Atara Biotherapeutics, Inc. — FY 2021 Form 10-K
Reporting period: Fiscal year ended December 31, 2021. Atara is a clinical-stage biotechnology company developing allogeneic T-cell immunotherapies. It had no approved products and generated no product-sale revenue.
Financial and liquidity overview
| Metric | FY 2021 | FY 2020 |
|---|---|---|
| License and collaboration revenue | $20.3 million | $0 |
| Research and development expense | $282.0 million | $244.7 million |
| General and administrative expense | $78.8 million | $64.4 million |
| Net loss | $340.1 million | $306.6 million |
| Net cash used in operations | $220.5 million | $180.8 million |
| Cash, cash equivalents and short-term investments | $371.1 million | $500.7 million |
| Total assets | $468.1 million | $588.1 million |
| Total liabilities | $188.5 million | $125.8 million |
Revenue was from collaboration and licensing arrangements, principally Bayer; the $45 million Pierre Fabre upfront payment was deferred and none was recognized as 2021 revenue. At year-end, deferred revenue totaled $96.5 million. The filing reports no conventional borrowing debt; lease liabilities were $28.3 million in total, including operating and finance leases. Product margins were not applicable because there were no product sales.
Financing activities provided $103.9 million in cash, mainly from $98.7 million net proceeds under at-the-market stock offerings. Shares outstanding increased to 91.7 million at year-end from 83.4 million. The company reported an accumulated deficit of $1.5 billion.
Material changes and business developments
- Revenue rose from zero in 2020 to $20.3 million in 2021, while net loss widened by $33.5 million and operating cash use increased by $39.8 million.
- R&D expense increased 15% to $282.0 million, driven largely by higher employee, facility and overhead costs; tab-cel expense declined as certain manufacturing activities shifted from 2020.
- In October 2021, Atara granted Pierre Fabre commercialization rights to tab-cel in Europe and select emerging markets for a $45 million upfront payment, up to $318 million in potential milestones, and tiered royalties. Atara retains rights in other major markets.
- Atara submitted an EU marketing authorization application for tab-cel in November 2021. It anticipated an EMA decision in Q4 2022 under accelerated assessment.
- In December 2021, the FDA granted ATA188 fast-track designation for primary and secondary progressive multiple sclerosis. A planned interim analysis of its Phase 2 study was expected in Q2 2022.
Outlook, risks and unusual items
- Management expected year-end 2021 cash, cash equivalents and short-term investments, together with an anticipated $100 million from a proposed manufacturing-facility asset sale to FUJIFILM Diosynth Biotechnologies, to fund planned operations into Q4 2023. The sale, announced in January 2022, remained subject to closing conditions and was not completed as of the filing.
- A major regulatory risk emerged after year-end: following a February 2022 FDA CMC meeting, Atara said the FDA had not agreed that commercial tab-cel was comparable to the product used in the pivotal ALLELE study and had initially recommended a clinical study with commercial product. Atara no longer expected a U.S. BLA filing in Q2 2022 and was discussing alternative approaches with the FDA.
- Atara reported a fatal serious adverse event in the ATA2271 Phase 1 study in February 2022. MSK temporarily paused new enrollment while the case was reviewed; the FDA agreed with the pause.
- Other significant risks include continued operating losses and financing needs, clinical and regulatory uncertainty, manufacturing qualification and supply challenges, competition, and possible COVID-19-related disruption. Management said the pandemic had not materially affected operations or timelines to date, but effects remained uncertain.
- The independent auditor issued unqualified opinions on the financial statements and internal control over financial reporting. The filing identified revenue recognition for out-license agreements and clinical-trial accruals/prepaids as critical audit matters.
Important facts for investors to verify
- Latest FDA feedback and the actual regulatory path and timing for a U.S. tab-cel application, including whether additional clinical data will be required.
- EMA review outcome and timing, and the status of Pierre Fabre’s supply and ancillary agreements and commercialization preparations.
- Results of the ATA188 interim analysis and subsequent development plans; also monitor the ATA2271 safety review and enrollment status.
- Closing and proceeds from the proposed $100 million facility asset sale, and whether cash runway assumptions remain achievable as spending and clinical plans evolve.
- Future cash burn, additional financing and dilution, including use of the remaining ATM capacity; verify the year-end cash balance against subsequent-period cash movements.