What changed in this filing

/stocks — the workspaceLOADING

Item 2. Management’s Discussion and Analysis

2021-08-10 compared with 2021-05-12 · 87 added, 28 removed, 125 unchanged (48% of the section changed)

15 unchanged sentences

and (v) all dollar amounts refer to United States dollars unless otherwise indicated.

The following should be read in conjunction with our unaudited condensed consolidated interim financial statements and related notes for the three months ended March 31, 2021 included in this Quarterly Report.

The following should be read in conjunction with our unaudited condensed consolidated interim financial statements and related notes for the six months ended June 30, 2021 included in this Quarterly Report.

Company Overview

14 unchanged sentences

We submitted an investigational new drug, or IND, application to the United States Food and Drug Administration, or the FDA, to initiate a Phase 2 clinical trial of MultiTAA-specific T cell therapy, which we refer to as MT-401 (zedenoleucel), in post-allogeneic HSCT patients with AML in both the adjuvant and active disease setting.

The dose administered in this multicenter trial is the approximate flat dose equivalent of the current maximum tolerated dose from the ongoing Phase 1 trial.

The dose administered in this multicenter trial is currently 100 million cells every two weeks for three doses.

In the adjuvant setting, patients will be randomized to either MultiTAA-specific T cell therapy at approximately 90 days post-transplant versus standard of care observation, while the active disease patients will receive MT-401 following relapse post-transplant as part of a single-arm group.

We expect to complete the safety lead-in portion of the trial in the first half of 2021.

We anticipate that we will initiate the remainder of the Phase 2 trial in the third quarter of 2021 and complete enrollment of 20 patients in that phase of the trial in the fourth quarter of 2021 in order to report results from the active disease arm of the trial in the first quarter of 2022.

We have completed the safety lead-in portion of the trial in June 2021.

We initiated the remainder of the Phase 2 trial in July 2021 and plan to complete enrollment of approximately 20 patients and activate additional clinical sites across the United States in the fourth quarter of 2021 in order to report results from the active disease arm of the trial in the first quarter of 2022.

We expect to begin manufacturing MT-401 for the Phase 2 trial at our cGMP manufacturing facility in the third quarter of 2021.

4 unchanged sentences

We are also evaluating the MultiTAA-specific T cell therapies in a Phase 2 clinical trial for the treatment of breast cancer and in Phase 1 clinical trials for the treatment of ALL, lymphoma, MM and sarcoma, all of which are being conducted by BCM.

As of December 2020, the MultiTAA-specific T cell therapies have been generally well tolerated by all of the patients enrolled in clinical trials in hematological and solid tumor indications with no incidents of cytokine release syndrome or neurotoxicity, which are frequently associated with CAR-T therapies.

As of June 2021, the MultiTAA-specific T cell therapies have been generally well tolerated by all of the patients enrolled in clinical trials in hematological and solid tumor indications with no incidents of cytokine release syndrome or neurotoxicity, which are frequently associated with CAR-T therapies.

Our ongoing clinical trials may be also affected by the COVID-19 pandemic.

Based on our observations in clinical trials in AML, pancreatic cancer, lymphoma, ALL and MM, we believe that the MultiTAA-specific T cell therapies have the potential to mediate a meaningful anti-tumor effect, as well as significant in vivo expansion of T cells.

We may initiate additional Phase 2 clinical trials investigating other indications in addition to our planned Phase 2 trial in post-transplant AML patients.

We may initiate additional clinical trials investigating other indications in addition to our planned Phase 2 trial in post-transplant AML patients.

Our clinical-stage pipeline, including clinical trials being conducted by BCM and other partners, is set forth below:

Results of Operations

In this discussion of our results of operations and financial condition, amounts, other than per-share amounts, have been rounded to the nearest thousand dollars.

Comparison of the Three Months Ended March 31, 2021 and 2020

The following table summarizes the results of our operations for the three months ended March 31, 2021 and 2020:

In this discussion of our results of operations and financial condition, amounts in financial tables, other than per-share amounts, have been rounded to the nearest thousand.

Comparison of the Three Months Ended June 30, 2021 and 2020

The following table summarizes the results of our operations for the three months ended June 30, 2021 and 2020:

For the Three Months Ended

Total revenues

Operating expenses:

8 unchanged sentences

Weighted average number of common shares outstanding, basic and diluted

We did not receive any grant income during the three months ended June 30, 2021.

During the three months ended June 30, 2020, we received $0.5 million of a grant awarded to the Mayo Foundation from the U.S.

Department of Defense to fund the Phase 2 clinical trial of TPIV100 for the treatment of HER2/neu breast cancer.

The portion of the grant we received compensated us for clinical supplies manufactured by us for the clinical trial.

Operating Expenses

Operating expenses incurred during the three months ended March 31, 2021 were $8.8 million compared to $6.6 million during the three months ended March 31, 2020.

Operating expenses incurred during the three months ended June 30, 2021 were $10.9 million compared to $6.8 million during the three months ended June 30, 2020.

Significant changes and expenditures in operating expenses are outlined as follows:

Research and Development Expenses

Research and development expenses increased by 48% to $5.6 million for the three months ended March 31, 2021, compared to $3.8 million for the three months ended March 31, 2020.

Research and development expenses increased by 72% to $7.4 million for the three months ended June 30, 2021, compared to $4.3 million for the three months ended June 30, 2020.

The increase of $3.1 million in 2021 was primarily attributable to the following:

o increase of $0.6 million in headcount-related expenses as we increased the number of research and development personnel,

o increase of $0.8 million in expenses related to our AML clinical trial,

o increase of $0.7 million in headcount-related expenses,

o increase of $0.5 million in process development expenses,

2 unchanged sentences

o increase of $0.2 million in other expenses, and

o increase of $0.4 million in depreciation expenses primarily attributable to our manufacturing facility and related expenses.

o increase of $0.4 million in depreciation expenses primarily attributable to our manufacturing facility and related expenses, offset by

o decrease of $0.5 million in expenses related to our vaccine clinical trials.

General and Administrative Expenses

General and administrative expenses were $3.1 million and $2.8 million for the three months ended March 31, 2021 and 2020, respectively.

The increase in general and administrative expenses was mainly comprised of increases in rent, insurance expenses and in headcount-related expenses, offset by a decrease in legal and professional fees.

General and administrative expenses were $3.6 million and $2.5 million for the three months ended June 30, 2021 and 2020, respectively.

The increase of $1.1 million in 2021 was primarily attributable to the following:

o increase of $0.3 million in legal fees,

o increase of $0.3 million in headcount-related expenses,

o increase of $0.2 million in rent and utilities, and

o increase of $0.3 million in other expenses.

Other Income (Expense)

Interest Income

Interest income was $2,000 and $0.1 million for the three months ended March 31, 2021 and 2020, respectively, and was attributable to interest income relating to funds that are held in U.S.

Interest income was $2,000 and $16,000 for the three months ended June 30, 2021 and 2020, respectively, and was attributable to interest income relating to funds that are held in U.S.

Treasury notes and U.S.

government agency-backed securities.

The increase in our net loss during the three months ended June 30, 2021 compared to the three months ended June 30, 2020 was due to the continued expansion of our research and development activities, increased expenses relating to future clinical trials, and the overall growth of our corporate infrastructure.

We anticipate that we will continue to incur net losses in the future as we continue to invest in research and development activities, including clinical development of our MultiTAA T cell product candidates.

Comparison of the Six Months Ended June 30, 2021 and 2020

The following table summarizes the results of our operations for the six months ended June 30, 2021 and 2020:

For the Six Months Ended

Total revenues

Operating expenses:

Research and development

General and administrative

Total operating expenses

Loss from operations

Other income (expense):

Change in fair value of warrant liabilities

Interest income

Net loss per share, basic and diluted

Weighted average number of common shares outstanding

We did not receive any grant income during the six months ended June 30, 2021.

During the six months ended June 30, 2020, we received $0.5 million of a grant awarded to the Mayo Foundation from the U.S.

Department of Defense to fund the Phase 2 clinical trial of TPIV100 for the treatment of HER2/neu breast cancer.

The portion of the grant we received compensated us for clinical supplies manufactured by us for the clinical trial.

Operating Expenses

Operating expenses incurred during the six months ended June 30, 2021 were $19.7 million compared to $13.5 million during the six months ended June 30, 2020.

Significant changes and expenditures in operating expenses are outlined as follows:

Research and Development Expenses

Research and development expenses increased by 61% to $13.0 million for the six months ended June 30, 2021, compared to $8.1 million for the six months ended June 30, 2020.

The increase of $4.9 million in 2021 was primarily attributable to the following:

o increase of $1.3 million in expenses related to our AML clinical trial,

o increase of $1.3 million in headcount-related expenses,

o increase of $0.6 million in process development expenses,

o increase of $0.9 million in sponsored research expenses from BCM agreements,

o increase of $0.7 million in rent and utilities, and

o increase of $0.9 million in depreciation expenses primarily attributable to our manufacturing facility and related expenses, offset by

o decrease of $0.8 million in expenses related to our vaccine clinical trials.

General and Administrative Expenses

General and administrative expenses were $6.7 million and $5.4 million for the six months ended June 30, 2021 and 2020, respectively.

The increase of $1.3 million in 2021 was primarily attributable to the following:

o increase of $0.1 million in insurance expenses,

o increase of $0.6 million in headcount-related expenses,

o increase of $0.3 million in rent and utilities, and

o increase of $0.3 million in other expenses.

Other Income (Expense)

Change in Fair Value of Warrant Liabilities

Change in fair value of warrant liabilities for the six months ended June 30, 2021 was $0 as compared to $31,000 for the six months ended June 30, 2020.

Interest Income

Interest income was $3,900 and $0.1 million for the six months ended June 30, 2021 and 2020, respectively, and was attributable to interest income relating to funds that are held in U.S.

Treasury notes and U.S.

government agency-backed securities.

As part of the reaction to the COVID-19 pandemic, the Federal Reserve cut rates in mid-March of 2020 to a range of 0.0% - 0.25%.

As such, we recorded lower interest income during the three months ended March 31, 2021.

The increase in our net loss during the three months ended March 31, 2021 compared to the three months ended March 31, 2020 was due to the continued expansion of our research and development activities, increased expenses relating to future clinical trials, and the overall growth of our corporate infrastructure.

As such, we recorded lower interest income during the six months ended June 30, 2021.

The increase in our net loss during the six months ended June 30, 2021 compared to the six months ended June 30, 2020 was due to the continued expansion of our research and development activities, increased expenses relating to future clinical trials, and the overall growth of our corporate infrastructure.

2 unchanged sentences

We have financed our operations primarily through public and private offerings of our debt and equity securities.

The following table sets forth our cash and cash equivalents and working capital as of March 31, 2021 and December 31, 2020:

The following table sets forth our cash and cash equivalents and working capital as of June 30, 2021 and December 31, 2020:

Cash and Working Capital

Cash and cash equivalents

Working capital

The following table summarizes our cash flows for the three months ended March 31, 2021 and 2020:

For the Three Months Ended

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

For the Six Months Ended

Net Cash provided by (used in):

4 unchanged sentences

Operating Activities

Net cash used in operating activities during the three months ended March 31, 2021 was $9.1 million compared to $4.1 million for the same period last year.

The changes in cash flow from operating activities during the three months ended March 31, 2020 were due to $8.8 million of net losses and a $2.4 million decrease from changes in operating assets and liabilities.

Net cash used in operating activities during the six months ended June 30, 2021 was $15.9 million compared to $8.4 million for the same period last year.

The changes in cash flow from operating activities during the six months ended June 30, 2021 were due to $19.7 million of net losses and a $0.8 million decrease from changes in operating assets and liabilities.

This was offset by $3.0 million of stock-based compensation, $1.0 million of depreciation expense and $0.5 million right-of-use asset amortization and lease liability accretion.

Investing Activities

Net cash used in investing activities was $0.4 million and $0.1 million for the purchase of property and equipment during the three months ended March 31, 2021 and 2020, respectively.

Net cash used in investing activities was $0.8 million and $3.9 million for the purchase of property and equipment during the six months ended June 30, 2021 and 2020, respectively.

The increase relates to purchases of laboratory equipment for the manufacturing facility.

Financing Activities

Net cash provided by financing activities was $52.7 million during the three months ended March 31, 2021, due to the net proceeds received from the underwritten public offering.

Net cash provided by financing activities was $0.6 million during the three months ended March 31, 2020.

Net cash provided by financing activities was $52.6 million during the six months ended June 30, 2021, due to the net proceeds received from the underwritten public offering.

Net cash provided by financing activities was $0.6 million during the six months ended June 30, 2020.

Future Capital Requirements

7 unchanged sentences

On March 16, 2021, we issued an aggregate of 32,282,857 shares of our common stock, for net proceeds of $52.6 million pursuant to an underwritten public offering.

As of March 31, 2021, we had working capital of $63.3 million, compared to working capital of $18.0 million as of December 31, 2020.

Based on our clinical and research and development plans and our timing expectations related to the progress of our programs, we expect that our cash and cash equivalents as of March 31, 2021 will enable us to fund our operating expenses and capital expenditure requirements into the first quarter of 2023.

As of June 30, 2021, we had working capital of $54.4 million, compared to working capital of $18.0 million as of December 31, 2020.

Based on our clinical and research and development plans and our timing expectations related to the progress of our programs, we expect that our cash and cash equivalents as of June 30, 2021 will enable us to fund our operating expenses and capital expenditure requirements into the first quarter of 2023.

We have based this estimate on assumptions that may prove to be wrong, and we could utilize our available capital resources sooner than we currently expect.

31 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 2. Management’s Discussion and Analysis