What changed in this filing

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Item 5. Market for Registrant’s Common Equity

2023-03-24 compared with 2022-03-21 · 198 added, 171 removed, 185 unchanged (67% of the section changed)

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Recent Sales of Unregistered Securities

As of February 21, 2022, there were approximately 18 registered holders of record of our ordinary shares.

As of March 20, 2023, there were 17 registered holders of record of our ordinary shares.

Dividend Policy

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We are a biotechnology company dedicated to developing and commercializing innovative solutions that treat urothelial and specialty cancers.

We have developed RTGel ™

We have developed RTGel ®

reverse-thermal hydrogel, a proprietary sustained release, hydrogel-based technology that has the potential to improve therapeutic profiles of existing drugs.

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

RTGel is a novel proprietary polymeric biocompatible, reverse thermal gelation hydrogel, which, unlike the general characteristics of most forms of matter, is liquid at lower temperatures and converts into gel form when warmed to body temperature.

We believe that these characteristics promote ease of delivery into and retention of drugs in body cavities, including the bladder and the upper urinary tract, forming a transient reservoir of drug that disintegrates over time while preventing rapid excretion, providing for increased dwell time.

We estimate that the annual treatable patient population of low-grade UTUC in the United States is approximately 6,000 to 7,000 and the annual treatable population of low-grade intermediate risk NMIBC is approximately 80,000.

is a novel proprietary polymeric biocompatible, reverse thermal gelation hydrogel technology, which, unlike the general characteristics of most forms of matter, is liquid at lower temperatures and converts into gel form when warmed to body temperature.

We believe that these characteristics promote ease of delivery into and retention of drugs in body cavities, including the bladder and the upper urinary tract, forming a transient reservoir of drug that dissolves over time while preventing rapid excretion, providing for increased dwell time.

RTGel leverages the physiologic flow of urine to provide a natural exit from the body.

We believe that RTGel , when formulated with an active drug, may allow for the improved efficacy of treatment of various types of urothelial and specialty cancers without compromising the safety of the patient or interfering with the natural flow of fluids in the urinary tract.

Jelmyto is our novel sustained-release RTGel -based formulation of mitomycin that we have developed for the treatment of low-grade UTUC. On April 15, 2020, the FDA approved our new drug application (“NDA”) for Jelmyto (mitomycin) for pyelocalyceal solution, formerly known as UGN-101, for the treatment of adult patients with low-grade UTUC.

We believe that RTGel 

®, when formulated with an active drug, may allow for the improved efficacy of treatment of various types of urothelial and specialty cancers and urologic diseases without compromising the safety of the patient or interfering with the natural flow of fluids in the urinary tract.

achieves this by:

increasing the exposure of active drugs in the bladder and upper urinary tract by significantly extending the dwell time of the active drug while conforming to the anatomy of the bladder and the upper urinary tract, which allows for enhanced drug tissue coverage.

For example, the average dwell time of the standard mitomycin water formulation, currently used as adjuvant treatment, in the upper urinary tract is approximately five minutes, compared to up to six hours when mitomycin is formulated with RTGel ;

administering higher doses of an active drug than would otherwise be possible using standard water-based formulations.

For instance, it is only possible to dissolve 0.5 mg of mitomycin in 1 mL of water while it is possible to formulate up to 8 mg of mitomycin with 1 mL of RTGel ;

maintaining the active drug’s molecular structure and mode of action.

These characteristics of RTGel  enable sustained release of mitomycin in the urinary tract for both Jelmyto and UGN-102.

Further, RTGel may be particularly effective in the bladder and upper urinary tract where tumor visibility and access are challenging, and where there exists a significant amount of urine flow and voiding.

We believe that these characteristics of RTGel may prove useful for the local delivery of active drugs to other bodily cavities in addition to the bladder and upper urinary tract.

Jelmyto 

On April 15, 2020, the FDA approved our new drug application (“NDA”) for Jelmyto (mitomycin) for pyelocalyceal solution, formerly known as UGN-101, for the treatment of adult patients with low-grade UTUC.

Jelmyto consists of mitomycin, an established chemotherapy, and sterile hydrogel, using our proprietary sustained release RTGel technology.

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 and Orphan Drug exclusivity applies through April 15, 2027 as well as a composition of matter patents set to expire in early 2031.

The main patents that protect Jelmyto ®

in the United States are set to expire in January 2031.

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

The FDA evaluated the 

Jelmyto  NDA under Priority Review, which is reserved for medicines that may represent significant improvements in safety or efficacy in treating serious conditions.

Jelmyto was also granted Breakthrough Therapy Designation by the FDA, which was created to expedite the development and review of drugs developed for serious or life-threatening conditions with high unmet need.

Low-grade UTUC is a rare cancer that develops in the lining of the upper urinary tract, ureters and kidneys.

In the United States, there are approximately 6,000 - 7,000 new or recurrent low-grade UTUC patients annually.

It is a challenging condition to treat due to the complex anatomy of the urinary tract system.

Prior to Jelmyto, the current standard of care included endoscopic resection(s) and radical nephroureterectomy, which involves the removal of the renal pelvis, kidney, ureter and bladder cuff.

Treatment is further complicated by the fact that low-grade UTUC is most commonly diagnosed in patients over 70 years of age, who may already have compromised kidney function and may suffer further complications as a result of a major surgery.

We are focused on changing the way urothelial cancers are treated, an area in which there has been no significant advancements in recent years. Jelmyto ®

is the first drug therapy of its kind, providing an alternative to endoscopic resection(s) and/or radical nephroureterectomy.

The FDA approval is based on results from our Phase 3 OLYMPUS trial showing Jelmyto achieved clinically significant disease eradication in adults with low-grade UTUC.

Findings from the final study results include:

Complete response (“CR”) (primary endpoint) of 58% (41/71) in the intent-to-treat population and in the sub-population of patients who were deemed not capable of surgical removal at diagnosis.

At the 12-month time point for assessment of durability, 23 patients remained in CR of a total of 41 patients, eight had experienced recurrence of disease and ten patients were unable to be evaluated.

Durability of response was estimated to be 81.8% at 12 months by Kaplan-Meier analysis.

The median duration of response was not reached.

The most commonly reported adverse events (≥ 20%) were ureteric obstruction, flank pain, urinary tract infection, hematuria, abdominal pain, fatigue, renal dysfunction, nausea, dysuria and vomiting.

Most adverse events were mild to moderate and manageable.

No treatment-related deaths occurred.

In December 2022, we presented new data from the OLYMPUS trial designed to obtain long‐term follow‐up data on Jelmyto.

Based on data available for 16 of the 23 patients who had remained in CR at the end of the OLYMPUS study, the median duration of response was 28.9 months.

Thirteen patients remained in CR, two patients had recurrence of low grade‐UTUC on the same side as treated in OLYMPUS, and one patient underwent RNU due to ureteral stricture without evidence of UTUC at the time of surgery.

No patient had progressed to high‐grade disease.

In June 2020, we initiated our commercial launch of Jelmyto in the United States.

We have staffed, trained and prepared a customer-facing team comprising territory business managers with deep experience in both urology and oncology.

These territory business managers are led by seven regional business managers.

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, Jelmyto and our technology, both in person and virtually.

In total, our customer-facing team comprises approximately 80 representatives.

We have staffed, trained and prepared a customer-facing team that includes territory business managers with deep experience in both urology and oncology.

These territory business managers are led by seven regional business directors, who are in turn supported by three regional operations managers. 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 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.

In total, our customer-facing team comprises approximately 80 representatives. 

We are committed to helping patients access Jelmyto .

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

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

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

All Medicare patients are covered and the vast majority of commercial plans have policies in place, in whole covering over 150 million lives.

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

We have implemented processes to help make Jelmyto preparation and administration safe and seamless for practitioners and patients, including entering into an agreement with a major national pharmacy under which the pharmacy, following receipt of a patient prescription, prepares and dispenses the Jelmyto admixture on our behalf.

We have implemented processes to help make Jelmyto preparation and administration safe and seamless for practitioners and patients, including entering into an agreement with a major national specialty pharmacy under which the pharmacy, following receipt of a patient prescription, prepares and dispenses the Jelmyto admixture on our behalf.

In September 2022, the FDA authorized an extension of the in-use period for Jelmyto admixture from eight hours to 96 hours (four days) following reconstitution of the product, adding convenience and flexibility in managing patient care.

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 low-grade 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.

We are evaluating the safety and efficacy of UGN-102, our novel sustained-release formulation of mitomycin for the treatment of low-grade intermediate risk NMIBC.

In the first two full fiscal years following the initiation of our commercial launch of Jelmyto in June 2020, we have experienced a moderate decline in revenue during the third quarter from the preceding quarter.

We believe this result is primarily attributable to the nature of low-grade disease, which does not require immediate treatment and therefore we believe there is an impact in the summer months.

However, it is too early to say with confidence whether this seasonality trend will continue in future periods.

Moreover, our future Jelmyto revenue will be impacted by various factors and we expect our Jelmyto revenue to fluctuate quarter-to-quarter for the foreseeable future.

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.

In October 2021, we reported final data from the Phase 2b OPTIMA II trial. The single-arm, open label trial completed enrollment of 63 patients at clinical sites across the United States and Israel in September 2019.

Patients were treated with six weekly instillations of UGN-102 and underwent assessment of CR (the primary endpoint) four to six weeks following the last instillation. 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.

This new Phase 3 ENVISION trial is a single-arm, multinational, multicenter study evaluating the efficacy and safety of UGN-102 as primary chemoablative therapy in patients with low-grade intermediate risk NMIBC.

The design for the Phase 3 ENVISION trial is similar to our Phase 2 OPTIMA II trial in that the patient population will have similar clinical characteristics, receive the same treatment regimen and undergo the same efficacy and safety assessments and qualitative follow-up.

Study participants will receive six once-weekly intravesical instillations of UGN-102.

The planned primary endpoint will evaluate the complete response rate at three months after the first instillation, and the key secondary endpoint will evaluate durability over time in patients who achieve complete response at the three-month assessment.

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

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

This new streamlined Phase 3 ENVISION trial is a single-arm, multinational, multicenter study evaluating the efficacy and safety of UGN-102 as primary chemoablative therapy in patients with low-grade intermediate risk NMIBC.

The design for this new Phase 3 ENVISION trial will be similar to our Phase 2 OPTIMA II trial in that the patient population will have the same clinical characteristics, receive the same treatment regimen and undergo the same efficacy and safety assessments and qualitative follow-up, but with different endpoints.

Study participants will receive 6 once-weekly intravesical instillations of UGN-102.

The planned primary endpoint is the complete response rate at three months after the first instillation, and the key secondary endpoint will be durability over time in patients who achieve complete response at the three-month assessment.

In February 2022, we announced the initiation of the Phase 3 ENVISION trial, which is expected to enroll approximately 220 patients across 90 sites, with completion of enrollment expected by the end of 2022. Assuming positive findings, we anticipate submitting an NDA for UGN-102 in 2024.

As a result of the FDA's acceptance of a single arm approach, we have stopped enrollment of the Phase 3 ATLAS study. However, at the time enrollment was stopped, any patients who had signed an informed consent were able to complete screening, and if eligible were randomized into the trial.

Patients continue to be followed in Phase 3 ATLAS study, and clinical results from these patients are expected to generate additional safety data and other insights in our evaluation of UGN-102 as a primary therapy in the treatment of low-grade intermediate risk NMIBC.

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.

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 (zalifrelimab), an anti-CTLA-4 antibody, which we intend to study as a combination therapy with multiple potential agents.

UGN-301, an immune checkpoint inhibitor, is delivered using our proprietary 

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

Our initial nonclinical studies involve the sequential use of UGN-201 (imiquimod), a TLR 7 agonist, and UGN-301 (zalifrelimab), an anti-CTLA-4 antibody, as an investigational treatment for high-grade NMIBC.

Toll-like receptors are pattern recognition receptors whose importance in stimulating innate and adaptive immunity has been established by recent studies.

Toll-like receptors are able to sense microbial components as well as host-derived endogenous molecules released by injured tissues and play a critical role in defending against invading pathogens.

Imiquimod, in its topical formulation, is FDA approved for several indications, including superficial basal cell carcinoma.

Patients were treated with six weekly instillations of UGN-102 and underwent assessment of CR (the primary endpoint) four to six weeks following the last instillation; 65%, or 41 out of 63 patients, treated with UGN-102 achieved a complete response three months after the start of therapy.

In this subset of patients, 39 (95%), 30 (73%), and 25 (61%) remained disease-free at six, nine, and 12 months after treatment initiation, respectively.

The probability of durable response nine months after CR (12 months after treatment initiation) was estimated to be 72.5% by Kaplan-Meier analysis. Thirteen patients had documented recurrences.

Fifty-seven of 63 (90%) patients completed all six instillations of UGN-102 according to the study protocol.

Median duration of response was not reached.

The most common adverse events, greater than 10%, were most often reported as mild to moderate in severity and include dysuria, hematuria, urinary frequency, fatigue, urgency and urinary tract infection. The final data was published online in The Journal of Urology in October 2021 and was included in the January 2022 print edition.

In December 2022 we presented new data from the OPTIMA II study designed to obtain long-term follow-up data on UGN-102 that shows median duration of response of 24.4 months based on available data for 15 out of 25 patients. Seven patients remained in CR, six patients had recurrence of low-grade disease, one patient had progression to high-grade disease and one patient withdrew consent but remained in CR at the last evaluation prior to discontinuation.

All patients were alive at the last contact, and five patients were known to have had post-study treatment with transurethral resection of the bladder tumors or fulguration.

UGN-102 is administered locally using the standard practice of intravesical instillation directly into the bladder via a catheter.

The instillation into the bladder is expected to take place in a physician’s office as a non-operative same-day treatment, in comparison with TURBT or similar surgical procedures, which are operations conducted under general anesthesia and may require an overnight stay.

Surgical tumor removal often has limited success due to the inability to properly identify, reach and resect all tumors.

We believe that an effective chemoablation agent can potentially provide better eradication of tumors irrespective of the detectability and location of the tumors.

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 comparing UGN-102 with or without TURBT 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.

This Phase 3 ENVISION trial is a single-arm, multinational, multicenter study evaluating the efficacy and safety of UGN-102 as primary chemoablative therapy in patients with low-grade intermediate risk NMIBC.

The design of the Phase 3 ENVISION trial is similar to our Phase 2 OPTIMA II trial in that the patient population has similar clinical characteristics, receives the same investigational treatment regimen and undergoes similar efficacy and safety assessments and qualitative follow-up.

Study participants receive six once-weekly intravesical instillations of UGN-102.

The primary endpoint will evaluate the complete response rate at three months after the first instillation, and the key secondary endpoint will evaluate durability of response in patients who achieve complete response at the three-month assessment.

In February 2022, we announced the initiation of the Phase 3 ENVISION trial, targeting enrollment of 220 patients across 90 sites.

In December 2022, we completed our target enrollment of the Phase 3 ENVISION trial. Assuming positive findings, we anticipate submitting an NDA for UGN-102 in 2024.

As a result of the FDA's acceptance of a single arm approach, we stopped enrollment of the Phase 3 ATLAS study. However, at the time enrollment was stopped, any patients who had signed an informed consent were able to complete screening, and if eligible were randomized into the trial.

Clinical results from these patients are expected to generate additional safety and efficacy data and other insights in our evaluation of UGN-102 as a primary therapy in the treatment of low-grade intermediate risk NMIBC.

We 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.

As per the study design, patients in this study received six once-weekly intravesical instillations of UGN-102 with the initial treatment visit occurring at the investigative site and instillation performed by a qualified physician.

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

The primary endpoints of the study include safety and tolerability, discontinuations from at home study treatment and feedback from patients, home health professionals and investigators via standardized questionnaires.

The study completed enrollment with a total of eight patients across four centers and all study visits for these enrolled patients have been completed.

Preliminary results were reported through a press release in February 2023, finding that UGN-102 was suitable to administer at home by a visiting nurse under the supervision of a treating physician and resulted in 75% of patients achieving a complete response, defined as no detectable disease three months after starting treatment.

Patients, nurses and investigators also completed home instillation feasibility questionnaires.

These standardized feasibility questionnaires highlighted that all eight patients preferred at-home to in-office treatment, and five of six patients recommended UGN-102 home instillation instead of TURBT.

Home instillation was reported as feasible for visiting nurses, and three of four investigators considered at-home treatment “not different”

than in-office treatment.

We believe establishing the 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 standalone agent and as a combination therapy with multiple potential agents.

Non-human primate toxicity studies supported 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.

High-grade NMIBC is a highly aggressive form of bladder cancer.

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.

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.

UGN-201 does not use our RTGel technology. 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 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 

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 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 utilizes 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 us 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. 

Our Research and Development and License Agreements

Allergan/AbbVie Agreement

In October 2016, we entered into an exclusive license agreement (the "Allergan/AbbVie Agreement") with Allergan Pharmaceuticals International Limited ("Allergan"), a wholly owned subsidiary of Allergan plc, which is now a part of AbbVie Inc.

("AbbVie") and granted Allergan an exclusive worldwide license to research, develop, manufacture and commercialize pharmaceutical products that contain 

RTGel  and clostridial toxins including BOTOX.

The license granted the exclusivity for the 

RTGel  and clostridial toxins including BOTOX alone or in combination with certain other active ingredients, referred to as the Licensed Products, which are approved for the treatment of adults with overactive bladder ("OAB") who cannot use or do not adequately respond to anticholinergics.

In October 2017, Allergan commenced a Phase 2 clinical trial of BOTOX/RTGel for the treatment of OAB, with the potential to evolve from multiple injections of BOTOX into the bladder to a single instillation of the novel formulation.

In August 2020, we announced that the Phase 2 APOLLO trial did not meet the primary endpoint. The data suggested that this result may have been due to BOTOX not effectively permeating the urothelium.

Over the past year, we have been in discussions with AbbVie to determine whether other products in their portfolio would be complementary with RTGel. Based on this review, there was limited interest to pursue combinatorial products, and therefore, in November 2021 the Allergan/AbbVie Agreement was terminated.

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 (AGEN1884) that is in early-stage development for high-grade NMIBC.

("Agenus"), 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 Phase 1 clinical 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 sequential use of UGN-201 and UGN-301 as an investigational treatment for high-grade NMIBC.

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

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

For additional information regarding our research and development and license agreements, see Note 12 to our financial statements appearing elsewhere in this Annual Report.

Impact of COVID-19 Pandemic

In the event of continuing disruptions related to COVID-19 variants, 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 the end of January 2022, over 75% of the U.S.

population has had at least one dose of the COVID-19 vaccine, and over 64% 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 

 Throughout 2021, we have experienced reduced or limited access to surgery centers and clinics, particularly in regions of the U.S.

that have continued to be heavily impacted by COVID-19. 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.

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. Pursuant to the agreement, as of December 31, 2022, we have made bi-annual payments totaling $2.0 million to MD Anderson to fund the collaboration, 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, although we will be responsible for costs related to existing joint projects that exceed the payments already made to MD Anderson.  

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

Components of Operating Results

During the year ended December 31, 2021 and December 31, 2020, we recognized $48.0 million and $11.8 million of revenues, respectively, from sales of our product, Jelmyto, 

which we launched in June 2020.

Cost of Revenues

Cost of revenues consist 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 expenses.

During the year ended December 31, 2022 and December 31, 2021, we recognized $ 64.4 million and $48.0 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, including inventory write-downs.

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 Expenses

Research and development expenses consist primarily of:

Research and development expenses, net consists primarily of:

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

expenses incurred under agreements with third parties, including CROs, subcontractors, suppliers and consultants, nonclinical studies and clinical trials;

expenses incurred to acquire, develop and manufacture nonclinical study and clinical trial materials;

expenses incurred to purchase API and other related manufacturing costs related to Research and Development activities;

expense incurred under agreements with third parties, including clinical research organizations ("CROs"), subcontractors, suppliers and consultants, nonclinical studies and clinical trials;

expense incurred to acquire, develop and manufacture nonclinical study and clinical trial materials;

expense incurred to purchase active pharmaceutical ingredient (“API”) in support of R&D activities and other related manufacturing costs;

facility and equipment costs, including depreciation expense, maintenance and allocated direct and indirect overhead costs.

We expense all research and development costs as incurred. We estimate nonclinical study and clinical trial expenses based on the services performed pursuant to contracts with research institutions and contract research organizations that conduct and manage nonclinical studies and clinical trials on our behalf based on actual time and expenses incurred by them.

We expense all research and development costs as incurred. We estimate nonclinical study and clinical trial expense based on the services performed pursuant to contracts with research institutions and contract research organizations that conduct and manage nonclinical studies and clinical trials on our behalf based on actual time and expense incurred by them.

We accrue for costs incurred as the services are being provided by monitoring the status of the trial or project and the invoices received from our external service providers.

We adjust our accrual as actual costs become known.

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 the milestone results are achieved.

We have received grants under the Israeli Law for the Encouragement of Industrial Research, Development and Technological Innovation, 5754-1984 (the “R&D Law”), from the Israel Innovation Authority in Israel (the “IIA”), an independent and impartial public entity, for some of our development programs.

Through December 31, 2021, we had received grants in the aggregate amount of $2.1 million.

On January 12, 2020, the IIA approved the Company’s request to unwind its obligation to the IIA regarding grants that were loaned to the Company between January 2004 and September 2016.

The total payment under the IIA approval, net of the royalties already paid, amounts to $6.6 million, which was fully paid during the first quarter of 2020. See Note 18 to the Consolidated Financial Statements included in this report for additional information.

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.

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.

Research and development activities are central to our business model.

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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 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.

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.

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:

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the length of time required to enroll eligible patients;

delays or operational challenges resulting from the ongoing COVID-19 pandemic;

the number of doses that patients receive;

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Other than Jelmyto , which was approved by the FDA in April 2020, we have not received approval of any of our product candidates.

UGN-102 is still in clinical development and our other product candidates are in nonclinical development, and the outcome of these efforts is uncertain.

UGN-102 and UGN-301 are still in clinical development.

As such, we cannot estimate the actual amounts necessary to successfully complete the development and commercialization of our product candidates or whether, or when, we may achieve profitability.

Until such time, if ever, as we can generate substantial product revenue, we expect to finance our cash needs through a combination of equity or debt financings and collaboration arrangements.

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

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

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. 

To date, selling and marketing expenses 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. 

General and Administrative Expenses

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

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

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.

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 the Consolidated Financial Statements.

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

Interest Expense

Interest expense is comprised of interest related to our long-term debt with Pharmakon (see Note 10 to our consolidated financial statements appearing elsewhere in this Annual Report).

Interest and Other Income, Net

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Income tax expense also consists of our estimate of uncertain tax positions, and related interest and penalties.

See Note 16 to the Consolidated Financial Statements for further information.

See Note 17 to our consolidated financial statements appearing elsewhere in this Annual Report for further information.  

Results of Operations

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Cost of revenue

Gross profit (loss)

Operating expenses:

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Financing on prepaid forward obligation

Interest expense on long-term debt

Interest and other income, net

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Income tax expense

Revenues were $48.0 million and $11.8 million for the years ended December 31, 2021 and 2020, respectively.

The increase of $36.2 million reflects the increased volume of sales of our product Jelmyto following its approval by the FDA in April 2020 commercial launch which commenced in June 2020.

Cost of Revenues

Cost of revenues were $5.2 million and $1.0 million for the years ended December 31, 2021 and 2020, 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 revenues through the second quarter of 2023 as we produce Jelmyto at costs reflecting the full costs of manufacturing and as we deplete inventories that we had expensed prior to receiving FDA approval.

Gross margin was 89.3% and 91.4% for the years ended December 31, 2021 and 2020, respectively.

Revenues were $64.4 million and $48.0 million for the years ended December 31, 2022 and 2021, respectively.

The increase of $16.4 million reflects the increased volume of sales of our product Jelmyto .

Cost of Revenue

Cost of revenue was $7.7 million and $5.2 million for the years ended December 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.

Gross margin would have been approximately 87.5% versus 88.1% for the year ended December 31, 2022, if we had not sold Jelmyto units that were expensed prior to regulatory approval.

Research and Development Expenses

Research and development expenses increased by $0.3 million to $47.6 million in the year ended December 31, 2021 from $47.3 million in the year ended December 31, 2020.

The increase is primarily attributable to higher research and development expense in 2021 related to the Phase 3 ATLAS study for UGN-102 which was initiated at the end of 2020, partially offset by the one-time payment in the prior year of $6.6 million to unwind our obligation to the IIA, and a decrease in personnel costs within research and development departments.

Research and development expenses were $52.9 million and $47.6 million for the years ended December 31, 2022 and 2021, respectively.

The increase in research and development expenses of $5.3 million is primarily attributable to higher research and development expenses in 2022 related to the Phase 3 ENVISION study for UGN-102, research into ingredient scale-up and production efficiency for 

Jelmyto , partially offset by lower stock-based compensation expenses in 2022.

Selling and Marketing Expenses

Selling and marketing expenses were $51.9 million and $47.6 million for the years ended December 31, 2022 and 2021, respectively.

The increase in selling and marketing expenses of $1.1 million resulted primarily attributable to higher field sales force expenses related to the launch and commercialization of 

The increase in selling and marketing expenses of $4.3 million is primarily attributable to brand marketing related expenses as well as expenses related to our participation in the American Urological Association's annual meeting, as well as our annual sales meeting, which did not occur in 2021, partially offset by lower stock-based compensation expenses in 2022.

General and Administrative Expenses

General and administrative expenses were $39.9 million and $43.7 million for the years ended December 31, 2021 and 2020, respectively.

The decrease in general and administrative expenses of $3.8 million resulted primarily from a decrease in consulting and personnel costs in 2021.

General and administrative expenses were $30.9 million and $39.9 million for the years ended December 31, 2022 and 2021, respectively.

The decrease in general and administrative expenses of $9.0 million resulted primarily from a decrease in compensation related costs in 2022.

Financing on Prepaid Forward Obligation

Financing on prepaid forward obligation was $17.3 million and $0 for the years ended December 31, 2021 and 2020, respectively, related to the closing of the RTW agreement.

Financing on prepaid forward obligation was $21.6 million and $17.3 for the years ended December 31, 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 9 to our consolidated financial statements appearing elsewhere in this Annual Report) which is affected by estimated future payments to RTW, which are based on a percentage of revenues.

The increase in financing on prepaid forward obligation of $4.3 million was driven primarily from a full twelve months of financing cost in 2022 for the RTW transaction, which was entered into in March 2021, partially offset by changes in underlying assumptions for remeasuring the effective rate.

Interest Expense on Long-term Debt

Interest expense was $8.4 million and zero for the years ended December 31, 2022 and 2021, respectively, related to the Pharmakon loan which closed in March 2022.

Interest and Other Income, Net

Interest and other income, net was income of $0.2 million and income of $1.6 million for the years ended December 31, 2021 and 2020, respectively.

The decrease of $1.4 million was primarily due to a decrease in our cash and cash equivalents and marketable securities.

Interest and other income, net was income of $1.0 million and income of $0.2 million for the years ended December 31, 2022 and 2021, respectively.

The increase of $0.8 million was primarily due to changes in the overall interest rate environment.

Liquidity and Capital Resources

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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 existing cash and cash equivalents and marketable securities, in addition to our recently announced Loan Agreement (see Note 19 to the Consolidated Financial Statements for additional details) are sufficient to fund our planned operations for at least the next 12 months.

Through December 31, 2021, we funded our operations primarily through public equity offerings, private placements of equity securities and our funding arrangement with RTW.

During the second quarter of 2020 we sold 700,000 ordinary shares under the ATM Sales Agreement, for gross proceeds of approximately $16.6 million.

The net proceeds to us after deducting sales commissions to Cowen and other issuance expenses were approximately $15.8 million.

The remaining capacity under the ATM Sales Agreement is approximately $83.4 million.

In March 2021, we entered into the Forward Contract with RTW, pursuant to which RTW agreed to provide us with an upfront cash payment of $75.0 million to support the launch of 

Jelmyto  and the development of UGN-102, and we agreed to provide RTW with tiered future payments based on global annual net product sales of 

Jelmyto  and UGN-102, if approved.

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. As of December 31, 2021, the amounts paid and payable to RTW amounted to $4.0 million. 

On March 7, 2022, we entered into the Loan Agreement, pursuant to which the Lenders agreed to make the Term Loans to Borrower in an aggregate principal amount of up to $100 million to be funded in two tranches:

(i) Tranche A Loan was advanced in the amount of $75 million ($72.6 million net of transaction costs) in March, 2022, and (ii) the Tranche B Loan of $25 million will be advanced at the Borrower's election, subject to the customary bring down conditions and deliverables, and in no event later than December 31, 2022. See Note 19 to the Consolidated Financial Statements for additional details.

We have incurred losses since our inception and negative cash flows from our operations, and as of December 31, 2021 we had an accumulated deficit of $467.3 million.

dollars. 

Through December 31, 2022, we funded our operations primarily through public equity offerings, private placements of equity securities and our funding arrangements with RTW and Pharmakon.

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.

The remaining capacity under the ATM Sales Agreement is approximately $83.4 million as of December 31, 2022.

The shares will be offered and sold pursuant to our shelf registration statement on Form S-3 filed with the SEC on November 15, 2022, which was declared effective on November 29, 2022.

In March 2021, we entered into a prepaid forward agreement with RTW, pursuant to which RTW agreed to provide us with an upfront cash payment of $75.0 million to support the launch of Jelmyto and the development of UGN-102, and we agreed to provide RTW with tiered future payments based on global annual net product sales of Jelmyto and UGN-102, if approved.

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 $100.0 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, and the second tranche of $25.0 million was funded in December 2022. 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 December 31, 2022 we had an accumulated deficit of $577.1 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 expenses, including third-party clinical research and development services, laboratory and related supplies, clinical costs, including manufacturing costs, legal and other regulatory expenses 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.

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 .

We routinely evaluate our liquidity needs, including assessment of our current financial condition, sources of liquidity including current cash and cash equivalents and marketable securities and management’s cash flow projections.

Our ability to continue as a going concern is expected to be impacted by our ability to raise additional capital to fund our operations, produce cash inflows from Jelmyto product sales and develop UGN-102. 

We believe that absent sufficient proceeds received from equity, financing, or business development transactions, we will not have sufficient cash and cash equivalents to fund our operations beyond one year from the issuance of our consolidated financial statements included elsewhere in this Annual Report.

We estimate that our existing resources and projected revenues will only be sufficient to fund our planned operations until mid-way through the first quarter of 2024. 

Accordingly, we will, within the next twelve months, require significant additional financing to continue our operations. 

In addition, there can be no assurances that we will be able to secure such additional financing if at all, on terms that are satisfactory to us, and in amounts sufficient to meet our needs.

These factors raise substantial doubt about our ability to continue as a going concern. 

Failure to successfully receive additional financing will require us to delay, limit or reduce product development and commercialization efforts.

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

Until such time, if ever, as we can generate substantial product revenue, we expect to finance our cash needs through a combination of equity or debt financings and collaboration arrangements.

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

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

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Net cash used in operating activities was $87.6 million during the year ended December 31, 2022, compared to $84.9 million used in operating activities during the year ended December 31, 2021.

The $21.0 million decrease was attributable primarily to the decrease of $17.7 million in the net loss driven by revenue from sales of our product 

Jelmyto  during 2021, as well as lower personnel related costs and the payment to the IIA during 2020.

The $2.7 million increase was attributable primarily to financing costs related to the prepaid forward obligation and Pharmakon loan, as well as timing of certain accruals, partially offset by the increase in net sales of our product Jelmyto during 2022.

Investing Activities

Net cash provided by investing activities was $4.1 million during the year ended December 31, 2021, compared to net cash provided by investing activities of $93.2 million during the year ended December 31, 2020.

The decrease of $89.1 million is primarily related to a decrease in maturities of marketable securities, in addition to an increase in purchases of marketable securities as compared to the prior year.

Net cash provided by investing activities was $1.1 million during the year ended December 31, 2022, compared to net cash provided by investing activities of $4.1 million during the year ended December 31, 2021.

The decrease of $3.0 million is attributable primarily to proportionately less maturities to purchases of marketable securities during 2022 as compared to 2021.

Financing Activities

Net cash provided by financing activities was $97.1 million during the year ended December 31, 2022, compared to net cash provided by financing activities of $72.3 million during the year ended December 31, 2021.

The increase of $55.8 is primarily due to the receipt of $72.4 million of net proceeds from the RTW Transaction in 2021, as compared to net proceeds received from sales under the ATM Sales Agreement in 2020.

The increase of $24.8 is primarily due to the receipt of net proceeds from the Pharmakon loan in 2022, as compared to net proceeds received from the RTW Transaction in 2021.

Funding and Cash Requirements

Our present and future funding and cash requirements will depend on many factors, including, among other things:

the progress, timing and completion of clinical trials for UGN-102;

nonclinical studies and clinical trials for UGN-301 or any of our other product candidates;

the progress, timing and completion of clinical trials for UGN-102 and UGN-301;

nonclinical studies and clinical trials for any of our other product candidates;

the costs related to obtaining regulatory approval UGN-102 and UGN-301 and any of our other product candidates, and any delays we may encounter as a result of regulatory requirements or adverse clinical trial results with respect to any of these product candidates;

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potential new product candidates we identify and attempt to develop;

revenues we may derive either directly or in the form of royalty payments from future sales of Jelmyto , UGN-102, UGN-301, RTGel reverse thermal hydrogel and any other product candidates;

revenues we may derive either directly or in the form of royalty payments from future sales of Jelmyto , UGN-102, UGN-301, RTGel reverse thermal hydrogel technology and any other product candidates;

the repayment of outstanding debt.

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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 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.

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Contractual Obligations and Commitments

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

In April 2016, we signed an addendum to our November 2014 lease agreement for our executive offices located in Israel, in order to increase the office space rented and to extend the rent period until 2019.

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

In July 2022, we signed a lease extension agreement extending the term of the lease through September 2025.

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

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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 10 to the Consolidated Financial Statements for further information.

On March 7, 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:

(i) the Tranche A Loan of $75 million was advanced in March, 2022 and (ii) the Tranche B Loan of $25 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.

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 $2.9 million as of December 31, 2022.

See Note 11 to our consolidated financial statements appearing elsewhere in this Annual 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 was advanced in December 2022.

The Term Loans will mature on the fifth-year anniversary of the Tranche A Closing Date (the “Maturity Date”).

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All product sales of Jelmyto are recognized through our arrangement with a single customer, a third-party national specialty distributor.

Net revenues 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 our co-pay assistance program, which are estimated based on industry benchmarking studies as well as our historical experience.

Research and Development

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

The costs of services performed by others in connection with the research and development activities of an entity, including research and development conducted by others on behalf of the entity, shall be included in research and development costs and expensed as the contracted work is performed.

We accrue for costs incurred as the services are being provided by monitoring the status of the trial or project and the invoices received from its external service providers.

We adjust accruals as actual costs become known.

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

The costs of intangibles that are purchased from others for a particular research and development project and that have no alternative future uses (in other research and development projects or otherwise) and therefore no separate economic values are recognized as research and development expense at the time the costs are incurred.

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.

Selling, general and administrative costs are expensed as incurred, and we accrue for services provided by third parties related to the above expenses by monitoring the status of services provided and receiving estimates from its service providers and adjusting its accruals as actual costs become known.

Net revenue recognized includes gross revenue and 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 our co-pay assistance program, which are estimated based on our historical experience.

Share-Based Compensation

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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”.

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

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

Each period we make a payment to RTW, an expense is recognized related to financing on the prepaid forward obligation based on an imputed rate derived from the expected future payments.

Management reassesses the effective rate each period based on the current carrying value of the obligation and the revised estimated future payments.

Changes in future payments from previous estimates are included in future financing expense. 

We provide for income taxes based on pretax income, if any, and applicable tax rates available in the various jurisdictions in which we operate, including Israel and the U.S.

Deferred taxes are computed using the asset and liability method.

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A valuation allowance is recognized to the extent that it is more likely than not that the deferred taxes will not be realized in the foreseeable future.

The Company follows a two-step approach in recognizing and measuring uncertain tax positions.

We follow a two-step approach in recognizing and measuring uncertain tax positions.

After concluding that a particular filing position can be recognized (i.e., has a more-likely-than-not chance of being sustained), ASC 740-10-30-7 requires that the amount of benefit recognized be measured using a methodology based on the concept of cumulative probability.

Under this methodology, the amount of benefit recorded represents the largest amount of tax benefit that is greater than 50% likely to be realized upon settlement with a taxing authority that has full knowledge of all relevant information.

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-K

Item 5. Market for Registrant’s Common Equity