infringement lawsuit against the Company in the U.S.

On March 4, 2020 , Vytacera Bio, LLC (“Vytacera”) filed a patent infringement lawsuit against the Company in the U.S.

District Court for the District of Delaware.

The lawsuit alleges that the Company's use, offers to sell, and/or sales of the PROBODY® technology platform for basic research applications constitutes infringement.

The complaint seeks unspecified monetary damages.

In September 2022, the Company filed a motion

The lawsuit alleged that the Company's use, offers to sell, and/or sales of the PROBODY® technology platform for

CytomX Therapeutics, Inc.

Notes to Condensed Financial Statements (Unaudited)

to dismiss the case and the Court granted the parties’ stipulation to stay all pending case deadlines until that motion is finally resolved.

On October 30, 2023, Magistrate Judge Burke issued a Report & Recommendation that recommended granting Company’s motion to dismiss all counts of the complaint.

In January 2024, the case was transferred to a new Judge and the case will remain stayed pending a ruling by the trial judge on the Magistrate’s Report & Recommendation.

The Company believes that the lawsuit is without merit and intends to vigorously defend itself.

The Company does not believe a loss is probable and has no t recorded any amount as a contingent liability for claims associated with this lawsuit as of June 30, 2024 .

basic research applications constituted infringement.

The complaint sought unspecified monetary damages.

In September 2022, the Company filed a motion to dismiss the case.

On October 17, 2024, the Court dismissed the case.

Vytacera may appeal.

The Company believes that the lawsuit is without merit and intends to vigorously defend itself through any appeal.

The Company does not believe a loss is probable and has no t recorded any amount as a contingent liability for claims associated with this lawsuit as of September 30, 2024 .

License Agreement

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In March 2024, the Company incurred $ 0.6 million of sublicense fees triggered by achieving the GLP toxicology studies milestone for the first clinical candidate which was nominated by Astellas in 2023, as well as by achieving the clinical candidate nomination milestone for a second collaboration target under the Astellas Agreement.

For the three and six months ended June 30, 2024 , the Company incurred sublicense expenses of $ 0.1 million and $ 1.6 million under the provisions of the UCSB Agreement.

For the three and six months ended June 30, 2023, the Company incurred sublicense expenses of $ 0 and $ 1.1 million under the provisions of the UCSB Agreement.

For the three and nine months ended September 30, 2024 , the Company incurred sublicense expenses of $ 0 and $ 1.6 million, respectively, under the provisions of the UCSB Agreement.

For the three and nine months ended September 30, 2023, the Company incurred sublicense expenses of $ 0 and $ 1.1 million under the provisions of the UCSB Agreement.

ImmunoGen (acquired by AbbVie in 2024)

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The state of California contested the Company’s tax position on revenue apportionment for upfront and milestone payments resulting from the Company’s collaboration and licensing agreements for the years 2017 and 2018.

In September 2023, the Company received Notice of Proposed Assessment (“NOPA”) from the Franchise Tax Board.

The Company recorded an uncertain tax position of $ 4.0 million in long term liabilities for the proposed tax assessment, penalties and interest through June 30, 2024.

Of the unrecognized tax benefits as of June 30, 2024 , approximately $ 4.0 million would affect the Company’s effective tax rate if recognized.

In September 2023, the Company rece ived Notice of Proposed Assessment (“NOPA”) from the Franchise Tax Board.

The Company recorded an uncertain tax position of $ 4.1 million in long term liabilities for the proposed tax assessment, penalties and interest through September 30, 2024.

Of the unrecognized tax benefits as of September 30, 2024 , approximately $ 4.1 million would affect the Company’s effective tax rate if recognized.

In addition, utilization of carryforward attributes and indirect federal tax effects of the assessment would result in a reduction in deferred tax assets of $ 5.1 million.

The Company filed a protest to

CytomX Therapeutics, Inc.

Notes to Condensed Financial Statements (Unaudited)

contest the proposed assessment in November 2023.

The Company filed a protest to contest the proposed assessment in November 2023.

Due to the ongoing n ature of the examination and discussions with the state of California, the Company is unable to estimate a date by which this matter will be resolved.

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Our vision is to transform lives with safer, more effective therapies with the goal to address major unmet needs in oncology.

Our proprietary, versatile, multi-modality PROBODY technology platform is designed to enable conditional activation of potent biologic therapeutic candidates within the tumor microenvironment, while minimizing drug activity in healthy tissues and circulation.

Our proprietary, versatile, multi-modality PROBODY technology platform is designed to enable conditional activation of potent masked biologic therapeutic candidates within the tumor microenvironment, while minimizing drug activity in healthy tissues and circulation.

Our platform is built on a strong foundation of tumor biology expertise, including deep knowledge of tumor-associated enzymes known as proteases.

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Patient enrollment in the Phase 1 dose escalation portion of the study continues to progress.

We reported in January 2023 that the initial single patient cohort phase of the study was complete and that the “3+3” patient cohort phase had been initiated.

On May 8, 2024, we reported initial Phase 1a data based on an April 16, 2024 data cutoff.

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Patients enrolled in the study were heavily pre-treated and had a median of 4 prior lines of therapy.

19 patients were enrolled into initial non-step dosing cohorts with target doses ranging from 0.007 mg to 6 mg, and 16 patients were subsequently enrolled into step-dosing cohorts with

CytomX Therapeutics, Inc.

target doses ranging from 5 mg to 10 mg and with tocilizumab prophylaxis.

19 patients were enrolled into initial non-step dosing cohorts with target doses ranging from 0.007 mg to 6 mg, and 16 patients were subsequently enrolled into step-dosing cohorts with target doses ranging from 5 mg to 10 mg and with tocilizumab prophylaxis.

As of the April 16, 2024 data cutoff enrollment into a cohort with a target dose of 15 mg was ongoing.

CytomX Therapeutics, Inc.

As of the cutoff date, CX-904 demonstrated a favorable safety profile.

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Preliminary pharmacokinetic and pharmacodynamic data were consistent with the PROBODY TCE mechanism of action, including maintained masking in circulation, and CD8+ T-cell margination and tumor infiltration.

The CX-904 Phase 1 dose escalation is ongoing with enrollment focused in patients with pancreatic ductal carcinoma, non-small cell lung cancer, and head and neck squamous cell carcinoma across multiple target dose cohorts with a focus on determining a recommended Phase 1b dose, or doses.

A CX-904 Phase 1 program update is expected by the end of 2024, including a potential decision, to initiate Phase 1b expansion cohorts in specific EGFR positive tumor types.

Our pipeline also includes CX-2051, a wholly-owned conditionally activated, PROBODY ADC paired with a next-generation camptothecin payload (Topoisomerase-1 inhibitor) and directed toward the epithelial cellular adhesion molecule (EpCAM).

CX-2051 is licensed from AbbVie (formerly ImmunoGen).

CX-2051 has been tailored to optimize the therapeutic index for the systemic treatment of EpCAM-expressing epithelial cancers where previous industry efforts targeting EpCAM have not been successful due to dose-limiting toxicities.

In the ongoing CX-904 Phase 1a dose escalation study, the 15 mg target step-dose has been cleared and a maximum tolerated dose for step-dosing has not been reached.

Dose escalation and optimization continue focused primarily in pancreatic ductal adenocarcinoma, head and neck squamous cell carcinoma, and non-small cell lung cancer .

Potential Phase 1b initiation in one or more tumor types is anticipated in 2025 pending the selection of an optimized dose and schedule and alignment with global co-development partner, Amgen.

Our pipeline also includes CX-2051, a wholly-owned conditionally activated, PROBODY ADC directed toward the epithelial cell adhesion molecule (EpCAM).

The CX-2051 payload, a next generation topoisomerase-1 inhibitor payload licensed from AbbVie (formerly ImmunoGen), is tailored to specific EpCAM-expressing indications, including colorectal cancer, and includes a payload-antibody linker designed to drive bystander effect, contributing to anti-tumor activity.

The design of CX-2051 has been tailored to optimize the therapeutic index for the systemic treatment of EpCAM-expressing epithelial cancers where previous industry efforts targeting EpCAM have not been successful due to dose-limiting toxicities.

CX-2051 has demonstrated a wide predicted therapeutic index and strong preclinical activity and tolerability in multiple preclinical models, including colorectal cancer.

The IND for CX-2051 was cleared by the FDA in January 2024 and Phase 1 clinical initiation in EpCAM expressing solid tumors, including CRC commenced in April 2024.

As of August 2024, the third cohort in the Phase 1 study had been opened with early enrollment focused primarily in CRC.

The IND for CX-2051 was cleared by the FDA in January 2024 and Phase 1 clinical initiation in EpCAM expressing solid tumors, including a primary initial focus in CRC commenced in April 2024.

As of November 2024, the Phase 1 study is enrolling the fifth dose escalation cohort with favorable safety and tolerability having been observed to date.

High expression of EpCAM has been documented in many tumor types, including colorectal cancer.

In the Phase 1 study, EpCAM expression levels are being assessed retrospectively and are anticipated to be high in the majority of CRC patients.

The Phase 1 dose escalation is intended to demonstrate clinical proof of concept to potentially move into dose expansion studies in 2025.

Initial Phase 1 data for CX-2051 is expected in the first half of 2025.

Dose escalation enrollment continues with initial Phase 1 data for CX-2051 expected in the first half of 2025.

Another wholly-owned product candidate is CX-801, an interferon ("IFN") alpha-2b PROBODY.

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CX-801 is a dually masked, conditionally activated version of IFNα2b that has the potential to become a cornerstone of combination therapy for a wide range of tumor types.

The IND for CX-801 was cleared by the FDA in January 2024, and in June 2024 the first clinical site for the CX-801 Phase 1 dose escalation study in solid tumors was activated.

The Phase 1 dose escalation study will enroll patients with melanoma, renal cell carcinoma, and head and neck squamous cell carcinoma.

In Phase 1 dose escalation, we will evaluate safety and signs of clinical activity for CX-801 monotherapy and in combination with KEYTRUDA®.

The IND for CX-801 was cleared by the FDA in January 2024, and in the third quarter of 2024 the first patient was dosed in the CX-801 Phase 1 dose escalation study in solid tumors.

The Phase 1 dose escalation study will enroll patients primarily with melanoma as well as renal cell carcinoma and head and neck squamous cell carcinoma.

In Phase 1 dose escalation, the study will evaluate safety and signs of clinical activity for CX-801 monotherapy and in combination with KEYTRUDA®.

In second quarter of 2024, CytomX announced a clinical collaboration with Merck to supply KEYTRUDA for evaluation of CX-801 in combination with KEYTRUDA® in the Phase 1 study.

CX-2029 was previously developed in a global co-development collaboration with AbbVie.

This program is intended to open a therapeutic window for successful targeting of CD71, also known as the transferrin receptor 1 (“TfR1”).

This program is intended to open a therapeutic window for CD71, also known as the transferrin receptor 1 (“TfR1”).

CD71 is a cell surface protein essential for iron uptake in dividing cells and is highly expressed in a number of solid and hematologic cancers.

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In March 2023, following the completion of the Phase 2 Study in squamous non-small cell lung cancer (“sqNSCLC”), head and neck squamous cell carcinoma (“HNSCC”), esophageal and gastro-esophageal junction (“E/GEJ”) cancers, AbbVie notified CytomX that it would not advance CX-2029 into additional clinical studies and terminated the 2016 CD71 License and Collaboration Agreement.

CytomX re-acquired full rights to CX-2029 but does not currently have

plans to make further significant investments in the solid tumor program in the near-term but continues to view CD71 as a target of strategic interest, including novel next-generation strategies.

CytomX re-acquired full rights to CX-2029 but does not currently have plans to make further significant

CytomX Therapeutics, Inc.

investments in the solid tumor program in the near-term but continues to view CD71 as a target of strategic interest, including novel next-generation strategies.

We are also continuously engaged in drug discovery efforts towards the generation of new clinical candidates across multiple modalities for the treatment of cancer, including additional ADCs, Cytokines, TCEs, and mRNAs reflecting the versatility of our PROBODY platform.

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We do not have any products approved for sale, and we continue to incur significant research and development and general administrative expenses related to our operations.

As of June 30, 2024 and December 31, 2023, we had an accumulated deficit of $716.2 million and $723.4 million, respectively.

As of September 30, 2024 and December 31, 2023, we had an accumulated deficit of $710.5 million and $723.4 million, respectively.

Global health authorities, including the FDA, regulate many aspects of a product candidate’s life cycle, including research and development and preclinical and clinical testing.

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Total revenue

The increase in revenue of $0.4 million for the three months ended June 30, 2024 compared to the corresponding period of 2023 was primarily due to an increase in revenue under the Regeneron Agreement and Moderna Agreement driven by higher percentage of completion of research collaboration programs that commenced in 2023.

The increase in revenue of $18.4 million for the six months ended June 30, 2024 compared to the corresponding period of 2023 was primarily due to:

The increase in revenue of $7.0 million for the three months ended September 30, 2024 compared to the corresponding period of 2023 was primarily due to an increase in revenue under the BMS Agreement driven by higher percentage of completion of existing research collaboration programs, partially offset by a decrease in revenue under the Astellas Agreement due to the completion of two programs that were nominated as clinical candidates, the first occurring in the first quarter of 2023 and the second occurring in the first quarter of 2024 as discussed further below;

and lower revenue under the Amgen Agreement due to increase in projected hours to completion which resulted in a cumulative negative adjustment to the current period.

The increase in revenue of $25.4 million for the nine months ended September 30, 2024 compared to the corresponding period of 2023 was primarily due to:

• An increase in revenue under the BMS Agreement driven by higher percentage of completion of the existing targets;

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One was related to the nomination of a second clinical candidate while the other was related to the milestone achievement of GLP toxicology study initiation for the first clinical candidate.

Astellas revenue in the first quarter of 2023 included the $5.0 million milestone for the 1st clinical candidate nomination achieved in the collaboration;

Astellas revenue in the first quarter of 2023 included the $5.0 million milestone for the first clinical candidate nomination achieved in the collaboration;

• An increase in revenue under the Regeneron Agreement and Moderna Agreement driven by higher percentage of completion of research collaboration programs that commenced in 2023.

• A decrease in revenue under the AbbVie Agreement due to termination of the agreement in March 2023.

• A decrease in revenue under the Amgen Agreement due to an increase in projected hours to completion.

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Operating Costs and Expenses

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External costs incurred by product candidate (target):

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Total research and development expenses

Research and development expenses increased by $4.5 million and $5.4 million for the three and six months ended June 30, 2024 compared to the corresponding periods of 2023.

Research and development expenses increased by $4.9 million for the three months ended September 30, 2024 compared to the corresponding period of 2023.

This was primarily due to:

CytomX Therapeutics, Inc.

• increase in manufacturing and clinical related activities for the CX-2051 program and clinical trial activities for the CX-904 program;

• increase in personnel related expenses, offset by

• decrease in manufacturing activities for the CX-801 program and winding down of clinical study activities related to the CX-2029 program.

Research and development expenses increased by $10.3 million for the nine months ended September 30, 2024 compared to the corresponding period of 2023.

This was primarily due to:

• a $5.0 million milestone payment to AbbVie (formerly ImmunoGen) in the current period, included in the general research and development expenses, for dosing the first patient for CX-2051 in Phase 1 under the ImmunoGen 2019 License Agreement;

• increase in manufacturing activities for the CX-2051 program and clinical trial activities for the CX-904 program;

• increase in manufacturing and clinical related activities for the CX-2051 program and clinical trial activities for the CX-904 program;

• increase in consulting and personnel related expenses, offset by

• decrease in laboratory contract services and manufacturing activities for the CX-801 program and winding down of clinical study activities related to the CX-2029 and CX-2009 programs.

• decrease in manufacturing activities and laboratory contract services for the CX-801 program and winding down of clinical study activities related to the CX-2029 and CX-2009 programs.

General and Administrative Expenses

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General and administrative

General and administrative expenses increased by $1.0 million for the three months ended June 30, 2024, compared to the corresponding period of 2023, primarily due to higher consulting expenses, personnel related expenses and intellectual property related legal services expenses.

General and administrative expenses increased by $0.8 million for the six months ended June 30, 2024, compared to the corresponding period of 2023, primarily due to higher consulting expenses, personnel related expenses and intellectual property related legal services expenses partially offset by lower rent as a result of partial sublease of the Company’s headquarters started in March 2023.

General and administrative expenses increased by $1.1 million for the three months ended September 30, 2024, compared to the corresponding period of 2023, primarily due to higher professional service expenses supporting intellectual property related activities and internal controls.

General and administrative expenses increased by $1.9 million for the nine months ended September 30, 2024, compared to the corresponding period of 2023, primarily due to higher professional services spend supporting intellectual property related activities and

CytomX Therapeutics, Inc.

internal controls, and consulting and personnel related expenses, partially offset by lower rent as a result of partial sublease of the Company’s headquarters which started in March 2023.

Interest Income and Other Income (Expense), Net

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Total interest income and other expense

Interest income decreased by $0.3 million and $0.5 million for the three and six months ended June 30, 2024, respectively, compared to the corresponding periods of 2023 was primarily driven by lower interest rates and the lower cash and cash equivalents and short-term investments position as compared to the corresponding periods.

Interest income decreased by $1.0 million and $1.5 million for the three and nine months ended September 30, 2024, respectively, compared to the corresponding periods of 2023.

The decrease was primarily driven by lower interest rates and the lower cash and cash equivalents and short-term investments position as compared to the corresponding periods of 2023.

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Provision for income taxes

The $0.1 million and $0.1 million tax provision represented the interest accrued for the three and six months ended June 30, 2024, respectively, related to the proposed assessment received from the state of California for the years 2017 and 2018.

The $0.1 million and $0.1 million tax provision represented the interest accrued for the three and nine months ended September 30, 2024, respectively, related to the proposed assessment received from the state of California for the years 2017 and 2018.

Liquidity and Capital Resources

Sources of Liquidity

As of June 30, 2024, we had cash, cash equivalents and short-term investments of $137.2 million and an accumulated deficit of $716.2 million, compared to cash, cash equivalents and short-term investments of $174.5 million and an accumulated deficit of $723.4 million as of December 31, 2023.

As of September 30, 2024, we had cash, cash equivalents and short-term investments of $117.6 million and an accumulated deficit of $710.5 million, compared to cash, cash equivalents and short-term investments of $174.5 million and an accumulated deficit of $723.4 million as of December 31, 2023.

To date, we have financed our operations primarily through sales of our common stock in conjunction with the IPO, subsequent stock offerings and through our at-the-market offering, sales of our convertible preferred securities prior to our IPO, payments received under our collaboration agreements and proceeds from private placements of our common stock, warrants and pre-funded warrants.

In July 2023, we completed a private placement and issued pre-funded warrants to purchase an aggregate of 14,423,077 shares of common

CytomX Therapeutics, Inc.

stock, accompanying Tranche 1 warrants to purchase up to 5,769,231 shares of common stock and accompanying Tranche 2 warrants to purchase up to 5,769,231 shares of common stock, at a combined price of $2.08 per share.

In July 2023, we completed a private placement and issued pre-funded warrants to purchase an aggregate of 14,423,077 shares of common stock, accompanying Tranche 1 warrants to purchase up to 5,769,231 shares of common stock and accompanying Tranche 2 warrants to purchase up to 5,769,231 shares of common stock, at a combined price of $2.08 per share.

We received gross proceeds of approximately $30.0 million.

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We collected the two milestones payment totaled $10.0 million in April 2024.

In April 2024, we sold 2,270,608 shares at an average price of $2.20 per share under our at-the-market offering and received net proceeds of approximately $4.8 million after deducting the 3.0% sales commission and related issuance cost.

During the three months ended September 30, 2024, we did not sell any shares of common stock under our at-the-market offering program.

As of September 30, 2024, $58.3 million remained available for sale under the Sales Agreement.

Based upon our current operating plan, we expect our existing capital resources will be sufficient to fund operations to the end of 2025.

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or if they are successful, that the terms and conditions of such financing will be favorable to us.

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Summary Statement of Cash Flows

The following table summarizes our cash flows for the periods indicated:

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Cash Flows from Operating Activities

During the six months ended June 30, 2024, cash used in operating activities was $45.6 million, which consisted of a net income of $7.3 million and non-cash charges of $3.4 million, adjusted by a net decrease of $56.3 million relating to the change of our net operating assets and liabilities.

During the nine months ended September 30, 2024, cash used in operating activities was $66.3 million, which consisted of a net income of $13.0 million and non-cash charges of $5.6 million, adjusted by a net decrease of $84.9 million relating to the change of our net operating assets and liabilities.

The non-cash charges primarily consisted of $5.8 million in stock-based compensation, $3.0 million in non-cash lease expense, $1.3 million in depreciation and amortization, partially offset by $4.5 million in accretion of discounts on investments.

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• a decrease of $4.1 million in accounts payable, accrued and other long-term liabilities primarily due to timing of payments;

• an increase of $2.5 million in cashflows from accounts receivable, prepaid and other current assets primarily due to decrease in advance payments due to timing of payment.

During the six months ended June 30, 2023, cash used in operating activities was $15.8 million, which consisted of a net loss of $4.4 million, adjusted by non-cash charges of $4.6 million and a net decrease of $16.0 million relating to the change of our net operating assets and liabilities.

• an increase of $1.9 million in cashflows from accounts receivable, prepaid and other current assets primarily due to decrease in advance payments.

During the nine months ended September 30, 2023, cash used in operating activities was $34.1 million, which consisted of a net loss of $1.4 million and a net decrease of $38.0 million relating to the change of our net operating assets and liabilities, offset by non-cash charges of $5.3 million.

The non-cash charges primarily consisted of $6.0 million in stock-based compensation, $2.8 million in non-cash lease expense, $1.7 million in depreciation and amortization, partially offset by $5.2 million in accretion of discounts on investments.

The change in our net operating assets and liabilities was primarily due to:

CytomX Therapeutics, Inc.

• a net decrease of $64.7 million in deferred revenue resulting from the continued recognition of deferred revenue from existing and new customers;

• a decrease of $12.3 million in accounts payable, accrued and other long-term liabilities primarily due to decrease of payroll-related expenses and restructuring related expenses as well as timing of other payments;

• a decrease of $9.6 million in accounts payable, accrued and other long-term liabilities primarily due to decrease of payroll-related expenses, restructuring related expenses, and laboratory contract services;

• an increase of $33.6 million in cash flows from accounts receivable primarily related to the receipt of the $35.0 million upfront payment and prepaid research under the Moderna agreement entered into in December 2022.

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Cash Flows from Investing Activities

During the six months ended June 30, 2024, cash provided by investing activities was $66.4 million, which consisted of $160.0 million of proceeds from the maturities of short-term investments partially offset by $93.4 million used in the purchase of short-term investments and $0.2 million of capital expenditures used to purchase property and equipment.

During the six months ended June 30, 2023, cash used in investing activities was $120.6 million, which consisted of $220.0 million used in the purchase of short-term investments and $0.6 million of capital expenditures used to purchase property and equipment, partially offset by $100.0 million in proceeds received upon the maturity of marketable securities.

During the nine months ended September 30, 2024, cash provided by investing activities was $84.6 million, which consisted of 190.5 million of proceeds from the maturities of short-term investments partially offset by $105.7 million used in the purchase of short-term investments and $0.2 million of capital expenditures used to purchase property and equipment.

During the nine months ended September 30, 2023, cash used in investing activities was $163.5 million, which consisted of $313.0 million used in the purchase of short-term investments and $0.5 million of capital expenditures used to purchase property and equipment, partially offset by $150.0 million in proceeds received upon the maturity of marketable securities.

CytomX Therapeutics, Inc.

Cash Flows from Financing Activities

During the six months ended June 30, 2024, cash provided by financing activities was $5.2 million, which consisted of $4.8 million of net proceeds from issuance of common stock, net of issuance costs and $0.4 million of proceeds from the exercise of stock options and employee stock purchases under the employee stock purchase plan.

During the six months ended June 30, 2023, cash provided by financing activities consisted of $0.3 million of proceeds from the exercise of stock options and employee stock purchases under the employee stock purchase plan.

During the nine months ended September 30, 2024, cash provided by financing activities was $5.3 million, which consisted of $4.8 million of net proceeds from issuance of common stock, net of issuance costs, and $0.4 million of proceeds from the exercise of stock options and employee stock purchases under the employee stock purchase plan.

During the nine months ended September 30, 2023, cash provided by financing activities consisted of $29.7 million of net proceeds from issuance of pre-funded warrants and warrants and $0.4 million of proceeds from the exercise of stock options and employee stock purchases under the employee stock purchase plan.

Contractual Obligations

During the six months ended June 30, 2024, there were no material changes in contractual obligations from the amounts disclosed in our Annual Report on Form 10-K for the year ended December 31, 2023.

During the nine months ended September 30, 2024, there were no material changes in contractual obligations from the amounts disclosed in our Annual Report on Form 10-K for the year ended December 31, 2023.

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Our disclosure controls and procedures are designed to provide reasonable assurance of achieving their control objectives.

Our management, with the participation of our Principal Executive and Principal Financial Officers, has evaluated the effectiveness of our disclosure controls and procedures as of June 30, 2024, the end of the period covered by this Quarterly Report on Form 10-Q.

Based on their evaluation and subject to the foregoing, the Principal Executive and Principal Financial Officers concluded that our disclosure controls and procedures were effective at the reasonable assurance level as of June 30, 2024.

Our management, with the participation of our Principal Executive and Principal Financial Officers, has evaluated the effectiveness of our disclosure controls and procedures as of September 30, 2024, the end of the period covered by this Quarterly Report on Form 10-Q.

Changes in Internal Controls Over Financial Reporting

There was no change in our internal control over financial reporting (as defined in Rules 13a-15(f) and 15d-15(f) under the Exchange Act) that occurred during our fiscal quarter ended June 30, 2024 that has materially affected, or is reasonably likely to materially affect, our internal control over financial reporting.

There was no change in our internal control over financial reporting (as defined in Rules 13a-15(f) and 15d-15(f) under the Exchange Act) that occurred during our fiscal quarter ended September 30, 2024 that has materially affected, or is reasonably likely to materially affect, our internal control over financial reporting.

CytomX Therapeutics, Inc.

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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 4. Controls and Procedures