UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM
QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
For the quarterly period ended
TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
For the transition period from to
Commission File Number:
(Exact Name of Registrant as Specified in Its Charter)
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(State or Other Jurisdiction of (Address of Principal Executive Office) |
| (I.R.S. Employer Identification No.) (Zip Code) |
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(Registrant’s Telephone Number, Including Area Code)
Securities registered pursuant to Section 12(b) of the Act:
Title of each class | Trading Symbol(s) | Name of each exchange on which registered |
Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.
Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files).
Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.
Large accelerated filer | ☐ | ☒ | ||
Non-accelerated filer | ☐ | Smaller reporting company | ||
Emerging growth company |
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐
Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes
As of July 31, 2023,
COHERUS BIOSCIENCES, INC.
FORM 10-Q FOR THE QUARTER ENDED JUNE 30, 2023
TABLE OF CONTENTS
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Condensed Consolidated Statements of Stockholders’ Equity (Deficit) | 8 | ||
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10 | |||
Management’s Discussion and Analysis of Financial Condition and Results of Operations | 30 | ||
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UDENYCA®, YUSIMRY™ and CIMERLI®, whether or not appearing in large print or with the trademark symbol, are trademarks of Coherus, its affiliates, related companies or its licensors or joint venture partners, unless otherwise noted. Trademarks and trade names of other companies appearing in this Quarterly Report on Form 10-Q are, to the knowledge of Coherus, the property of their respective owners. |
2
CAUTIONARY NOTE REGARDING FORWARD LOOKING STATEMENTS
This Quarterly Report on Form 10-Q contains forward-looking statements regarding future events and our future results that are subject to the safe harbors created under the Securities Act of 1933, as amended (the “Securities Act”), and the Securities Exchange Act of 1934, as amended (the “Exchange Act”). Any statements contained herein that are not statements of historical facts contained in this Quarterly Report on Form 10-Q may be deemed to be forward-looking statements. In some cases, you can identify forward-looking statements by words such as “aim,” “anticipate,” “assume,” “attempt,” “believe,” “contemplate,” “continue,” “could,” “due,” “estimate,” “expect,” “goal,” “intend,” “may,” “objective,” “plan,” “predict,” “potential,” “seek,” “should,” “strive,” “target,” “will,” “would” and other similar expressions that are predictions of or indicate future events and future trends, or the negative of these terms or other comparable terminology. These forward-looking statements include, but are not limited to, statements about:
● | whether we will be able to continue to maintain or increase sales for our products; |
● | our expectations regarding our ability to develop and commercialize toripalimab, CHS-006 and our other product candidates in the United States and Canada, including whether the trial results, data package or biologics license application (“BLA”) for toripalimab will be sufficient to support regulatory approval; |
● | our ability to address comments raised in the complete response letter for the original BLA for toripalimab and timing of the review for the original BLA resubmission for toripalimab; |
● | our ability to receive marketing authorization for the on-body injector presentation of UDENYCA®, including the timing of receiving such marketing authorization, if approved; |
● | our ability to maintain regulatory approval for our products and our ability to obtain and maintain regulatory approval of our product candidates, if and when approved; |
● | our expectations regarding government and third-party payer coverage and reimbursement; |
● | our ability to achieve the closing of the acquisition of Surface Oncology, Inc. (“Surface”) in a timely manner or at all and realize the anticipated benefits from the transaction; |
● | our ability to manufacture our product candidates in conformity with regulatory requirements and to scale up manufacturing capacity of these products for commercial supply; |
● | our reliance on third-party contract manufacturers to supply our products and product candidates for us; |
● | our expectations regarding the potential market size and the size of the patient populations for our products and product candidates, if approved for commercial use; |
● | our expectations about making required future interest and principal payments as they become due in connection with our debt obligations; |
● | our financial performance, including, but not limited to, projected future performance of our gross margins, research and development expenses and selling and general administrative expenses; |
● | the implementation of strategic plans for our business, products and product candidates; |
● | the initiation, timing, progress and results of future preclinical and clinical studies and our research and development programs; |
3
● | the scope of protection we are able to establish and maintain for intellectual property rights covering our products and product candidates; |
● | our ability to finalize the Definitive Agreements or close on the transactions contemplated by them; |
● | our expectations regarding the scope or enforceability of third-party intellectual property rights, or the applicability of such rights to our products and product candidates; |
● | the cost, timing and outcomes of litigation involving our products and product candidates; |
● | our reliance on third-party contract research organizations to conduct clinical trials of our product candidates; |
● | the benefits of the use of our products and product candidates; |
● | the rate and degree of market acceptance of our current or any future products and product candidates; |
● | our ability to compete with companies currently producing competitor products, including Neulasta, Humira and Lucentis and other biosimilar products made by other companies; |
● | developments and projections relating to our competitors, our market opportunity and our industry; and |
● | the potential impact of COVID-19 and the continuation of the war in Ukraine on our business and prospects. |
We have based these forward-looking statements on our current expectations about future events. These statements are not guarantees of future performance and involve risks, uncertainties and assumptions that are difficult to predict. Our actual results may differ materially from those suggested by these forward-looking statements for various reasons, including those identified in Part II, Item 1A Risk Factors and discussed elsewhere in this Quarterly Report on Form 10-Q. Given these risks and uncertainties, you are cautioned not to place undue reliance on forward-looking statements. The forward-looking statements included in this report are made only as of the date hereof. Except as required under federal securities laws and the rules and regulations of the Securities and Exchange Commission (“SEC”), we do not undertake, and specifically decline, any obligation to update any of these statements or to publicly announce the results of any revisions to any forward-looking statements after the distribution of this report, whether as a result of new information, future events, changes in assumptions or otherwise. Our forward-looking statements do not reflect the potential impact of any future acquisitions, mergers, dispositions, joint ventures, or investments we may make or enter into, except for the acquisition of Surface to the extent described herein.
This Quarterly Report on Form 10-Q also contains estimates, projections, market opportunity estimates and other information concerning our industry, our business, and the markets for certain diseases, including data regarding the estimated size of those markets, and the incidence and prevalence of certain medical conditions. Information that is based on estimates, forecasts, projections, market research or similar methodologies is inherently subject to uncertainties and actual events or circumstances may differ materially from events and circumstances reflected in this information. Unless otherwise expressly stated, we obtained this industry, business, market and other data from reports, research surveys, studies and similar data prepared by market research firms and other third parties, industry, medical and general publications, government data, publicly filed reports and similar sources.
4
PART I. FINANCIAL INFORMATION
ITEM 1. Unaudited Condensed Consolidated Financial Statements
Coherus BioSciences, Inc.
Condensed Consolidated Balance Sheets
(in thousands, except share and per share data)
(unaudited)
June 30, | December 31, | |||||
| 2023 |
| 2022 | |||
Assets |
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Current assets: |
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Cash and cash equivalents | $ | | $ | | ||
Investments in marketable securities | | | ||||
Trade receivables, net |
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Inventory |
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Prepaid manufacturing |
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Other prepaids and current assets |
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Total current assets |
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Property and equipment, net |
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Inventory, non-current |
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Goodwill and intangible assets |
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Other assets, non-current |
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Total assets | $ | | $ | | ||
Liabilities and Stockholders’ Deficit |
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Current liabilities: |
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Accounts payable | $ | | $ | | ||
Accrued rebates, fees and reserves |
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Accrued compensation |
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Accrued and other current liabilities |
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Total current liabilities |
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Term loans | | | ||||
Convertible notes | | | ||||
Lease liabilities, non-current |
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Other liabilities, non-current |
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Total liabilities |
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Commitments and contingencies (Note 8) |
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Stockholders’ deficit: |
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Common stock ($ |
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Additional paid-in capital |
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Accumulated other comprehensive loss |
| ( |
| ( | ||
Accumulated deficit |
| ( |
| ( | ||
Total stockholders' deficit |
| ( |
| ( | ||
Total liabilities and stockholders’ deficit | $ | | $ | |
See accompanying notes.
5
Coherus BioSciences, Inc.
Condensed Consolidated Statements of Operations
(in thousands, except share and per share data)
(unaudited)
Three Months Ended | Six Months Ended | |||||||||||
June 30, | June 30, | |||||||||||
|
| 2023 |
| 2022 |
| 2023 |
| 2022 | ||||
Net revenue | $ | | $ | | $ | | $ | | ||||
Costs and expenses: |
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Cost of goods sold |
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Research and development |
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Selling, general and administrative |
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Total costs and expenses |
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Loss from operations |
| ( |
| ( |
| ( | ( | |||||
Interest expense |
| ( |
| ( |
| ( |
| ( | ||||
Loss on debt extinguishment | — | — | — | ( | ||||||||
Other income (expense), net |
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Loss before income taxes |
| ( |
| ( |
| ( |
| ( | ||||
Income tax provision |
| — |
| — |
| — |
| — | ||||
Net loss | $ | ( | $ | ( | $ | ( | $ | ( | ||||
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Basic and diluted net loss per share | $ | ( | $ | ( | $ | ( | $ | ( | ||||
Weighted-average number of shares used in computing basic and diluted net loss per share |
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See accompanying notes.
6
Coherus BioSciences, Inc.
Condensed Consolidated Statements of Comprehensive Loss
(in thousands)
(unaudited)
Three Months Ended | Six Months Ended | |||||||||||
June 30, | June 30, | |||||||||||
|
| 2023 |
| 2022 |
| 2023 |
| 2022 | ||||
Net loss | $ | ( | $ | ( | $ | ( | $ | ( | ||||
Other comprehensive loss: |
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Unrealized loss on available-for-sale securities, net of tax | ( | — | ( | — | ||||||||
Foreign currency translation adjustments, net of tax |
| ( |
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| ( |
| — | ||||
Comprehensive loss | $ | ( | $ | ( | $ | ( | $ | ( |
See accompanying notes.
7
Coherus BioSciences, Inc.
Condensed Consolidated Statements of Stockholders’ Equity (Deficit)
(in thousands, except share and per share data)
(unaudited)
Accumulated | |||||||||||||||||
Additional | Other | Total | |||||||||||||||
Common Stock | Paid-In | Comprehensive | Accumulated | Stockholders' | |||||||||||||
|
| Shares |
| Amount |
| Capital |
| Loss |
| Deficit |
| Deficit | |||||
Balances at December 31, 2022 |
| | $ | | $ | | $ | ( | $ | ( | $ | ( | |||||
Net loss | — |
| — |
| — |
| — |
| ( |
| ( | ||||||
Issuance of common stock upon exercise of stock options | |
| — |
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| — |
| — |
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Issuance of common stock upon vesting of restricted stock units ("RSUs") | |
| — |
| — |
| — |
| — |
| — | ||||||
Issuance of common stock under ATM Offering, net of issuance costs | | — | | — | — | | |||||||||||
Taxes paid related to net share settlement of RSUs | ( | — | ( | — | — | ( | |||||||||||
Stock-based compensation expense | — |
| — |
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| — |
| — |
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Other comprehensive loss, net of tax |
| — |
| — |
| — |
| ( |
| — |
| ( | |||||
Balances at March 31, 2023 |
| | | | ( | ( | ( | ||||||||||
Net loss |
| — |
| — |
| — |
| — |
| ( |
| ( | |||||
Issuance of common stock upon exercise of stock options |
| |
| — |
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| — |
| — |
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Issuance of common stock upon vesting of RSUs | |
| — |
| — |
| — |
| — |
| — | ||||||
Issuance of common stock under Public Offering, net of issuance costs | | | | — | — | | |||||||||||
Offering costs associated with ATM offering | — | — | ( | — | — | ( | |||||||||||
Taxes paid related to net share settlement of RSUs | ( | — | ( | — | — | ( | |||||||||||
Issuance of common stock under the employee stock purchase plan ("ESPP") |
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| — |
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| — |
| — |
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Stock-based compensation expense |
| — |
| — |
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| — |
| — |
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Other comprehensive loss, net of tax | — | — | — | ( | — | ( | |||||||||||
Balances at June 30, 2023 |
| | $ | | $ | | $ | ( | $ | ( | $ | ( |
Accumulated | |||||||||||||||||
Additional | Other | Total | |||||||||||||||
Common Stock | Paid-In | Comprehensive | Accumulated | Stockholders' | |||||||||||||
|
| Shares |
| Amount |
| Capital |
| Loss |
| Deficit |
| Equity (Deficit) | |||||
Balances at December 31, 2021 |
| | $ | | $ | | $ | ( | $ | ( | $ | | |||||
Net loss |
| — |
| — |
| — |
| — |
| ( |
| ( | |||||
Issuance of common stock upon exercise of stock options |
| |
| — |
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| — |
| — |
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Issuance of common stock upon vesting of RSUs |
| |
| — |
| — |
| — |
| — |
| — | |||||
Taxes paid related to net share settlement of RSUs | ( | — | ( | — | — | ( | |||||||||||
Stock-based compensation expense |
| — |
| — |
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| — |
| — |
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Other comprehensive loss, net of tax |
| — |
| — |
| — |
| ( |
| — |
| ( | |||||
Balances at March 31, 2022 |
| | | | ( | ( | | ||||||||||
Net loss |
| — |
| — |
| — |
| — |
| ( |
| ( | |||||
Issuance of common stock upon exercise of stock options |
| |
| — |
| |
| — |
| — |
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Issuance of common stock upon vesting of RSUs | |
| — |
| — |
| — |
| — |
| — | ||||||
Taxes paid related to net share settlement of RSUs | ( | — | ( | — | — | ( | |||||||||||
Issuance of common stock under the ESPP |
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| — |
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| — |
| — |
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Stock-based compensation expense |
| — |
| — |
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| — |
| — |
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Other comprehensive gain, net of tax | — | — | — | | — | | |||||||||||
Balances at June 30, 2022 |
| | $ | | $ | | $ | ( | $ | ( | $ | ( |
See accompanying notes.
8
Coherus BioSciences, Inc.
Condensed Consolidated Statements of Cash Flows
(in thousands)
(unaudited)
Six Months Ended | ||||||
June 30, | ||||||
| 2023 |
| 2022 | |||
Operating activities |
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Net loss | $ | ( | $ | ( | ||
Adjustments to reconcile net loss to net cash used in operating activities: |
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Depreciation and amortization |
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Stock-based compensation expense |
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Inventory write-offs, net | | — | ||||
Non-cash accretion of discount on marketable securities |
| ( |
| — | ||
Non-cash interest expense from amortization of debt discount & issuance costs |
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Non-cash operating lease expense | | | ||||
Option payment to Shanghai Junshi Biosciences Ltd. ("Junshi Biosciences") |
| — |
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Loss on debt extinguishment | — | | ||||
Other non-cash adjustments, net | ( | ( | ||||
Changes in operating assets and liabilities: |
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Trade receivables, net |
| ( |
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Inventory |
| ( |
| ( | ||
Prepaid manufacturing |
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Other prepaid, current and non-current assets |
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| ( | ||
Accounts payable |
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Accrued rebates, fees and reserves |
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| ( | ||
Accrued compensation |
| ( |
| ( | ||
Accrued and other current and non-current liabilities |
| ( |
| ( | ||
Net cash used in operating activities |
| ( |
| ( | ||
Investing activities |
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Purchases of property and equipment |
| ( |
| ( | ||
Proceeds from disposal of property and equipment | | — | ||||
Purchases of investments in marketable securities |
| ( |
| — | ||
Proceeds from maturities of investments in marketable securities |
| |
| — | ||
Proceeds from sale of investments in marketable securities | | — | ||||
Option payment to Junshi Biosciences | — | ( | ||||
Net cash provided by (used in) investing activities |
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Financing activities |
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Proceeds from 2027 Term Loans, net of debt discount & issuance costs | — | | ||||
Proceeds from issuance of common stock under ATM Offering, net of issuance costs | | — | ||||
Proceeds from issuance of common stock under Public Offering, net of issuance costs | | — | ||||
Proceeds from issuance of common stock upon exercise of stock options |
| | | |||
Proceeds from purchase under the employee stock purchase plan |
| | | |||
Taxes paid related to net share settlement of RSUs |
| ( | ( | |||
Repayment of 2022 Convertible Notes and premiums | — | ( | ||||
Repayment of 2025 Term Loan, premiums and exit fees | — | ( | ||||
Other financing activities | ( | ( | ||||
Net cash provided by (used in) financing activities |
| |
| ( | ||
Net increase (decrease) in cash, cash equivalents and restricted cash |
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| ( | ||
Cash, cash equivalents and restricted cash at beginning of period |
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Cash, cash equivalents and restricted cash at end of period | $ | | $ | |
See accompanying notes.
9
Coherus BioSciences, Inc.
Notes to Condensed Consolidated Financial Statements
(unaudited)
1. Organization and Summary of Significant Accounting Policies
Organization
Coherus BioSciences, Inc. (the “Company” or “Coherus”) is a commercial-stage biopharmaceutical company focused on the research, development and commercialization of innovative immunotherapies to treat cancer. Coherus’ strategy is to build a leading immuno-oncology franchise funded with cash generated from net sales of its diversified portfolio of United States Food and Drug Administration (“FDA”)-approved therapeutics. The Company’s headquarters and laboratories are located in Redwood City, California and in Camarillo, California, respectively. The Company sells UDENYCA® (pegfilgrastim-cbqv), a biosimilar to Neulasta, a long-acting granulocyte-colony stimulating factor, in the United States. On August 2, 2022, the FDA approved CIMERLI® (ranibizumab-eqrn), a biosimilar to Lucentis, and commercial launch commenced in October 2022 in the United States. The Company launched YUSIMRY™ (adalimumab-aqvh), a biosimilar to Humira (adalimumab), in the United States in July 2023.
The Company’s product pipeline comprises the following
Basis of Consolidation
The accompanying unaudited condensed consolidated financial statements include the accounts of Coherus and its wholly-owned subsidiaries. All intercompany transactions and balances have been eliminated upon consolidation. The accompanying unaudited condensed consolidated financial statements have been prepared in accordance with United States generally accepted accounting principles (“U.S. GAAP”) for interim financial information and in accordance with the instructions to Form 10-Q and Rule 10-01 of Regulation S-X of the Securities Act of 1933, as amended (the “Securities Act”). Accordingly, they do not include all of the information and notes required by U.S. GAAP for complete financial statements. These unaudited condensed consolidated financial statements reflect all adjustments, including normal recurring accruals, that the Company believes are necessary to fairly state the financial position and the results of the Company’s operations and cash flows for interim periods in accordance with U.S. GAAP. Interim-period results are not necessarily indicative of results of operations or cash flows for a full year or any subsequent interim period.
10
The accompanying unaudited condensed consolidated financial statements should be read in conjunction with the Company’s audited financial statements and notes thereto included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2022 (the “2022 Form 10-K”) filed with the SEC.
Use of Estimates
The preparation of financial statements in conformity with U.S. GAAP requires management to make judgements, estimates and assumptions that affect the reported amounts of assets, liabilities, revenue and expenses, and related disclosures. Management bases its estimates on historical experience and on various other assumptions that are believed to be reasonable under the circumstances. These estimates form the basis for making judgments about the carrying values of assets and liabilities when these values are not readily apparent from other sources. Estimates are assessed each period and updated to reflect current information. Accounting estimates and judgements are inherently uncertain and therefore actual results could differ from these estimates.
Cash, Cash Equivalents and Restricted Cash
The following table provides a reconciliation of cash, cash equivalents and restricted cash reported within the condensed consolidated balance sheets, which, in aggregate, represent the amount reported in the condensed consolidated statements of cash flows:
(in thousands) | January 1, | |||||
At beginning of period: |
| 2023 |
| 2022 | ||
Cash and cash equivalents | $ | | $ | | ||
Restricted cash | | | ||||
Total cash, cash equivalents and restricted cash | $ | | $ | | ||
June 30, | ||||||
At end of period: | 2023 |
| 2022 | |||
Cash and cash equivalents | $ | | $ | | ||
Restricted cash |
| |
| | ||
Total cash, cash equivalents and restricted cash | $ | | $ | |
Restricted cash consists of deposits for letters of credit that the Company has provided to secure its obligations under certain leases and is included in other assets, non-current on the condensed consolidated balance sheets.
Trade Receivables
Trade receivables are recorded net of allowances for chargebacks, cash discounts for prompt payment and credit losses. The Company estimates an allowance for expected credit losses by considering factors such as historical experience, credit quality, the age of the accounts receivable balances, and current economic conditions that may affect a customer’s ability to pay. The corresponding expense for the credit loss allowance is reflected in selling, general and administrative expenses. The credit loss allowance was immaterial as of June 30, 2023 and December 31, 2022.
Derivative Instruments
In January 2023, the Company commenced using derivative contracts (foreign exchange option contracts) for the purpose of economically hedging exposure to changes in currency fluctuations between the U.S. Dollar and the Euro. The Company recognizes all derivatives at fair value in the condensed consolidated balance sheets, and corresponding gains and losses are recognized in other income (expense), net in the condensed consolidated statements of operations. The estimated fair value of derivative financial instruments represents the amount required to enter into similar
11
contracts with similar remaining maturities based on quoted market prices. During the periods presented, the Company did not apply hedge accounting to these instruments (see Note 9).
Recent Accounting Pronouncements
The Company has reviewed recent accounting pronouncements and concluded they are either not applicable to the business or that no material effect is expected on the condensed consolidated financial statements as a result of future adoption.
2. Revenue
The Company initiated sales of CIMERLI in October 2022. All net product revenue was in the United States, and the Company’s net revenue was as follows:
Three Months Ended | Six Months Ended | |||||||||||
June 30, | June 30, | |||||||||||
(in thousands) |
| 2023 | 2022 | 2023 |
| 2022 | ||||||
Products | ||||||||||||
UDENYCA | $ | | $ | | $ | | $ | | ||||
CIMERLI | | — | | — | ||||||||
Total net product revenue | | | | | ||||||||
Other |
| |
| |
| |
| | ||||
Total net revenue | $ | | $ | | $ | | $ | |
Gross product revenues by significant customer as a percentage of total gross product revenues were as follows:
| Three Months Ended | Six Months Ended |
| ||||||||||
June 30, | June 30, | ||||||||||||
2023 |
| 2022 | 2023 |
| 2022 |
| |||||||
McKesson Corporation |
| | % | | % | | % | | % | ||||
AmeriSource-Bergen Corporation |
| | % | | % | | % | | % | ||||
Cardinal Health, Inc. |
| | % | | % | | % | | % |
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Product Sales Discounts and Allowances
The activities and ending reserve balances for each significant category of discounts and allowances, which constitute variable consideration, were as follows:
Six Months Ended June 30, 2023 | ||||||||||||
| Chargebacks |
|
| Other Fees, |
| |||||||
and Discounts | Co-pay | |||||||||||
for Prompt | Assistance | |||||||||||
(in thousands) | Payment | Rebates | and Returns | Total | ||||||||
Balances at December 31, 2022 | $ | | $ | | $ | | $ | | ||||
Provision related to sales made in: |
| |||||||||||
Current period | | | | | ||||||||
Prior period - increase (decrease) | ( | | | | ||||||||
Payments and customer credits issued |
| ( | ( | ( | ( | |||||||
Balances at June 30, 2023 | $ | | $ | | $ | | $ | |
Six Months Ended June 30, 2022 | ||||||||||||
| Chargebacks |
|
| Other Fees, |
| |||||||
and Discounts | Co-pay | |||||||||||
for Prompt | Assistance | |||||||||||
(in thousands) | Payment | Rebates | and Returns | Total | ||||||||
Balances at December 31, 2021 | $ | | $ | | $ | | $ | | ||||
Provision related to sales made in: | ||||||||||||
Current period |
| | | | | |||||||
Prior period - increase (decrease) | ( |