PROTHENA CORP PUBLIC LTD CO [PRTA] Filings

10-Q 1 prta-20240930.htm 10-Q prta-20240930

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

______________________________________

FORM 10-Q

_____________________________________

(Mark One)


☒			QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended September 30, 2024


☐			TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

Commission file number: 001-35676

______________________________________

PROTHENA CORPORATION PUBLIC LIMITED COMPANY

(Exact name of registrant as specified in its charter)

______________________________________


Ireland						98-1111119
(State or other jurisdiction of incorporation or organization)						(I.R.S. Employer Identification Number)


77 Sir John Rogerson’s Quay, Block C
Grand Canal Docklands
Dublin 2,	D02 VK60,	Ireland
(Address of principal executive offices including Zip Code)

Registrant’s telephone number, including area code: 011-353-1-236-2500

______________________________________

Securities registered pursuant to Section 12(b) of the Act:


Title of Each Class	Trading Symbol	Name of Each Exchange on Which Registered
Ordinary Shares, par value $0.01 per share	PRTA	The Nasdaq Global Select Market

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. Yes ☒ No ☐

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 during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes ☒ No ☐

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	☒	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 ☐ No ☒

The number of ordinary shares outstanding was 53,808,732 as of November 6, 2024.

PROTHENA CORPORATION PLC

Form 10-Q – QUARTERLY REPORT

For the Quarter Ended September 30, 2024

TABLE OF CONTENTS


			Page

PART I. FINANCIAL INFORMATION			1
Item 1. Financial Statements (unaudited)			1
Condensed Consolidated Balance Sheets as of September 30, 2024 and December 31, 2023			1
Condensed Consolidated Statements of Operations for the three and nine months ended September 30, 2024 and 2023			2
Condensed Consolidated Statements of Cash Flows for the nine months ended September 30, 2024 and 2023			3
Condensed Consolidated Statements of Shareholders' Equity for the three and nine months ended September 30, 2024 and 2023			5
Notes to Condensed Consolidated Financial Statements			7
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations			24
Item 3. Quantitative and Qualitative Disclosures About Market Risk			35
Item 4. Controls and Procedures			35

PART II. OTHER INFORMATION			37
Item 1. Legal Proceedings			37
Item 1A. Risk Factors			37
Item 2. Unregistered Sales of Equity Securities and Use of Proceeds			71
Item 3. Defaults Upon Senior Securities			72
Item 4. Mine Safety Disclosures			72
Item 5. Other Information			72
Item 6. Exhibits			73

SIGNATURES			74

EXHIBIT INDEX			73

Note Regarding Forward-Looking Statements

In addition to historical information, this Quarterly Report on Form 10-Q contains forward-looking statements within the meaning of Section 21E of the Securities Exchange Act of 1934, as amended. Forward-looking statements may include words such as “aim,” “anticipate,” “assume,” “believe,” “contemplate,” “continue,” “could,” “due,” “estimate,” “expect,” “goal,” “intend,” “may,” “objective” “plan,” “predict,” “potential,” “positioned,” “seek,” “should,” “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. In addition, any statements that refer to expectations, projections, or other characterizations of future events or circumstances are forward-looking statements.

These forward-looking statements, which reflect our beliefs, assumptions, expectations, estimates, forecasts, and projections about our business and the industry in which we operated as of the date hereof, are estimates based on our best judgment. These statements relate to, among other things, our goal to continue building a biology-directed discovery engine targeting protein dysregulation; the treatment potential, designs, proposed mechanisms of action, and potential administration of our drug candidates; potential indications and attributes of epitopes and antibodies we have identified in our programs; plans for ongoing and future clinical trials of our drug candidates; our potential to advance, initiate, and complete investigational new drug (“IND”) enabling studies for our discovery and preclinical programs; the expected timing of reporting data from clinical trials of our drug candidates, including multiple clinical readouts starting in mid-2025 and continuing throughout the year from our Phase 1 clinical trial evaluating PRX012 and any topline study results for our Phase 3 AFFIRM-AL clinical trial in the first half of 2025; our collaborations with F. Hoffman-La Roche Ltd and Hoffmann-La Roche Inc. (together “Roche”), Bristol Myers Squibb Company (“BMS”), and Novo Nordisk, and amounts we may receive under such collaborations; the sufficiency of our cash position to fund advancement of a broad pipeline and completion of our ongoing clinical trials; and our anticipated need for additional capital.

These forward-looking statements are not guarantees of future performance or development and involve known and unknown risks, uncertainties, and other factors that are in some cases beyond our control. As a result, any or all of our forward-looking statements in this Quarterly Report on Form 10-Q may turn out to be inaccurate. Factors that could cause our actual results to differ materially include, but are not limited to, the risks and uncertainties set forth below, those discussed under Part II Item 1A “Risk Factors” of this Quarterly Report on Form 10-Q, and in our other filings with the U.S. Securities and Exchange Commission.

Except as required by law or by the rules and regulations of the U.S. Securities and Exchange Commission, we undertake no obligation to revise or update any forward-looking statements to reflect any event or circumstance that arises after the date of this Quarterly Report on Form 10-Q, including without limitation:

•our ability to obtain additional financing in future offerings and/or obtain funding from future collaborations;

•our operating losses;

•our ability to successfully complete research and development of our drug candidates;

•our ability to develop, manufacture and commercialize products;

•our collaborations and other agreements with third parties, including Roche, BMS, and Novo Nordisk;

•our ability to protect our patents and other intellectual property;

•our ability to hire and retain key employees;

•our ability to maintain financial flexibility and sufficient cash, cash equivalents and investments and other assets capable of being monetized to meet our liquidity requirements;

•the timing, receipt, and amount of any capital investments, cost-sharing contributions or reimbursements, milestone payments, or royalties that we might receive under current or potential future collaborations, including any milestone payments pursuant to our agreement with Novo Nordisk;

•potential disruptions in the U.S. and global capital and credit markets, including by geopolitical conflicts and pandemics;

•government regulation of our industry;

•the volatility of the market price of our ordinary shares; and

• business disruptions.

Summary of Risks Affecting Our Business

Our business is subject to numerous risks and uncertainties. The following summary highlights some of the risks you should consider with respect to our business and prospects. These risks are described more fully in Part II Item 1A “Risk Factors” of this Quarterly Report on Form 10-Q which includes a more complete discussion of the risks summarized below as well as a discussion of other risks related to our business, our prospects, and your investment.

•We anticipate that we will incur losses for the foreseeable future and we may never sustain profitability.

•We will require additional capital to fund our operations, and if we are unable to obtain such capital, we will be unable to successfully develop and commercialize drug candidates.

•Our success is largely dependent on the success of our research and development programs; our drug candidates are in various stages of development and we may not be able to successfully discover, develop, obtain regulatory approval for, or commercialize any drug candidates.

•We have entered into agreements to develop and bring to market drug candidates with Roche, BMS, and Novo Nordisk and may enter into additional agreements in the future, and we might not realize the anticipated benefits of such agreements including receiving anticipated milestone payments pursuant to these agreements.

•If clinical trials of our drug candidates are prolonged, delayed, suspended, or terminated, we may be unable to commercialize our drug candidates on a timely basis, which would require us to incur additional costs and delay our receipt of any revenue from potential product sales.

•Even if any of our drug candidates receives regulatory approval, if such approved product does not achieve broad market acceptance, the revenues that we generate from sales of the product will be limited.

•If we are unable to adequately protect or enforce the intellectual property relating to our drug candidates our ability to successfully commercialize our drug candidates will be harmed.

•Our future success depends on our ability to retain key personnel and to attract, retain, and motivate qualified personnel.

PART I. FINANCIAL INFORMATION

ITEM 1. FINANCIAL STATEMENTS

Prothena Corporation plc and Subsidiaries

Condensed Consolidated Balance Sheets (unaudited)

(in thousands, except share and per share data)


	September 30,		December 31,
	2024		2023
Assets
Current assets:
Cash and cash equivalents	$	519,262	$	618,830
Accounts receivable	—		5,159
Prepaid expenses and other current assets	15,722		13,941
Restricted cash, current	—		1,352
Total current assets	534,984		639,282
Non-current assets:
Property and equipment, net	3,254		3,836
Operating lease right-of-use assets	11,400		12,162
Deferred tax assets	41,002		33,893
Restricted cash, non-current	860		860
Other non-current assets	3,754		6,349
Total non-current assets	60,270		57,100
Total assets	$	595,254	$	696,382
Liabilities and Shareholders’ Equity
Current liabilities:
Accounts payable	$	10,330	$	25,391
Accrued research and development	10,340		14,724
Deferred revenue, current	8,832		—
Lease liability, current	2,613		1,114
Other current liabilities	14,307		15,662
Total current liabilities	46,422		56,891
Non-current liabilities:
Deferred revenue, non-current	5,589		67,405
Lease liability, non-current	8,881		10,721
Total non-current liabilities	14,470		78,126
Total liabilities	60,892		135,017
Commitments and contingencies (Note 6)
Shareholders’ equity:
Euro deferred shares, €22 nominal value:	—		—
Authorized shares — 10,000 at September 30, 2024 and December 31, 2023
Issued and outstanding shares — none at September 30, 2024 and December 31, 2023
Ordinary shares, $0.01 par value:	538		537
Authorized shares — 100,000,000 at September 30, 2024 and December 31, 2023
Issued and outstanding shares — 53,808,732 and 53,682,117 at September 30, 2024 and December 31, 2023, respectively
Additional paid-in capital	1,578,209		1,540,859
Accumulated deficit	(1,044,385)		(980,031)
Total shareholders’ equity	534,362		561,365
Total liabilities and shareholders’ equity	$	595,254	$	696,382

See accompanying Notes to Condensed Consolidated Financial Statements.

Prothena Corporation plc and Subsidiaries

Condensed Consolidated Statements of Operations

(in thousands, except per share data)

(unaudited)


	Three Months Ended September 30,				Nine Months Ended September 30,
	2024		2023		2024		2023
Collaboration revenue	$	970	$	84,866	$	132,984	$	91,004
Revenue from license and intellectual property	—		—		50		50
Total revenue	970		84,866		133,034		91,054
Operating expenses:
Research and development	50,723		57,913		172,347		158,680
General and administrative	16,760		16,645		50,351		44,895
Total operating expenses	67,483		74,558		222,698		203,575
Income (loss) from operations	(66,513)		10,308		(89,664)		(112,521)
Other income (expense):
Interest income	6,743		8,522		20,429		22,912
Other expense, net	(66)		(15)		(194)		(253)
Total other income, net	6,677		8,507		20,235		22,659
Income (loss) before income taxes	(59,836)		18,815		(69,429)		(89,862)
Benefit from income taxes	(835)		(3,092)		(5,075)		(10,310)
Net income (loss)	$	(59,001)	$	21,907	$	(64,354)	$	(79,552)
Basic net income (loss) per ordinary share	$	(1.10)	$	0.41	$	(1.20)	$	(1.50)
Diluted net income (loss) per ordinary share	$	(1.10)	$	0.38	$	(1.20)	$	(1.50)
Shares used to compute basic net income (loss) per share	53,790		53,559		53,757		53,064
Shares used to compute diluted net income (loss) per share	53,790		58,004		53,757		53,064

See accompanying Notes to Condensed Consolidated Financial Statements.

Prothena Corporation plc and Subsidiaries

Condensed Consolidated Statements of Cash Flows

(in thousands)

(unaudited)


	Nine Months Ended September 30,
	2024		2023
Operating activities
Net loss	$	(64,354)	$	(79,552)
Adjustments to reconcile net loss to cash used in operating activities:
Depreciation	672		652
Share-based compensation	35,444		29,834
Deferred income taxes	(7,109)		(11,712)
Reduction in the carrying amount of right-of-use assets	2,000		5,221
Changes in operating assets and liabilities:
Accounts receivable	5,159		(5,159)
Prepaid and other assets	768		(6,824)
Accounts payable, accruals and other liabilities	(20,289)		18,496
Deferred revenue	(52,984)		(29,014)
Operating lease liabilities	(1,585)		(4,810)
Net cash used in operating activities	(102,278)		(82,868)
Investing activities
Purchases of property and equipment	(255)		(1,261)
Net cash used in investing activities	(255)		(1,261)
Financing activities
Proceeds from issuance of ordinary shares in public offering, net	—		20,689
Proceeds from issuance of ordinary shares in at-the-market offering, net	(295)		2,959
Proceeds from issuance of ordinary shares upon exercise of stock options	1,908		20,972
Net cash provided by financing activities	1,613		44,620
Net decrease in cash, cash equivalents and restricted cash	(100,920)		(39,509)
Cash, cash equivalents and restricted cash, beginning of the year	621,042		712,618
Cash, cash equivalents and restricted cash, end of the period	$	520,122	$	673,109

Supplemental disclosures of cash flow information
Cash paid for income taxes	$	2,412	$	384

Supplemental disclosures of non-cash investing and financing activities
Acquisition of property and equipment included in accounts payable and accrued liabilities	$	71	$	93
Right-of-use assets obtained in exchange for lease obligations	$	217	$	3,810
Reclassification of prepaid lease payments to right-of-use assets upon lease commencement	$	—	$	7,522
At-the-market offering costs included in accounts payable and accrued liabilities	$	—	$	8

See accompanying Notes to Condensed Consolidated Financial Statements.

The following table provides a reconciliation of cash, cash equivalents and restricted cash reported within the statement of financial position that sum to the total of the same such amounts shown in the Condensed Consolidated Statements of Cash Flows.


	Nine Months Ended September 30,
	2024		2023
Cash and cash equivalents	$	519,262	$	670,897
Restricted cash, current	—		1,352
Restricted cash, non-current	860		860
Total cash, cash equivalents and restricted cash, end of the period	$	520,122	$	673,109

Prothena Corporation plc and Subsidiaries

Condensed Consolidated Statements of Shareholders' Equity

(in thousands, except share data)

(unaudited)


	Ordinary Shares			Additional Paid-in Capital		Accumulated Deficit		Total Shareholders' Equity
	Shares	Amount
Balances at December 31, 2023	53,682,117	$	537	$	1,540,859	$	(980,031)	$	561,365
Share-based compensation				12,383				12,383
Issuance of ordinary shares upon exercise of stock options	38,338	—		890				890
Net loss						(72,239)		(72,239)
Balances at March 31, 2024	53,720,455	537		1,554,132		(1,052,270)		502,399
Share-based compensation				12,041				12,041
Issuance of ordinary shares upon exercise of stock options	51,390	1		590				591
Net income						66,886		66,886
Balances at June 30, 2024	53,771,845	538		1,566,763		(985,384)		581,917
Share-based compensation				11,020				11,020
Issuance of ordinary shares upon exercise of stock options	35,887	—		426				426
Issuance of ordinary shares upon vesting of restricted stock units	1,000	—		—				—
Net income						(59,001)		(59,001)
Balances at September 30, 2024	53,808,732	$	538	$	1,578,209	$	(1,044,385)	$	534,362


	Ordinary Shares			Additional Paid-in Capital		Accumulated Deficit		Total Shareholders' Equity
	Shares	Amount
Balances at December 31, 2022	52,103,608	$	521	$	1,454,524	$	(833,003)	$	622,042
Share-based compensation				8,790				8,790
Issuance of ordinary shares upon exercise of stock options	179,474	2		2,538				2,540
Issuance of ordinary shares from the underwriters partial exercise of their 30-day option to purchase additional shares as part of the December 2022 public offering, net of issuance costs of $1.4 million	395,096	4		20,897				20,901
Net loss						(46,864)		(46,864)
Balances at March 31, 2023	52,678,178	527		1,486,749		(879,867)		607,409
Share-based compensation				10,100				10,100
Issuance of ordinary shares upon exercise of stock options	772,928	8		15,651				15,659
Adjustment related to December 2022 public offering				2				2
Issuance of ordinary shares under the at-the-market offering program, net of issuance costs of $119 thousand	42,361	—		3,104				3,104
Net loss						(54,595)		(54,595)
Balances at June 30, 2023	53,493,467	535		1,515,606		(934,462)		581,679


	Ordinary Shares			Additional Paid-in Capital		Accumulated Deficit		Total Shareholders' Equity
	Shares	Amount
Share-based compensation				10,944				10,944
Adjustment related to the at-the-market offering program				(14)				(14)
Issuance of ordinary shares upon exercise of stock options	145,148	1		2,710				2,711
Net income						21,907		21,907
Balances at September 30, 2023	53,638,615	$	536	$	1,529,246	$	(912,555)	$	617,227

See accompanying Notes to Condensed Consolidated Financial Statements.

Notes to the Condensed Consolidated Financial Statements

(unaudited)

1.Organization

Description of Business

Prothena Corporation plc (“Prothena” or the “Company”) is a late-stage clinical biotechnology company with expertise in protein dysregulation and a pipeline of investigational therapeutics with the potential to change the course of devastating neurodegenerative and rare peripheral amyloid diseases.

Fueled by its deep scientific expertise built over decades of research, the Company is advancing a pipeline of therapeutic candidates for a number of indications and novel targets for which its ability to integrate scientific insights around neurological dysfunction and the biology of misfolded proteins can be leveraged. The Company’s wholly-owned programs include birtamimab for the potential treatment of AL amyloidosis, and a portfolio of programs for the potential treatment of Alzheimer’s disease including PRX012, which targets amyloid beta (Aβ), and PRX123, a novel dual Aβ-tau vaccine. The Company’s partnered programs include prasinezumab for the potential treatment of Parkinson’s disease and other related synucleinopathies that targets alpha-synuclein in collaboration with Roche. In addition, we have partnered BMS-986446 (formerly PRX005) for the potential treatment of Alzheimer’s disease that targets tau and PRX019 for the potential treatment of neurodegenerative diseases with an undisclosed target in two separate license agreements with Bristol Myers Squibb (BMS). The Company is also entitled to certain potential milestone payments pursuant to the Company’s share purchase agreement with Novo Nordisk pertaining to the Company’s ATTR amyloidosis business (inclusive of coramitug, formerly PRX004).

The Company was formed on September 26, 2012, under the laws of Ireland and re-registered as an Irish public limited company on October 25, 2012. The Company's ordinary shares began trading on The Nasdaq Global Market under the symbol “PRTA” on December 21, 2012, and currently trade on The Nasdaq Global Select Market.

Liquidity and Business Risks

As of September 30, 2024, the Company had an accumulated deficit of $1.0 billion and cash and cash equivalents of $519.3 million.

Based on the Company's business plans, management believes that the Company’s cash and cash equivalents at September 30, 2024, are sufficient to meet its obligations for at least the next twelve months. To operate beyond such period, or if the Company elects to increase its spending on research and development programs significantly above current long-term plans or enters into potential licenses and/or other acquisitions of complementary technologies, products or companies, the Company may need additional capital. The Company expects to continue to finance future cash needs that exceed its cash from operating activities primarily through its current cash and cash equivalents, payments pursuant to its agreements with Roche, BMS, and Novo Nordisk, and, to the extent necessary, through proceeds from public or private equity or debt financings, loans and other collaborative agreements with corporate partners or other arrangements.

2.Summary of Significant Accounting Policies

Basis of Preparation and Presentation of Financial Information

These accompanying Condensed Consolidated Financial Statements have been prepared in accordance with the accounting principles generally accepted in the U.S. (“GAAP”) and with the instructions for Form 10-Q and Regulation S-X statements. Accordingly, they do not include all of the information and notes required for complete financial statements. These Condensed Consolidated Financial Statements should be read in conjunction with the Consolidated Financial Statements and Notes thereto contained in the Company’s Annual Report on Form 10-K filed with the U.S. Securities and Exchange Commission (the “SEC”) on February 22, 2024 (the “2023 Form 10-K”). These unaudited interim Condensed Consolidated Financial Statements are presented in U.S. dollars, which is the functional currency of the Company and its consolidated subsidiaries. These Condensed Consolidated Financial Statements include the accounts of the Company and its consolidated subsidiaries. All intercompany balances and transactions have been eliminated in consolidation.

Unaudited Interim Financial Information

The accompanying Condensed Consolidated Financial Statements and related disclosures are unaudited, have been prepared on the same basis as the annual consolidated financial statements and, in the opinion of management, reflect all adjustments, which include only normal recurring adjustments, necessary for a fair presentation of the results of operations for

the periods presented. The year-end condensed consolidated balance sheet data was derived from audited financial statements, however certain information and footnote disclosures normally included in financial statements prepared in accordance with GAAP have been condensed or omitted. The condensed consolidated results of operations for any interim period are not necessarily indicative of the results to be expected for the full year or for any other future year or interim period.

Use of Estimates

The preparation of the Condensed Consolidated Financial Statements in conformity with U.S. GAAP requires the Company to make judgments, estimates and assumptions that affect the reported amounts of assets, liabilities, revenues and expenses, and related disclosures. On an ongoing basis, management evaluates its estimates, including critical accounting policies or estimates related to revenue recognition and research and development expenses. The Company bases its estimates on historical experience and on various other market specific and other relevant assumptions that management believes to be reasonable under the circumstances, the results of which form the basis for making judgments about the carrying values of assets and liabilities that are not readily apparent from other sources. Because of the uncertainties inherent in such estimates, actual results may differ materially from these estimates.

Significant Accounting Policies

There were no significant changes to the accounting policies during the nine months ended September 30, 2024, from the significant accounting policies described in Note 2 of the Notes to Consolidated Financial Statements in the 2023 Form 10-K.

Concentration of Risks and Other Risks and Uncertainties

Financial instruments that potentially subject the Company to concentration of credit risk consist of cash and cash equivalents. The Company places its cash equivalents with high credit quality financial institutions and, by policy, limits the amount of credit exposure with any one financial institution. Deposits held with banks have exceeded, and will continue to exceed, federally insured limits. The Company is exposed to credit risk in the event of a default by the financial institutions holding its cash and cash equivalents. The Company has not experienced any losses on its deposits of cash and cash equivalents and its credit risk exposure is up to the extent recorded on the Company's Condensed Consolidated Balance Sheet.

The Company’s business is primarily conducted in U.S. dollars except for its agreements with contract manufacturers for drug supplies which are primarily denominated in Euros. The Company recorded a loss on foreign currency exchange rate differences of approximately $194,000 and $253,000 during the nine months ended September 30, 2024, and 2023, respectively. If the Company increases its business activities that require the use of foreign currencies, it may be exposed to losses if the Euro and other such currencies continue to strengthen against the U.S. dollar.

As of September 30, 2024, and December 31, 2023, approximately $3.3 million and $3.8 million, respectively, of the Company’s property and equipment, net was held in the U.S. and a nominal amount was in Ireland.

The Company is subject to a number of risks similar to other late-stage clinical biotechnology companies, including, but not limited to, the need to obtain adequate additional funding, possible failure of current or future preclinical testing or clinical trials, its reliance on third parties to conduct its clinical trials, the need to obtain regulatory and marketing approvals for its drug candidates, competitors developing new technological innovations, the need to successfully commercialize and gain market acceptance of the Company’s drug candidates, its right to develop and commercialize its drug candidates pursuant to the terms and conditions of the licenses granted to the Company, protection of proprietary technology, and the need to secure and maintain adequate clinical trial management, manufacturing, packaging, labeling, storage, testing, and distribution arrangements with third parties. The Company also relies on third-party consultants to assist in managing these third parties and assist with its clinical trial operations and manufacturing. If the Company does not successfully commercialize or partner any of its drug candidates, it will be unable to generate product revenue or achieve profitability. Further, the Company is also subject to broad market risks and uncertainties resulting from recent events, such as inflation, rising interest rates, and recession risks, as well as supply chain and labor shortages.

Segment

The Company operates in one segment. The Company’s chief operating decision maker (the “CODM”), its chief executive officer, manages the Company’s operations and evaluates the Company’s financial performance on a consolidated basis for purposes of allocating resources.

Recent Accounting Pronouncements

On March 6, 2024, the SEC issued final rule, “The Enhancement and Standardization of Climate-Related Disclosures for Investors”, which requires registrants to disclose material climate-related risks, including descriptions of board oversight and

risk management activities, the material impacts of these risks on a registrants strategy, business model and outlook and any material climate-related targets or goals. The rule requires these climate-related information to be disclosed in registration statements and annual reports. Registrants will also need to quantify certain effects of severe weather events and other natural conditions in a note to their audited financial statements. In addition, accelerated and large accelerated filers will need to disclose Scope 1 and Scope 2 greenhouse gas (GHG) emissions, if material, which will be subject to third-party assurance. The Company will be required to comply with the rule in fiscal year beginning January 1, 2025 for all disclosures other than the compliance with quantitative and qualitative disclosure requirements of material expenditures and material impacts on financial estimates that directly result from (1) activities to mitigate or adapt to the climate-related risks, (2) targets or goals and (3) transition plans will be required beginning fiscal year 2026. The Company’s other compliance dates are the following: 1) Scope 1 and Scope 2 GHG emissions - fiscal year beginning January 1, 2026; Limited assurance - fiscal year beginning January 1, 2029; Reasonable assurance - fiscal year beginning January 1, 2033; and Electronic tagging - fiscal year beginning January 1, 2026. The Company is currently evaluating the impact of the new standard on its consolidated financial statements and related disclosures. On April 4, 2024, the Securities and Exchange Commission (SEC) voluntarily stayed implementation of its recently adopted Climate Disclosure Rules.

On November 27, 2023, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update 2023-07 ("ASU 2023-07"), Segment Reporting- Improvements to Reportable Segment Disclosures, which requires public entities to provide disclosures on significant segment expenses that are regularly provided to the CODM and included within each reported measure of segment profit or loss and other segment items on an annual and interim basis. The guidance also requires public entities to provide all disclosures about reportable segment’s profit or loss and assets in interim periods that are currently required annually. Public entities with a single reportable segment have to provide all disclosures required by Accounting Standards Codification (“ASC”) 280, Segment Reporting including the significant segment expense disclosures. The guidance is applied retrospectively to all periods presented in financial statements and is effective for fiscal years beginning after December 15, 2023, and for interim periods beginning after December 15, 2024. Early adoption is permitted. The Company is currently evaluating the impact of adopting the update on the Company's disclosures.

In December 2023, the FASB issued ASU 2023-09, Improvements to Income Tax Disclosures, which requires public business entities to disclose a tabular reconciliation using both percentages and amounts, broken out into specific categories with certain reconciling items at or above 5% of the expected tax further broken out by nature and/or jurisdiction. The guidance also requires all entities to disclose income taxes paid, net of refunds, disaggregated by federal (national), state and foreign taxes for annual periods and to disaggregate the information by jurisdiction based on a quantitative threshold. All entities are required to apply the guidance prospectively, with the option to apply it retrospectively. The guidance will be effective for the Company’s annual period ending December 31, 2025. Early adoption is permitted. The Company is currently evaluating the impact of the new standard on its income tax disclosures.

3.Fair Value Measurements

The Company measures certain financial assets and liabilities at fair value on a recurring basis, including cash equivalents. Fair value is an exit price, representing the amount that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants. As such, fair value is a market-based measurement that should be determined based on assumptions that market participants would use in pricing an asset or a liability. A three-tier fair value hierarchy is established as a basis for considering such assumptions and for inputs used in the valuation methodologies in measuring fair value:

Level 1 — inputs are quoted prices (unadjusted) for identical assets or liabilities in active markets.

Level 2 — inputs are other than quoted prices included in Level 1 that are observable for the asset or liability, either directly or indirectly.

Level 3 — inputs are unobservable inputs that are supported by little or no market activities, which would require the Company to develop its own assumptions.

The fair value hierarchy also requires an entity to maximize the use of observable inputs and minimize the use of unobservable inputs when measuring fair value. The carrying amounts of certain financial instruments, such as cash equivalents, prepaid expenses and other current assets, accounts receivable, accounts payable and accrued liabilities, approximate fair value due to their short-term nature.

Based on the fair value hierarchy, the Company classifies its cash equivalents within Level 1. This is because the Company values its cash equivalents using quoted market prices. The Company’s Level 1 securities consisted of $499.2 million and $589.9 million in money market funds included in cash and cash equivalents at September 30, 2024, and December 31, 2023, respectively.

4.Composition of Certain Balance Sheet Items

Prepaid Expenses and Other Current Assets

Prepaid and other current assets consisted of the following (in thousands):


	September 30,		December 31,
	2024		2023
Prepaid R&D expenses	$	13,120	$	10,998
Prepaid G&A expenses	1,537		803
Other	1,065		2,140
Prepaid expenses and other current assets	$	15,722	$	13,941

Property and Equipment, net

Property and equipment, net consisted of the following (in thousands):


	September 30,		December 31,
	2024		2023
Machinery and equipment	$	9,137	$	9,019
Purchased computer software	2,204		2,232
	11,341		11,251
Less: accumulated depreciation and amortization	(8,087)		(7,415)
Property and equipment, net	$	3,254	$	3,836

Depreciation expense was $0.2 million and $0.7 million for the three and nine months ended September 30, 2024, respectively, compared to $0.2 million and $0.7 million for the three and nine months ended September 30, 2023, respectively.

Other Current Liabilities

Other current liabilities consisted of the following (in thousands):


	September 30,		December 31,
	2024		2023
Payroll and related expenses	$	11,869	$	13,245
Professional services	999		288
Other	1,439		2,129
Other current liabilities	$	14,307	$	15,662

5.Net Income (Loss) Per Ordinary Share

Net income (loss) per ordinary share was determined as follows (in thousands, except per share amounts):


	Three Months Ended September 30,				Nine Months Ended September 30,
	2024		2023		2024		2023
Numerator:
Net income (loss)	$	(59,001)	$	21,907	$	(64,354)	$	(79,552)
Denominator:
Weighted-average ordinary shares outstanding used in per share calculations - basic	53,790		53,559		53,757		53,064
Weighted-average ordinary shares outstanding used in per share calculations - diluted	53,790		58,004		53,757		53,064
Net income (loss) per share:
Basic net income (loss) per ordinary share	$	(1.10)	$	0.41	$	(1.20)	$	(1.50)
Diluted net income (loss) per ordinary share	$	(1.10)	$	0.38	$	(1.20)	$	(1.50)

Potentially issuable ordinary shares were not used in computing diluted net loss per ordinary share as their effect would be anti-dilutive due to the loss recorded during the three and nine months ended September 30, 2024 and nine months ended September 30, 2023, and therefore diluted net loss per share is equal to basic net loss per share.

The equivalent ordinary shares not included in diluted net income (loss) per share because their effect would be anti-dilutive are as follows (in thousands):


	Three Months Ended September 30,		Nine Months Ended September 30,
	2024	2023	2024	2023
Stock options to purchase ordinary shares	11,297	2,110	11,297	9,939
Restricted Stock Units (RSU)	24	27	24	27
Total	11,321	2,137	11,321	9,966

6. Commitments and Contingencies

Lease Commitments

As of September 30, 2024, the Company currently has four leases relating to its facilities in the United States and Dublin, Ireland.

South San Francisco Facility

The Company had a noncancelable operating sublease (the “SSF Lease”) covering 128,751 square feet of office and laboratory space in South San Francisco, California, U.S. (the “SSF Facility”), which expired on December 31, 2023.

Total operating lease cost was nil and nil for the three and nine months ended September 30, 2024, respectively, and $1.6 million and $4.8 million for the three and nine months ended September 30, 2023, respectively. Total cash paid against the operating lease liability was nil and nil for the three and nine months ended September 30, 2024, respectively, and $1.6 million and $4.9 million for the three and nine months ended September 30, 2023, respectively. The Company obtained a standby letter of credit which could be drawn down by the sublandlord in the event the Company failed to fully and faithfully perform all of its obligations under the SSF Lease and to compensate the sublandlord for all losses and damages the sublandlord may have suffered as a result of the occurrence of any default on the part of Company not cured within the applicable cure period. This standby letter of credit was collateralized by a certificate of deposit of the same amount which was classified as restricted cash as of December 31, 2023. The remaining standby letter of credit amount of $1.4 million was released to the Company in May 2024.

Sub-Sublease of South San Francisco Facility

The Company had a Sub-Sublease Agreement (the “Sub-Sublease”) with Assembly Biosciences, Inc. covering approximately 46,641 square feet of office and laboratory space of the SSF Facility. The Sub-Sublease expired on December 15, 2023, in connection with the expiration of the SSF Lease. The Sub-Sublease was considered an operating lease under ASC 842. For the three and nine months ended September 30, 2024, the Company recorded nil and nil, respectively, and $0.7 million and $2.2 million, for the three and nine months ended September 30, 2023, respectively, of sub-lease rental income as an offset to its operating expenses.

Dublin

In June 2021, the Company entered into a lease agreement for office space in Dublin, Ireland, which commenced in August 2021 and had an initial term of one year. In addition, the Company entered into a lease agreement for additional office space in Dublin, Ireland, which commenced in August 2023 and had an initial term of one year. Both leases have an automatic renewal clause, pursuant to which each agreement will be extended automatically for successive periods equal to their current terms, unless each agreement is cancelled by the Company. In April 2024, the Company renewed both leases, each for another one year term with termination dates in July 2025.

Brisbane Facility

On October 28, 2022, the Company entered into a noncancelable operating sublease (the "Brisbane Sublease") to sublease approximately 31,157 square feet of office and laboratory space located in Brisbane, California (the “Brisbane Facility”) with Arcus Biosciences, Inc., (the "Sublandlord"). The Brisbane Sublease became effective on October 28, 2022. The Brisbane Sublease provides that the Company's obligation to pay rent commenced on July 1, 2023, which is subject to abatement for the

first six months following such date, with the exception of the seventh rent payment that was due upon execution of the Brisbane Sublease. The Company is obligated to make lease payments totaling approximately $14.9 million over the lease term, which expires on September 30, 2028, unless terminated earlier. The Brisbane Sublease further provides that the Company is obligated to pay the Sublandlord certain costs, including taxes and operating expenses. The Company has the option to extend the sublease by providing written notice at least nine months prior to the expiration of the sublease term. As of September 30, 2024, the Brisbane Sublease has a remaining lease term of 4.0 years.

The Brisbane Sublease is considered an operating lease and the accounting lease commencement date was on July 31, 2023 when the Company gained control over the Brisbane Facility. The Company recorded a right-of-use asset of approximately $11.4 million and lease liability of approximately $3.6 million relating to the Brisbane Sublease on the lease commencement date. The discount rate used to determine the lease liability was 5.76%. The initial measurement of the right-of-use asset for the Brisbane Sublease includes the tenant improvement added by the Company wherein the lessor was deemed the accounting owner.

The Company was entitled to an improvement allowance of up to $9.3 million, to be used for costs incurred by the Company to construct certain improvements to the Brisbane Facility and to prepare for the Company's occupancy of the Brisbane Facility. As of September 30, 2024, all of the $9.3 million improvement allowance has been received from the Sublandlord and the Company is obligated to fund construction costs incurred in excess of the improvement allowance.

Total operating lease cost for the Brisbane Sublease was $0.8 million and $2.4 million for the three and nine months ended September 30, 2024, respectively, and $0.5 million and $0.5 million for three and nine months ended September 30, 2023, respectively. Total cash paid against the operating lease liability was $0.7 million and $2.0 million for the three and nine months ended September 30, 2024, respectively, and $0.2 million and $0.2 million for three and nine months ended September 30, 2023, respectively.

In conjunction with the Brisbane Sublease, the Company obtained a standby letter of credit in the initial amount of $0.9 million, which may be drawn down by the Sublandlord in the event the Company fails to fully and faithfully perform all of its obligations under the Brisbane Sublease and to compensate the Sublandlord for all losses and damages the Sublandlord may suffer as a result of the occurrence of any default on the part of the Company not cured within the applicable cure period. As of September 30, 2024, none of the standby letter of credit amount of $0.9 million has been used.

The following table sets out a maturity analysis of payments under the Company’s operating leases, including a reconciliation to the lease liabilities recognized in the Condensed Consolidated Balance Sheets as of September 30, 2024 (in thousands):


Year Ended December 31,	Operating Leases
2024 (3 months)	808
2025	3,188
2026	3,158
2027	3,269
2028	2,523
Thereafter	—
Total	$	12,946
Less: Present value adjustment	(1,452)
Lease liability	$	11,494

Indemnity Obligations

The Company has entered into indemnification agreements with its current and former directors and officers and certain key employees. These agreements contain provisions that may require the Company, among other things, to indemnify such persons against certain liabilities that may arise because of their status or service and advance their expenses incurred as a result of any indemnifiable proceedings brought against them. The obligations of the Company pursuant to the indemnification agreements continue during such time as the indemnified person serves the Company and continues thereafter until such time as a claim can be brought. The maximum potential amount of future payments the Company could be required to make under these indemnification agreements is unlimited; however, the Company has a director and officer liability insurance policy that limits its exposure and enables the Company to recover a portion of any future amounts paid. As a result of its insurance policy

coverage, the Company believes the estimated fair value of these indemnification agreements is minimal. Accordingly, the Company had no liabilities recorded for these agreements as of September 30, 2024, and December 31, 2023.

Other Commitments

In the normal course of business, the Company enters into various firm purchase commitments primarily related to research and development activities. As of September 30, 2024, the Company had non-cancelable purchase commitments to suppliers for $8.0 million of which $2.4 million is included in current liabilities, and contractual obligations under license agreements of $0.3 million of which nil is included in current liabilities. The following is a summary of the Company's non-cancelable purchase commitments and contractual obligations as of September 30, 2024 (in thousands):


	Total		2024		2025		2026		2027		2028		Thereafter
Purchase Obligations (1)	$	8,036	$	7,664	$	269	$	103	$	—	$	—	$	—
Contractual obligations under license agreements	323		49		64		60		60		45		45
Total	$	8,359	$	7,713	$	333	$	163	$	60	$	45	$	45

________________

(1) Purchase obligations consist of non-cancelable purchase commitments to suppliers and contract research organizations.

7. Significant Agreements

Roche License Agreement

In December 2013, the Company through its wholly owned subsidiary Prothena Biosciences Limited and Prothena Biosciences Inc entered into a License, Development, and Commercialization Agreement (the “License Agreement”) with F. Hoffmann-La Roche Ltd. and Hoffmann-La Roche Inc. (together, “Roche”) to develop and commercialize certain antibodies that target α-synuclein, including prasinezumab, which are referred to collectively as “Licensed Products.” Upon the effectiveness of the License Agreement in January 2014, the Company granted to Roche an exclusive, worldwide license to develop, make, have made, use, sell, offer to sell, import and export the Licensed Products. The Company retained certain rights to conduct development of the Licensed Products and an option to co-promote prasinezumab in the U.S. During the term of the License Agreement, the Company and Roche will work exclusively with each other to research and develop antibody products targeting alpha-synuclein (or α-synuclein) potentially including incorporation of Roche’s proprietary Brain Shuttle™ technology to potentially increase delivery of therapeutic antibodies to the brain. The License Agreement provided for Roche making an upfront payment to the Company of $30.0 million, which was received in February 2014; making a clinical milestone payment of $15.0 million upon initiation of the Phase 1 clinical trial for prasinezumab, which was received in May 2014; making a clinical milestone payment of $30.0 million upon dosing of the first patient in the Phase 2 clinical trial for prasinezumab, which was achieved in June 2017; and making a clinical milestone payment of $60.0 million upon dosing of the first patient in the global Phase 2b PADOVA study for prasinezumab, which was achieved in May 2021.

For prasinezumab, Roche is obligated to pay:

•up to $290.0 million upon the achievement of development, regulatory, and various first commercial sales milestones;

•up to $155.0 million upon achievement of U.S. commercial sales milestones;

•up to $175.0 million upon achievement of ex-U.S. commercial sales milestones; and

•tiered, high single-digit to high double-digit royalties in the teens based on U.S. and ex-U.S. annual net sales, subject to certain adjustments, with respect to the applicable Licensed Product.

Roche bore 100% of the cost of conducting the research collaboration under the License Agreement during the research term, which expired December 31, 2017. In May 2021, the Company exercised its rights under the terms of License Agreement to receive potential U.S. commercial sales milestone and royalties, in lieu of a U.S. profit and loss share for prasinezumab in Parkinson’s disease. Thus, in the U.S., through May 28, 2021, the parties shared all development costs, all of which were allocated 70% to Roche and 30% to the Company, for prasinezumab in the Parkinson’s disease indication. If the Company opts in to participate in co-development and co-funding for any other Licensed Products and/or indications, the parties will share all development and commercialization costs, as well as profits, all of which will be allocated 70% to Roche and 30% to the Company.

The Company initiated a Phase 1 clinical trial for prasinezumab in 2014. Following the Phase 1 clinical trial, Roche became primarily responsible for developing, obtaining and maintaining regulatory approval for and commercializing Licensed Products. Roche also became responsible for the clinical and commercial manufacture and supply of Licensed Products.

In addition, the Company has an option under the License Agreement to co-promote prasinezumab in the U.S. in the Parkinson’s disease indication. If the Company exercises such option, it may also elect to co-promote additional Licensed Products in the U.S. approved for Parkinson’s disease. Outside the U.S., Roche will have responsibility for developing and commercializing the Licensed Products. Roche bears all costs that are specifically related to obtaining or maintaining regulatory approval outside the U.S. and will pay the Company a variable royalty based on annual net sales of the Licensed Products outside the U.S.

The License Agreement continues on a country-by-country basis until the expiration of all payment obligations under the License Agreement. The License Agreement may also be terminated (i) by Roche at will after the first anniversary of the effective date of the License Agreement, either in its entirety or on a Licensed Product-by-Licensed Product basis, upon 90 days’ prior written notice to the Company prior to first commercial sale and 180 days’ prior written notice to Prothena after first commercial sale, (ii) by either party, either in its entirety or on a Licensed Product-by-Licensed Product or region-by-region basis, upon written notice in connection with a material breach uncured 90 days after initial written notice, and (iii) by either party, in its entirety, upon insolvency of the other party. The License Agreement may be terminated by either party on a patent-by-patent and country-by-country basis if the other party challenges a given patent in a given country. The Company’s rights to co-develop Licensed Products under the License Agreement will terminate if the Company commences certain studies for certain types of competitive products. The Company’s rights to co-promote Licensed Products under the License Agreement will terminate if the Company commences a Phase 3 study for such competitive products.

The License Agreement cannot be assigned by either party without the prior written consent of the other party, except to an affiliate of such party or in the event of a merger or acquisition of such party, subject to certain conditions. The License Agreement also includes customary provisions regarding, among other things, confidentiality, intellectual property ownership, patent prosecution, enforcement and defense, representations and warranties, indemnification, insurance, and arbitration and dispute resolution.

Performance Obligations

As of September 30, 2024, and December 31, 2023, there were no remaining performance obligations under the License Agreement since the obligations related to research and development activities were only for the Phase 1 clinical trial and the remaining obligations were delivered or performed.

Milestone Accounting

Under the License Agreement, the Company is eligible to receive certain milestone payments upon the achievement of development, regulatory and various first commercial sales milestones. Milestone payments are evaluated under ASC Topic 606. Factors considered in this determination included scientific and regulatory risk that must be overcome to achieve each milestone, the level of effort and investment required to achieve the milestone, and the monetary value attributed to the milestone. Accordingly, the Company estimates payments in the transaction price based on the most likely approach, which considers the single most likely amount in a range of possible amounts related to the achievement of these milestones. Additionally, milestone payments are included in the transaction price only when the Company can conclude it is probable that a significant revenue reversal will not occur in future periods when the milestone is achieved.

The Company excludes the milestone payments and royalties in the initial transaction price calculation because such payments are considered to be variable considerations with constraint. Such milestone payments and royalties will be recognized as revenue once the Company can conclude it is probable that a significant revenue reversal will not occur in future periods.

The clinical and regulatory milestones under the License Agreement after the point at which the Company could opt out are considered to be variable considerations with constraint due to the fact that active participation in the development activities that generate the milestones is not required under the License Agreement, and the Company can opt out of these activities. There are no refunds or claw-back provisions and the milestones are uncertain of occurrence even after the Company has opted out. Based on this determination, these milestones will be recognized when the Company can conclude it is probable that a significant revenue reversal will not occur in future periods.

Collaboration Agreement with Bristol Myers Squibb

Overview

On March 20, 2018, the Company, through its wholly owned subsidiary Prothena Biosciences Limited (“PBL”), entered into a Master Collaboration Agreement (the “Collaboration Agreement”) with Celgene Switzerland LLC (“Celgene”), a subsidiary of Celgene Corporation (which was acquired by Bristol Myers Squibb (“BMS”) in November 2019), pursuant to which Prothena granted to Celgene a right to elect in its sole discretion to exclusively license rights both in the U.S. (the “US Rights”) and on a global basis (the “Global Rights”), with respect to the Company’s programs to develop and commercialize antibodies targeting tau, TDP-43 and an undisclosed target (the “Collaboration Targets”).

The Collaboration Agreement provided for Celgene making an upfront payment to the Company of $100.0 million, plus future potential license exercise payments and regulatory and commercial milestones for each program under the Collaboration Agreement, as well as royalties on net sales of any resulting marketed products. In connection with the Collaboration Agreement, the Company and Celgene entered into a Share Subscription Agreement on March 20, 2018, under which Celgene subscribed to 1,174,536 of the Company’s ordinary shares for a price of $42.57 per share, for a total of approximately $50.0 million.

BMS US and Global Rights and Licenses

On a program-by-program basis, beginning on the effective date of the Collaboration Agreement and ending on the date that the IND Option term expires for such program (which generally occurs sixty days after the date on which the Company delivers to BMS the first complete data package for an IND that was filed for a lead candidate from the relevant program), BMS may elect in its sole discretion to exercise its US Rights to receive an exclusive license to develop, manufacture and commercialize antibodies targeting the applicable Collaboration Target in the U.S. (the “US License”). If BMS exercises its US Rights for a collaboration program, it is obligated to pay the Company an exercise fee of approximately $80.0 million per program. Thereafter, following the first to occur of (a) completion by the Company, in its discretion and at its cost, of Phase 1 clinical trials for such program or (b) BMS’ election to assume responsibility to complete such Phase 1 clinical trials (at its cost), BMS would have the sole right to develop, manufacture and commercialize antibody products targeting the relevant Collaboration Target for such program (the “Collaboration Products”) in the U.S.

On a program-by-program basis, following completion of a Phase 1 clinical trial for a collaboration program for which BMS has previously exercised its US Rights, BMS may elect in its sole discretion to exercise its Global Rights with respect to such collaboration program to receive a worldwide, exclusive license to develop, manufacture and commercialize antibodies targeting the applicable Collaboration Target (the “Global License”). If BMS exercises its Global Rights, BMS would be obligated to pay the Company an additional exercise fee of $55.0 million for such collaboration program. The Global Rights would then replace the US Rights for that collaboration program, and BMS would have decision making authority over developing, obtaining and maintaining regulatory approval for, manufacturing and commercializing the Collaboration Products worldwide.

After BMS’ exercise of Global Rights for a collaboration program, the Company is eligible to receive up to $562.5 million in regulatory and commercial milestones per program. Following an exercise by BMS of either US Rights or Global Rights for such collaboration program, the Company will also be eligible to receive tiered royalties on net sales of Collaboration Products ranging from high single digit to high teen percentages, on a weighted average basis depending on the achievement of certain net sales thresholds. Such exercise fees, milestones and royalty payments are subject to certain reductions as specified in the Collaboration Agreement, the agreement for US Rights and the agreement for Global Rights.

BMS will continue to pay royalties on a Collaboration Product-by-Collaboration Product and country-by-country basis, until the latest of (i) expiration of certain patents covering the Collaboration Product, (ii) expiration of all regulatory exclusivity for the Collaboration Product, and (iii) an agreed period of time after the first commercial sale of the Collaboration Product in the applicable country (the “Royalty Term”).

Term

The term of the Collaboration Agreement expired on May 24, 2024.

The term of any US License or Global License would continue on a Licensed Product-by-Licensed Product and country-by-country basis until the expiration of all Royalty Terms under such agreement.

Performance Obligations

The Company assessed the Collaboration Agreement and concluded that it represented a contract with a customer within the scope of ASC 606. Per ASC 606, a performance obligation is defined as a promise to transfer a good or service or a series of distinct goods or services. At inception of the Collaboration Agreement, the Company is not obligated to transfer any US License or Global License to BMS unless BMS exercises its US Rights or Global Rights, respectively, and the Company is not obligated to perform development activities under the development plan during preclinical and Phase 1 clinical trials including the regulatory filing of the IND.

The discovery, preclinical and clinical development activities performed by the Company are to be performed at the Company’s discretion and are not promised goods or services and therefore are not considered performance obligations under ASC 606, unless and until the Company agrees to perform the Phase 1 clinical trials (after the IND option exercise) that are determined to be performance obligations at the time the option is exercised. Per the terms of the Collaboration Agreement, the Company may conduct discovery activities to characterize, identify and generate antibodies to become collaboration candidates that target such Collaboration Target, and thereafter may pre-clinically develop collaboration candidates to identify lead candidates that target such Collaboration Target and file an IND with the U.S. Food and Drug Administration (the “FDA”) for a Phase 1 clinical trial for such lead candidates. In the event the Company agrees to be involved in a Phase 1 clinical trial, the Company will further evaluate whether any such promise represents a performance obligation at the time the option is exercised. If it is concluded that the Company has obligated itself to an additional performance obligation besides the license granted at IND option exercise, then the effects of the changes in the arrangement will be evaluated under the modification guidance of ASC 606.

The Company is not obligated to perform manufacturing activities. Per the terms of the Collaboration Agreement, to the extent that the Company, at its discretion, conducts a program, the Company shall be responsible for the manufacture of collaboration candidates and collaboration products for use in such program, as well as the associated costs. Delivery of manufactured compound (clinical product supply) is not deemed a performance obligation under ASC 606 as the Company is not obligated to transfer supply of collaboration product to BMS unless BMS exercises its right to participate in the Phase 1 development.

Compensation for the Company’s provision of inventory supply, to the extent requested by BMS would be paid to the Company by BMS at a reasonable stand-alone selling price for such supply. Given that (i) there is substantial uncertainty about the development of the programs, (ii) the pricing for the inventory is at its standalone selling price and (iii) the manufacturing services require the entity to transfer additional goods or services that are incremental to the goods and services provided prior to the resolution of the contingency, the Company’s supply of product is not a material right. Therefore, the inventory supply is not considered a performance obligation unless and until, requested by BMS.

In addition to the grant of the US License after BMS exercises its US Rights for a program, BMS would be entitled to receive certain ancillary development services from the Company, such as technology transfer assistance, regulatory support, safety data reporting activities and transition supply, if requested by BMS.

In addition to the grant of the Global License after BMS exercises the Global Rights for a program, BMS is entitled to receive certain ancillary development services from the Company, such as ongoing clinical trial support upon request by BMS, transition supply, if requested by BMS, and regulatory support for coordination of pharmacovigilance matters.

The Company evaluated the potential obligations to transfer the US Licenses and Global Licenses and performance of the ancillary development services subsequent to exercise of the US Rights and Global Rights, if the options are exercised by BMS, under ASC 606-10-55-42 and 55-43 to determine whether the US Rights or the Global Rights provided BMS a “material right” and concluded that BMS’ options to exercise its US Rights and Global Rights represented “material rights” to BMS that it would not have received without entering into the Collaboration Agreement.

At inception of the Collaboration Agreement, there were a total of six options, including US Rights and Global Rights to acquire a US License and a Global License, respectively, and rights to request certain development services (following exercise of the US Rights and Global Rights, respectively) for each of the three programs. None of which were remaining as of May 24, 2024. The deferred revenue balance as of September 30, 2024 of $14.4 million is related to the outstanding PRX019 Phase 1 Clinical Trial Obligation (“PRX019 Phase 1 Clinical Trial Obligation”). Per ASC 606, the US Rights and Global Rights are material rights and therefore are performance obligations. The goods and services underlying the options are not accounted for as separate performance obligations, but rather become performance obligations, if and when, an option is exercised.

US License Agreement for the Tau/BMS-986446 Collaboration Target

BMS exercised its US Rights for the tau/BMS-986446 (formerly PRX005) Collaboration Target and on July 30, 2021, PBL entered into a U.S. License Agreement granting BMS an exclusive license to develop, manufacture and commercialize tau Collaboration Products in the United States targeting tau (the “Tau US License Agreement”). The Company received an associated option exercise fee of $80.0 million.

The Tau US License Agreement included the following distinct performance obligations: (1) the delivery of the US License for tau/BMS-986446 Collaboration Target (“Tau US License Obligation”); and (2) the Company’s obligation to provide development activities under the development plan during any Phase 1 clinical trials (the “Tau US Development Services Obligation”). Revenue allocated to the Tau US License Obligation was recognized when the Company satisfied its obligation at a point in time, while the revenue allocated to the Tau US Development Services Obligation was recognized over time using an input-based model. All performance obligations have been delivered.

Global License Agreement for the Tau/BMS-986446 Collaboration Target

Subsequently, BMS exercised its Global Rights for the tau/BMS-986446 Collaboration Target and on July 5, 2023, PBL entered into a Global License Agreement granting BMS an exclusive license to develop, manufacture and commercialize tau Collaboration Products globally for any and all uses or purposes with respect to any human or animal disease, disorder or condition (the “Tau Global License Agreement”). The Tau Global License Agreement supersedes and replaces the Tau US License Agreement in its entirety. The Company received an associated option exercise fee of $55.0 million in August 2023 and it is eligible to receive regulatory and sales milestones up to $562.5 million upon achievement of certain events, including regulatory approval of a tau Collaboration Product, and on BMS achieving certain annual, worldwide net sales thresholds. The Company also is eligible to receive tiered royalties on net sales of tau Collaboration Products, ranging from high single digit to high teen percentages, on a weighted average basis depending on the achievement of certain net sales thresholds.

The Company’s distinct performance obligation under the Tau Global License Agreement was limited to the delivery of the Global License for tau/BMS-986446 Collaboration Target (“Tau Global License Obligation”). Revenue allocated to the Tau Global License Obligation was recognized by the Company at the time that the license was delivered in July 2023.

Global License Agreement for the undisclosed/PRX019 Collaboration Target

On May 24, 2024, PBL entered into a Global License Agreement granting BMS an exclusive license to develop, manufacture and commercialize Collaboration Products targeting an undisclosed target (including PRX019) globally for any and all uses or purposes with respect to any human or animal disease, disorder or condition (the “PRX019 Global License Agreement”). The Company received an associated option exercise fee of $80.0 million in June 2024 and is eligible to receive further development and regulatory milestones of up to $242.5 million upon achievement of certain development and regulatory milestones, including regulatory approval, of a Collaboration Product, and up to $375.0 million upon BMS achieving certain annual, worldwide net sales thresholds. The Company also is eligible to receive tiered royalties on annual, worldwide net sales of Collaboration Products, ranging from high single digit to high teen percentages, on a weighted average basis depending on the achievement of certain net sales thresholds. Such milestones and royalty payments (i) could be reduced in the case where BMS is successful in developing a modified version of PRX019 that achieves certain specified improved metrics, and (ii) are subject to certain reductions as specified in the PRX019 Global License Agreement.

The PRX019 Global License Agreement included the following distinct performance obligations: (1) the delivery of the Global License for the undisclosed Collaboration Target (“PRX019 Global License Obligation”); and (2) the Company’s obligation to run a Phase 1 clinical trial for PRX019. Pursuant to the terms of the PRX019 Global License Agreement, BMS may elect to assume responsibility for completing such Phase 1 clinical trial (at its cost). Revenue allocated to the PRX019 Global License Obligation was recognized when the Company satisfied its obligation at a point in time, while the revenue allocated to the PRX019 Phase 1 Clinical Trial Obligation is recognized over time using an input-based model.

Transaction Price

At inception of the Collaboration Agreement, the Company did not transfer any goods or services to BMS that were material. Accordingly, the Company concluded that the initial transaction price would be recognized as a contract liability and would be deferred until the Company transfers control of goods or services to BMS (which would be when BMS exercises the US Right or Global Right and receives control of the US License or Global License for at least one of the programs), or when the IND Option term expires if BMS had not yet exercised the US Right, or when the Phase 1 Option term expires if BMS had not yet exercised the Global Right, or at the termination of the Collaboration Agreement, whichever occurs first. At such point that the Company transfers control of goods or services to BMS, or when the option expires, the Company would recognize

revenue as a continuation of the original contract. Under this approach, the Company would treat the consideration allocated to the material right as an addition to the consideration for the goods or services underlying the contract option.

At inception of the Collaboration Agreement, the Company estimated the standalone selling price for each performance obligation (i.e., the US Rights and Global Rights by program). The estimate of standalone selling price for the US Rights and Global Rights by program was based on the adjusted market assessment approach using a discounted cash flow model. The key assumptions used in the discounted cash flow model included the market opportunity for commercialization of each program in the U.S. or globally depending on the license, the probability of successfully developing and commercializing a given program target, the estimated remaining development costs for the respective program, the estimated time to commercialization of the drug for that program, and a discount rate.

The initial transaction price under the Collaboration Agreement, pursuant to ASC 606, was $110.2 million, including the $100.0 million upfront payment and $10.2 million premium on the ordinary shares purchased under the SSA. The Company allocated the initial transaction price across the US Rights and Global Rights for each program in a range of approximately $15-$25 million and $10-$18 million, respectively.

The Company did not include the option fees in the initial transaction price because such fees are contingent on the options to the US Rights and the Global Rights being exercised. Upon the exercise of the US Rights and the Global Rights for a program, the Company would have the obligation to deliver the US License and Global License and provide certain ancillary development services if requested by BMS, subsequent to its exercise of the US Rights and Global Rights, respectively, for such program. The Company would include the option fees in the transaction price at the point in time a material right is exercised and the Company transfers control of the goods and services to BMS. In addition, the Company did not include in the initial transaction price certain clinical and regulatory milestone payments since they relate to licenses for which BMS had not yet exercised its option to obtain and these variable considerations are constrained due to the likelihood of a significant revenue reversal.

Upon entering into the Tau Global License Agreement, the Company granted BMS a Global License for the tau/BMS-986446 Collaboration Target, which transferred control of such underlying Global License to BMS. Following execution of the Tau Global License Agreement, BMS paid the Company a $55.0 million option exercise fee. Under the continuation of the original contract method, the Company computed the relative sales price after the Company transferred control of the Global License for tau/BMS-986446. The Company used the original allocated consideration for the Global Right for tau/BMS-986446 of $17.9 million (computed at the inception of the contract) plus the $55.0 million option exercise fee to arrive at the total transaction price of approximately $72.9 million. Given that the Company’s distinct performance obligation under the Tau Global License Agreement was limited to the Tau Global License Obligation no further allocation was required.

Upon entering into the PRX019 Global License Agreement, the Company granted BMS a Global License for the undisclosed/PRX019 Collaboration Target, which transferred control of such underlying Global License to BMS. Following execution of the PRX019 Global License Agreement, BMS paid the Company an $80.0 million option exercise fee. As the original contract contemplated a US and Global payment for $80.0 million and $55.0 million, respectively, and a new payment structure and only one license was agreed to, accordingly, we accounted for the payment under modification accounting. The Company concluded that the modification would be accounted for on a prospective basis as a termination of the existing contract and creation of a new contract. The Company computed the relative sales price for the identified remaining performance obligations consisting of the Global License for PRX019 and the PRX019 Phase 1 Clinical Trial Obligation. The transaction price consisted of the original allocated consideration for the US Right for PRX019 of $24.9 million, and original allocated consideration for the Global Right for PRX019 of $17.4 million (both computed at the inception of the Collaboration Agreement) plus the $80.0 million option exercise fee to arrive at the total transaction price of approximately $122.4 million. This total transaction price was allocated using the relative sales price method between the PRX019 Global License Obligation and the PRX019 Phase 1 Clinical Trial Obligation.

The best estimate of selling price for the Global License for PRX019 was based on a discounted cash flow model. The key assumptions used in the discounted cash flow model used to determine the best estimate of selling price for the license included the market opportunity for commercialization of PRX019, the probability of successfully developing/commercializing PRX019, the remaining development costs for PRX019, and the estimated time to commercialization of PRX019 using a discount rate of 13%. Based on the relative selling price method, the amount that the Company allocated to the performance obligations was as follows: $106.3 million to the license to be recognized concurrent with the delivery of the license; and $16.1 million as development services for the Phase 1 clinical trial to be recognized based on input-based model over the service period.

Significant Payment Terms

The upfront payment of $100.0 million was received in April 2018, while all option fees and milestone payments are due within 30 days after the achievement of the relevant milestone by BMS or receipt by BMS of an invoice for such an amount from the Company.

The Collaboration Agreement does not have a significant financing component since a substantial amount of consideration promised by BMS to the Company is variable and the amount of such variable consideration varies based upon the occurrence or non-occurrence of future events that are not within the control of either BMS or the Company. Variable considerations related to clinical and regulatory milestone payments and option fees are constrained due to the likelihood of a significant revenue reversal.

Revenue and Expense Recognition

For the three and nine months ended September 30, 2024, collaboration revenue from BMS was $1.0 million and $133.0 million, respectively, and for the three and nine months ended September 30, 2023, $84.9 million and $91.0 million, respectively. Collaboration revenue for the three months ended September 30, 2024 was related to PRX019 Phase 1 Clinical Trial Obligation performed while collaboration revenue for the nine months ended September 30, 2024 included recognition of $107.9 million for the transfer of the PRX019 Global License and partial performance of the PRX019 Phase 1 Clinical Trial Obligation. In addition, the material rights for the US Rights and Global Rights for the TDP-43 Collaboration Target of $14.6 million and $10.4 million, respectively, expired unexercised on May 24, 2024 as a result of the expiration of the research term of the Collaboration Agreement. Accordingly, $25.0 million of deferred revenue was recognized as revenue on May 24, 2024. As of September 30, 2024, the aggregate amount of the transaction price allocated to the performance obligations that are unsatisfied was $14.4 million. The Company had nil and $5.2 million accounts receivable from BMS at September 30, 2024, and December 31, 2023, respectively.

Deferred Revenue

The deferred revenue balance at the beginning of the quarter ended September 30, 2024 was $15.4 million. During the three months ended September 30, 2024, $1.0 million was recognized as collaboration revenue related to the PRX019 Phase 1 Clinical Trial Obligation performed. As of September 30, 2024, the total deferred revenue balance of $14.4 million relates to outstanding performance obligations related to the PRX019 Phase 1 Clinical Trial Obligation of which $8.8 million, and $5.6 million remained in current and non-current deferred revenue, respectively. The deferred revenue balance will be recognized as revenue over the remaining service period.

Milestone and Royalties Accounting

Under the Tau Global License Agreement, the Company is eligible to receive milestone payments of up to $187.5 million upon the achievement of certain specified regulatory milestones and milestone payments of up $375.0 million upon the achievement of certain specified commercial sale milestones. Under the PRX019 Global License Agreement, the Company is eligible to receive milestone payments of up to $242.5 million upon the achievement of certain specified development and regulatory milestones and milestone payments of up $375.0 million upon BMS achieving certain annual, worldwide net sales thresholds. Milestone payments are evaluated under ASC Topic 606. Factors considered in this determination included scientific and regulatory risk that must be overcome to achieve each milestone, the level of effort and investment required to achieve the milestone, and the monetary value attributed to the milestone. Accordingly, the Company estimates payments in the transaction price based on the most likely approach, which considers the single most likely amount in a range of possible amounts related to the achievement of these milestones. Additionally, milestone payments are included in the transaction price only when the Company can conclude it is probable that a significant revenue reversal will not occur in future periods.

The Company excluded the milestone payments and royalties in the initial transaction price because such payments are considered to be variable considerations with constraint. Such milestone payments and royalties will be recognized as revenue at a point in time when the Company can conclude it is probable that a significant revenue reversal will not occur in future periods.

The Company did not achieve any clinical and regulatory milestones under the Collaboration Agreement during the three and nine months ended September 30, 2024 and 2023.

Novo Nordisk Share Purchase Agreement

On July 8, 2021, the Company together with its wholly owned subsidiary, PBL, entered into a definitive share purchase agreement with Novo Nordisk A/S and Novo Nordisk Region Europe A/S (each an unrelated party). Under the terms of such agreement, Novo Nordisk acquired PBL’s wholly-owned subsidiary, Neotope Neuroscience Limited (“NNL”) and gained full worldwide rights to the intellectual property and related rights to the Company’s ATTR amyloidosis business and pipeline. Upon consummation of the transaction, NNL ceased to be a related party of PBL. The aggregate purchase price consisted of an upfront payment of $60.0 million in cash, subject to customary purchase price adjustments.

Should Novo Nordisk achieve certain stages of development or commercialization for products or product candidates containing coramitug (formerly PRX004) or a derivative thereof in ATTR amyloidosis, PBL is entitled to receive certain milestone payments based on specified development and commercial milestones. The development and commercialization milestone payments will be discounted if the milestone events are achieved with respect to other indications. Should Novo Nordisk achieve specified thresholds of worldwide, annual net sales of the milestone products, regardless of indication, PBL will also be entitled to receive specified one-time net sales milestone payments. All milestone payments attributable to an achieved milestone will be paid to PBL, subject to Novo Nordisk’s offset right for indemnity claims or unpaid amounts in respect of any purchase price adjustment.

The upfront payment of $60.0 million was accounted for as revenue in 2021. In addition to the upfront payment, Novo Nordisk agreed to pay for certain out of pocket expenses under the Transition Services Agreement, which netted to $0.7 million after closing adjustments related to the sale of the ATTR amyloidosis business and pipeline.

Contingent Consideration/Milestone Accounting

In December 2022, the Company received a $40.0 million development milestone payment related to the continued advancement of coramitug in a Phase 2 clinical trial for the treatment of ATTR amyloidosis with cardiomyopathy. This amount was accounted for as revenue from license and intellectual property in 2022.

The Company is eligible to receive additional development and sales milestone payments from Novo Nordisk totaling up to $1.13 billion upon achievement of certain specified development and commercial sales milestones under the share purchase agreement.

The Company excluded the milestone payments in the initial transaction price because such payments are considered to be variable considerations with constraint. Such milestone payments will be recognized as revenue at a point in time when the Company can conclude it is probable that a significant revenue reversal will not occur in future periods.

Revenue Recognition

No revenue was recognized related to the transaction during the three and nine months ended September 30, 2024 and 2023, respectively. The Company had no accounts receivable from Novo Nordisk as of September 30, 2024 and December 31, 2023, respectively.

8. Shareholders' Equity

Ordinary Shares

As of September 30, 2024, the Company had 100,000,000 ordinary shares authorized for issuance with a par value of $0.01 per ordinary share and 53,808,732 ordinary shares issued and outstanding. Each ordinary share is entitled to one vote and, on a pro rata basis, to dividends when declared and the remaining assets of the Company in the event of a winding up.

Euro Deferred Shares

As of September 30, 2024, the Company had 10,000 Euro Deferred Shares authorized for issuance with a nominal value of €22 per share. No Euro Deferred Shares are outstanding at September 30, 2024. The rights and restrictions attaching to the Euro Deferred Shares rank pari passu with the ordinary shares and are treated as a single class in all respects.

December 2022 Offering

In December 2022, the Company completed an underwritten public offering of an aggregate of 3,250,000 of its ordinary shares at a public offering price of $56.50 per ordinary share. The Company received aggregate net proceeds of approximately $172.4 million, after deducting the underwriting discount and offering costs.

In January 2023, the Company issued an additional 395,096 ordinary shares resulting from the underwriters’ partial exercise of their 30-day option to purchase up to an additional 487,500 ordinary shares of as part of the December 2022 underwritten public offering. The Company received approximately $20.9 million proceeds from the exercise, net of underwriting discount but before deducting any offering costs.

At-the-Market Offerings

In December 2021, the Company entered into an Equity Distribution Agreement (the “December 2021 Distribution Agreement”), pursuant to which the Company could issue and sell, from time to time, the Company's ordinary shares. In connection with entering into the December 2021 Distribution Agreement, on December 23, 2021, the Company filed with the SEC a prospectus supplement relating to the offer, issuance and sale of up to $250.0 million of the Company’s ordinary shares (the “December 2021 Prospectus”) pursuant to the December 2021 Distribution Agreement.

For the three and nine months ended September 30, 2023, the Company sold and issued nil and 42,361 ordinary shares, respectively, pursuant to the December 2021 Distribution Agreement under the December 2021 Prospectus. For the nine months ended September 30, 2023, total gross proceeds were approximately $3.2 million before deducting underwriting discounts, commissions, and other offering expenses payable by the Company of $0.1 million.

The December 2021 Prospectus was no longer effective as of March 23, 2024. As of March 23, 2024, the Company had sold and issued 953,589 ordinary shares pursuant to the December 2021 Distribution Agreement under the December 2021 Prospectus for total gross proceeds of approximately $56.3 million before deducting underwriting discounts, commissions, and other offering expenses payable by the Company of $1.8 million.

In February 2024, the Company amended the Equity Distribution Agreement that it entered into in December 2021 (the “Amended Distribution Agreement”), pursuant to which the Company may issue and sell, from time to time, the Company's ordinary shares. In connection with amending the Amended Distribution Agreement, on February 22, 2024, the Company filed with the SEC a prospectus relating to the offer, issuance, and sale of up to $250.0 million of the Company’s ordinary shares (the “February 2024 Prospectus”) pursuant to the Amended Distribution Agreement. For the three and nine months ended September 30, 2024, the Company sold and issued no ordinary shares pursuant to the Amended Distribution Agreement under the February 2024 Prospectus.

The issuance and sale of the Company’s ordinary shares pursuant to the December 2021 Distribution Agreement and the Amended Distribution Agreement is deemed an “at-the-market” offering and is registered under the Securities Act of 1933, as amended.

9. Share-Based Compensation

Equity Incentive Plans

The Company’s equity incentive plans, the 2018 Long Term Incentive Plan, as amended (the “2018 LTIP”), 2020 Employment Inducement Incentive Plan, as amended (the “2020 EIIP”), and previously, the Amended and Restated 2012 Long Term Incentive Plan (the “2012 LTIP”), reserve ordinary shares for the issuance of stock options, stock appreciation rights, restricted shares, RSUs, performance bonus awards, performance share units awards, dividend equivalents and other share or cash-based awards to eligible individuals. Options granted under each of the 2018 LTIP, 2020 EIIP, and 2012 LTIP expire no later than ten years from the date of grant.

In May 2024, the Company’s shareholders approved an amendment to the 2018 LTIP to increase the number of ordinary shares available for issuance under the 2018 LTIP by 2,000,000 ordinary shares. As of September 30, 2024, the number of ordinary shares authorized under the 2018 LTIP was 16,620,433. Upon adoption of the 2018 LTIP, no new awards are permitted under the 2012 LTIP.

As of September 30, 2024, the number of ordinary shares authorized under the 2020 EIIP was 1,485,000 and 186,043 ordinary shares remained available for future awards under the 2020 EIIP. The Company’s Board of Directors has adopted a series of amendments to increase the ordinary shares available for issuance under the 2020 EIIP and it reserves the right to both amend the 2020 EIIP to increase the number of ordinary shares available and make additional awards to key new hires.

The Company’s option awards generally vest over four years, while RSUs vest over two years. As of September 30, 2024, 4,029,431 ordinary shares remained available for grant under its equity plans.

Share-based Compensation Expense

Share-based compensation expense recorded in these Condensed Consolidated Financial Statements was based on awards granted under the 2012 LTIP, the 2018 LTIP, and the 2020 EIIP. The estimated forfeiture rate as of September 30, 2024 was 7%. Changes in our estimates and assumptions relating to forfeitures may cause us to realize material changes in stock-based compensation expense in the future.

The amount of unearned share-based compensation related to unvested stock options at September 30, 2024, is $84.9 million. The weighted-average period over which this unearned share-based compensation is expected to be recognized is 2.66 years.

The following table summarizes share-based compensation expense for the periods presented (in thousands):


	Three Months Ended September 30,				Nine Months Ended September 30,
	2024		2023		2024		2023
Research and development	$	5,128	$	4,948	$	16,217	$	14,178
General and administrative	5,892		5,996		19,227		15,656
Total share-based compensation expense	$	11,020	$	10,944	$	35,444	$	29,834

The Company recognized tax benefits from share-based awards of $2.0 million and $1.9 million for the three months ended September 30, 2024 and 2023, respectively, and $6.3 million and $5.3 million for the nine months ended September 30, 2024 and 2023, respectively.

The fair value of the options granted to employees and non-employee directors during the three months ended September 30, 2023 and nine months ended September 30, 2024 and 2023 was estimated as of the grant date using the Black-Scholes option-pricing model using the key assumptions listed in the following table. There were no stock options granted during the three months ended September 30, 2024, thus no key assumptions are shown in the table below.


	Three Months Ended September 30,					Nine Months Ended September 30,
	2023					2024				2023
Expected term (in years)	4.42		-	4.42		4.60		-	5.56	4.38		-	5.40
Expected volatility	76.8	%	-	76.8	%	74.5	%	-	78.6%	76.4	%	-	90.1%
Risk-free interest rate	4.3	%	-	4.4	%	3.8	%	-	4.7%	3.5	%	-	4.4%
Expected dividend yield	—%					—%				—%
Weighted average grant date fair value	$40.83					$19.21				$37.67

The fair value of employee stock options is amortized on a straight-line basis over the requisite service period for each award. Each of the inputs discussed above is subjective and generally requires management judgment to determine.

The following table summarizes the Company’s stock option activity during the nine months ended September 30, 2024:


	Options	Weighted Average Exercise Price		Weighted Average Remaining Contractual Term (years)	Aggregate Intrinsic Value (in thousands)
Outstanding at December 31, 2023	9,866,337	$	29.06	6.60	$	118,447
Granted	2,156,450	29.45
Exercised	(125,615)	15.19
Forfeited	(470,719)	36.14
Expired	(129,710)	30.92
Outstanding at September 30, 2024	11,296,743	$	28.97	6.25	$	11,170
Vested and expected to vest at September 30, 2024	10,968,503	$	28.74	6.16	$	11,169
Vested at September 30, 2024	7,521,340	$	24.85	5.00	$	11,125

The total intrinsic value of options exercised was $0.3 million and $5.7 million during the three months ended September 30, 2024 and 2023 respectively, and $1.3 million and $51.1 million during the nine months ended September 30, 2024 and 2023, respectively, determined as of the date of exercise.

The following table summarizes the activity and related information for RSUs during the nine months ended September 30, 2024:


	Number of Units	Weighted Average Grant-Date Fair Value	Weighted Average Remaining Contractual Term (years)	Aggregate Intrinsic Value (in thousands)
Unvested at December 31, 2023	25,250	$58.01	1.09	$918
Units Granted	—	—
Units Vested	(1,000)	68.71
Units Forfeited	—	—
Unvested at September 30, 2024	24,250	$57.57	0.37	$406
Unvested and expected to vest at September 30, 2024	23,620	$57.71	0.36	$395

The fair value of RSUs was determined on the date of grant based on the market price of the Company’s ordinary shares as of that date. The fair value of the RSUs is recognized as an expense on a straight-line basis over the vesting period of each RSU. Upon the vesting of the RSUs, a portion of the shares vested are sold by the employee to satisfy employee withholding tax requirements (sell-to-cover). As of September 30, 2024, total compensation cost not yet recognized related to unvested RSUs was $0.3 million, which is expected to be recognized over a weighted-average period of 0.41 years. RSUs settle into ordinary shares upon vesting.

10. Income Taxes

The major taxing jurisdictions for the Company are Ireland and the U.S. The Company recorded an income tax benefit of $0.8 million and $5.1 million for the three and nine months ended September 30, 2024, as compared to $3.1 million and $10.3 million for the three and nine months ended September 30, 2023, respectively. The provision for income taxes differs from the statutory tax rate of 12.5% applicable to Ireland primarily due to Irish net operating losses for which a tax provision benefit is not recognized, U.S. income taxed at different rates, adjustments to deferred tax assets for the deductibility of stock compensation and capitalization of research and development costs.

The Company has generally computed its interim period provision for (benefit from) income taxes by applying its forecasted effective tax rate to year-to-date earnings. However, due to a significant amount of U.S. permanent differences relative to the amount of U.S. forecasted income used in computing the effective tax rate, the effective tax rate is highly sensitive to minor fluctuations in U.S. forecasted income. As such, the Company has computed the U.S. component of the consolidated provision for (benefit from) income taxes for the three and nine months ended September 30, 2024, using an actual year-to-date tax calculation.

The non-U.S. tax expense continues to be zero due to cumulative historic and year-to-date losses and a full valuation allowance on our deferred tax assets in our non-U.S. jurisdictions.

Deferred income taxes reflect the net tax effect of temporary differences between the carrying amount of assets and liabilities for financial reporting purposes and the amounts used for income tax purposes. The Company's deferred tax assets (“DTA”) are composed primarily of its Irish subsidiaries' net operating loss carryforwards, California net operating loss carryforwards available to reduce future taxable income of the Company's U.S. subsidiaries, federal and California tax credit carryforwards, share-based compensation, capitalized R&D, and other temporary differences. The Company maintains a valuation allowance against certain U.S. federal and state and Irish deferred tax assets. Each reporting period, the Company evaluates the need for a valuation allowance on its deferred tax assets by jurisdiction.

No provision for income tax in Ireland has been recognized on undistributed earnings of the Company’s U.S. subsidiaries as the Company considers the U.S. earnings to be indefinitely reinvested.

The Company is subject to reviews and audits by the U.S. Internal Revenue Service (“IRS”), the Irish Revenue Commissioners, and other taxing authorities from time to time. The Company’s U.S. subsidiaries are currently under examination by the IRS for tax year 2021. The Company periodically reviews its uncertain tax positions. The Company’s assessment is based on many factors, including any ongoing IRS audits. For the three and nine months ended September 30, 2024, the Company’s assessment did not result in a material change in unrecognized tax benefits.

ITEM 2. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

In addition to historical information, this Quarterly Report on Form 10-Q contains forward-looking statements which may cause our actual results to differ materially from expectations, plans and anticipated results discussed in forward-looking statements. Factors that could cause our actual results to differ materially include, but are not limited to, the risks and uncertainties set forth in the “Summary of Risks Affecting Our Business” at the beginning of this Quarterly Report on Form 10-Q, Part II Item 1A “Risk Factors” of this Quarterly Report on Form 10-Q, and in our other filings with the U.S. Securities and Exchange Commission.

This discussion should be read in conjunction with the Condensed Consolidated Financial Statements and Notes presented in this Quarterly Report on Form 10-Q and the Consolidated Financial Statements and Notes contained in our Annual Report on Form 10-K filed with the SEC on February 22, 2024 (the “2023 Form 10-K”).

Overview

Prothena is a late-stage clinical biotechnology company with expertise in protein dysregulation and a pipeline of investigational therapeutics with the potential to change the course of devastating neurodegenerative and rare peripheral amyloid diseases.

Fueled by our deep scientific expertise built over decades of research, we are advancing a pipeline of therapeutic candidates for a number of indications and novel targets for which our ability to integrate scientific insights around neurological dysfunction and the biology of misfolded proteins can be leveraged. Our wholly-owned programs include birtamimab for the potential treatment of AL amyloidosis, and a portfolio of programs for the potential treatment of Alzheimer’s disease including PRX012, which targets amyloid beta (“Aβ”), and PRX123, a novel dual Aβ-tau vaccine. Our partnered programs include prasinezumab for the potential treatment of Parkinson’s disease and other related synucleinopathies that targets alpha-synuclein in collaboration with Roche. In addition, we have partnered BMS-986446 (formerly PRX005) for the potential treatment for Alzheimer’s disease that targets tau and PRX019 for the potential treatment of neurodegenerative diseases with an undisclosed target in two separate license agreements with Bristol Myers Squibb (“BMS”). We are also entitled to certain potential milestone payments pursuant to our share purchase agreement with Novo Nordisk pertaining to our ATTR amyloidosis business (inclusive of coramitug, formerly PRX004).

We were formed on September 26, 2012, under the laws of Ireland and re-registered as an Irish public limited company on October 25, 2012. Our ordinary shares began trading on The Nasdaq Global Market under the symbol “PRTA” on December 21, 2012, and currently trade on The Nasdaq Global Select Market.

Birtamimab for the Potential Treatment of AL Amyloidosis

Birtamimab is an investigational humanized antibody that targets toxic misfolded light chain that causes organ dysfunction and failure in patients with AL amyloidosis. AL amyloidosis is a rare, progressive, and typically fatal disease where immunoglobulin light chain proteins produced by clonal plasma cells misfold, aggregate, and deposit as amyloid in vital organs. These toxic aggregates and amyloid deposits cause progressive damage and failure of vital organs, including the heart.

Birtamimab binds to both soluble and insoluble amyloid aggregates in multiple organs and promotes the clearance of amyloid deposits via phagocytosis. This anti-amyloid mechanism of action broadly targets misfolded kappa and lambda light chain to clear deposited amyloid that causes organ dysfunction and failure in patients with AL amyloidosis. Birtamimab is the only investigational therapeutic that has demonstrated a significant survival benefit in a randomized clinical trial in patients with Mayo Stage IV AL amyloidosis. Birtamimab has been granted Fast Track Designation by the U.S. Food and Drug Administration (“FDA”) for the treatment of Mayo Stage IV patients with AL amyloidosis to reduce the risk of mortality and has been granted Orphan Drug Designation by both the FDA and European Medicines Agency (“EMA”).

It is estimated that 200,000 to 400,000 patients globally suffer from this rare disease, with approximately 60,000 to 120,000 (or 30%) of those patients being categorized as Mayo Stage IV. Patients categorized at diagnosis as Mayo Stage IV have poor outcomes with current standard-of-care that aims to reduce the production of new protein but does not directly target and clear the toxic amyloid that deposits in organs. There are currently no approved treatments for AL amyloidosis that have demonstrated a survival benefit in a randomized clinical trial, and there is an urgent unmet medical need for therapies that improve survival in patients at risk for early mortality due to amyloid deposition.

Confirmatory Phase 3 AFFIRM-AL Clinical Trial Design under SPA Agreement with FDA

Based on further analyses of data from the VITAL clinical trial and multiple in-depth discussions with the FDA, Prothena announced plans in February 2021, to advance birtamimab into the confirmatory Phase 3 AFFIRM-AL clinical trial in patients with Mayo Stage IV AL amyloidosis. AFFIRM-AL is a registration-enabling Phase 3 clinical trial that is being conducted with a primary endpoint of all-cause mortality at p<0.10 under a Special Protocol Assessment (“SPA”) agreement with the FDA. Patient enrollment is on track in the AFFIRM-AL trial and full topline trial results are expected in the first half of 2025.

AFFIRM-AL is an ongoing global, multi-center, double-blind, placebo-controlled, 2:1 randomized, time-to-event trial expected to enroll up to approximately 220 newly diagnosed, treatment naïve patients with AL amyloidosis categorized as Mayo Stage IV. It has been designed to evaluate the primary endpoint of time to all-cause mortality with a significance level of p<0.10. Secondary endpoints will assess change from baseline to month 9 in functional capacity as measured by 6MWT distance and quality of life as measured by SF-36v2 PCS.

An interim analysis is conducted when approximately 50% of the events have occurred, allowing the independent data monitoring committee to recommend either continuing the trial or stopping early for overwhelming efficacy. Patients will receive 24 mg/kg of birtamimab or placebo by intravenous infusion every 28 days, with all patients receiving concurrent standard of care therapy consisting of a first line bortezomib-containing regimen.

Phase 3 VITAL Clinical Trial Results

In June 2023, we announced that results from the Phase 3 VITAL clinical trial were published in Blood, a journal of the American Society of Hematology (“ASH”). The published data demonstrate that in a post hoc analysis of patients with Mayo Stage IV AL amyloidosis, a statistically significant survival benefit of 74 percent was observed for those treated with birtamimab plus standard of care (“SOC”) versus 49 percent in patients on placebo plus SOC at 9 months (HR 0.413, p=0.021).

The article, entitled “Birtamimab plus standard of care in light chain amyloidosis: the phase 3 randomized placebo-controlled VITAL clinical trial”, also demonstrated that patients with Mayo Stage IV AL amyloidosis treated with birtamimab had statistically significant improvements over placebo in a post hoc assessment of two key secondary endpoints, quality of life (assessed with the Short Form-36 version 2 physical component score, SF-36v2 PCS) and cardiac function (assessed with the 6-minute walk test). Patients treated with birtamimab showed a slower decline in quality of life with a mean decrease of 0.75 in the SF-36v2 PCS at 9 months compared to a mean decrease of 5.40 in the SF-36v2 PCS for patients on placebo at 9 months (a mean difference of 4.65 favoring birtamimab; p=0.046). Patients treated with birtamimab after 9 months demonstrated an increase in mean distance of 15.22 meters in the 6-minute walk test, compared to a decrease in mean distance of 21.15 meters for patients on placebo (a mean difference of 36.37 meters favoring birtamimab; p=0.022).

Prasinezumab for the Potential Treatment of Parkinson’s Disease and Other Synucleinopathies

Prasinezumab is an investigational humanized monoclonal antibody that targets alpha-synuclein, a protein found in neurons that can aggregate and spread from cell to cell, resulting in the neuronal dysfunction and loss that causes Parkinson’s disease and other synucleinopathies. Prasinezumab is the focus of our worldwide collaboration with Roche.

Parkinson’s disease is a progressive degenerative disorder of the central nervous system (“CNS”) that affects approximately one in 100 people over the age of 60, with incidence increasing based on an aging population. With an estimated 10 million people living with Parkinson’s disease worldwide today, it is the most common neurodegenerative movement disorder and fastest growing neurological disorder. The disease is characterized by the neuronal accumulation of aggregated α-synuclein in the CNS and peripheral nervous system that results in a wide spectrum of worsening progressive motor and non-motor symptoms. While diagnosis currently relies on motor symptoms classically associated with Parkinson's disease, non-motor symptoms may present many years earlier. Current treatments for Parkinson’s disease are symptomatic and only address a subset of symptoms such as motor impairment, dementia or psychosis. Symptomatic therapies do not target the underlying cause of the disease and as the disease progresses and dopaminergic neurons continue to be lost, these drugs lose effectiveness, often leading to debilitating side effects as the disease progresses. There are currently no treatments available that target the underlying cause of the disease. Prasinezumab is designed to block the cell-to-cell transmission of the aggregated, pathogenic forms of alpha-synuclein in Parkinson's disease, thereby slowing clinical decline. The goal of our approach is to slow the progressive neurodegenerative consequences of disease, a current unmet need.

Phase 2b PADOVA Clinical Trial

A Phase 2b clinical trial (PADOVA) to further assess the efficacy of prasinezumab in an expanded patient population is being conducted by Roche. PADOVA is a Phase 2b, randomized, double-blind, placebo-controlled, multicenter clinical trial to evaluate the efficacy and safety of prasinezumab in patients with early Parkinson’s disease who are on stable symptomatic (levodopa) medication. The trial has enrolled 586 patients randomized to receive either prasinezumab or placebo via intravenous infusion every 4 weeks. The primary endpoint is time to meaningful progression on motor signs of the disease, as assessed by ≥5 point increase in Movement Disorder Society – Unified Parkinson’s Disease Rating Scale (“MDS-UPDRS”) Part III score from baseline. In the first quarter of 2023, Roche completed enrollment for the Phase 2b PADOVA trial.

Prasinezumab is the first anti-alpha synuclein antibody to advance into late-stage development. In March 2022, results from the analysis of part 2 of the Phase 2 PASADENA trial of prasinezumab were presented in an oral presentation by Roche at the International Conference on Alzheimer’s and Parkinson’s Diseases (“AD/PD 2022”). Results showed that participants with Parkinson’s disease who were treated with prasinezumab for two years (early-start group) showed slower decline of MDS-UPDRS Part III scores relative to participants treated with placebo in the first year and prasinezumab in the second year (delayed-start group), further supporting a potential effect on delaying motor progression in patients. In October 2024, Roche published results in Nature Medicine from the long-term open-label extension of the PASADENA trial, which compared the prasinezumab population with a propensity score-balanced cohort of real-world data (“RWD”) Parkinson’s Progression Markers Initiative (“PPMI”). The data suggests that prasinezumab continued to show reduced motor and functional progression in prazinezumab-treated individuals with early-stage Parkinson’s disease compared to a real-world data arm on MDS-UPDRS Part III score (clinician-rated motor examination) OFF and ON symptomatic medication state and MDS-UPDRS Part II score (patient-reported motor experiences of daily living).

Coramitug (formerly PRX004) for the Potential Treatment of ATTR Amyloidosis

Coramitug is an investigational antibody designed to deplete amyloid associated with disease pathology in hereditary and wild type ATTR amyloidosis, without affecting the native, normal tetrameric form of the protein.

Coramitug’s proposed mechanism of action is to deplete both circulating non-native TTR to prevent further deposition and deposited amyloid to improve organ function. Coramitug has been shown in preclinical studies to inhibit amyloid fibril formation, neutralize soluble aggregate forms of non-native TTR, and promote clearance of insoluble amyloid fibrils through antibody-mediated phagocytosis. This differentiated depleter mechanism of action could be developed as a monotherapy approach to ATTR amyloidosis and might also complement existing therapeutic approaches which either stabilize or reduce production of the native TTR tetramer.

We completed a Phase 1 clinical trial with coramitug in patients with hereditary forms of ATTR amyloidosis, in which coramitug was demonstrated to be safe and well tolerated. In October 2024, these Phase 1 results were published in Amyloid, the official journal of the International Society of Amyloidosis.

ATTR Amyloidosis Business Acquired by Novo Nordisk

In July 2021, we announced that we and Novo Nordisk entered into a definitive purchase agreement under which Novo Nordisk acquired our clinical stage antibody coramitug and broader ATTR amyloidosis business.

Under the terms of the definitive purchase agreement, Novo Nordisk acquired our wholly-owned subsidiary and gained full worldwide rights to the intellectual property and related rights of our ATTR amyloidosis business and pipeline. The aggregate purchase price consists of an upfront payment and development and sales milestone payments totaling up to $1.23 billion. We have earned approximately $100 million to date.

A Phase 2 clinical trial of coramitug in approximately 99 patients with ATTR amyloidosis with cardiomyopathy is being conducted by Novo Nordisk (NCT05442047).

BMS-986446 (formerly PRX005) for the Potential Treatment of Alzheimer’s Disease

BMS-986446 is designed to be a best-in-class anti-tau antibody that specifically binds with high affinity the R1, R2, and R3 repeats within the microtubule binding region (“MTBR”) of tau and targets both 3R and 4R tau isoforms. MTBR-tau has been shown in preclinical studies to be involved in the pathological spread of tau. Neurofibrillary tangles composed of misfolded tau proteins, along with amyloid beta plaques, are pathological hallmarks of Alzheimer’s disease. Cell-to-cell transmission of pathogenic extracellular tau and the accumulation of pathogenic tau also correlate with the progression of symptomatology and clinical decline in patients with Alzheimer’s disease. Recent publications suggest that during the course of Alzheimer’s disease progression, tau appears to spread throughout the brain via synaptically-connected pathways; this propagation of pathology is thought to be mediated by tau “seeds” containing the MTBR of tau. Additionally, it has been recently reported that the presence of MTBR fragments in cerebrospinal fluid correlate with dementia stages and tau tangles in Alzheimer’s disease to a higher degree than fragments of other tau regions. In preclinical research, antibodies targeting this region of tau were superior in blocking tau uptake and neurotoxicity, which has been associated with efficacy in relevant animal models. In these preclinical models, BMS-986446 demonstrated significant reduction of intraneuronal tau pathology and progression protection against behavioral deficit in a tau transgenic mouse model and complete blockade of neuronal tau internalization in vitro.

In July 2021, we entered into an exclusive US license agreement for BMS-986446 and we received an associated option exercise fee of $80 million. In July 2023, we entered into an exclusive global license agreement for BMS-986446, which as discussed above supersedes and replaces the US license agreement in its entirety and we received an associated option exercise fee of $55 million. We are eligible to receive regulatory and sales milestone payments of up to $563 million, as well as tiered royalties on annual, worldwide net sales.

Phase 1 Clinical Trial

In this first-in-human, randomized, placebo controlled, single ascending dose (“SAD”) clinical trial, healthy volunteers (n=19) were enrolled into three BMS-986446 dose level cohorts (low, medium or high dose) and randomized in a 3:1 drug to placebo ratio. Trial participants received a single dose of BMS-986446 or placebo intravenously (“IV”) and were followed for up to two months. The results of the trial found all three dose level cohorts of BMS-986446 to be generally safe and well tolerated, meeting the Phase 1 SAD trial primary objective. None of the treatment emergent adverse events (“TEAE”) were serious. No clinically relevant changes were observed in other safety parameters. BMS-986446 also met key pharmacokinetic (“PK”) and immunogenicity secondary endpoints. Plasma drug concentrations of BMS-986446 increased in a dose-proportional manner. Furthermore, BMS-986446 exposure in cerebrospinal fluid (“CSF”) was measured in the high dose cohort and based on the robust exposure of BMS-986446 in the CSF (day 29 CSF:Plasma ratio=0.2%), substantial target engagement is expected in the CNS. BMS-986446 had a desirable immunogenicity profile with no persistent BMS-986446-induced antidrug antibodies (“ADA”s) observed.

A multiple ascending dose (“MAD”) portion of the Phase 1 clinical trial was ongoing at the time BMS acquired the global rights to the program and control of the Phase 1 trial. All program updates going forward, including results from ongoing and any future BMS-986446 clinical trials, will be reported by BMS.

Phase 2 Clinical Trial

In the first quarter of 2024, BMS advanced the anti-tau program BMS-986446 with the initiation of a Phase 2 clinical trial (NCT06268886). This is a randomized, double-blind, placebo-controlled, global, Phase 2 clinical trial designed to evaluate the efficacy, safety, and tolerability of BMS-986446, an anti-MTBR tau monoclonal antibody, in approximately 475 participants

with early Alzheimer's disease. Participants will be randomized into one of three treatment arms including placebo, BMS-986446 Dose A, and BMS-986446 Dose B. The primary outcome measure is mean change from baseline to week 76 in Clinical Dementia Rating Scale Sum of Boxes (“CDR-SB”).

PRX012 for the Potential Treatment of Alzheimer’s Disease

PRX012 is an investigational antibody that targets Aβ, or amyloid beta, a protein implicated in Alzheimer’s disease. Our scientists have advanced the understanding of the biology of Alzheimer’s disease and made particularly impactful and fundamental discoveries that elucidated the role amyloid plays in the disease.

Monoclonal antibodies targeting key epitopes within the N-terminus of Aβ have demonstrated that reducing amyloid plaque burden is associated with the slowing of clinical decline in Alzheimer’s disease. To address the growing prevalence of Alzheimer’s disease with a therapeutic that can be made widely accessible to patients, we have developed highly potent anti-Aβ antibodies that retain or improve key attributes that are thought to underlie the observed efficacy of N-terminally directed therapeutics such as aducanumab, with the aim of offering similar or improved efficacy with convenient subcutaneous dosing regimens. In preclinical studies, our antibodies demonstrated a higher binding strength to amyloid than aducanumab; specifically, our lead candidate with an approximately 10-fold greater affinity/avidity for fibrillar Aβ than aducanumab that also neutralized soluble, toxic (i.e., oligomeric) Aβ species. Preclinical studies also showed that our antibodies recognize Aβ pathology to a greater extent than aducanumab, demonstrating more extensive plaque area binding at lower antibody concentrations, which are estimated to be clinically relevant exposures in the central nervous system following systemic dosing.

We are advancing our lead candidate, PRX012, as a next-generation approach for subcutaneous administration to i address the unmet need of millions of patients with presymptomatic or early symptomatic Alzheimer's disease. In March 2022, we announced the FDA clearance of the IND for PRX012 and the initiation of a Phase 1 single ascending dose trial to investigate the safety, tolerability, immunogenicity, and pharmacokinetics of PRX012 in both healthy volunteers and patients with Alzheimer’s disease. In April 2022, we announced that the FDA granted Fast Track designation for PRX012 for the treatment of Alzheimer’s disease. The FDA’s Fast Track designation program is designed to expedite the development and review of drugs intended to treat a serious condition, such as Alzheimer’s disease, with evidence demonstrating the potential to address an unmet medical need. In January 2024, we announced that topline Phase 1 data from the single ascending dose trial and the initial multiple dose cohort (70 mg) supports once-monthly subcutaneous treatment and dose escalation. The ongoing Phase 1 trial continues as planned and we expect to report multiple clinical readouts starting in mid-2025 and continuing throughout the year.

PRX123, a Dual Aβ-Tau Vaccine for the Potential Treatment and Prevention of Alzheimer’s Disease

We are developing a dual vaccine, PRX123, which concomitantly targets key epitopes within both the Aβ and tau proteins. Preclinical models suggest that Aβ and tau act synergistically in the development of Alzheimer’s disease; however, the majority of vaccines and passive immunotherapies under development today target only one of these two pathological features.

PRX123 is being developed for the potential prevention and treatment of Alzheimer’s disease. In preclinical studies, PRX123 has generated polyclonal responses against key epitopes within the N-terminal of Aβ and a key region of tau to promote amyloid clearance and blockade of tau transmission. Immunohistochemistry using sera from immunized animals demonstrated an appropriate and balanced immune response with antibodies that react to both Aβ plaques and tau tangles at concentrations expected to be reached in CNS following immunization and resultant titer generation.

In March 2022, we delivered an oral presentation at AD/PD 2022 on preclinical data demonstrating that PRX123 generated anti-Aβ and anti-tau antibodies to enable phagocytosis of Aβ and to neutralize tau. These findings provided proof of concept in multiple preclinical species.

In January 2024, we announced that the FDA has cleared the IND application for PRX123 and granted PRX123 Fast Track designation.

PRX019, for the Potential Treatment of Neurodegenerative Diseases

PRX019 is an investigational antibody for the potential treatment of neurodegenerative diseases in development in collaboration with BMS.

In December 2023, the FDA cleared the IND application for PRX019. In May 2024, we entered into an exclusive global license agreement for PRX019 and we received an associated option exercise fee of $80.0 million. We are eligible to receive

development, regulatory, and sales milestone payments of up to $617.5 million as well as tiered royalties on annual, worldwide net sales.

In November 2024, we announced that we had initiated a Phase 1 first-in-human clinical trial to evaluate the safety, tolerability, immunogenicity, and pharmacokinetics of single ascending and multiple doses in healthy adults.

Our Discovery and Preclinical Programs

We are also advancing several discovery and preclinical-stage programs for neurological diseases with significant unmet medical needs.

If promising, we expect to advance our discovery programs into preclinical development. New target discovery will focus on areas where we can bring potential new therapies to patients expeditiously through our internal expertise and resources. Existing late discovery-stage or preclinical-stage programs may be partnered or out-licensed.

Critical Accounting Policies and Estimates

Management’s discussion and analysis of our financial condition and results of operations is based on our Condensed Consolidated Financial Statements, which have been prepared in accordance with the accounting principles generally accepted in the U.S. (“GAAP”). The preparation of these Condensed Consolidated Financial Statements requires us to make estimates and assumptions for the reported amounts of assets, liabilities, revenues, expenses and related disclosures.

There were no significant changes to our critical accounting policies and estimates during the nine months ended September 30, 2024, from the critical accounting policies and estimates disclosed in Management's Discussion and Analysis of Financial Condition and Results of Operations in our 2023 Form 10-K.

Recent Accounting Pronouncements

Except as described in Note 2 to the Condensed Consolidated Financial Statements under the heading “Recent Accounting Pronouncements”, there have been no new accounting pronouncements or changes to accounting pronouncements during the nine months ended September 30, 2024, as compared to the recent accounting pronouncements described in our 2023 Form 10-K, that are of significance or potential significance to us.

Results of Operations

Comparison of three and nine months ended September 30, 2024 and 2023

Revenue


	Three Months Ended September 30,				Change
	2024		2023		$		%
	(Dollars in thousands)
Collaboration revenue	$	970	$	84,866	$	(83,896)	(99)	%
Total revenue	$	970	$	84,866	$	(83,896)	(99)	%


	Nine Months Ended September 30,				Change
	2024		2023		$		%
	(Dollars in thousands)
Collaboration revenue	$	132,984	$	91,004	$	41,980	46	%
Revenue from license and intellectual property	50		50		—		—	%
Total revenue	$	133,034	$	91,054	$	41,980	46	%

Total revenue was $1.0 million and $84.9 million for the three months ended September 30, 2024, and 2023, respectively, and $133.0 million and $91.1 million for the nine months ended September 30, 2024, and 2023, respectively.

Collaboration revenue was $1.0 million and $133.0 million for the three and nine months ended September 30, 2024, compared to $84.9 million and $91.0 million for the three and nine months ended September 30, 2023, respectively. Collaboration revenue for the three and nine months ended September 30, 2024, was related to revenue recognized under our Collaboration Agreement with BMS. Collaboration revenue for the three months ended September 30, 2024 related to PRX019 Phase 1 Clinical Trial Obligation. Collaboration revenue for the nine months ended September 30, 2024 included $107.9 million from the PRX019 Global License Agreement and PRX019 Phase 1 Clinical Trial Obligation and $25.0 million was related to BMS’s material rights for the US Rights and Global Rights for the TDP-43 Collaboration Target that expired unexercised on May 24, 2024 as a result of the expiration of the research term of the Collaboration Agreement.

Collaboration revenue for the three and nine months ended September 30, 2023, included revenue from BMS for US Development Services related to the Tau/PRX005 program. As of September 30, 2024, the Company does not have any remaining Tau US Development Services Obligations and has recognized all revenue from this performance obligation as of December 31, 2023.

As of September 30, 2024, the Company has $14.4 million of deferred revenue related to the remaining performance obligations under the PRX019 Global License Agreement related to PRX019 Phase 1 Clinical Trial Obligations. See Note 7, “Significant Agreements” to the Condensed Consolidated Financial Statements regarding the Collaboration Agreement with BMS for more information.

License and intellectual property revenue for the nine months ended September 30, 2024, and 2023 included $50,000 in each period, respectively, in license fees recognized under the License Agreement entered into on March 1, 2020, between the Company's wholly owned subsidiary, Prothena Biosciences Limited, and F. Hoffmann-La Roche Ltd.

Operating Expenses


	Three Months Ended September 30,				Change
	2024		2023		$		%
	(Dollars in thousands)
Research and development	$	50,723	$	57,913	$	(7,190)	(12)	%
General and administrative	16,760		16,645		115		1	%
Total operating expenses	$	67,483	$	74,558	$	(7,075)	(9)	%


	Nine Months Ended September 30,				Change
	2024		2023		$		%
	(Dollars in thousands)
Research and development	$	172,347	$	158,680	$	13,667	9	%
General and administrative	50,351		44,895		5,456		12	%
Total operating expenses	$	222,698	$	203,575	$	19,123	9	%

Total operating expenses consist of R&D expenses, general and administrative (“G&A”) expenses. Our operating expenses were $67.5 million and $74.6 million for the three months ended September 30, 2024, and 2023, respectively, and $222.7 million and $203.6 million for the nine months ended September 30, 2024, and 2023, respectively.

Our research activities are aimed at developing new drug products. Our development activities involve the translation of our research into potential new drugs. Our R&D expenses primarily consist of personnel costs and related expenses, including share-based compensation and external costs associated with clinical activities and drug development related to our drug programs, including birtamimab, BMS-986446 (PRX005), PRX012, PRX123 and preclinical activities related to our discovery programs.

Our G&A expenses primarily consist of personnel costs and related expenses, including share-based compensation and consulting expenses.

Research and Development Expenses

Our R&D expenses decreased by $7.2 million or (12)% for the three months ended September 30, 2024, and increased by $13.7 million or 9%, for the nine months ended September 30, 2024, compared to the same period in the prior year. The decrease for the three months ended September 30, 2024, compared to the same period in the prior year, was due primarily to

lower manufacturing expenses. The increase for the nine months ended September 30, 2024, compared to the same period in the prior year, was primarily due to higher clinical trial expenses primarily related to the PRX012 and birtamimab programs and higher personnel expenses.

The following table sets forth the R&D expenses for our major programs (specifically, any active program with successful first dosing in a Phase 1 clinical trial), which were birtamimab, prasinezumab, NNC6019 (PRX004), BMS-986446 (PRX005), PRX012 and other R&D expenses for the three and nine months ended September 30, 2024, and 2023, and the cumulative amounts to date (in thousands):


	Three Months Ended September 30,				Nine Months Ended September 30,				Cumulative to Date(1)
	2024		2023		2024		2023
Birtamimab (NEOD001)	$	18,159	$	18,508	$	60,908	$	50,288	$	533,225
PRX002/RG7935(2)	10		3		16		8		106,831
Coramitug (PRX004)(3)	—		22		4		63		79,895
BMS-986446 (PRX005)	96		1,826		258		9,858		57,621
PRX012	28,093		27,553		97,900		69,966		263,670
Other R&D(4)	4,365		10,001		13,261		28,497
	$	50,723	$	57,913	$	172,347	$	158,680

(1)Cumulative R&D costs to date include the costs incurred from the date when the applicable program was separately tracked in preclinical development. Expenditures in the early discovery stage are not tracked by program and accordingly have been excluded from the applicable cumulative amount.

(2)Through May 28, 2021, Prasinezumab costs include payments to Roche for our share of the development expenses incurred by Roche related to prasinezumab programs.

(3) On July 8, 2021, we sold shares of one of our wholly-owned subsidiaries to Novo Nordisk. In connection with the transaction, Novo Nordisk acquired our ATTR amyloidosis business, including the clinical stage antibody coramitug (PRX004). Expenses incurred in 2024 and 2023 relate to certain close out activities and transition services provided to Novo Nordisk.

(4) Other R&D is comprised primarily of preclinical development and discovery programs that have not progressed to first patient dosing in a Phase 1 clinical trial and close out costs for programs that we are no longer advancing.

General and Administrative Expenses

Our G&A expenses increased by $0.1 million or 1% for the three months ended September 30, 2024, and increased by $5.5 million, or 12%, for the nine months ended September 30, 2024, compared to the same period in the prior year. The increase for the nine months ended September 30, 2024, compared to the prior year, was primarily due to higher personnel expenses.

Other Income (Expense)


	Three Months Ended September 30,		Change
	2024	2023	$		%
	(Dollars in thousands)
Interest income	6,743	8,522	$	(1,779)	(21)	%
Other income (expense), net	(66)	(15)	(51)		340	%
Total other income (expense), net	6,677	8,507	$	(1,830)	(22)	%


	Nine Months Ended September 30,		Change
	2024	2023	$		%
	(Dollars in thousands)
Interest income	20,429	22,912	$	(2,483)	(11)	%
Other income (expense), net	(194)	(253)	59		(23)	%
Total other income (expense), net	20,235	22,659	$	(2,424)	(11)	%

Interest income decreased by $1.8 million or 21% for the three months ended September 30, 2024, and decreased by $2.5 million, or 11%, for the nine months ended September 30, 2024, compared to the same period in the prior year, primarily due to lower interest income from our cash and money market accounts resulting from lower cash balances.

Other expense, net for the three and nine months ended September 30, 2024, and 2023, was primarily foreign exchange losses from transactions with vendors denominated in Euros.

Provision for (benefit from) Income Taxes


	Three Months Ended September 30,				Change
	2024		2023		$		%
	(Dollars in thousands)
Benefit from income taxes	$	(835)	$	(3,092)	$	2,257	(73)	%


	Nine Months Ended September 30,				Change
	2024		2023		$		%
	(Dollars in thousands)
Benefit from income taxes	$	(5,075)	$	(10,310)	$	5,235	(51)	%

The benefit from income taxes decreased by $2.3 million or 73% for the three months ended September 30, 2024, and decreased by $5.2 million, or 51%, for the nine months ended September 30, 2024, compared to the same period in the prior year. The decrease in benefit from income taxes for the three and nine months ended September 30, 2024, compared to the same period in the prior year, was primarily due to a decrease in the net amount capitalized as deferred tax assets related to Section 174 R&D Capitalization.

The tax provisions for all periods presented primarily reflect U.S. federal taxes associated with recurring profits attributable to intercompany services that our U.S. subsidiary performs for the Company. No tax benefit has been recorded related to tax losses recognized in Ireland and any deferred tax assets for those losses are offset by a valuation allowance.

Liquidity and Capital Resources

Overview


	September 30,		December 31,
	2024		2023
Working capital	$	488,562	$	582,391
Cash and cash equivalents	$	519,262	$	618,830
Total assets	$	595,254	$	696,382
Total liabilities	$	60,892	$	135,017
Total shareholders’ equity	$	534,362	$	561,365

Working capital was $488.6 million as of September 30, 2024, a decrease of $93.8 million from working capital of $582.4 million as of December 31, 2023. This decrease in working capital during the nine months ended September 30, 2024, was primarily attributable to cash use of $222.7 million for operating expenses (adjusted to exclude non-cash charges) offset in part by $80.0 million option exercise payment from BMS, net proceeds received from interest income on investments of $20.4 million and to a lesser extent, stock option exercises of approximately $1.9 million.

As of September 30, 2024, we had $519.3 million in cash and cash equivalents. Although we believe, based on our current business plans, that our existing cash and cash equivalents will be sufficient to meet our obligations for at least the next twelve months, we anticipate that we will require additional capital in the future in order to continue the research and development of our drug candidates. Additionally, in order to develop and obtain regulatory approval for our potential products we will need to raise substantial additional funds. We expect to raise any such additional funds through public or private equity or debt financings, collaborative agreements with corporate partners, or other arrangements, including pursuant to the Amended Distribution Agreement (See Note 8, “Shareholders’ Equity” to the Condensed Consolidated Financial Statements for more information). We cannot assume that such additional financings will be available on acceptable terms, if at all, and such financings may only be available on terms dilutive to our shareholders.

In managing our liquidity needs in Ireland, we do not rely on unrepatriated earnings as a source of funds. As of September 30, 2024, $255.0 million of our outstanding cash and cash equivalents related to U.S. operations are considered permanently reinvested. We do not intend to repatriate these funds. However, if these funds were repatriated back to Ireland, we would incur a withholding tax from the dividend distribution.

The adequacy of our cash resources depends on many assumptions, including assumptions with respect to our expenses. These assumptions may prove to be wrong, and we could use our available capital resources sooner than we currently expect. Because of the numerous risks and uncertainties associated with the development and commercialization of our product candidates, we are unable to estimate the amounts of increased capital outlays and operating expenses associated with completing the development of our product candidates. Our future capital requirements will depend on numerous factors, including, without limitation, the timing of initiation, progress, results and costs of our clinical trials; the results of our research and nonclinical studies; the costs of clinical manufacturing and of establishing commercial manufacturing arrangements; the costs of preparing, filing and prosecuting patent applications and maintaining, enforcing and defending intellectual property-related claims; the costs and timing of capital asset purchases; our ability to establish research collaborations, strategic collaborations, licensing or other arrangements; the costs to satisfy our obligations under current and potential future collaborations; the costs of any in-licensing transactions; and the timing, receipt, and amount of revenues or royalties, if any, from any approved drug candidates.

Our cash and cash equivalents may also be potentially supplemented in the future by proceeds from our collaboration partners and milestone payments from Novo Nordisk. Pursuant to the Collaboration Agreement with Roche, we are eligible to receive payments for commercial and regulatory milestones and royalties on net sales of Collaboration Products. See Note 7, “Significant Agreements” to our Condensed Consolidated Financial Statements regarding the Roche License Agreement for more information. Pursuant to the Collaboration Agreement with BMS (formerly Celgene), we are eligible to receive payments for commercial and regulatory milestones and royalties on net sales of Collaboration Products. See Note 7, “Significant Agreements” to our Condensed Consolidated Financial Statements regarding the Collaboration Agreement with BMS for more information. Pursuant to the share purchase agreement with Novo Nordisk, we are eligible to receive development and sales milestone payments. See Note 7, “Significant Agreements” to our Condensed Consolidated Financial Statements regarding the Novo Nordisk Share Purchase Agreement for more information.

Cash Flows

The following table summarizes the primary sources and uses of cash for each of the periods presented, in our Condensed Consolidated Statements of Cash Flows (in thousands):


	Nine Months Ended September 30,
	2024		2023
Net cash used in operating activities	$	(102,278)	$	(82,868)
Net cash used in investing activities	(255)		(1,261)
Net cash provided by financing activities	1,613		44,620
Net decrease in cash, cash equivalents and restricted cash	$	(100,920)	$	(39,509)

Cash Used in Operating Activities

Net cash used in operating activities was $102.3 million for the nine months ended September 30, 2024, which was primarily due to ongoing research and development activities and general and administrative expenses to support those activities for a total of $222.7 million in operating expenses (adjusted to exclude non-cash charges of approximately $31.0 million), cash paid for accounts payable, accruals and other liabilities and prepaid expenses, partially offset by proceeds

received from interest income on investments of $20.4 million, cash from collection of accounts receivable and proceeds from stock option exercises of approximately $1.9 million.

Cash Used in Investing Activities

Net cash used in investing activities was $255,000 for the nine months ended September 30, 2024, which primarily consisted of expenditures to purchase property and equipment.

Cash Provided by Financing Activities

Net cash provided by financing activities was $1.6 million for the nine months ended September 30, 2024, primarily from proceeds from issuances of ordinary shares upon exercises of stock options of $1.9 million.

Nine Months Ended September 30, 2023

Refer to “Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations — Liquidity and Capital Resources” in our third quarter 2023 Quarterly Report on Form 10-Q for a discussion of the cash flows for the nine months ended September 30, 2023.

Off-Balance Sheet Arrangements

At September 30, 2024, we were not a party to any off-balance sheet arrangements that have, or are reasonably likely to have, a current or future effect on our financial condition, changes in financial condition, revenue or expenses, results of operations, liquidity, capital expenditures or capital resources.

Contractual Obligations

Our contractual obligations as of September 30, 2024, consisted of minimum cash payments under operating leases of $12.9 million, purchase obligations of $8.0 million (of which $2.4 million is included in current liabilities), and contractual obligations under license agreements of $0.3 million (of which nil is included in current liabilities). Purchase obligations consist of non-cancelable purchase commitments to suppliers. Operating leases represent our future minimum rental commitments under our non-cancelable operating leases. For additional information regarding the timing for our contractual obligations see Note 6, “Commitments and Contingencies” to Condensed Consolidated Financial Statements.

In June 2021, we entered into a lease agreement for office space in Dublin, Ireland, which commenced in August 2021 and had an initial term of one year. In addition, we entered into a lease agreement for additional office space in Dublin, Ireland, which commenced in August 2023 and had an initial term of one year. In April 2024, we renewed both leases, each for another one year term with termination dates in July 2025. Both leases have an automatic renewal clause, pursuant to which each agreement will be extended automatically for successive periods equal to their current terms, unless each agreement is cancelled by us.

In October 2022, we entered into a noncancelable operating sublease to lease approximately 31,157 square feet of office and laboratory space in Brisbane, California. We are obligated to make lease payments totaling approximately $14.9 million over the lease term, which expires on September 30, 2028, unless terminated earlier. Of this obligation, approximately $12.8 million remains outstanding as of September 30, 2024.

The following is a summary of our contractual obligations as of September 30, 2024 (in thousands):


	Total		2024		2025		2026		2027		2028		Thereafter
Operating leases (1)	$	12,946	$	808	$	3,188	$	3,158	$	3,269	$	2,523	$	—
Purchase obligations	8,036		7,664		269		103		—		—		—
Contractual obligations under license agreements	323		49		64		60		60		45		45
Total	$	21,305	$	8,521	$	3,521	$	3,321	$	3,329	$	2,568	$	45

(1) See Note 6, “Commitments and Contingencies” to our Condensed Consolidated Financial Statements.

In addition to the contractual obligations above, we also expect to have future material cash requirements related to our clinical trials, discovery and pre-clinical programs, human capital and intellectual property. Assuming no significant change in our business, we expect the full year 2024 net cash used in operating and investing activities to be approximately $148 million to $160 million.

ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

We are exposed to market risks in the ordinary course of our business including the effects of changes in foreign currency exchange rates and interest rates. Market risk represents the risk of loss that may impact our financial position due to adverse changes in financial market prices and rates.

Foreign Currency Risk

Our business is primarily conducted in U.S. dollars except for our agreements with contract manufacturers for drug supplies which are primarily denominated in Euros. We recorded a loss on foreign currency exchange rate differences of approximately $194,000, and $253,000, during the nine months ended September 30, 2024, and 2023. If we increase our business activities that require the use of foreign currencies, we may be exposed to losses if the Euro and other such currencies continue to strengthen against the U.S. dollar.

Interest Rate Risk

Our exposure to interest rate risk is limited to our cash equivalents, which consist of accounts maintained in money market funds. We have assessed that there is no material exposure to interest rate risk given the nature of money market funds. In general, money market funds are not subject to interest rate risk because the interest paid on such funds fluctuates with the prevailing interest rate. Accordingly, our interest income fluctuates with short-term market conditions.

In the future, we anticipate that our exposure to interest rate risk will primarily be related to our investment portfolio. We may invest any surplus funds in accordance with a policy approved by our board of directors which will specify the categories, allocations, and ratings of securities we may consider for investment. The primary objectives of our investment policy are to preserve principal and maintain proper liquidity to meet our operating requirements. Our investment policy also specifies credit quality standards for our investments and limits the amount of credit exposure to any single issue, issuer or type of investment.

Credit Risk

Financial instruments that potentially subject us to concentration of credit risk consist of cash and cash equivalents and accounts receivable. We place our cash and cash equivalents with high credit quality financial institutions and pursuant to our investment policy, we limit the amount of credit exposure with any one financial institution. Deposits held with banks have exceeded, and will continue to exceed, federally insured limits on such deposits. We are exposed to credit risk in the event of a default by the financial institutions holding our cash and cash equivalents. We have not experienced any losses on our deposits of cash and cash equivalents. Our credit risk exposure is up to the extent recorded on the Company's Condensed Consolidated Balance Sheets.

ITEM 4. CONTROLS AND PROCEDURES

Evaluation of Disclosure Controls and Procedures

Our management, with the participation of our chief executive officer (“CEO”) and chief financial officer (“CFO”) evaluated the effectiveness of our disclosure controls and procedures pursuant to Rule 13a-15 under the Securities Exchange Act of 1934, as amended (the “Exchange Act”), as of the end of the period covered by this Form 10-Q. Based on this evaluation, our CEO and CFO concluded that, as of September 30, 2024, our disclosure controls and procedures are designed and are effective to provide reasonable assurance that information we are required to disclose in reports that we file or submit under the Exchange Act is recorded, processed, summarized, and reported within the time periods specified in the SEC’s rules and forms, and that such information is accumulated and communicated to our management, including our CEO and CFO, as appropriate, to allow timely decisions regarding required disclosure.

Changes in Internal Control over Financial Reporting

There were no changes in our internal control over financial reporting identified in management’s evaluation pursuant to Rules 13a-15(d) or 15d-15(d) of the Exchange Act during our third fiscal quarter ended September 30, 2024, that materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.

Limitations on Effectiveness of Controls and Procedures

Internal control over financial reporting has inherent limitations. Internal control over financial reporting is a process that involves human diligence and compliance and is subject to lapses in judgment and breakdowns resulting from human failures. Internal control over financial reporting also can be circumvented by collusion or improper management override. Because of such limitations, there is a risk that material misstatements will not be prevented or detected on a timely basis by internal control over financial reporting. However, these inherent limitations are known features of the financial reporting process. Therefore, it is possible to design into the process safeguards to reduce, though not eliminate, this risk.

Our management recognizes that any controls and procedures, no matter how well designed and operated, can provide only reasonable assurance of achieving the desired control objectives. In addition, the design of disclosure controls and procedures must reflect the fact that there are resource constraints and that management necessarily applies its judgment in evaluating the benefits of possible controls and procedures relative to their costs.

PART II. OTHER INFORMATION

ITEM 1. LEGAL PROCEEDINGS

We are not currently a party to any material legal proceedings. We may at times be party to ordinary routine litigation incidental to our business. When appropriate in management’s estimation, we may record reserves in our financial statements for pending legal proceedings.

ITEM 1A. RISK FACTORS

Investing in our ordinary shares involves a high degree of risk. Our Annual Report on Form 10-K for 2023 (filed with the SEC on February 22, 2024) includes a detailed discussion of our business and the risks to our business. You should carefully read that Form 10-K. You should carefully consider the risks described below, together with all of the other information included in this Quarterly Report on Form 10-Q, in considering our business and prospects. If any of the following risks, other unknown risks, or risks that we think are immaterial occur, our business, financial condition, results of operations, cash flows, or growth prospects could be adversely impacted, in which case, the market price of our ordinary shares could decline, and you may lose all or part of your investment in our ordinary shares. Additional risks and uncertainties not presently known to us or that we currently deem immaterial also may impair our business operations.

Risks Relating to Our Financial Position, Our Need for Additional Capital, and Our Business

We anticipate that we will incur losses for the foreseeable future and we may never sustain profitability.

We may not generate the cash that is necessary to finance our operations in the foreseeable future. We incurred net income (losses) of ($64.4) million for the nine months ended September 30, 2024, and $(147.0) million and $(116.9) million, and $67.0 million for the years ended December 31, 2023, 2022 and 2021, respectively. As of September 30, 2024, we had an accumulated deficit of $1.0 billion. We expect to continue to incur substantial losses for the foreseeable future as we:

•support the Phase 3 AFFIRM-AL clinical trial for birtamimab, the Phase 1 clinical trials for PRX012, the Phase 1 clinical trial for PRX019, and potential additional clinical trials for these and other programs, including PRX123;

•develop and possibly commercialize our drug candidates, including birtamimab, PRX012, and PRX123;

•undertake nonclinical development of other drug candidates and initiate clinical trials, if supported by nonclinical data;

•pursue our early stage research and seek to identify additional drug candidates; and

•potentially acquire rights from third parties to drug candidates or technologies through licenses, acquisitions, or other means.

We must generate significant revenue to achieve and maintain profitability. Even if we succeed in discovering, developing, and commercializing one or more drug candidates, we may not be able to generate sufficient revenue and we may never be able to achieve or sustain profitability.

We will require additional capital to fund our operations, and if we are unable to obtain such capital, we will be unable to successfully develop and commercialize drug candidates.

As of September 30, 2024, we had cash and cash equivalents of $519.3 million. The majority of such cash is held in accounts at U.S. banking institutions that we believe are of high quality. Cash held in depository accounts may exceed the $250,000 Federal Deposit Insurance Corporation insurance limits. If such banking institutions were to fail, we could lose all or a portion of those amounts held in excess of such insurance limitations. Although we believe, based on our current business plans, that our existing cash and cash equivalents will be sufficient to meet our obligations for at least the next twelve months, we anticipate that we will require additional capital in order to continue the research and development, and eventual commercialization, of our drug candidates. Our future capital requirements will depend on many factors that are currently unknown to us, including, without limitation:

•the timing of progress, results, and costs of our clinical trials, including the Phase 3 clinical trial for birtamimab, the Phase 2 clinical trial for prasinezumab being conducted by Roche, the Phase 2b clinical trial for prasinezumab being conducted by Roche, the Phase 2 clinical trial for coramitug (formerly PRX004) being conducted by Novo Nordisk, the Phase 1 clinical trial for BMS-986446 (formerly PRX005) being conducted by BMS, the Phase 2 clinical trial for BMS-986446 being conducted by BMS, the Phase 1 clinical trials for PRX012, and the Phase 1 clinical trial for PRX019;

•the timing, initiation, progress, results, and costs of these and our other research, development, and possible commercialization activities;

•the results of our research, nonclinical studies, and clinical trials;

•the costs of manufacturing our drug candidates for clinical development as well as for future commercialization needs;

•if and when appropriate, the costs of preparing for commercialization of our drug candidates;

•the costs of preparing, filing, and prosecuting patent applications, and maintaining, enforcing, and defending intellectual property-related claims;

•our ability to establish strategic collaborations, licensing, or other arrangements;

•the costs to satisfy our obligations under current and potential future collaborations; and

•the timing, receipt, and amount of revenues or royalties, if any, from any approved drug candidates.

We have based our expectations relating to liquidity and capit

PROTHENA CORP PUBLIC LTD CO [PRTA] Filings
10-Q	[2024-11]
10-Q	[2024-08]
10-Q	[2024-05-08]
10-K	[2024-02-22]
10-Q	[2023-11-02]
10-Q	[2023-08-03]
10-Q	[2023-05-04]
10-K	[2023-02-28]
10-Q	[2022-11-03]
10-Q	[2022-08-08]
10-Q	[2022-05-05]
10-K	[2022-02-25]
10-Q	[2021-11-04]
10-Q	[2021-08-05]
10-Q	[2021-05-11]
10-K	[2021-02-26]
10-Q	[2020-11-04]
10-Q	[2020-08-06]
10-Q	[2020-05-06]
10-K	[2020-03-03]
10-Q	[2019-11-05]
10-Q	[2019-08-06]
10-Q	[2019-05-07]
10-K	[2019-03-15]
10-Q	[2018-11-06]
10-Q	[2018-08-07]
10-Q	[2018-05-09]
10-K	[2018-02-26]
10-Q	[2017-11-07]
10-Q	[2017-08-09]
10-Q	[2017-05-09]
10-K	[2017-02-27]
10-Q	[2016-11-02]
10-Q	[2016-08-02]
10-Q	[2016-05-04]
10-K	[2016-02-25]
10-Q	[2015-11-02]
10-Q	[2015-08-05]
10-Q	[2015-05-06]
10-K	[2015-03-13]
10-Q	[2014-11-04]
10-Q	[2014-08-05]
10-Q	[2014-05-05]
10-K	[2014-03-07]
10-Q	[2013-11-12]
S-1	[2013-09-17]
10-Q	[2013-08-13]
10-Q	[2013-05-15]
10-K	[2013-03-29]