What changed in this filing

/stocks — the workspaceLOADING

Item 1. Financial Statements

2022-08-11 compared with 2022-05-10 · 538 added, 248 removed, 751 unchanged (51% of the section changed)

3 unchanged sentences

(in thousands, except share amounts and par value)

(unaudited)  

Current assets:

8 unchanged sentences

11,595  

Prepaid expense and other current assets

11,717  

Prepaid expenses and other current assets

10,433  

Total current assets

4 unchanged sentences

Restricted deposit

Right of use asset

Right of use assets

Marketable securities

2 unchanged sentences

$ 119,746  

Liabilities and Shareholders' Equity

Liabilities and Shareholders' Equity (Deficit)

Current liabilities:

Accounts payable and accrued expense

Accounts payable and accrued expenses

$ 8,647  

$ 12,102  

Employee related accrued expense

Employee related accrued expenses

Other current liabilities

8 unchanged sentences

71,196  

Long-term lease liability

Long-term lease liabilities

Uncertain tax positions liability

3 unchanged sentences

Commitments and Contingencies (Note 18)

Shareholders' equity:

Ordinary shares, NIS 0.01 par value;

100,000,000 shares authorized at March 31, 2022 and December 31, 2021;

22,682,221 and 22,462,995 shares issued and outstanding as of March 31, 2022 and December 31, 2021, respectively

Shareholders' Equity (Deficit):

Ordinary shares, NIS 0.01 par value, 100,000,000 shares authorized at June 30, 2022 and December 31, 2021;

22,727,891 and 22,462,995 shares issued and outstanding as of June 30, 2022 and December 31, 2021, respectively

Additional paid-in capital

3 unchanged sentences

( 522,404 )  

Accumulated other comprehensive income (loss)

Accumulated other comprehensive loss

( 56 )  

8 unchanged sentences

in thousands, except share and per share amounts)

For the Three Months Ended March 31,

For the Three Months Ended June 30,

For the Six Months Ended June 30,

$ 16,604  

$ 13,032  

$ 30,168  

$ 20,517  

Cost of revenue

Operating expense:

Research and development expense

Selling, general and administrative expense

14,758  

11,605  

26,797  

18,193  

Operating expenses:

Research and development expenses

12,640  

12,124  

25,336  

22,637  

Selling, general and administrative expenses

20,833  

22,304  

42,133  

44,493  

Operating loss

( 18,715 )  

( 22,823 )  

( 40,672 )  

Financing on prepaid forward obligation

( 5,833 )  

( 3,120 )  

( 11,659 )  

Interest expense on long-term debt

Other income (expense)

( 2,239 )  

( 2,521 )  

Interest and other income, net

Loss before income taxes

( 26,659 )  

( 25,910 )  

( 54,726 )  

Income tax expense

( 32 )  

( 312 )  

( 357 )  

$ (26,691 )  

$ (26,222 )  

$ (55,083 )  

Statements of Comprehensive Loss

Other comprehensive income

Unrealized (loss) gain on marketable securities

$ (26,691 )  

$ (26,222 )  

$ (55,083 )  

Other comprehensive income (loss)

Unrealized gain (loss) on investments

( 98 )  

( 31 )  

Comprehensive Loss

$ ( 26,678 )  

$ ( 26,320 )  

$ ( 55,114 )  

Net loss per ordinary share - basic and diluted

$ ( 1.18 )  

( 1.17 )  

$ ( 2.43 )  

Weighted average number of shares outstanding used in computation of basic and diluted loss per ordinary share

22,703,572  

22,331,119  

22,667,825  

22,287,037  

The accompanying notes are an integral part of these condensed consolidated financial statements.

1 unchanged sentence

Condensed Consolidated Statements of Shareholders ’

 Equity (Deficit)

in thousands, except share amounts)

3 unchanged sentences

income (loss)

Balance as of January 1, 2022

Changes During the Three Months Ended March 31, 2022

Balance as of April 1, 2022

22,682,221  

$ 478,646  

$ (495,713 )  

$ (69 )  

Changes During the Three Months Ended June 30, 2022

Exercise of options into ordinary shares

45,670  

Share-based compensation

Other comprehensive income

Balance as of March 31, 2022

(26,691 )  

Balance as of June 30, 2022

22,727,891  

$ 481,485  

$ (522,404 )  

$ (56 )  

Balance as of April 1, 2021

22,280,394  

$ 458,723  

$ (382,436 )  

$ 76,491  

Changes During the Three Months Ended June 30, 2021

Exercise of options into ordinary shares

74,139  

Share-based compensation

Other comprehensive loss

( 98 )  

(26,222 )  

Balance as of June 30, 2021

22,354,533  

$ 464,823  

$ (408,658 )  

$ 56,271  

The accompanying notes are an integral part of these condensed consolidated financial statements.

UroGen Pharma Ltd.

Condensed Consolidated Statements of Shareholders ’

Equity (Deficit)

in thousands, except share amounts)

Ordinary Shares

Additional paid-in

Other comprehensive

income (loss)

Balance as of January 1, 2022

Changes During the Three Months Ended March 31, 2021

22,462,995  

$ 475,698  

$ (467,321 )  

$ (25 )  

$ 8,413  

Changes During the Six Months Ended June 30, 2022

Exercise of options into ordinary shares

264,896  

Share-based compensation

Other comprehensive income

Balance as of March 31, 2021

Other comprehensive loss

( 31 )  

(55,083 )  

Balance as of June 30, 2022

22,727,891  

$ 481,485  

(522,404 )  

$ (56 )  

Balance as of January 1, 2021

22,167,791  

$ 452,525  

$ (356,501 )  

$ 96,355  

Changes During the Six Months Ended June 30, 2021

Exercise of options into ordinary shares

186,742  

Share-based compensation

12,241  

Other comprehensive loss

( 226 )  

(52,157 )  

Balance as of June 30, 2021

22,354,533  

$ 464,823  

$ (408,658 )  

$ 56,271  

The accompanying notes are an integral part of these condensed consolidated financial statements.

2 unchanged sentences

in thousands)

Three Months Ended March 31,

Six Months Ended June 30,

Cash Flows From Operating Activities

$ ( 55,083 )  

Adjustment to reconcile net loss to net cash from operating activities:

Depreciation and amortization

Inventory Obsolescence

Accrued financing on prepaid forward obligation

1 unchanged sentence

Share-based compensation

12,241  

Interest expense on long-term debt

Amortization of right of use asset

Lease liability

Amortization of right of use assets

Changes in operating assets and liabilities:

( 480 )  

Accounts receivable

Prepaid expense and other current assets

Prepaid expenses and other current assets

( 2,958 )  

Other non-current assets

Accounts payable and accrued expense

Employee related accrued expense

( 444 )  

Accounts payable and accrued expenses

( 3,454 )  

Employee related accrued expenses

( 520 )  

Other current liabilities

( 704 )  

Lease liabilities

( 574 )  

Net cash used in operating activities

( 48,195 )  

Cash Flows From Investing Activities

Purchases of marketable securities

Maturities of marketable securities

13,533  

26,295  

Purchases of property and equipment

( 88 )  

Net cash (used in) provided by investing activities

13,445  

Cash Flows From Financing Activities

Proceeds from prepaid forward arrangement

72,472  

Proceeds from exercise of options into ordinary shares

Proceeds from issuance of long-term debt

70,793  

Issuance cost related to at-the-market issuances

( 144 )  

Net cash provided by financing activities

Increase (Decrease) in Cash and Cash Equivalents

70,665  

72,519  

Increase in Cash and Cash Equivalents

35,915  

10,457  

Cash, Cash Equivalents and Restricted Cash at Beginning of Period

45,586  

54,090  

Cash, Cash Equivalents and Restricted Cash at End of Period

$ 81,501  

$ 64,547  

Supplemental Disclosures of Non-Cash Activities

Non-cash new lease liabilities

Non-cash issuance cost

$ 1,419  

The accompanying notes are an integral part of these condensed consolidated financial statements.

31 unchanged sentences

31, 2021, as filed with the Securities and Exchange Commission (“SEC”) on March 21, 2022.

The Company has experienced net losses since its inception and has an accumulated deficit o f $ 495.7  million and $ 467.3 million as of March 31, 2022 and December 

The Company has experienced net losses since its inception and has an accumulated deficit o f $ 522.4  

million and $ 467.3  million as of June 30, 2022 and December 

31, 2021, respectively.

23 unchanged sentences

Marketable Securities

The Company considers all highly liquid investments with an original maturity of three months or less when purchased to be cash equivalents.

Cash and cash equivalents consist primarily of money market funds and bank money market accounts and are stated at cost, which approximates fair value.

Restricted cash is related primarily to cash held to secure corporate credit cards;

restricted deposits are related to cash held to secure leases.

Cash and cash equivalents and marketable securities totaled $ 137.1 million as of March 31, 2022 .

The Company classifies its marketable securities as available-for-sale in accordance with the Financial Accounting Standards Board (“FASB”) Accounting Standards Codification (“ASC”) Topic 320, “Investments —

The Company presents all highly liquid investments with an original maturity of three months or less when purchased as cash equivalents.

Cash and cash equivalents generally consist of money market funds and bank money market accounts and are stated at cost, which approximates fair value.

Cash and cash equivalents and marketable securities totaled $ 112.4  million as of June 30, 2022 .

The Company accounts for its investments, which include cash equivalents and marketable securities, as available-for-sale in accordance with the Financial Accounting Standards Board (“FASB”) Accounting Standards Codification (“ASC”) Topic 320, “Investments —

Debt and Equity Securities”.

Available-for-sale debt securities are carried at fair value with unrealized gains and losses reported in other comprehensive income/loss within shareholders’

Realized gains and losses are recorded as a component of interest and other income (expense), net.

Realized gains and losses are recorded as a component of interest and other income, net.

The cost of securities sold is based on the specific-identification method.

Short-term investments are valued using models or other valuation methodologies that use Level 2 inputs.

Certain short-term investments are valued using models or other valuation methodologies that use Level 2 inputs.

These models are primarily industry-standard models that consider various assumptions, including time value, yield curve, volatility factors, default rates, current market and contractual prices for the underlying financial instruments, as well as other relevant economic measures.

3 unchanged sentences

Impairment that has not been recorded through an allowance for credit losses is recorded through other comprehensive income, net of applicable taxes.

Restricted cash is related primarily to cash held to secure corporate credit cards;

restricted deposits are related to cash held to secure leases.

Concentration of Credit Risk

10 unchanged sentences

The Company has not experienced any credit losses related to this customer and has not currently recognized any allowance for doubtful accounts.

The Company provides for income taxes based on pretax income, if any, and applicable tax rates available in the various jurisdictions in which it operates, including Israel and the U.S.

The Company provides for income taxes based on pretax income, if any, and applicable tax rates available in the various jurisdictions in which it operates, including Israel and the United States.

Deferred taxes are computed using the asset and liability method.

24 unchanged sentences

The net proceeds received under the RTW Transaction were recognized as a long-term liability.

The subsequent measurement for the liability follows the accounting  principles defined in ASC Topic 835 - 30, “Imputation of Interest”.

The subsequent measurement for the liability follows the accounting principles defined in ASC Topic 835 - 30, “Imputation of Interest”.

See Note 9 for further discussion related to the prepaid forward obligation.

2 unchanged sentences

(“Pharmakon”).

The Company recognizes interest expense in current earnings, and accrued interest within other current liabilities on the condensed consolidated balance sheet.

The Company recognizes capitalized financing expenses as a direct offset to the long-term debt on the Company's condensed consolidated balance sheet, and amortizes them over the term of the debt using the effective interest method.

The Company recognizes interest expense in current earnings, and accrued interest within other current liabilities on the condensed consolidated balance sheets.

The Company recognizes capitalized financing expenses as a direct offset to the long-term debt on the Company's condensed consolidated balance sheets, and amortizes them over the term of the debt using the effective interest method.

See Note 10 for further discussion related to long-term debt.

17 unchanged sentences

Net revenue recognized include management’s estimate of returns, consideration paid to the customer, chargebacks relating to differences between the wholesale acquisition cost and the contracted price offered to the end consumer, chargebacks relating to 340b drug pricing programs, Medicaid drug rebate programs, and the Company’s copay assistance program, which are estimated based on industry benchmarking studies as well as the Company’s historical experience.

Research and Development Expense

Research and Development Expenses

Research and development costs are expensed as incurred and consist primarily of the cost of salaries, share-based compensation expense, payroll taxes and other employee benefits, subcontractors and materials used for research and development activities, including nonclinical studies, clinical trials, manufacturing costs and professional services.

3 unchanged sentences

Where contingent milestone payments are due to third parties under research and development arrangements or license agreements, the milestone payment obligations are expensed when such development milestone results are achieved.

Selling General and Administrative Expense

Selling, general and administrative expense consists primarily of personnel costs (including share-based compensation related to directors, employees and consultants).

Selling General and Administrative Expenses

Selling, general and administrative expenses consist primarily of personnel costs (including share-based compensation related to directors, employees and consultants).

Other significant costs include commercial, medical affairs, external professional service costs, facility costs, accounting and audit services, legal services, and other consulting fees.

14 unchanged sentences

Other Financial Information

Accounts Payable and Accrued Expense

Accounts payable and accrued expense consists of the following as of March 31, 2022 and December 

Accounts Payable and Accrued Expenses

Accounts payable and accrued expenses consisted of the following as of June 30, 2022 and December 

31, 2021  (in thousands):

Accounts payable

$ 2,457  

$ 5,786  

Accrued sales reserves

Accrued clinical expense

Accrued research and development expense

Accrued selling, general and administrative expense

Accrued other expense

Total accounts payable and accrued expense

Interest and Other Income (Expense), Net

Interest and other income (expense) consisted of the following as of March 31, 2022 and 2021 (in thousands):

Three Months Ended March 31,

Accrued clinical expenses

Accrued research and development expenses

Accrued selling, general and administrative expenses

Accrued other expenses

Total accounts payable and accrued expenses

$ 8,647  

$ 12,102  

Interest and Other Income, Net

Interest and other income, net consisted of the following as of June 30, 2022 and 2021 (in thousands):

Six Months Ended June 30,

Interest income

Other finance (expense), net

Total other income (expense)

Other income (expense), net

Interest and other income, net

Note 5 –

Inventories consist of the following as of 

March 31, 2022 and December 31, 2021 (in thousands):

Inventories consisted of the following as of 

June 30, 2022 and December 31, 2021 (in thousands):

Raw materials (1)

$ 4,543  

$ 3,894  

Finished goods

Total inventories

( 1 )  $ 1.3  million and $ 1.0 million of raw materials are included within other non-current assets on the condensed consolidated balance sheets at March 31, 2022 and December 31, 2021, respectively .

$ 6,577  

$ 5,852  

( 1 )  $ 1.5  million and $ 1.0  million of raw materials are included within other non-current assets on the condensed consolidated balance sheets at June 30, 2022 and December 31, 2021, respectively.

Note 6 –

8 unchanged sentences

Unobservable inputs that reflect the reporting entity’s own assumptions.

The carrying amounts of the Company’s cash and cash equivalents, restricted cash, other current assets, accounts payable and accrued liabilities are generally considered to be representative of their fair value because of the short-term nature of these instruments.

The carrying value of the prepaid forward obligation (See Note 9 - Prepaid Forward Obligation) approximates its fair value as the effective interest rate approximates the market rate for loans with similar terms and risk characteristics.

Likewise, the carrying value of long-term debt on the Company’s balance sheet (see Note 10  –

Long-Term Debt), approximates its fair value as the interest rate approximates the market rate for loans with similar terms and risk characteristics.

The carrying amounts of the Company’s cash, restricted cash, other current assets, accounts payable and accrued liabilities are generally considered to be representative of their fair value because of the short-term nature of these assets and liabilities.

The carrying value of the prepaid forward obligation (See Note 9 - Prepaid Forward Obligation) approximates its fair value. 

The Company estimated the fair value of the prepaid forward obligation using Level 3 inputs, including internally developed financial forecasts and management's estimate of probability of success related to product candidates, and determined that the effective interest rate in the obligation approximates market rates for loans with similar terms and risk characteristics. 

The Company estimated the fair value of long-term debt (see Note 10 - Long-Term Debt) using the income approach with Level 3 inputs.

The Company estimated future floating rate interest payments using a forward curve of a three -month benchmark rate, and estimated fair value based on publicly available data reported in the financial statements of publicly traded venture lending companies.

Based on a reasonable range of yields for debt instruments of similar tenor in a similar industry, the Company determined that the carrying value of the long-term debt on the Company's balance sheet approximates its fair value.

No transfers between levels have occurred during the periods presented.

Assets and liabilities measured at fair value on a recurring basis based on Level 1 and Level 2 fair value measurement criteria as of March 31, 2022 are as follows (in thousands):

Assets measured at fair value on a recurring basis based on Level 1 and Level 2 fair value measurement criteria as of June 30, 2022 are as follows (in thousands):

Fair Value Measurements Using

2 unchanged sentences

Identical Assets

Cash equivalents

US government

$ 29,357  

Commercial paper

23,042  

Total cash equivalents

52,399  

29,357  

23,042  

Marketable securities

US government

25,023  

Corporate bonds

Commercial paper

Certificates of deposit

Total marketable securities

Additionally, as of March 31, 2022 there were approximately $ 75.0 million of money market funds included within cash and cash equivalents on the condensed consolidated balance sheet that are measured at fair value based on Level 1 fair value measurement criteria.

Assets and liabilities measured at fair value on a recurring basis based on Level 1 and Level 2 fair value measurement criteria as of December 31, 2021 are as follows (in thousands):

31,721  

25,023  

Total assets at fair value

$ 84,120  

$ 54,380  

$ 29,740  

Assets measured at fair value on a recurring basis based on Level 1 and Level 2 fair value measurement criteria as of December 31, 2021 are as follows (in thousands):

Fair Value Measurements Using

2 unchanged sentences

Identical Assets

Cash equivalents

Money market funds

$ 21,402  

Marketable securities

US government

19,307  

Corporate bonds

Commercial paper

14,492  

Certificates of deposit

Total marketable securities

Additionally, as of December 31, 2021 

there were approximately $ 21.4 million of money market funds included within cash and cash equivalents on the condensed consolidated balance sheet that are measured at fair value based on Level 1 fair value measurement criteria.

45,454  

19,307  

26,147  

Total assets at fair value

$ 66,856  

$ 40,709  

$ 26,147  

Note 7 –

Marketable Securities

The following table summarizes the Company’s marketable securities (excluding cash and cash equivalents) as of March 31, 2022 (in thousands):

 Investments

The following table summarizes the Company’s investments as of June 30, 2022 (in thousands):

Cash equivalents:

US government

$ 29,356  

$ 29,357  

Commercial paper

23,045  

23,042  

Total cash equivalents

$ 52,401  

$ ( 3 )  

$ 52,399  

Marketable securities:

US government

$ 25,072  

$ ( 49 )  

$ 25,023  

Corporate bonds

Commercial paper

Certificates of deposit

Total marketable securities

The Company classifies its marketable securities as available-for-sale and they consist of all debt securities.

The amortized cost basis as of March 31, 2022 includes $ 0.1  million of accrued interest receivable.

As of March 31, 2022 marketable securities were in a net unrealized loss position. Unrealized gains and losses on available-for-sale debt securities are included as a component of comprehensive loss. 

March 31, 2022 , the aggregate fair value of marketable securities held by the Company in an unrealized loss position was $ 31.7 million which consisted of 

17  securities. The unrealized loss was primarily driven by minor fluctuations in the fair value of corporate bonds driven by changes in market interest rates.

$ 31,775  

$ ( 54 )  

$ 31,721  

The Company classifies its investments as available-for-sale and they consist entirely of debt securities.

As of June 30, 2022 , the amortized cost of investments included an immaterial amount of accrued interest.

As of June 30, 2022 , marketable securities were in a net unrealized loss position. Unrealized gains and losses on available-for-sale debt securities are included as a component of comprehensive loss. 

June 30, 2022 , the aggregate fair value of investments held by the Company in an unrealized loss position was $ 43.6 million which consisted of 

16 securities. The unrealized loss was primarily driven by minor fluctuations in the fair value of government bonds driven by changes in interest rates.

The Company does not expect to settle the debentures at a price less than the amortized cost basis of the investment;

1 unchanged sentence

In accordance with the Company’s general investment strategy, the Company does not intend to sell the investments before maturity.

March 31, 2022 , the Company believes the cost basis for its marketable securities were recoverable in all material aspects and no credit losses were recognized in the period.

The Company’s marketable securities as of March 31, 2022 mature at various dates through July 2023.

The fair values of marketable securities by contractual maturity consist of the following (in thousands):

June 30, 2022 , the Company believes the cost basis for its marketable securities were recoverable in all material aspects and no credit losses were recognized in the period.

The Company’s investments as of June 30, 2022 mature at various dates through July 2023.

The fair values of investments by contractual maturity consist of the following (in thousands):

Maturities within one year

$ 83,447  

$ 44,779  

Maturities after one year through three years

Total marketable securities

Total investments

$ 84,120  

$ 45,454  

Note 8 –

Property and Equipment

Property and equipment, consists of the following as of March 31, 2022 and December 31, 2021 (in thousands):

Property and equipment, consists of the following as of June 30, 2022 and December 31, 2021 (in thousands):

Laboratory equipment

3 unchanged sentences

accumulated depreciation and amortization

( 2,675 )  

Property and equipment, net

Depreciation and amortization expense was $ 0.2 million for the 

three months ended March 31, 2022 and $ 0.2  million for the three months ended March 31, 2021 .

$ 1,605  

$ 1,967  

Depreciation and amortization expense was $ 0.2 million and $ 0.4  million for the 

three and six months ended June 30, 2022 and $ 0.2 million and $ 0.4 million for the three and six months ended June 30, 2021 .

Note 9 –

5 unchanged sentences

If certain revenue thresholds for Jelmyto aggregate worldwide annual net sales are not met, the future cash payments to RTW with respect to Jelmyto annual net sales up to $200 million will increase by 3.5 %, and may decrease back to 9.5% dependent on the Company meeting certain subsequent Jelmyto aggregate worldwide annual net sales thresholds.

The rate in effect for the three months ended March 31, 2022 for annual sales up to $ 200 million was 13.0 %.

The rate in effect for the six months ended June 30, 2022 for annual sales up to $ 200 million was 13.0 %.

In addition, subject to FDA approval of UGN- 102, RTW is entitled to receive tiered, future cash payments based on aggregate worldwide annual net product sales of UGN- 102 in an amount equal to:

1 unchanged sentence

If the Company does not receive FDA approval for UGN- 102 by a specified date, the future cash payments to RTW with respect to aggregate worldwide annual net sales of Jelmyto across all Jelmyto annual net sales tiers will increase by 1.5 %.

The rate in effect for 2022 for sales up to $ 200 million is 13 %. 

In accordance with the prepaid forward agreement, the Company will be required to make payments of amounts owed to RTW each calendar quarter, through and until the quarter in which the aggregate cash payments received by RTW are equal to or greater than $300 million.

6 unchanged sentences

Prepaid forward obligation at closing of RTW Transaction

$ 75,000  

Capitalized closing costs

Financing on prepaid forward obligation

17,291  

Amounts paid and payable

Carrying value of prepaid forward obligation as of December 31, 2021

85,713  

Financing on prepaid forward obligation

11,659  

Amounts paid and payable

Carrying value of prepaid forward obligation as of March 31, 2022

Carrying value of prepaid forward obligation as of June 30, 2022

$ 93,461  

Note 10 –

10 unchanged sentences

The facility will mature 

five  years from initial funding and can be prepaid in whole at the Company's discretion, at any time, subject to prepayment premiums and makewhole amounts. The loan will require interest-only payments for the 

five  years from initial funding and can be prepaid in whole at the Company's discretion, at any time, subject to prepayment premiums and make-whole amounts. The loan will require interest-only payments for the 

48  months followed by principal and interest payments with interest accruing using 

4 unchanged sentences

The Company incurred financing expenses of $ 4.2 million which are recognized as a direct offset to the long-term debt on the Company's condensed consolidated balance sheet.

These debt issuance costs are 

amortized over the term of the debt using the effective interest method, and are recorded in the condensed consolidated statements of operations as “Interest expense".

These debt issuance costs are amortized over the term of the debt using the effective interest method, and are recorded in the condensed consolidated statements of operations as “Interest expense".

The following table shows the activity with respect to the carrying value of the long-term debt, in thousands:

Long-term debt at closing of Pharmakon loan

$ 75,000  

Capitalized costs and discounts

1 unchanged sentence

Amounts paid and payable

Carrying value of Pharmakon loan as of March 31, 2022

Carrying value of Pharmakon loan as of June 30, 2022

$ 71,196  

Note 11  

Operating Leases

The Company has the following office and laboratory facility leases:

The Company had the following office and laboratory facility leases as of June 30, 2022 :

In April 2016, UPL signed an addendum to its November 2014 lease agreement for the Company’s offices located in Israel, in order to increase the office space rented and to extend the rent period until 2019.

In March 2019, UPL utilized the agreement extension option and extended the rent period for additional three years until August 2022.

In March 2019, UPL utilized the agreement extension option and extended the rent period for an additional three years until August 2022.

In September 2017, UPI entered into a new lease agreement for its office space in New York, which the Company previously used as its headquarters.

The lease agreement commenced in October 2017 and terminated in February 2021.  

In April 2018, UPI entered into a new lease agreement for an office in Los Angeles, California.

1 unchanged sentence

The landlord provided a tenant allowance for leasehold improvements of $ 0.2 million that was accounted for as a lease incentive.

The Company’s remaining contractual obligation under this lease is approximately $ 0.6  million as of March 31, 2022 .

The Company’s remaining contractual obligation under this lease is approximately $ 0.5  million as of June 30, 2022 .

In November 2019, UPI entered into a sublease for this office space, with a lease commencement date of 

1 unchanged sentence

The subtenants exercised their early access clause and moved into the premises at the end of November 2019. 

The remaining rental payments to be received over the lease term is approximately $ 0.5  million as of March 31, 2022 .

The Company accounts for the sublease as on operating lease in accordance with ASC 842 - 10 - 25 - 2 and ASC 842 - 10 - 25 - 3.

The remaining rental payments to be received over the lease term is approximately $ 0.4  million as of June 30, 2022 .

The Company accounts for the sublease as an operating lease in accordance with ASC 842 - 10 - 25 - 2 and ASC 842 - 10 - 25 - 3.

The main lease was considered for impairment and the amount was determined to be immaterial.

In November 2019, UPI entered into a new lease agreement for an office in Princeton, New Jersey, which the Company now uses as its headquarters.

The lease commencement date was November 29, 2019 and the lease term is 38 months.

The Company’s remaining contractual obligation under this lease is approximately $ 0.5  million as of March 31, 2022 .

The lease commencement date was November 29, 2019, with an original lease term of 38 months, expiring January 31, 2023.

In June 

2022, the Company signed a lease extension for the Princeton office, extending the term of the lease through January 31, 2026. 

The Company’s remaining contractual obligation under this lease is approximately $ 2.1  million as of June 30, 2022 .

In addition, the Company has other operating office equipment and vehicle leases.

2 unchanged sentences

The Company’s leases expire at various dates from 2022  through 2026, with varying renewal and termination options.

The components of lease cost for the three months ended March 31, 2022  

and 2021 were as follows (in thousands):

The components of lease cost for the three and six months ended June 30, 2022  and 2021 were as follows (in thousands):

Three Months Ended

Six Months Ended

Operating lease cost

1 unchanged sentence

( 56 )  

( 112 )  

Variable lease cost

The amounts recognized as of March 31, 2022 and 

The amounts recognized as of June 30, 2022 and 

December 31, 2021 were as follows (in thousands):

Right of use asset

Right of use assets

$ 2,116  

$ 1,180  

Long-term lease liabilities

Other current liabilities

As of March 31, 2022 , no impairment losses have been recognized to date.

Supplemental information related to leases for the three months ended March 31, 2022  and 2021 is as follows (in thousands):

Three Months Ended  

As of June 30, 2022 , no impairment losses have been recognized to date.

Supplemental information related to leases for the six months ended 

June 30, 2022 and 2021 is as follows (in thousands):

Six Months Ended  

Cash paid for amounts included in the measurement of lease liabilities:

4 unchanged sentences

9.93 %  

As of March 31, 2022, maturities of lease liabilities were as follows (in thousands):

As of June 30, 2022 , maturities of lease liabilities were as follows (in thousands):

Years ending December 31,

2 unchanged sentences

Total future minimum lease payments

$ 2,680  

Present value of lease liabilities

As of March 31, 2022 , undiscounted cash flows to be received under the Company’s operating sublease on an annual basis were as follows (in thousands):

$ 2,332  

As of June 30, 2022 , undiscounted cash flows to be received under the Company’s operating sublease on an annual basis were as follows (in thousands):

Operating Leases

2 unchanged sentences

2026 and thereafter

Sublease income is recognized net within operating expense.

Sublease income for the three months ended March 31, 2022 and 2021 was as follows (in thousands):

Sublease income is recognized net within operating expenses.

Sublease income for the three and six months ended June 30, 2022 and 2021 was as follows (in thousands):

Three Months Ended

Six Months Ended

Sublease income from fixed lease payments

1 unchanged sentence

Revenue From Product Sales

Net product sales consist of the following for the three months ended March 31, 2022 and 2021 (in thousands):

Net product sales consist of the following for the three and six months ended June 30, 2022 and 2021 (in thousands):

Three Months Ended

Six Months Ended

$ 16,604  

$ 13,032  

$ 30,168  

$ 20,517  

Net revenue recognized includes management’s estimate of returns, consideration paid to the customer, chargebacks relating to differences between the wholesale acquisition cost and the contracted price offered to the end consumer, chargebacks relating to 

340b  drug pricing programs, Medicaid drug rebate programs, and the Company’s copay assistance program, which are estimated based on industry benchmarking studies as well as the Company’s historical experience.

Reserves related to items that are contractually able to be net settled are recognized as contra accounts receivables. The following table shows the activity with respect to sales reserves for period ended March 31, 2022 ( in thousands):

Reserves related to government sponsored programs

2 unchanged sentences

Balance as of December 31, 2021

Changes during Q1 22

Balance as of March 31, 2022

$ 1,335  

$ 1,708  

( 2,593 )  

( 2,956 )  

Balance as of June 30, 2022

$ 1,396  

$ 1,935  

Note 13  

1 unchanged sentence

Agenus Agreement

In November 2019, the Company entered into a license agreement with Agenus Inc., pursuant to which Agenus granted to the Company an exclusive, worldwide ( not including Argentina, Brazil, Chile, Colombia, Peru, Venezuela and their respective territories and possessions), royalty-bearing, sublicensable license under Agenus’s intellectual property rights to develop, make, use, sell, import, and otherwise commercialize products incorporating a proprietary antibody of Agenus known as AGEN1884 for the treatment of cancers of the urinary tract via intravesical delivery.

AGEN1884 is an anti-CTLA- 4 antagonist that is currently being evaluated by Agenus as a monotherapy in PD- 1 refractory patients and in combination with Agenus’

anti-PD- 1 antibody in solid tumors.

In November 2019, the Company entered into a license agreement with Agenus Inc., pursuant to which Agenus granted to the Company an exclusive, worldwide ( not including Argentina, Brazil, Chile, Colombia, Peru, Venezuela and their respective territories and possessions), royalty-bearing, sublicensable license under Agenus’s intellectual property rights to develop, make, use, sell, import, and otherwise commercialize products incorporating a proprietary monoclonal antibody of Agenus known as AGEN1884 (zalifrelimab), an anti-CTLA- 4 antagonist, for the treatment of cancers of the urinary tract via intravesical delivery.

Initially, the Company plans to develop AGEN1884 in combination with UGN- 201 for the treatment of high-grade NMIBC.

10 unchanged sentences

In January 2021, the Company announced that it entered into a three -year strategic research collaboration agreement with MD Anderson focusing on the sequential use of UGN- 201 and UGN- 301  as an investigational treatment for high-grade NMIBC.

Under the agreement, MD Anderson and the Company will collaborate on the design and conduct of non-clinical and clinical studies with oversight from a joint steering committee.

Under the terms of the agreement, MD Anderson and the Company will collaborate on the design and conduct of non-clinical and clinical studies with oversight from a joint steering committee.

The Company will provide funding, developmental candidates, and other support.

Pursuant to the agreement, the Company makes bi-annual payments to MD Anderson to fund the collaboration.

As of March 31, 2022 , the Company has made payments to MD Anderson of $ 1,000,000  recognized evenly over the associated period through research and development expense.

As of June 30, 2022 , the Company has made payments to MD Anderson totaling $ 2.0 million recognized evenly over the associated period through research and development expenses.

In July 2022, the Company determined that it had achieved the objectives that it established when the agreement was initiated, and notified MD Anderson that it was exercising its right to conclude the collaboration in 2022 as the Company did not foresee initiating further development activities as part of the collaboration, although the Company will continue to collaborate on existing joint projects.

As a result of this notification, the Company is not responsible for any further fixed bi-annual funding payments.

Note 14  

Shareholders ’

The Company had 100.0 million ordinary shares authorized for issuance as of March 31, 2022 and December 31, 2021 .

The Company had 22.7  million and 22.5  million ordinary shares issued and outstanding as of March 31, 2022 and December 

The Company had 100.0 million ordinary shares authorized for issuance as of June 30, 2022 and December 31, 2021 .

The Company had 22.7  million and 22.5  million ordinary shares issued and outstanding as of June 30, 2022 and December 

31, 2021, respectively.

4 unchanged sentences

Share-Based Compensation

In October 2010, the Board approved a share option plan (the “Plan”) for grants to Company employees, consultants, directors, and other service providers.

The grant of options to Israeli employees under the Plan is subject to the terms stipulated by Section 102 of the Israeli Income Tax Ordinance (“Section 102”

In October 2010, the Board approved a share option plan (the "2010 Plan") for grants to Company employees, consultants, directors, and other service providers.

Subsequently, in March 2017, the Board adopted the 2017 Equity Incentive Plan (the "2017 Plan" and, together with the 2010 Plan, the "Plans"), which was approved by the shareholders in April 2017.

The 2017 Plan provides for the grant of stock options, stock appreciation rights, restricted stock awards, RSU awards, performance share awards, performance cash awards, and other forms of share awards to the Company's employees, directors and consultants.

The grant of options to Israeli employees under the Plans is subject to the terms stipulated by Section 102 of the Israeli Income Tax Ordinance (“Section 102”

The option grants are subject to the track chosen by the Company, either the “regular income”

1 unchanged sentence

track, as set out in Section 102.

The Company registered the Plan under the capital gains track, which offers more favorable tax rates to the employees.

As a result, and pursuant to the terms of Section 102, the Company is not allowed to claim as an expense for tax purposes the amounts credited to the employees in respect of options granted to them under the Plan, including amounts recorded as salary benefits in the Company’s accounts, with the exception of the work-income benefit component, if any, determined on grant date.

For non-employees and for non-Israeli employees, the Plan is subject to Section 3 (i) of the Israeli Income Tax Ordinance.

The Company registered the Plans under the capital gains track, which offers more favorable tax rates to the employees.

As a result, and pursuant to the terms of Section 102, the Company is not allowed to claim as an expense for tax purposes the amounts credited to the employees in respect of options granted to them under the Plans, including amounts recorded as salary benefits in the Company’s accounts, with the exception of the work-income benefit component, if any, determined on grant date.

For non-employees and for non-Israeli employees, the Plans are subject to Section 3 (i) of the Israeli Income Tax Ordinance.

Employees are typically granted stock options and/or restricted stock units ("RSUs"), upon commencement of employment.

Also, eligible employees may receive an annual grant of options or RSUs.

Non-employee members of the Board typically receive a grant of stock options and/or RSUs annually.

The term of any option granted under the Plan cannot exceed 10 years.

Non-employee members of the Board typically receive a grant of stock options upon initial appointment to the Board, and stock options annually.

The term of any option granted under the Plans cannot exceed 10 years.

Options shall not have an exercise price less than 100 % of the fair market value of the Company’s ordinary shares on the grant date, and generally vest over a period of three years.

7 unchanged sentences

exercise behavior, and for non-employees, and directors using the contractual term.

In March 2017, the Board adopted the 2017 Equity Incentive Plan (the "2017 Plan"), which was approved by the shareholders in April 2017.

The maximum number of ordinary shares that was initially authorized for issuance under the 2017 Plan is 1,400,000 . On January 1, 2018, the share reserve increased by 250,167 to 1,650,167 .

On October 12, 2018, the Company increased the amount of registered ordinary shares of the Company’s 2017 Plan by 1,900,000 to 3,550,167 .

On June 8, 2020 the Company’s shareholders approved an increase to the amount of registered ordinary shares of the Company’s 2017 Plan by 400,000 to 3,950,167 .

On June 7, 2021, the Company’s shareholders approved an increase of the amount of registered ordinary shares of the Company’s 2017 Plan by 400,000 to 4,350,167 .

The maximum number of ordinary shares that was initially authorized for issuance under the 2017 Plan was 

1,400,000 . On January 1, 2018, the share reserve increased by 250,167 to 1,650,167 shares.

On October 12, 2018, the Company increased the amount of ordinary shares authorized for issuance under the 2017 Plan by 1,900,000 to 3,550,167 shares.

On June 8, 2020 the Company’s shareholders approved an increase to the amount of ordinary shares authorized for issuance under the 2017 Plan by 400,000 to 3,950,167 shares.

On June 7, 2021, the Company’s shareholders approved an increase to the amount of ordinary shares authorized for issuance under the 2017 Plan by 400,000 to 4,350,167 shares.

On June 8, 2022, the Company's shareholders approved an increase to the amount of ordinary shares authorized for issuance under the 2017  Plan by 400,000 to 4,750,167 shares. 

In May 2019, the Company adopted the UroGen Pharma Ltd.

2019 Inducement Plan (the “Inducement Plan”).

Under the Inducement Plan, the Company is authorized to issue up to 900,000 ordinary shares pursuant to awards issued under the Inducement Plan.

The only persons eligible to receive grants of Awards (as defined below) under the Inducement Plan are individuals who satisfy the standards for inducement grants under Nasdaq Marketplace Rule 5635 (c)( 4 ) or 5635 (c)( 3 ) and the related guidance under Nasdaq IM 

5635 - 1,  including individuals who were not previously an employee or director of the Company or are following a bona fide period of non-employment, in each case as an inducement material to such individual’s agreement to enter into employment with the Company. Under the Inducement Plan, an “Award”

is a nonstatutory stock option, RSU or other right to receive ordinary shares pursuant to the Inducement Plan.

Under the Inducement Plan, the Company is authorized to issue up to 900,000 ordinary shares pursuant to inducement awards.

The only persons eligible to receive grants under the Inducement Plan are individuals who satisfy the standards for inducement grants under Nasdaq Marketplace Rule 5635 (c)( 4 ) and the related guidance under Nasdaq IM 

In December 2021, the Board approved a 300,000 increase in the share reserve of the Inducement Plan. 

As of March 31, 2022 , 3,949,544 ordinary shares are subject to outstanding awards under the Company's share-based compensation plans and 722,810 ordinary shares remain available for future awards.

As of June 30, 2022 , 3,916,311 ordinary shares are subject to outstanding awards under the Company's share-based compensation plans and 1,010,573 ordinary shares remain available for future awards.

The following table illustrates the effect of share-based compensation on the condensed consolidated statements of operations (in thousands):

Three Months Ended

Research and development expense

Selling, general and administrative expense

The total unrecognized compensation cost of options and RSUs at March 31, 2022 is $ 17.5 million with a weighted average recognition period of 1.96 years.

Six Months Ended

Research and development expenses

$ 1,041  

$ 1,398  

$ 2,148  

Selling, general and administrative expenses

10,093  

$ 2,823  

$ 6,046  

$ 5,772  

$ 12,241  

The total unrecognized compensation cost of options and RSUs at June 30, 2022 is $ 14.9 million with a weighted average recognition period of 1.81  years.

Note 16  

1 unchanged sentence

is taxed under Israeli tax laws.

As of March 31, 2022 , the Company continues to maintain a full valuation allowance against deferred tax assets for all jurisdictions.

As of June 30, 2022 , the Company continues to maintain a full valuation allowance against deferred tax assets for all jurisdictions.

In evaluating the need for a valuation allowance, the Company considers all sources of taxable income available to realize the deferred tax asset, including the future reversal of existing temporary differences, forecasts of future taxable income, and tax planning strategies.

The Company has cumulative global pretax losses for the years ended 2021, 2020 and 

2019, and for the three months ended March 31, 2022 .

2019, and for the six months ended June 30, 2022 .

The Company will continue to assess the extent to which its deferred tax assets may be realized in the future and will adjust the valuation allowance as needed.

The Company has a liability for uncertain tax positions of $ 2.8  million as of March 31, 2022 , for tax positions relating to transfer pricing between affiliated entities.

The Company has a liability for uncertain tax positions of $ 2.8  million as of June 30, 2022 , for tax positions relating to transfer pricing between affiliated entities.

The Company recognizes interest accrued and penalties related to uncertain tax positions as a component of income tax expense.

As of March 31, 2022 , the Company’s liability for uncertain tax positions includes $ 0.9  million of accrued interest and penalties.

The Company operates on a global basis and is subject to tax laws and regulations in the U.S.

As of June 30, 2022 , the Company’s liability for uncertain tax positions includes $ 0.9  million of accrued interest and penalties.

The Company operates on a global basis and is subject to tax laws and regulations in the United States and Israel.

The estimate of the Company’s tax liabilities relating to uncertain tax positions requires management to assess uncertainties and to make judgments about the application of complex tax laws and regulations, expectations regarding the outcome of tax authority examinations, as well as the ultimate measurement of potential liabilities.

5 unchanged sentences

There were no related party transactions for the 

three months ended March 31, 2022 or 2021 .

six months ended June 30, 2022 or 2021 .

Note 18  

2 unchanged sentences

Further, the Company indemnifies its directors and officers who are, or were, serving at the Company’s request in such capacities.

The Company’s maximum exposure under these arrangements is unknown as of March 31, 2022 and December 31, 2021 .

The Company’s maximum exposure under these arrangements is unknown as of June 30, 2022 and December 31, 2021 .

The Company does not anticipate recognizing any significant losses relating to these arrangements.

2 unchanged sentences

Subsequent Events

The Company has evaluated and determined there were no subsequent events through May 10, 2022.

In July 2022, the Company signed a lease extension agreement for the Company’s offices located in Israel, extending the term of the lease through September 2025. 

The Company's total contractual base rent obligation for the three -year extension is approximately $ 0.9  million.  

The Company has evaluated and determined there were no further subsequent events.

Management ’

60 unchanged sentences

It has been designed to prolong exposure of urinary tract tissue to mitomycin, thereby enabling the treatment of tumors by non-surgical means.

New product exclusivity for Jelmyto exists through April 15, 2023, Orphan Drug exclusivity through April 15, 2027, as well as a composition of matter patent through 2031. The main patents that protect Jelmyto in the United States are set to expire on January 20, 2031.

New product exclusivity for Jelmyto exists through April 15, 2023, Orphan Drug exclusivity through April 15, 2027, as well as a composition of matter patent set to expire in early 2031. The main patents that protect Jelmyto in the United States are set to expire on January 20, 2031.

These patents were listed in the FDA's Orange Book (Approved Drug Products with Therapeutic Equivalence Evaluations).

20 unchanged sentences

Each region is additionally supported by one to two clinical nurse educators to provide education and training around instillation, as well as a Field Reimbursement manager to help ensure access and reimbursement for appropriate patients.

In addition, our organization includes seven medical science liaisons who appropriately engage with physicians interested in learning more about UroGen, 

In addition, our organization currently includes several medical science liaisons who appropriately engage with physicians interested in learning more about UroGen, 

Jelmyto  and our technology, both in person and virtually.

2 unchanged sentences

Our market access teams have laid the foundation for coverage and reimbursement, meeting multiple times with payors.

The majority of large commercial plans have policies in place, covering over 150 million lives.

Over 95% of large commercial plans, as well as Medicare, have policies in place, covering over 150 million lives.

In addition to reimbursement and access, we have also been focused on ensuring seamless integration into physician practices.

1 unchanged sentence

In October 2020, a Medicare C-Code was issued for Jelmyto .

The Centers for Medicare & Medicaid Services established a permanent and product-specific J-code for Jelmyto that took effect on January 1, 2021, and replaced the C-Code. We are also launching a registry to capture data and evaluate real world outcomes in patients with UTUC that have been or will be treated with Jelmyto.

The Centers for Medicare & Medicaid Services established a permanent and product-specific J-code for Jelmyto that took effect on January 1, 2021, and replaced the C-Code. We have also launched a registry to capture data and evaluate real world outcomes in patients with UTUC that have been or will be treated with Jelmyto .

The purpose of the registry is to study the use of Jelmyto in clinical practice in the United States and address specific clinical questions.

UGN-102 

(mitomycin) for intravesical solution

UGN-102 is our sustained-release formulation of mitomycin that we are developing for the treatment of low-grade intermediate risk NMIBC.

11 unchanged sentences

The prevalence of bladder cancer in the United States based on most recently published data was approximately 724,000 and estimated 2021 annual incidence of bladder cancer was approximately 85,000.

We estimate based upon a review of peer-reviewed literature and publicly available data that there are approximately 80,000 low-grade intermediate risk NMIBC patients in the U.S.

We estimate based upon a review of peer-reviewed literature and publicly available data that there are approximately 80,000 low-grade intermediate risk NMIBC patients in the United States annually.

We believe that UGN-102 has the potential to be a new therapeutic option for the treatment of low-grade intermediate risk NMIBC patients.

4 unchanged sentences

In addition, by removing the need for surgery, patients may avoid potential complications associated with surgery.

We initiated the Phase 3 ATLAS trial in December 2020 and until November 2021, were enrolling patients in this trial assessing UGN-102 with or without TURBT compared to standard of care.

We initiated the Phase 3 ATLAS trial in December 2020 and until November 2021, were enrolling patients in this trial assessing UGN-102 with or without TURBT compared to standard of care, TURBT.

In parallel, we continued to engage in discussions with the FDA and, based on this dialogue, we designed a trial in order to demonstrate the efficacy and safety of UGN-102.

7 unchanged sentences

We have also initiated a Phase 3b study with the objective of demonstrating whether UGN-102 can be administered at home by a qualified home health professional, avoiding the need for repeated visits to a healthcare setting for instillation. Patients in the ongoing Phase 3b study will receive six once-weekly intravesical instillations of UGN-102.

The Phase 3b study aims to enroll up to 10 patients across four centers.

The initial treatment visit will occur at the investigative site and instillation will be performed by a qualified physician.

The Phase 3b study aims to enroll up to 10 patients across four centers, with completion of enrollment anticipated by the end of 2022. The initial treatment visit will occur at the investigative site and instillation will be performed by a qualified physician.

Treatment visits two to six will take place at the patient's home and instillation will be performed by a properly trained and qualified home health professional.

The primary endpoint of the study is the incidence of treatment-emergent adverse events ("TEAEs"), serious TEAEs, TEAEs of special interest, discontinuations from at home study treatment, and clinically significant abnormalities in laboratory tests (hematology, serum chemistry, and urinalysis).

We believe the ease and convenience of home instillation has the potential to transform care and facilitate alternative access to treatment.

Our immuno-uro-oncology pipeline includes UGN-301, an anti-CTLA-4 antibody, which we intend to study as a combination therapy with multiple potential agents.

The completion of non-human primate toxicity studies support the initiation of a multi-arm Phase 1 study of UGN-301 in combination with other agents.

We believe establishing a precedent for a convenient at home solution may facilitate access-to-care and address quality of life issues that certain patients may face with the current standard of care .

UGN-301 (zalifrelimab) intravesical solution

Our immuno-uro-oncology pipeline includes UGN-301, an anti-CTLA-4 monoclonal antibody, which we intend to study as a combination therapy with multiple potential agents.

Non-human primate toxicity studies support the initiation of a multi-arm Phase 1 study of UGN-301 in combination with other agents.

We believe that this approach leverages our unique drug delivery technology and provides an opportunity to evaluate intravesical delivery of UGN-301 in combination with other immuno-modulators, chemotherapies, gene therapy and innate immune stimulators.

1 unchanged sentence

TURBT followed by adjuvant intravesical immunotherapy with Bacillus of Calmette and Guerin ("BCG") is the current standard of care therapy for high-grade NMIBC. However, the high rates of recurrence and significant risk of progression to muscle-invasive tumors are particularly dangerous.

Radical cystectomy, or bladder removal is strongly advocated in patients with BCG-unresponsive NMIBC (i.e.

patients with BCG-refractory and BCG-relapsing tumors in whom further BCG therapy is not recommended) or for patients who cannot tolerate BCG.

Drugs such as Keytruda have been recently approved for the BCG refractory population.

Radical cystectomy, or bladder removal is strongly advocated in patients with BCG-unresponsive NMIBC (i.e., patients with BCG-refractory and BCG-relapsing tumors in whom further BCG therapy is not recommended) or for patients who cannot tolerate BCG.

The first combination we are seeking to investigate clinically involves the sequential use of UGN-201 (imiquimod), a toll-like receptor-7 ("TLR 7") agonist, and UGN-301 in high-grade NMIBC ("high-grade NMIBC").

UGN-201 is a liquid formulation of imiquimod for intravesical administration that has been optimized for delivery in the urinary tract.

We believe that UGN-201 may elicit an adaptive immune response in the presence of released bladder cancer antigens, which may translate into a long lasting acquired immune response.

We believe the combination of UGN-301 and UGN-201 could further increase the adaptive immune response and potentially represent a valid post-TURBT adjuvant treatment of high-grade NMIBC. UGN-301 is delivered using our proprietary 

We believe that UGN-201 may elicit an innate immune response in the presence of released bladder cancer antigens, which may translate into a long lasting acquired immune response.

We believe the combination of UGN-301 and UGN-201 could elicit an innate as well as adaptive immune response and potentially represent a valid post-TURBT adjuvant treatment of high-grade NMIBC. UGN-301 is delivered using our proprietary 

RTGel  technology, which has been designed to significantly improve the effectiveness of certain intravesical therapy.

In November 2019, we entered into a worldwide license agreement with Agenus Inc.

to develop and commercialize zalifrelimab via intravesical delivery in combination with UGN-201 for the treatment of urinary tract cancers, initially in high-grade NMIBC.

We believe that the combination treatment makes local therapy a potentially more effective treatment option while minimizing systemic exposure and potential side effects.

to develop and commercialize zalifrelimab via intravesical delivery for the treatment of urinary tract cancers, initially in high-grade NMIBC.

We believe that the combination of UGN-301 and UGN-201 makes local therapy a potentially more effective treatment option while minimizing systemic exposure and potential side effects.

In March 2022, we announced FDA clearance of our Investigational New Drug application ("IND") to begin a novel Phase 1 clinical study of UGN-301 in patients with recurrent NMIBC. The novel study design will utilize a Master Protocol that we believe is a more efficient and streamlined approach to development.

It will provide more flexibility to add study arms as the trial progresses and is expected to increase efficiency and potentially reduce costs.

We expect the Master Protocol will allow the Company to more quickly evaluate safety, tolerability and dosing of UGN-301 in combination with additional immunomodulators and chemotherapies, with the goal of developing optimized treatment regimens for patients. The multi-arm Phase 1 study was initiated in April 2022 and is expected support the development of UGN-301 in high-grade NMIBC.

We expect the Master Protocol will allow the Company to more quickly evaluate safety, tolerability and dosing of UGN-301 in combination with additional immunomodulators and chemotherapies, with the goal of developing optimized treatment regimens for patients. The multi-arm Phase 1 study, which is expected to support the development of UGN-301 in high-grade NMIBC, was initiated in April 2022 and is actively enrolling and on track for first-arm completion within approximately 12-months.

Our Research and Development and License Agreements

Agenus Agreement

In November 2019, we entered into a license agreement with Agenus Inc.

(“Agenus”).

Pursuant to the agreement, Agenus granted us an exclusive, worldwide license (not including Argentina, Brazil, Chile, Colombia, Peru, Venezuela and their respective territories and possessions), royalty-bearing, sublicensable license under Agenus’s intellectual property rights to develop, make, use, sell, import and otherwise commercialize products incorporating a proprietary antibody of Agenus known as AGEN1884 for the treatment of cancers of the urinary tract via intravesical delivery.

AGEN1884 is an anti-CTLA-4 antagonist that is currently being evaluated by Agenus as a monotherapy in PD-1 refractory patients and in combination with Agenus’

anti-PD-1 antibody (AGEN2034) in solid tumors.

UGN-301 is a formulation of RTGel and zalifrelimab that is in early-stage development for high-grade NMIBC.

In November 2019, we entered into a license agreement with Agenus Inc., pursuant to which Agenus granted us an exclusive, worldwide (not including Argentina, Brazil, Chile, Colombia, Peru, Venezuela and their respective territories and possessions), royalty-bearing, sublicensable license under Agenus’s intellectual property rights to develop, make, use, sell, import, and otherwise commercialize products incorporating a proprietary monoclonal antibody of Agenus known as AGEN1884 (zalifrelimab), an anti-CTLA-4 antagonist, for the treatment of cancers of the urinary tract via intravesical delivery.

UGN-301 is a formulation of zalifrelimab administered using RTGel technology that is in early-stage development for high-grade NMIBC.

MD Anderson Agreement

Based on nonclinical studies conducted by us, UGN-201 in combination with anti-CTLA-4 antagonists have shown encouraging results for the potential treatment of high-grade NMIBC.

In January 2021, we announced that we entered into a three-year strategic research collaboration agreement with MD Anderson focusing on the sequential use of UGN-201 and UGN-301 as an investigational treatment for high-grade NMIBC.

Under the agreement, we will collaborate with MD Anderson on the design and conduct of non-clinical and clinical studies with oversight from a joint steering committee.

We will provide funding, developmental candidates, and other support.

In January 2021, we announced that we had entered into a three-year strategic research collaboration agreement with MD Anderson focusing on the sequential use of UGN-201 and UGN-301 as an investigational treatment for high-grade NMIBC.

Under the terms of the agreement, we and MD Anderson agreed to collaborate on the design and conduct of non-clinical and clinical studies with oversight from a joint steering committee.

We agreed to provide funding, developmental candidates, and other support.

Pursuant to the agreement, we have made bi-annual payments to MD Anderson to fund the collaboration, totaling $2.0 million and recognized evenly over the associated period through research and development expenses.

In July 2022, we determined that we had achieved the objectives that we established when the agreement was initiated, and notified MD Anderson that we were exercising our right to conclude the collaboration in 2022 as we did not foresee initiating further development activities as part of the collaboration, although we will continue to collaborate on existing joint projects.

As a result of this notification, we are not responsible for any further fixed bi-annual funding payments.

For additional information regarding our research and development and license agreements, see Note 13 to our condensed consolidated financial statements appearing elsewhere in this Quarterly Report.

Impact of COVID-19 Pandemic

In the event of a prolonged disruption related to COVID-19, there could be detrimental impact to our ongoing and future clinical trials, our ongoing commercial launch and future commercialization activities for Jelmyto , and our ability to access capital markets.

According to the Centers for Disease Control and Prevention, as of April 2022, over 75% of the U.S.

COVID-19 could have a detrimental impact on our ongoing and future clinical trials, our ongoing commercial launch and future commercialization activities for Jelmyto , and our ability to access capital markets.

According to the Centers for Disease Control and Prevention, as of July 2022, over 75% of the U.S.

population has had at least one dose of the COVID-19 vaccine, and over 65% are fully vaccinated.

However, as circumstances evolve, in particular related to the emergence of variants, it will be important to understand potential impacts to patients and the hospital system, and the ability for patients to access 

However, as circumstances evolve, in particular related to the emergence of variants and subvariants, it will be important to understand potential impacts to patients and the hospital system, and the ability for patients to access 

Jelmyto. 

While it is difficult to predict the impact of the ongoing COVID-19 pandemic, including associated variants, on our business and the healthcare industry, we continue to monitor the evolving COVID-19 situation, and the potential further impacts that the pandemic and related government response may have on our business.

While it is difficult to predict the ultimate impact of the ongoing COVID-19 pandemic on our business and the healthcare industry, we continue to monitor the evolving COVID-19 situation, and the potential further impacts that the pandemic and related government response may have on our business.

Components of Operating Results

During the three months ended March 31, 2022 and 2021 we recognized $13.6 million and $7.5 million of revenue, respectively from sales of our product, Jelmyto .

During the three and six months ended June 30, 2022 we recognized $16.6 million and $30.2 million of revenue, respectively from sales of our product, Jelmyto .

Cost of Revenue

Cost of revenue consists primarily of inventory and related costs associated with the manufacturing, distribution, warehousing and preparation of Jelmyto .

In periods prior to receiving FDA approval for Jelmyto , we recognized inventory and related costs associated with the manufacture of Jelmyto as research and development expense.

Research and Development Expense

Research and development expense, net consists primarily of:

Cost of revenue consists primarily of inventory and related costs associated with the manufacturing, distribution, warehousing and preparation of Jelmyto, 

including inventory impairment.

In periods prior to receiving FDA approval for Jelmyto , we recognized inventory and related costs associated with the manufacture of Jelmyto as research and development expenses.

Research and Development Expenses

Research and development expenses, net consist primarily of:

salaries and related costs, including share-based compensation expense, for our personnel in research and development functions;

8 unchanged sentences

Where at risk contingent milestone payments are due to third parties under research and development and collaboration agreements, the milestone payment obligations are expensed when such development milestone results are achieved.

We are currently focused on advancing our product candidates, and our future research and development expense will depend on their clinical success.

Research and development expense will continue to be significant and will increase over at least the next several years as we continue to develop our product candidates and conduct nonclinical studies and clinical trials of our product candidates.

We are currently focused on advancing our product candidates, and our future research and development expenses will depend on their clinical success.

Research and development expenses will continue to be significant and will increase over at least the next several years as we continue to develop our product candidates and conduct nonclinical studies and clinical trials of our product candidates.

Research and development activities are central to our business model.

4 unchanged sentences

In addition, we cannot forecast which product candidates may be subject to future collaborations, if and when such arrangements will be entered into, if at all, and to what degree such arrangements would affect our development plans and capital requirements.

We expect our research and development expense to increase over the next several years as our clinical programs progress and as we seek to initiate clinical trials of additional product candidates.

We also expect to incur increased research and development expense as we selectively identify and develop additional product candidates.

We expect our research and development expenses to increase over the next several years as our clinical programs progress and as we seek to initiate clinical trials of additional product candidates.

We also expect to incur increased research and development expenses as we selectively identify and develop additional product candidates.

The duration, costs and timing of clinical trials and development of our product candidates will depend on a variety of factors that include, but are not limited to, the following:

17 unchanged sentences

License fees and development milestone payments related to in-licensed products and technology are expensed as incurred or when achieved, in the case of milestones, if it is determined at that point that they have no established alternative future use.

Selling and Marketing Expense

To date, selling and marketing expense consists primarily of commercial personnel costs (including share-based compensation) along with pre-commercialization and commercialization activities related to Jelmyto , formerly known as UGN-101.

We anticipate that our selling and marketing expense remain relatively consistent for the remainder of 2022 .

General and Administrative Expense

General and administrative expense consists primarily of personnel costs (including share-based compensation related to directors, executives, finance, medical affairs, business development, investor relations, and human resource functions).

Selling and Marketing Expenses

To date, selling and marketing expenses consist primarily of commercial personnel costs (including share-based compensation) along with pre-commercialization and commercialization activities related to Jelmyto , formerly known as UGN-101.

For the remainder of 2022, we anticipate that our selling and marketing expenses  will remain relatively consistent with the first half of the year .

General and Administrative Expenses

General and administrative expenses consist primarily of personnel costs (including share-based compensation related to directors, executives, finance, medical affairs, business development, investor relations, and human resource functions).

Other significant costs include medical affairs services, external professional service costs, facility costs, accounting and audit services, legal services, and other consulting fees.

We anticipate that our general and administrative expense will remain relatively consistent for  the remainder of 2022, and may increase in the future to support the potential approval and commercialization of our product candidates and our continued research and development programs. 

For the remainder of 2022, we anticipate that our general and administrative expenses 

will remain relatively consistent with the first half of the year , and may increase in the future to support the potential approval and commercialization of our product candidates and our continued research and development programs. 

Financing on prepaid forward obligation

Financing on prepaid forward obligation is comprised of financing expense related to the RTW Transaction (as defined in Note 3 to our condensed consolidated financial statements included in this Quarterly Report).

Financing on prepaid forward obligation is comprised of financing expense related to the RTW Transaction (see Note 9 to our condensed consolidated financial statements included in this Quarterly Report).

Interest expense

2 unchanged sentences

Interest and other income, net, consisted primarily of interest income.

We have yet to generate taxable income in Israel.

We have yet to generate net taxable income in Israel.

We have historically incurred operating losses resulting in carry forward tax losses totaling approximately $335.8 million as of December 31, 2021.

11 unchanged sentences

Results of Operations

Comparison of the three months ended March 31, 2022 and 2021

The following table sets forth our results of operations for the three months ended March 31, 2022 and 2021.

Three Months Ended March 31,

Comparison of the three months ended June 30, 2022 and 2021

The following table sets forth our results of operations for the three months ended June 30, 2022 and 2021.

Three Months Ended June 30,

(in thousands)

Cost of revenue

Operating expense:

Operating expenses:

Research and development

1 unchanged sentence

General and administrative

Total operating expense

Total operating expenses

Operating loss

Financing on prepaid forward obligation

Interest expense

Interest expense on long-term debt

Interest and other income, net

1 unchanged sentence

Income tax expense

Revenue was $13.6 million and $7.5 million for the three months ended March 31, 2022 and 2021, respectively.

The increase in revenue of $6.1 million reflects the increased volume of sales of our product Jelmyto .

Revenue was $16.6 million and $13.0 million for the three months ended June 30, 2022 and 2021, respectively.

The increase in revenue of $3.6 million reflects the increased volume of sales of our product Jelmyto .

Cost of Revenue

Cost of revenue was $1.5 million and $ 0.9  million for the three months ended March 31, 2022 and 2021, respectively.

In periods prior to receiving FDA approval for Jelmyto , we recognized inventory and related costs associated with the manufacture of Jelmyto as research and development expense.

Cost of revenue was $1.8 million and $1.4 million for the three months ended June 30, 2022 and 2021, respectively.

In periods prior to receiving FDA approval for Jelmyto , we recognized inventory and related costs associated with the manufacture of Jelmyto as research and development expenses.

We expect this to continue to impact cost of revenue through the first quarter of 2023 as we produce Jelmyto at costs reflecting the full cost of manufacturing and as we deplete inventories that we had expensed prior to receiving FDA approval.

Gross margin would have been approximately 88.2% versus 88.7 % for the three months ended March 31, 2022, if we had not sold Jelmyto units that were expensed prior to regulatory approval.

Research and Development Expense

Research and development (R&D) expense was $12.7 million and $10.5 million for the three months ended March 31, 2022 and 2021, respectively.

The overall increase of $2.2 million is primarily attributable to the Phase 3 ENVISION study for UGN-102, and commencement of Phase 1 study for UGN-301.

Selling and Marketing Expense

Selling and marketing expense was $13.4 milli on and $11.4 million for the three months ended March 31, 2022 and 2021 , respectively.

The increase in selling and marketing expense of $2.0 million is primarily attributable to expenses related to our annual sales meeting held in March 2022 which did not occur during the first quarter of 2021.

Gross margin would have been approximately 88.3% versus 88 .9 % for the three months ended June 30, 2022, if we had not sold Jelmyto units that were expensed prior to regulatory approval.

Research and Development Expenses

Research and development expenses were $12.6 million and $12.1 million for the three months ended June 30, 2022 and 2021, respectively.

The overall increase of $0.5 million is primarily attributable to the Phase 3 ENVISION study for UGN-102, partially offset by lower expenses for the Phase 1 study for UGN-301 as compared to pre-clinical work in the prior year.

Selling and Marketing Expenses

Selling and marketing expenses were $12.8 milli on and $11.8 million for the three months ended June 30, 2022 and 2021 , respectively.

The increase in selling and marketing expenses of $1.0 million is primarily attributable to expenses related to participation in the American Urological Association's annual meeting.

General and Administrative Expenses

General and administrative expenses were $8.0 million and $10.5 million for the three months ended June 30, 2022 and 2021 , respectively.

The decrease in general and administrative expenses of $2.5 million resulted primarily from a decrease in stock-based compensation expenses in 2022.

Financing on Prepaid Forward Obligation

Financing on prepaid forward obligation was $5.8 million and $3.1 million for the three months ended June 30, 2022 and 2021, respectively.

The measurement of financing on prepaid forward obligation is an accounting estimate under the "imputed interest method" of accounting (see Note 3 to our condensed consolidated financial statements appearing elsewhere in this Quarterly Report). Under this measurement attribute, the cost of financing on prepaid forward obligation will vary over the life of the obligation.  The increase in financing on prepaid forward obligation of $2.7 million resulted primarily from a full three months of financing cost in 2022 for the RTW, which closed in May 2021, as well as fluctuations in the accounting measurement of the cost.

Interest Expense on Long-term Debt

Interest expense was $2.2 million and zero for the three months ended June 30, 2022 and 2021, respectively.

The cost in 2022 relates to the Pharmakon loan which closed in March 2022.

Interest and Other Income, Net

Interest and other income, net was $0.1 million and $33,000 for the three months ended June 30, 2022 and 2021, respectively.

The increase in interest and other income, net was primarily due to minor fluctuations in interest earned on investments and foreign exchange.

Comparison of the six months ended June 30, 2022 and 2021

The following table sets forth our results of operations for the six months ended June 30, 2022 and 2021.

Six Months Ended June 30,

(in thousands)

Cost of revenue

Operating expenses:

Research and development

Selling and marketing

General and administrative

Total operating expenses

Operating loss

Financing on prepaid forward obligation

Interest expense on long-term debt

Interest and other income, net

Loss before income taxes

Income tax expense

Revenue was $30.2 million and $20.5 million for the six months ended June 30, 2022 and 2021, respectively.

The increase in revenue of $9.7 million reflects the increased volume of sales of our product Jelmyto .

Cost of Revenue

Cost of revenue was $3.4 million and $2.3 million for the six months ended June 30, 2022 and 2021, respectively.

In periods prior to receiving FDA approval for Jelmyto , we recognized inventory and related costs associated with the manufacture of Jelmyto as research and development expenses.

Gross margin would have been approximately 88.3% versus 88.8 % for the six months ended June 30, 2022, if we had not sold Jelmyto units that were expensed prior to regulatory approval.

Research and Development Expenses

Research and development expenses were $25.3 million and $22.6 million for the six months ended June 30, 2022 and 2021, respectively.

The overall increase of $2.7 million is primarily attributable to the Phase 3 ENVISION study for UGN-102 as well as research into ingredient scale-up and production efficiency for Jelmyto .

Selling and Marketing Expenses

Selling and marketing expenses were $26.2 milli on and $22.9 million for the six months ended June 30, 2022 and 2021 , respectively.

The increase in selling and marketing expenses of $3.3 million is primarily attributable to increased brand marketing expenditures and expenses related to our participation in the American Urological Association's annual meeting, as well as our 

annual sales meeting held in March 2022, which did not occur during the first half of 2021.

General and Administrative Expense

General and administrative expense was $7.9 million and $10.8 million for the three months ended March 31, 2022 and 2021 , respectively.

The decrease in general and administrative expense of $2.9 million resulted primarily from a decrease in compensation expenses in 2022.

General and administrative expense was $15.9 million and $21.5 million for the six months ended June 30, 2022 and 2021 , respectively.

The decrease in general and administrative expense of $5.6 million resulted primarily from a decrease in stock-based compensation expenses in 2022.

Financing on Prepaid Forward Obligation

Financing on prepaid forward obligation was $5.8 million and $0 for the three months ended March 31, 2022 and 2021, respectively.

The cost in 2022 relates to the financing cost of the RTW Transaction which closed in May 2021.

Financing on prepaid forward obligation was $11.7 million and $3.1 million for the six months ended June 30, 2022 and 2021, respectively.

The increase in financing on prepaid forward obligation of $8.6 million resulted primarily from a full six months of financing cost in 2022 for the RTW, which closed in May 2021, as well as fluctuations in the accounting measurement of the cost.

Interest Expense

Interest expense was $0.3 million and $0.0 for the three months ended March 31, 2022 and 2021, respectively.

Interest expense was $2.5 million and zero for the six months ended June 30, 2022 and 2021, respectively.

The cost in 2022 relates to the Pharmakon loan which closed in March 2022.

Interest and Other Income, Net

Interest and other income, net was $0.0 million and $0.2 million for the three months ended March 31, 2022 and 2021, respectively.

The decrease in interest and other income, net of $0.2 million was primarily due to lower interest earned on cash and marketable securities.

Interest and other income, net was $0.1 million and $0.2 million for the six months ended June 30, 2022 and 2021, respectively.

The decrease in interest and other income, net of $0.1 million was primarily due to lower interest earned on cash, cash equivalents and marketable securities.

Liquidity and Capital Resources

As of March 31, 2022, we had $137.1 million in cash and cash equivalents and marketable securities.

As of June 30, 2022, we had $112.4 million in cash and cash equivalents and marketable securities.

Cash in excess of immediate requirements is invested in accordance with our investment policy, primarily with a view to liquidity and capital preservation, and is held primarily in U.S.

Based on our cash flow projections, we believe that our current cash and cash equivalents and marketable securities are sufficient to fund our planned operations beyond the next 12 months.

Through March 31, 2022, we funded our operations primarily through public equity offerings, private placements of equity securities and our funding arrangement with RTW Investments (“RTW”).

Through June 30, 2022, we funded our operations primarily through public equity offerings, private placements of equity securities and our funding arrangement with RTW Investments (“RTW”).

In December 2019, we entered into a sales agreement (the “ATM Sales Agreement”) with Cowen and Company, LLC (“Cowen”) pursuant to which we may from time to time offer and sell our ordinary shares having an aggregate offering price of up to $100.0 million.

5 unchanged sentences

In May 2021, following the receipt of necessary regulatory approvals, we received the $75.0 million prepaid forward payment ($ 72.4  million net of transaction costs) from RTW.

On March 7, 2022, we entered into a loan agreement ("Loan Agreement") with Pharmakon for a senior secured term loan of up to $100 million in two tranches.

The first tranche of $75 million ($72.6 million net of transaction costs) was funded in March 2022. At our option, we may draw up to an additional $25 million before December 31, 2022, subject to customary bring down conditions and deliverables.

The Pharmakon loan will mature five years from initial funding and can be prepaid in whole at our discretion, at any time, subject to prepayment premiums and makewhole amounts. The Pharmakon loan will require interest-only payments for the first 48 months followed by principal and interest payments with interest accruing using 3-month LIBOR (with a 1.25% floor) plus 8.25%. In the event of the cessation of LIBOR, the benchmark governing the interest rate will be replaced with a rate based on the secured overnight financing rate published by the Federal Reserve Bank of New York.

We have incurred losses since our inception and negative cash flows from our operations, and as of March 31, 2022 we had an accumulated deficit of $495.7 million.

On March 7, 2022, we entered into a loan agreement ("Loan Agreement") with Pharmakon for a senior secured term loan of up to $100.0 million in two tranches.

The first tranche of $75.0 million ($72.6 million of proceeds were received, $70.8 million net of additional transaction costs) was funded in March 2022. At our option, we may draw up to an additional $25.0 million before December 31, 2022, subject to customary bring down conditions and deliverables.

The Pharmakon loan will mature five years from initial funding and can be prepaid in whole at our discretion, at any time, subject to prepayment premiums and make-whole amounts. The Pharmakon loan will require interest-only payments for the first 48 months followed by principal and interest payments with interest accruing using 3-month LIBOR (with a 1.25% floor) plus 8.25%. In the event of the cessation of LIBOR, the benchmark governing the interest rate will be replaced with a rate based on the secured overnight financing rate published by the Federal Reserve Bank of New York.

We have incurred losses since our inception and negative cash flows from our operations, and as of June 30, 2022 we had an accumulated deficit of $522.4 million.

We anticipate that we will continue to incur losses for the reasonably foreseeable future.

Our primary uses of capital are, and we expect will continue to be, commercialization activities, research and development expense, including third-party clinical research and development services, laboratory and related supplies, clinical costs, including manufacturing costs, legal and other regulatory expense and general and administrative costs, partially offset by proceeds from sales of Jelmyto .

Our primary uses of capital are, and we expect will continue to be, commercialization activities, research and development expenses, including third-party clinical research and development services, laboratory and related supplies, clinical costs, including manufacturing costs, legal and other regulatory expense and general and administrative costs, partially offset by proceeds from sales of Jelmyto .

We cannot estimate the actual amounts necessary to successfully commercialize any approved products, including Jelmyto , or whether, or when, we may achieve profitability.

1 unchanged sentence

There can be no assurances that we will be able to secure such additional financing if at all, or on terms that are satisfactory to us, and that it will be sufficient to meet its needs.

In the event we is not successful in obtaining sufficient funding, this could force us to delay, limit, or reduce our product development, commercialization efforts or other operations.

In the event we are not successful in obtaining sufficient funding, this could force us to delay, limit, or reduce our product development, commercialization efforts or other operations.

Funding and Material Cash Requirements

13 unchanged sentences

Debt financing, if available, may involve agreements that include covenants that further limit or restrict our ability to take specific actions, such as incurring additional debt, making capital expenditures or declaring dividends.

In addition, the terms of the Forward Contract and Loan Agreement limit our ability to take certain actions, including incurring additional indebtedness.

In addition, the terms of the Pre-Paid Forward Contract with RTW and the Loan Agreement limit our ability to take certain actions, including incurring additional indebtedness.

If we raise funds through additional collaborations, strategic alliances or licensing arrangements with third parties, we may have to relinquish valuable rights to our technologies, future revenue streams, research programs or product candidates or to grant licenses on terms that may not be favorable to us.

11 unchanged sentences

Also, in November 2019, we entered into a new lease agreement, dated effective October 31, 2019, for an office in Princeton, NJ.

The lease commencement date was November 29, 2019 and the lease term is 38 months.

The total obligation for future minimum lease payments under our operating leases is $1.6 million as of December 31, 2021.

See Note 11 to the Consolidated Financial Statements for further information.

In March 2022, UroGen Pharma Ltd., the Borrower and the Guarantors party thereto from time to time entered into the Loan Agreement with the Lenders and Collateral Agent pursuant to which the Lenders agreed to make the Term Loans to the Borrower in an aggregate principal amount of up to $100 million to be funded in two tranches:

The lease commencement date was November 29, 2019 and the lease term is 38 months. In June 2022, the Company signed an amendment to its November 2019 lease agreement to extend the term for an additional three years through January 31, 2026. 

The total obligation for future minimum lease payments under our operating leases is $2.7 million as of June 30, 2022. See Note 11 to the condensed consolidated financial statements appearing elsewhere in this Quarterly Report for further information.

In March 2022, UroGen Pharma Ltd., Urogen Pharma, Inc., as the borrower ("Borrower"), and certain direct and indirect subsidiaries of the Company party thereto from time to time, as guarantors ("Guarantors" and, collectively with UroGen Pharma Ltd.

and Borrower, "Credit Parties"), entered into the Loan Agreement with funds managed by Pharmakon Advisors, L.P., including BPCR Limited Partnership (as a "Lender"), BioPharma Credit Investments V (Master) LP (as a "Lender"), and BioPharma Credit PLC, as collateral agent for the Lenders (in such capacity, "Collateral Agent"), pursuant to which the Lenders agreed to make the Term Loans to the Borrower in an aggregate principal amount of up to $100.0 million to be funded in two tranches:

(i) the Tranche A Loan of $75.0 million was advanced in March, 2022 and (ii) the Tranche B Loan of $25.0 million will be advanced at Borrowers election, subject to certain conditions, subject to the customary bring down conditions and deliverables, and in no event later than December 31, 2022.

8 unchanged sentences

The following table sets forth the significant sources and uses of cash for the periods set forth below: 

Three Months Ended March 31,

Six Months Ended June 30,

(in thousands)

5 unchanged sentences

Operating Activities

Net cash used in operating activities was $24.0million during the three months ended March 31, 2022, compared to $27.4 million during the three months ended March 31, 2021.

The $3.4 million decrease was attributable primarily to financing payments related to the prepaid forward obligation and timing of certain accruals, partially offset by increased collections of accounts receivables.

Net cash used in operating activities was $48.2 million during the six months ended June 30, 2022, compared to $46.3 million during the six months ended June 30, 2021.

The $1.9 million increase was attributable primarily to financing payments related to the prepaid forward obligation and timing of certain accruals.

Investing Activities

Net cash used in investing activities was $13.6 million during the three months ended March 31, 2022, compared to $15.0 million provided by investing activities during the three months ended March 31, 2021.

The net decrease of $1.4 million is primarily related to a decrease in maturities of marketable securities, as compared to the prior year.

Net cash provided by investing activities was $13.4 million during the six months ended June 30, 2022, compared to $15.7 million used in investing activities during the six months ended June 30, 2021.

The net change of $29.1 million is primarily related to reinvestment in securities with original maturity of less than 90 days which are classified as cash equivalents in the current period, as compared to investments in longer term marketable securities in the prior year.

Financing Activities

Net cash provided by financing activities was $70.7 million during the three months ended March 31, 2022, compared to $0.0 million during the three months ended March 31, 2021.

The increase is related to the proceeds from the Pharmakon loan in the current year.

Net cash provided by financing activities was $70.7 million during the six months ended June 30, 2022, compared to $72.5 million during the six months ended June 30, 2021.

The decrease is related to proceeds from the Pharmakon loan in the current year as compared to proceeds from the prepaid forward arrangement with RTW in the prior year.

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