What changed in this filing

/stocks — the workspaceLOADING

Item 1. Financial Statements

2024-08-07 compared with 2024-05-07 · 158 added, 97 removed, 466 unchanged (35% of the section changed)

6 unchanged sentences

Cash and cash equivalents $ 494,597 $ 99,915

Restricted cash

Marketable securities 563,197 534,216

Trade receivables, net

Prepaid expenses and other current assets 14,963 3,150

17 unchanged sentences

Preferred stock, par value $ 0.0001 per share authorized:

5,000,000 shares at March 31, 2024 and December 31, 2023;

2,369,797 and 2,369,797 shares issued and outstanding at March 31, 2024 and December 31, 2023, respectively

5,000,000 shares at June 30, 2024 and December 31, 2023;

2,369,797 and 2,369,797 shares issued and outstanding at June 30, 2024 and December 31, 2023, respectively

Common stock, par value $ 0.0001 per share authorized:

200,000,000 at March 31, 2024 and December 31, 2023;

20,684,663 and 19,875,427 shares issued and outstanding at March 31, 2024 and December 31, 2023, respectively

200,000,000 at June 30, 2024 and December 31, 2023;

21,700,893 and 19,875,427 shares issued and outstanding at June 30, 2024 and December 31, 2023, respectively

Additional paid-in-capital 2,493,288 1,741,153

7 unchanged sentences

in thousands, except share and per share amounts)

Three Months Ended March 31,

Total revenues $ — $ —

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

2024 2023 2024 2023

Product revenue, net

$ 14,638 $ — $ 14,638 $ —

Operating expenses:

Cost of sales

Research and development 71,091 68,605 142,328 130,759

12 unchanged sentences

in thousands)

Three Months Ended March 31,

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

2024 2023 2024 2023

Net Loss $ ( 151,971 ) $ ( 85,800 ) $ ( 299,512 ) $ ( 162,696 )

19 unchanged sentences

Balance at March 31, 2024 2,369,797 $ — 20,684,663 $ 2 $ 2,334,760 $ ( 172 ) $ ( 1,483,831 ) $ 850,759

Issuance of common shares in equity offering, excluding to related parties, net of transaction costs — — 346,153 — 85,950 — — 85,950

Sale of common shares to related parties and exercise of common stock options, net of transaction costs — — 670,077 — 48,174 — — 48,174

Stock-based compensation expense related to equity-classified awards — — — — 24,404 — — 24,404

Unrealized loss on marketable securities — — — — — ( 196 ) — ( 196 )

Net loss — — — — — — ( 151,971 ) ( 151,971 )

Balance at June 30, 2024 2,369,797 $ — 21,700,893 $ 2 $ 2,493,288 $ ( 368 ) $ ( 1,635,802 ) $ 857,120

Balance at December 31, 2022 2,369,797 $ — 18,102,523 $ 2 $ 1,160,079 $ ( 32 ) $ ( 962,660 ) $ 197,389

5 unchanged sentences

Balance at March 31, 2023 2,369,797 $ — 18,283,074 $ 2 $ 1,189,776 $ ( 86 ) $ ( 1,039,556 ) $ 150,136

Issuance of common shares in equity offering, excluding to related parties, net of transaction costs — — 85,901 — 21,754 — — 21,754

Sale of common shares to related parties and exercise of common stock options, net of transaction costs — — 90,058 — 6,251 — — 6,251

Compensation expense related to stock options for services — — — — 10,973 — — 10,973

Unrealized loss on marketable securities — — — — ( 3 ) — ( 3 )

Hercules warrant — — — — 195 — — 195

Net loss — — — — — — ( 85,800 ) ( 85,800 )

Balance at June 30, 2023 2,369,797 $ — 18,459,033 $ 2 $ 1,228,949 $ ( 89 ) $ ( 1,125,356 ) $ 103,506

See accompanying notes to condensed consolidated financial statements.

2 unchanged sentences

in thousands)

Three Months Ended

Six Months Ended

Cash flows from operating activities:

5 unchanged sentences

Changes in operating assets and liabilities:

Trade receivables, net

Prepaid expenses and other current assets ( 11,813 ) ( 582 )

6 unchanged sentences

Sales and maturities of marketable securities 346,431 100,204

Acquisition of intangible asset

Purchases of property and equipment, net of disposals ( 488 ) ( 104 )

Net cash provided by (used in) investing activities 98,053 ( 186,864 )

Net cash used in investing activities ( 24,045 ) ( 190,596 )

Cash flows from financing activities:

Proceeds from issuances of stock, excluding related parties, net of transaction costs

397,510 21,754

Proceeds from related parties - warrants, exercise of common stock options, net of transaction costs 310,319 24,154

5 unchanged sentences

Cash, cash equivalents, and restricted cash at end of period $ 499,597 $ 77,196

Supplemental disclosure of cash flow information:

Intangible assets in accounts payable at the end of the period

See accompanying notes to condensed consolidated financial statements.

7 unchanged sentences

In March 2024, Rezdiffra became the first and only FDA-approved therapy for patients with NASH.

Rezdiffra became commercially available in the United States in April 2024.

Rezdiffra is indicated in conjunction with diet and exercise for the treatment of adults with noncirrhotic NASH with moderate to advanced liver fibrosis (consistent with stages F2 to F3 fibrosis).

15 unchanged sentences

Actual results could differ from those estimates.

Revenue Recognition

The Company recognizes revenue in accordance with ASC Topic 606 - Revenue from Contracts with Customers.

Revenue is recognized at a point in time when the customer obtains control of promised goods or services in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services.

To determine revenue recognition for arrangements that the Company determines are within the scope of ASC 606, the Company performs the following five steps:

(i) identify the contract(s) with a customer;

(ii) identify the performance obligation(s) in the contract;

(iii) determine the transaction price;

(iv) allocate the transaction price to the performance obligation(s) in the contract;

and (v) recognize revenue when (or as) the Company satisfies its performance obligation(s).

Revenue from product sales is recorded net of adjustments for estimated government-mandated rebates and chargebacks, distribution fees, estimated product returns, and other deductions.

Accruals are established for these deductions, and actual amounts incurred are offset against applicable accruals.

The Company reflects these accruals as either a reduction in the related account receivable from the customer or as an accrued liability, depending on the means by

which the deduction is settled.

Sales deductions are based on management’s estimates that involve a substantial degree of judgment.

Net Product Revenue

On March 14, 2024, the Company announced that the U.S.

Food and Drug Administration (“FDA”) granted accelerated approval of Rezdiffra (resmetirom) in conjunction with diet and exercise for the treatment of adults with noncirrhotic nonalcoholic steatohepatitis (“NASH”) with moderate to advanced liver fibrosis (consistent with stages F2 to F3 fibrosis).

The Company enters into agreements with specialty pharmacies and specialty distributors, each a “Customer” and collectively the “Customers”, to sell Rezdiffra in the U.S.

Revenues from product sales are recognized when the Customer obtains control of the Company’s product, which occurs at a point in time, typically upon delivery to the Customer.

Revenue is recorded net of variable consideration, which includes prompt pay discounts, returns, chargebacks, rebates, and co-payment assistance.

The variable consideration is estimated based on contractual terms as well as management assumptions.

The amount of variable consideration is calculated by using the expected value method, which is the sum of probability-weighted amounts in a range of possible outcomes, or the most likely amount method, which is the single most likely amount in a range of possible outcomes.

Estimates are reviewed quarterly and adjusted as necessary.

Customers receive a 2 % prompt pay discount for payments made within a contractually agreed number of days before the due date.

The discounts are accounted for as a reduction of the transaction price and recorded as a contra receivable.

The Company records allowances for product returns as a reduction of revenue at the time product sales are recorded.

Product returns are estimated based on forecasted sales and historical and industry data.

Returns are permitted under certain contractual circumstances, including product expiration date.

A returns reserve is recorded as an accrued liability.

Chargebacks :

Chargebacks are reserved for from eligible healthcare providers, resulting from discounted sales prices offered to qualified customers.

The Company is charged back for the difference between the sale price and the discounted price, which is recorded as a contra receivable.

Co-Payment Assistance :

Co-payment assistant programs are offered to eligible end-users as price concessions and are recorded as accrued liabilities and a reduction of the transaction price.

The Company uses a third-party to administer the co-payment program for pharmacy benefit claims.

Rebates include mandated discounts relating to the Medicaid Drug Rebate Program and Medicare coverage gap rebates.

The discount obligations result in decreases to revenue and are recorded to accrued liabilities.

The Company generates revenue from a small number of large, reputable customers.

The following customers accounted for over 10% of total gross product revenue during three months ended June 30, 2024.

As the Company launched Rezdiffra in April 2024, there were no sales and no corresponding customer concentrations in prior periods.

Three Months Ended June 30,

Cash and Cash Equivalents

2 unchanged sentences

The primary objective of the Company’s investment activities is to preserve its capital for the purpose of funding operations and the Company does not enter into investments for trading or speculative purposes.

The Company’s cash is deposited in highly rated financial institutions in the United States.

The Company’s cash is

deposited in highly rated financial institutions in the United States.

The Company invests in money market funds and high-grade, commercial paper and corporate bonds, which management believes are subject to minimal credit and market risk.

6 unchanged sentences

To determine whether an impairment exists, the Company considers whether it intends to sell the debt security and, if the Company does not intend to sell the debt security, it considers available evidence to assess whether it is more likely than not that it will be required to sell the security before the recovery of its amortized cost basis.

During the three months ended March 31, 2024 and 2023, the Company determined it did not have any securities that were other-than-temporarily impaired.

During the six months ended June 30, 2024 and 2023, the Company determined it did not have any securities that were other-than-temporarily impaired.

Marketable securities are stated at fair value, including accrued interest, with their unrealized gains and losses included as a component of accumulated other comprehensive income or loss, which is a separate component of stockholders’ equity.

1 unchanged sentence

Realized gains and losses are determined on the specific identification method.

During the three months ended March 31, 2024 and 2023, the Company did no t have any realized gains or losses on marketable securities.

During the six months ended June 30, 2024 and 2023, the Company did no t have any realized gains or losses on marketable securities.

Fair Value of Financial Instruments

10 unchanged sentences

These inputs include reported trades of and broker-dealer quotes on the same or similar securities, issuer credit spreads, benchmark securities and other observable inputs.

As of March 31, 2024, the Company’s financial assets valued based on Level 1 inputs consisted of cash and cash equivalents in a money market fund, its financial assets valued based on Level 2 inputs consisted of high-grade corporate and government agency bonds and commercial paper, and it had no financial assets valued based on Level 3 inputs.

During the three months ended March 31, 2024 and 2023, the Company did not have any transfers of financial assets between Levels 1 and 2.

As of March 31, 2024 and December 31, 2023, the Company did not have any financial liabilities that were recorded at fair value on a recurring basis on the balance sheet.

As of June 30, 2024, the Company’s financial assets valued based on Level 1 inputs consisted of cash and cash equivalents in a money market fund, its financial assets valued based on Level 2 inputs consisted of high-grade corporate and government agency bonds and commercial paper, and it had no financial assets valued based on Level 3 inputs.

During the six months ended June 30, 2024 and 2023, the Company did not have any transfers of financial assets between Levels 1 and 2.

As of June 30, 2024 and December 31, 2023, the Company did not have any financial liabilities that were recorded at fair value on a recurring basis on the balance sheet.

Inventory is stated at the lower of cost or estimated net realizable value, using actual cost, based on a first-in, first-out (“FIFO”) method.

The Company analyzes its inventory levels quarterly and writes down inventory subject to expiry or in excess of expected requirements, or that has a cost basis in excess of its expected net realizable value.

The Company analyzes its inventory levels quarterly and writes down inventory subject to expiry or

in excess of expected requirements, or that has a cost basis in excess of its expected net realizable value.

These write downs are charged to cost of goods sold in the accompanying Consolidated Statements of Income.

3 unchanged sentences

Research and development costs are expensed as incurred.

Research and development costs are comprised of costs incurred in performing research and development activities, including internal costs (including stock-based compensation),

costs for consultants, milestone payments under licensing agreements, and other costs associated with the Company’s preclinical and clinical programs.

Research and development costs are comprised of costs incurred in performing research and development activities, including internal costs (including stock-based compensation), costs for consultants, milestone payments under licensing agreements, and other costs associated with the Company’s preclinical and clinical programs.

In particular, the Company has conducted safety studies in animals, optimized and implemented the manufacturing of its drug, and conducted clinical trials, all of which are considered research and development expenditures.

24 unchanged sentences

Under current tax regulations, the Company does not receive a tax deduction for the issuance, exercise or disposition of ISOs if the employee meets certain holding requirements.

If the employee does not meet the holding requirements, a disqualifying disposition occurs, at which time the Company may receive a tax deduction.

If the employee does not meet the holding

requirements, a disqualifying disposition occurs, at which time the Company may receive a tax deduction.

The Company does not record tax benefits related to ISOs unless and until a disqualifying disposition is reported.

2 unchanged sentences

The Company uses the asset and liability method to account for income taxes.

Deferred tax assets and liabilities are determined based on the expected future tax consequences of temporary differences between the Company’s financial statement carrying amounts and the tax basis of assets and liabilities using enacted tax rates expected to be in effect in the

years in which the differences are expected to reverse.

The Company currently maintains a 100 % valuation allowance on its deferred tax assets.

5 unchanged sentences

Diluted net loss per common share is computed using the weighted average number of common shares outstanding and the weighted average dilutive potential common shares outstanding using the treasury stock method.

However, for the three months ended March 31, 2024 and 2023, diluted net loss per share is the same as basic net loss per share because the inclusion of weighted average shares of common stock issuable upon the exercise of stock options and warrants or vesting of restricted stock units, and common stock issuable upon the conversion of preferred stock would be anti-dilutive.

However, for the six months ended June 30, 2024 and 2023, diluted net loss per share is the same as basic net loss per share because the inclusion of weighted average shares of common stock issuable upon the exercise of stock options and warrants or vesting of restricted stock units, and common stock issuable upon the conversion of preferred stock would be anti-dilutive.

The following table summarizes outstanding securities not included in the computation of diluted net loss per common share, as their inclusion would be anti-dilutive:

Outstanding at March 31,

Outstanding at June 30,

Common stock options 1,772,807 2,583,540

15 unchanged sentences

Liquidity and Uncertainties

The Company is subject to risks common to development stage companies and early commercial companies in the biopharmaceutical industry including, but not limited to, uncertainty of product development and commercialization, dependence on key personnel, uncertainty of market acceptance of products and product reimbursement, product liability, uncertain protection of proprietary technology, potential inability to raise additional financing necessary for development and commercialization, and compliance with the U.S.

and commercialization, and compliance with the U.S.

Food and Drug Administration (“FDA”) and other government regulations.

The Company has incurred losses since inception, including approximately $ 147.5 million for the three months ended March 31, 2024, resulting in an accumulated deficit of approximately $ 1,483.8 million as of March 31, 2024.

The Company has incurred losses since inception, including approximately $ 299.5 million for the six months ended June 30, 2024, resulting in an accumulated deficit of approximately $ 1,635.8 million as of June 30, 2024.

To date, the Company has funded its operations primarily through proceeds from sales of the Company’s capital stock and debt financings.

1 unchanged sentence

for the treatment of adults with noncirrhotic NASH with moderate to advanced liver fibrosis (consistent with stages F2 to F3 fibrosis).

Rezdiffra became available in the U.S.

Rezdiffra became commercially available in the U.S.

in April 2024.

1 unchanged sentence

In April 2024, underwriters exercised in full their option to purchase additional shares as part of the public offering, resulting in additional net cash proceeds of approximately $ 85.9 million.

Please see “Note 11 – Subsequent Events” to the condensed consolidated financial statements included in this Quarterly Report on Form 10-Q for

more information.

The Company believes that its cash, cash equivalents and marketable securities will be sufficient to fund operations past one year from the issuance of these financial statements.

5 unchanged sentences

Cash, Cash Equivalents and Marketable Securities

The Company held restricted cash of $ 1.2 million as of March 31, 2024 as collateral to its corporate credit card program.

The Company held restricted cash of $ 5.0 million as of June 30, 2024 as collateral to its corporate credit card program.

The Company had no restricted cash as of December 31, 2023.

Restricted cash is included within the cash and cash equivalents balance on the Consolidated Balance Sheet.

A summary of cash, cash equivalents and available-for-sale marketable securities held by the Company as of March 31, 2024 and December 31, 2023 is as follows (in thousands):

March 31, 2024

A summary of cash, cash equivalents and available-for-sale marketable securities held by the Company as of June 30, 2024 and December 31, 2023 is as follows (in thousands):

June 30, 2024

Cost Unrealized

10 unchanged sentences

219,363 — ( 149 ) 219,214

Total cash, cash equivalents and marketable securities $ 1,059,235 $ 57 $ ( 229 ) $ 1,059,063

Total cash, cash equivalents, restricted cash, and marketable securities $ 1,063,162 $ 5 $ ( 373 ) $ 1,062,794

December 31, 2023

14 unchanged sentences

Total cash, cash equivalents and marketable securities $ 633,663 $ 476 $ ( 8 ) $ 634,131

The following table summarizes the Company's inventory balances as of March 31, 2024 and December 31, 2023 (in thousands):

March 31, 2024 December 31, 2023

The following table summarizes the Company's inventory balances as of June 30, 2024 and December 31, 2023 (in thousands):

June 30, 2024 December 31, 2023

Raw Materials

2 unchanged sentences

Accrued Liabilities

Accrued liabilities as of March 31, 2024 and December 31, 2023 consisted of the following (in thousands):

Accrued liabilities as of June 30, 2024 and December 31, 2023 consisted of the following (in thousands):

2024 December 31,

4 unchanged sentences

Professional fees 15,496 6,814

Gross to net accrued expenses

Other 5,119 1,970

4 unchanged sentences

Under the terms of the Loan Facility, the first $ 50.0 million tranche was drawn at closing.

The Company also could draw up to an additional $ 125.0 million in two separate tranches upon achievement of certain resmetirom clinical and regulatory milestones.

The Company also could draw up to an additional $ 125.0 million in two separate

tranches upon achievement of certain resmetirom clinical and regulatory milestones.

A fourth tranche of $ 75.0 million could have been drawn by the Company, subject to the approval of Hercules.

7 unchanged sentences

In connection with the first tranche drawn at closing, the Company issued Hercules a warrant to purchase 14,899 shares of Company common stock, which had a Black-Scholes value of $ 0.6 million.

On February 3, 2023, the Company entered into the First Amendment (the “Amendment”) to the Loan Facility (as amended, the “Amended Loan Facility”).

On February 3, 2023, the Company entered into the First Amendment (the “First Amendment”) to the Loan Facility (as amended, the “Amended Loan Facility”).

Under the Amended Loan Facility, an additional $ 35.0 million was drawn under a second, expanded, $ 65.0 million tranche (“Tranche 2”) in February of 2023 following the Company’s achievement of the Phase 3 clinical development milestone.

1 unchanged sentence

The remaining $ 15.0 million available under Tranche 2 was drawn in September of 2023 in accordance with the Amended Loan Facility.

The third tranche (“Tranche 3”) of $ 75.0 million remains unchanged by the Amendment, and such borrowings became available when the Company achieved a milestone with FDA approval for Rezdiffra in March 2024.

As of March 31, 2024, the Company has not drawn down on Tranche 3, and the $ 75.0 million remains available until June 12, 2024.

Coincident with the expansion of Tranche 2 borrowing capacity by $ 15.0 million, the Amendment reduced the fourth tranche under the Loan Facility (“Tranche 4”) by $ 15.0 million to $ 60.0 million, which is available subject to Hercules’ sole discretion.

In connection with the $ 35.0 million drawn under Tranche 2 at the closing of the Amendment, $ 15.0 million drawn in June of 2023, and $ 15.0 million drawn in September of 2023, the Company issued to Hercules and

affiliates Tranche 2 Warrants to purchase an aggregate of 4,555 shares of common stock, which had a Black-Scholes value of $ 0.9 million.

The Amendment reduced the interest rate under the Amended Loan Facility to the greater of (i) the prime rate as reported in The Wall Street Journal plus 2.45 % and (ii) 8.25 %.

The Amendment and the Amended Loan Facility summary terms were disclosed in the Company’s Current Report on Form 8-K filed with the Securities and Exchange Commission on February 9, 2023.

The third tranche (“Tranche 3”) of $ 75.0 million was unchanged by the First Amendment, and such borrowings became available when the Company achieved a milestone with FDA approval for Rezdiffra in March 2024.

The Company did not elect to draw Tranche 3 before it expired in June 2024.

In connection with the $ 35.0 million drawn under Tranche 2 at the closing of the First Amendment, $ 15.0 million drawn in June of 2023, and $ 15.0 million drawn in September of 2023, the Company issued to Hercules and affiliates Tranche 2 Warrants to purchase an aggregate of 4,555 shares of common stock, which had a Black-Scholes value of $ 0.9 million.

The First Amendment reduced the interest rate under the Amended Loan Facility to the greater of (i) the prime rate as reported in The Wall Street Journal plus 2.45 % and (ii) 8.25 %.

The First Amendment and the Amended Loan Facility summary terms were disclosed in the Company’s Current Report on Form 8-K filed with the Securities and Exchange Commission on February 9, 2023.

The Loan Facility includes affirmative and restrictive financial covenants commencing on January 1, 2023, including maintenance of a minimum cash, cash equivalents and liquid funds covenant of $ 35.0 million, which may decrease in certain circumstances if the Company achieves certain clinical milestones and a revenue milestone, and a revenue-based covenant that could apply commencing at or after the time that financial reporting is due for the quarter ending September 30, 2024.

5 unchanged sentences

The Loan Facility also includes customary covenants associated with a secured loan facility, including covenants concerning financial reporting obligations, and certain limitations on indebtedness, liens (including a negative pledge on intellectual property and other assets), investments, distributions (including dividends), collateral, investments, distributions, transfers, mergers or acquisitions, taxes, corporate changes, and deposit accounts.

As of March 31, 2024, the outstanding principal under the Loan Facility was $ 115.0 million.

The interest rate as of March 31, 2024 was 10.95 %.

As of March 31, 2024, the Company was in compliance with all loan covenants and provisions.

Future minimum payments, including interest and principal, under the loans payable outstanding as of March 31, 2024 are as follows (in thousands):

Period Ending March 31, 2024:

As of June 30, 2024, the outstanding principal under the Loan Facility was $ 115.0 million.

The interest rate as of June 30, 2024 was 10.95 %.

As of June 30, 2024, the Company was in compliance with all loan covenants and provisions.

Future minimum payments, including interest and principal, under the loans payable outstanding as of June 30, 2024 are as follows (in thousands):

Period Ending June 30, 2024:

Thereafter 53,387

11 unchanged sentences

Each share of the Series A and B Preferred Stock is convertible into shares of common stock following notice that may be given at the holder’s option.

ranking prior to the Series A and B Preferred Stock upon liquidation, the holders of the Series A and B Preferred Stock shall participate pari passu with the holders of the common stock (on an as-if-converted-to-Common-Stock basis) in the net assets of the Company.

Upon any liquidation, dissolution or winding-up of the Company, whether voluntary or involuntary, after the satisfaction in full of the debts of the Company and the payment of any liquidation preference owed to the holders of shares of capital stock of the Company ranking prior to the Series A and B Preferred Stock upon liquidation, the holders of the Series A and B Preferred Stock shall participate pari passu with the holders of the common stock (on an as-if-converted-to-Common-Stock basis) in the net assets of the Company.

Shares of the Series A and B Preferred Stock will generally have no voting rights, except as required by law.

9 unchanged sentences

The net proceeds to the Company for the exercise of the Underwriters’ Option, after deducting the underwriting discounts and commissions and estimated offering expenses payable by the Company, was approximately $ 85.9 million.

See Note 11- Subsequent Events for more information.

The Company intends to use the net proceeds from the 2024 Offering for its commercial activities in connection with the launch of Rezdiffra in the U.S.

14 unchanged sentences

A holder of 2023 Pre-Funded Warrants may not exercise the warrant if the holder, together with its affiliates, would beneficially own more than 9.99 % of the number of shares of common stock outstanding immediately after giving effect to such exercise.

2023 Pre-Funded Warrants may increase or decrease this percentage, but not in excess of 19.99 % , by providing at least 61 days prior notice to the Company.

A holder of 2023 Pre-Funded Warrants may increase or decrease this percentage, but not in excess of 19.99 % , by providing at least 61 days prior notice to the Company.

At-The-Market Issuance Sales Agreement

3 unchanged sentences

Subject to the terms and conditions of the 2021 Sales Agreement, Cowen would use commercially reasonable efforts consistent with its normal trading and sales practices to sell the common stock based upon the Company’s instructions (including any price, time or size limits or other customary parameters or conditions the Company imposed).

In total, under the 2021 Sales Agreement the Company sold 1,235,943 shares for an aggregate of $ 199.9 million in gross proceeds, with net proceeds to the Company of approximately $ 195.8 million after deducting commissions and other transaction costs through December 31, 2022.

All shares were sold pursuant to the Company’s effective shelf registration statement on Form S-3 (the “Registration Statement”) and the prospectus supplement relating thereto.

As of March 31, 2024, no amounts remained reserved and available for sale under the 2021 Sales Agreement and the related prospectus supplement.

In May 2023, the Company amended the 2021 Agreement (the “Sales Agreement Amendment”), with Cowen, pursuant to which the Company may, from time to time, issue and sell an additional $ 200.0 million in shares of its common stock.

The Company is not obligated to make any sales of its common stock under this arrangement.

Any shares sold will be sold pursuant to the Registration Statement and prospectus supplement filed pursuant to the Registration Statement.

The Sales Agreement Amendment authorizes sales of shares of the Company’s common stock, from time to time, at the Company’s option, through Cowen as its sales agent.

In May 2023, the Company entered into an amendment to the 2021 Sales Agreement (the “Sales Agreement Amendment”), with Cowen, pursuant to which the Company could, from time to time, issue and sell an additional $ 200.0 million in shares of its common stock, until it was terminated in May 2024.

The Company was not obligated to make any sales of its common stock under this arrangement.

Any shares sold would be sold pursuant to the Registration Statement and prospectus supplement filed pursuant to the Registration Statement.

The 2021 Sales Agreement, as amended by the Sales Agreement Amendment, authorized sales of shares of the Company’s common stock, from time to time, at the Company’s option, through Cowen as its sales agent.

Sales of common stock through Cowen may be made by any method that is deemed an “at-the-market” offering as defined in Rule 415 promulgated under the Securities Act of 1933, as amended, and as described in the prospectus supplement.

During the three months ended March 31, 2024, under the Sales Agreement Amendment, the Company sold no shares.

In total under the Sales Agreement Amendment, the Company sold 98,101 shares for an aggregate of $ 25.2 million in gross proceeds, with net proceeds to the Company of approximately $ 24.5 million after deducting commissions and other transaction costs.

Since the entry into the Sales Agreement Amendment in May 2023, the Company sold 98,101 shares in total under the 2021 Sales Agreement, as amended by the Sales Agreement Amendment, for an aggregate of $ 25.2 million in gross proceeds, with net proceeds to the Company of approximately $ 24.5 million after deducting commissions and other transaction costs.

All shares were sold pursuant to the Company’s effective Registration Statement and the prospectus supplement relating thereto.

As of March 31, 2024, $ 174.8 million remained reserved and available for sale under the 2023 Sales Agreement Amendment and the Company’s related prospectus supplement.

In total, the Company sold 1,334,044 shares of Common Stock having an aggregate offering price of $ 225.1 million pursuant to the 2021 Sales Agreement, as amended by the Sales Agreement Amendment.

In May 2024, the Company entered into a Sales Agreement (the “2024 Sales Agreement”) with Cowen, replacing and superseding the 2021 Sales Agreement, as amended by the Sales Agreement Amendment which was terminated effective upon the entry into the 2024 Sales Agreement.

The Company is authorized to issue and sell up to $ 300.0 million in shares of the Company’s common stock under the 2024 Sales Agreement.

The Company sold no shares in the three and six months ended June 30, 2024 under either the 2021 Sales Agreement, as amended by the Sales Agreement Amendment, or the 2024 Sales Agreement.

Stock-based Compensation

4 unchanged sentences

The terms of stock options awarded under the 2015 Stock Plan, in general, are determined by the Compensation Committee, provided the exercise price per share generally shall not be set at less than the fair market value of a share of the common stock on the date of grant and the term shall not be greater than ten years from the date the option is granted.

As of March 31, 2024, 456,241 shares were available for future issuance under the 2015 Stock Plan.

On June 25, 2024, the Company’s stockholders approved an amendment to the 2015 Stock Plan to increase the total number of shares of common stock available for issuance by 750,000 and extend its duration by 10 years until April 23, 2035.

As of June 30, 2024, 1,264,199 shares were available for future issuance under the 2015 Stock Plan.

2023 Inducement Plan

2 unchanged sentences

The Inducement Plan provides for the granting of non-statutory stock options, restricted stock, restricted stock units, performance stock units and other stock-based compensation awards to new employees, but does not allow for the granting of incentive stock options.

The terms of the stock options under the Inducement Plan, in general, are determined by the Compensation Committee, provided the exercise price per share generally shall not be set at less than the fair market value of a share of the common stock on the date of grant and the

term shall not be greater than ten years from the date the option or award is granted.

A total of 500,000 shares of the Company’s common stock were reserved for issuance under the Inducement Plan.

As of March 31, 2024, 23,366 shares were available for future issuance under the 2023 Inducement Plan.

As of June 30, 2024, 19,097 shares were available for future issuance under the 2023 Inducement Plan.

Stock Options

The following table summarizes stock option activity during the three months ended March 31, 2024:

The following table summarizes stock option activity during the six months ended June 30, 2024:

average exercise

3 unchanged sentences

Options cancelled ( 59,995 ) 118.98

Outstanding at March 31, 2024 2,458,227 $ 88.18

Exercisable at March 31, 2024 1,850,988 $ 75.49

The total cash received by the Company as a result of stock option exercises was $ 1.4 million and $ 17.9 million, respectively, for the three months ended March 31, 2024 and 2023.

The total intrinsic value of options exercised was $ 3.8 million and $ 32.5 million, respectively, for the three months ended March 31, 2024 and 2023.

The weighted-average grant date fair values, based on the Black-Scholes option model, of options granted during the three months ended March 31, 2024 and 2023 were $ 152.05 and $ 219.02 , respectively.

Outstanding at June 30, 2024 1,772,807 $ 93.76

Exercisable at June 30, 2024 1,323,994 $ 79.14

The total cash received by the Company as a result of stock option exercises was $ 49.7 million and $ 21.8 million, respectively, for the six months ended June 30, 2024 and 2023.

The total intrinsic value of options exercised was $ 121.1 million and $ 48.9 million, respectively, for the six months ended June 30, 2024 and 2023.

The weighted-average grant date fair values, based on the Black-Scholes option model, of options granted during the six months ended June 30, 2024 and 2023 were $ 153.98 and $ 219.02 , respectively.

Restricted Stock Units

2 unchanged sentences

RSUs vest over a period of months or years, or upon the occurrence of certain performance criteria or the attainment of stated goals or events, and are subject to forfeiture if employment or service terminates before vesting.

As of March 31, 2024, the Company had 530,671 restricted stock units outstanding, with a weighted average grant date fair value of $ 231.44 per unit.

The following table summarizes RSU activity, excluding performance-based RSUs, during the three months ended March 31, 2024:

As of June 30, 2024, the Company had 508,947 restricted stock units outstanding, with a weighted average grant date fair value of $ 230.61 per unit.

The following table summarizes RSU activity, excluding performance-based RSUs, during the six months ended June 30, 2024:

Weighted average grant date fair value

Unvested at December 31, 2023

Outstanding at December 31, 2023

376,117 $ 241.45

3 unchanged sentences

( 51,862 ) 243.28

Unvested at March 31, 2024

530,671 $ 231.44

Outstanding at June 30, 2024 508,947 $ 230.61

Performance-Based Restricted Stock Units

1 unchanged sentence

Depending on the terms of the PSUs and the outcome of the pre-established performance criteria, which may include a market and/or performance condition, a recipient may ultimately earn the target number of PSUs granted or a specified multiple thereof at the end of the vesting period.

As of March 31, 2024, the Company granted 101,202 PSUs.

The maximum number of outstanding PSUs eligible to be earned as of March 31, 2024 are 252,404 PSUs, with a weighted average grant date fair value of $ 268.63 per unit.

The following table summarizes PSU activity during the six months ended June 30, 2024:

PSUs Eligible to Earn PSUs Weighted average grant date fair value

Outstanding PSUs at December 31, 2023 50,000 150,000 $ 146.37

PSUs granted 51,202 102,404 388.02

PSUs attained — — —

PSUs forfeited ( 8,442 ) ( 16,884 ) 388.02

Outstanding at June 30, 2024 92,760 235,520 $ 257.77

Outstanding Awards

As of March 31, 2024, the Company had restricted stock units, performance stock units, and options outstanding pursuant to which an aggregate of 3,241,302 shares of its common stock may be issued pursuant to the terms of all awards granted under the 2015 Stock Plan and Inducement Plan.

As of June 30, 2024, the Company had restricted stock units, performance stock units, and options outstanding pursuant to which an aggregate of 2,517,274 shares of its common stock may be issued pursuant to the terms of all awards granted under the 2015 Stock Plan and Inducement Plan.

Stock-Based Compensation Expense

Stock-based compensation expense during the three months ended March 31, 2024 and 2023 was as follows (in thousands):

Three Months Ended March 31,

Stock-based compensation expense during the three and six months ended June 30, 2024 and 2023 was as follows (in thousands):

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

2024 2023 2024 2023

Stock-based compensation expense by type of award:

7 unchanged sentences

Total stock-based compensation expense included in net loss $ 24,404 $ 10,973 $ 44,306 $ 22,223

Unrecognized stock-based compensation expense as of March 31, 2024 was $ 177.3 million with a weighted average remaining period of 3.00 years.

Unrecognized stock-based compensation expense as of June 30, 2024 was $ 149.1 million with a weighted average remaining period of 2.09 years.

Commitments and Contingencies

4 unchanged sentences

Furthermore, a tiered single-digit royalty is payable on net sales of resmetirom or a product developed from resmetirom, subject to certain reductions.

The Company achieved the U.S.

regulatory approval milestone but had no Licensed Product sales for the three months ended March 31, 2024.

The company did no t achieve any product development or regulatory milestones for the three months ended March 31, 2023.

The Company launched Rezdiffra in the U.S.

in April 2024.

The company did no t achieve any product development or regulatory milestones for the six months ended June 30, 2023.

The Company has entered into customary contractual arrangements and letters of intent in preparation for and in support of clinical trials and commercialization.

In August 2023, the Company entered into the Fifth Amendment to the Office Lease (the “Lease Amendment”).

In August 2023, the Company entered into the Fifth Amendment to the Office Lease (the “Fifth Lease Amendment”).

The Lease Amendment extended the term of the lease through November 2026.

As a result of the Lease Amendment, an incremental $ 1.6 million ROU asset and lease liabilities were recorded during the year ended December 31, 2023.

As a result of the Lease Amendment, an incremental $ 1.6 million right-of-use asset and lease liabilities were recorded during the year ended December 31, 2023.

In April 2024 and May 2024, the Company entered into the Sixth (the “Sixth Lease Amendment”) and Seventh (the “Seventh Lease Amendment”) Amendments to the Office Lease, respectively, expanding the amount of office space available in the same premises.

The lease commencement date had not yet occurred as of June 30, 2024 and therefore there was no impact to the financial statements.

Subsequent Events

As part of the 2024 Offering, on April 2, 2024, the Underwriters’ Option exercise closed.

The 2024 Underwriters exercised in-full their option to purchase 346,153 additional shares of Common Stock at the public offering price for the Shares of $ 260.00 per share, less underwriting discounts and commissions, pursuant to the Underwriting Agreement.

Gross proceeds were $ 90.0 million.

The net proceeds to the Company for the exercise of the Underwriters’ Option, after

deducting the underwriting discounts and commissions and estimated offering expenses payable by the Company, was approximately $ 85.9 million.

********** END OF FINANCIAL STATEMENTS **********

67 unchanged sentences

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

What changed 10-Q

Item 1. Financial Statements