Alpha Tau Medical Ltd. — FY2021 Form 20-F
Reporting period: Fiscal year ended December 31, 2021; this is an annual report, not a standalone Q4 filing. Financial statements are prepared under U.S. GAAP and amounts below are in U.S. dollars. The company is a clinical-stage oncology company developing Alpha DaRT, a localized radiation therapy for solid tumors. It had no product revenue and had not commercialized its product as of year-end. Israel had granted marketing approval for certain skin and oral-cavity cancers, but the company said it had not launched sales there; it had no U.S. marketing authorization.
Financial results and liquidity
| Metric | FY2021 | FY2020 |
|---|---|---|
| Revenue | None | None |
| Research and development, net | $11.447 million | $7.544 million |
| Marketing expense | $0.482 million | $0.288 million |
| General and administrative expense | $1.861 million | $1.412 million |
| Total operating expenses / operating loss | $13.790 million | $9.244 million |
| Net financial expense | $13.474 million | Net financial income of $0.520 million |
| Net loss | $27.271 million | $8.882 million |
| Basic and diluted loss per share | $0.67 | $0.22 |
| Net cash used in operating activities | $11.812 million | $7.251 million |
At December 31, 2021, cash and cash equivalents were $23.236 million, restricted cash $0.618 million, and short-term deposits $8.080 million, totaling $31.934 million. Current assets were $32.641 million and current liabilities $4.405 million. Total liabilities were $23.028 million, including an $18.623 million liability for warrants to purchase preferred shares; the balance sheet reports no conventional borrowings. Convertible preferred shares of $53.964 million were presented outside permanent equity, and shareholders’ deficiency was $34.777 million. Operating cash use increased year over year; FY2021 investing cash inflow of $19.273 million chiefly reflected deposit maturities, while financing cash inflow was only $0.111 million.
Changes versus the prior comparable period
- Net loss more than tripled, from $8.882 million to $27.271 million. The principal unusual driver was a $13.257 million non-cash increase in the fair value of preferred-share warrants, recorded as financial expense.
- Operating expenses rose $4.546 million, mainly from increased R&D staffing and clinical activity, with smaller increases in marketing and administration.
- Operating cash use increased by $4.561 million. Cash, cash equivalents and restricted cash rose to $23.854 million, while short-term deposits fell substantially; total cash, restricted cash and deposits declined from $46.591 million to $31.934 million.
Outlook, commentary and key risks
Management expected expenses and losses to increase as the company advances trials, expands manufacturing and pursues regulatory approvals. It stated that proceeds from the March 7, 2022 business combination and PIPE financing, together with year-end resources, were expected to fund operations and capital needs for at least two years; this is an estimate dependent on assumptions, not a guarantee. The March 2022 transactions raised $90.872 million in gross proceeds, after the reporting date.
Clinical results reported are preliminary and do not establish future efficacy or approval. In a U.S. pilot feasibility study, all 10 treated lesions reportedly showed complete response at approximately 12 weeks, with no product-related serious adverse events; the company anticipated a pivotal trial in 2022, subject to FDA feedback. Across trials of superficial lesions, the company reported a pooled 98% overall response rate and 74% complete response rate among lesions reaching the protocol evaluation endpoint. These are company-reported results, not evidence of commercial effectiveness.
Material risks include the lack of revenue and continuing losses; need for additional capital; clinical, regulatory and reimbursement uncertainty; potential delays or patient-enrollment impacts from COVID-19; radioisotope supply and manufacturing scale-up; dependence on third parties; competition; intellectual-property challenges; and geopolitical, currency and operational risks in Israel. The company had $8.364 million of undiscounted operating lease commitments, including $0.775 million due in 2022. It reported no material pending legal proceedings and no dividends planned for the foreseeable future.
Most important facts for investors to verify
- Review the audited statements and warrant valuation: the $13.257 million fair-value charge materially affected FY2021 loss, and the warrant liability reached $18.623 million.
- Confirm the status, design, enrollment, follow-up and final results of the U.S. pivotal-trial plan, and the regulatory pathway and timing with the FDA.
- Assess the quality and maturity of reported clinical evidence, including response definitions, follow-up duration, adverse events and whether pooled results are comparable across trials.
- Verify post-combination cash, actual burn rate and runway against management’s at-least-two-year estimate, including planned trial and manufacturing spending.
- Track regulatory authorization, reimbursement, manufacturing capacity and reliable supply of Thorium-228/Radium-224 before assuming commercial readiness.