10-K
1
f10k2020_protaratherapeutics.htm
ANNUAL REPORT
UNITED
STATES
SECURITIES
AND EXCHANGE COMMISSION
WASHINGTON,
D.C. 20549
Form
10-K
(Mark
One)
☒ ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
For
the fiscal year ended December 31, 2020
Or
☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
For
the transition period from to
Commission
File Number: 001-36694
PROTARA THERAPEUTICS, INC.
(Exact
Name of Registrant as Specified in Its Charter)
345 Park Avenue South
3rd Floor
New York, NY
(Address of Principal Executive Offices)
10010
(Zip Code)
(646) 844-0337
(Registrant’s telephone number, including
area code)
Securities registered pursuant to Section
12(b) of the Act:
Title of each class Trading Symbol(s) Name of each exchange on which registered
Common Stock, par value $0.001 per share TARA The Nasdaq Capital Market
Securities registered pursuant to Section
12(g) of the Act: None
Indicate by check mark if the registrant is a well-known seasoned
issuer, as defined in Rule 405 of the Securities Act. Yes o No x
Indicate by check mark if the registrant is not required to file
reports pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934. Yes o No x
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 x No o
Indicate by check mark whether the registrant has submitted electronically
every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§ 232.405 of this chapter) during
the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes x No o
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 definitions
of “large accelerated filer”, “accelerated filer”, “smaller reporting company” and “emerging
growth company” in Rule 12b-2 of the Securities Exchange Act of 1934:
Large accelerated filer o Accelerated filer o
Non-accelerated filer x Smaller reporting company x
Emerging growth company o
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. o
Indicate by check mark whether the registrant has filed a report
on and attestation to its management’s assessment of the effectiveness of its internal control over financial reporting under
Section 404(b) of the Sarbanes-Oxley Act (15 U.S.C. 7262(b)) by the registered public accounting firm that prepared or issued its
audit report. o
Indicate by check mark whether the registrant is a shell company
(as defined in Rule 12b-2 of the Securities Exchange Act of 1934). Yes o No x
As of June 30, 2020, the last business day of the registrant’s
most recently completed second fiscal quarter, the aggregate market value of the registrant’s common stock held by non-affiliates
of the registrant was approximately $76.9 million, based on the closing price of the registrant’s common stock on the Nasdaq
Capital Market on June 30, 2020 of $29.32 per share.
As of March 9,
2021, 11,228,606 shares of the registrant’s common stock, $0.001 par value,
were outstanding.
DOCUMENTS INCORPORATED BY REFERENCE
Portions of the registrant’s definitive Proxy Statement to
be filed with the Securities and Exchange Commission by April 30, 2021 are incorporated
by reference into Part III of this report.
PROTARA THERAPEUTICS, INC.
TABLE OF CONTENTS
FORM 10-K
For the Year Ended December 31, 2020
Page
PART I
Item 1. Business 3
Item 1A. Risk Factors 27
Item 1B. Unresolved Staff Comments 48
Item 2. Properties 48
Item 3. Legal Proceedings 48
Item 4. Mine Safety Disclosures 48
PART II
Item 6. Selected Financial Data 49
Item 7A. Quantitative and Qualitative Disclosures About Market Risk 57
Item 8. Financial Statements and Supplementary Data 58
Item 9A. Controls and Procedures 58
Item 9B. Other Information 58
PART III
Item 10. Directors, Executive Officers and Corporate Governance 59
Item 11. Executive Compensation 59
Item 14. Principal Accountant Fees and Services 59
PART IV
Item 15. Exhibits and Financial Statement Schedules 60
i
PART I
FORWARD-LOOKING STATEMENTS
This report and the information
incorporated herein by reference contain forward-looking statements that involve a number of risks and uncertainties, as well as
assumptions that, if they never materialize or prove incorrect, could cause our results to differ materially from those expressed
or implied by such forward-looking statements. Although our forward-looking statements reflect the good faith judgment of our management,
these statements can only be based on facts and factors currently known by us. Consequently, forward-looking statements are inherently
subject to risks and uncertainties, and actual results and outcomes may differ materially from results and outcomes discussed in
the forward-looking statements. In addition, statements that “we believe” and similar statements reflect our beliefs
and opinions on the relevant subject. These statements are based upon information available to us as of the date of this report,
and while we believe such information forms a reasonable basis for such statements, such information may be limited or incomplete,
and our statements should not be read to indicate that we have conducted an exhaustive inquiry into, or review of, all potentially
available relevant information. These statements are inherently uncertain and you are cautioned not to unduly rely upon these statements.
The forward-looking statements
are contained principally in the sections entitled “Business,” “Risk Factors,” and “Management’s
Discussion and Analysis of Financial Condition and Results of Operations.” All statements, other than statements of historical
facts, contained in this document, including statements regarding our business, operations and financial performance and conditions,
as well as our plans, objectives and expectations for our business operations and financial performance and condition, are forward-looking
statements. These statements relate to future events or to our future financial performance and involve known and unknown risks,
uncertainties and other factors which may cause our actual results, performance or achievements to be materially different from
any future results, performance or achievements expressed or implied by the forward-looking statements. The words “anticipate,”
“believe,” “continue,” “could,” “estimate,” “expect,” “intend,”
“may,” “might,” “plan,” “predict,” “project,” “potential,”
“should,” “target,” “will,” “would,” or the negative of those terms and similar
expressions are intended to identify forward-looking statements, although not all forward-looking statements contain these identifying
words.
These forward-looking statements include, but are not limited
to, statements about:
● expectations regarding the safety and efficacy of our product candidates;
● expectations regarding potential market size;
● developments and projections relating to our competitors and industry;
● our ability to remain listed on the Nasdaq Capital Market;
● the impact of government laws and regulations;
● the timing or likelihood of regulatory filings and approvals; and
● our ability to protect our intellectual property position.
We may not actually achieve
the plans, intentions or expectations disclosed in our forward-looking statements, and you should not place undue reliance on our
forward-looking statements. Forward-looking statements should be regarded solely as our current plans, estimates and beliefs. Actual
results or events could differ materially from the plans, intentions and expectations disclosed in the forward-looking statements
we make. We have included important factors in the cautionary statements included in this document, particularly in the “Risk
Factors” section, that we believe could cause actual results or events to differ materially from the forward-looking
statements that we make. Moreover, we operate in a very competitive and rapidly changing environment. New risks emerge from time
to time. It is not possible for our management to predict all risks, nor can we assess the impact of all factors on our business
or the extent to which any factor, or combination of factors, may cause actual results to differ materially from those contained
in any forward-looking statements we may make. Our forward-looking statements do not reflect the potential impact of any future
acquisitions, mergers, dispositions, joint ventures or investments we may make.
We undertake no obligation
to revise or publicly release the results of any revision to these forward-looking statements, except as required by law. Given
these risks and uncertainties, readers are cautioned not to place undue reliance on such forward-looking statements. All forward-looking
statements are qualified in their entirety by this cautionary statement.
SUMMARY OF RISKS AFFECTING
OUR BUSINESS
Below is a summary of the principal factors
that make an investment in our securities speculative or risky. This summary does not address all of the risks that we face. Additional
discussion of the risks and uncertainties summarized in this risk factor summary, and other risks and uncertainties that we face,
are set forth in Part I, Item 1A, Risk Factors, and should be carefully considered, together with other information in this Report
on Form 10-K and our other filings with the SEC before making investment decisions regarding our securities.
Item 1.Business.
Overview
We are a New York City
based clinical-stage biopharmaceutical company committed to identifying and advancing transformative therapies for the treatment
of cancer and rare diseases with significant unmet needs. We prioritize creativity, diverse perspectives, integrity and tenacity
to expedite our goal of bringing life-changing therapies to people with limited treatment options.
Our portfolio includes
two development programs utilizing TARA-002, an investigational cell therapy based on the broad immunopotentiator, OK-432, which
was originally granted marketing approval by the Japanese Ministry of Health and Welfare as an immunopotentiating cancer therapeutic
agent. This cell therapy is currently approved in Japan for lymphatic malformations, or LMs, and multiple oncologic indications.
It has never been approved outside Japan and we have secured worldwide rights to the asset excluding Japan and Taiwan and have
begun to explore its use in rare and oncology indications. We are developing TARA-002 in non-muscle invasive bladder cancer, or
NMIBC, and in LMs.
TARA-002’s
lead oncology program is in NMIBC, which is cancer found in the tissue that lines the inner surface of the bladder that has not
spread into the bladder muscle. Bladder cancer is the sixth most common cancer in the United States, with NMIBC representing approximately
80% of bladder cancer diagnoses. Approximately 65,000 patients are diagnosed with NMIBC in the United States each year. Very few
new therapeutics have been approved in NMIBC since the 1990s and the current standard of care for NMIBC includes intravesical
Bacillus Calmette-Guerin, or BCG,. The mechanism of TARA-002 is similar to BCG. Both TARA-002 and BCG are intravesically administered
and elicit a type Th1 type immune response and locally activated generally similar array of cytokines and immune cells.
In August of 2020,
we announced constructive feedback following a pre-Investigational New Drug (pre-IND) interaction with the Office of Tissues and
Advanced Therapies division of the Center for Biologics Evaluation and Research, or CBER, at the FDA on a development plan for
TARA-002 in NMIBC. Building on existing data from OK-432, and subject to the completion of non-clinical studies as well as acceptance
of the IND application, we plan to commence a Phase 1 clinical trial in late 2021 to assess the safety and tolerability of TARA-002
in patients with high grade NMIBC.
Our most advanced
clinical program is for LMs, which are rare, non-malignant cysts of the lymphatic vascular system that primarily form in the head
and neck region of children before the age of two. In July 2020, the U.S. Food and Drug Administration, or FDA, granted Rare Pediatric
Disease designation for TARA-002 for the treatment of LMs. OK-432, the originator compound to TARA-002, has been the standard of
care in LMs in Japan for over 20 years. In addition to the clinical experience in Japan, we have secured the rights to a dataset
from one of the largest ever conducted Phase 2 studies in lymphatic malformations, in which OK-432 was administered via a compassionate
use program led by the University of Iowa to over 400 pediatric and adult patients. We have updated the initial IND that was submitted
by the University of Iowa and submitted the update and accompanying clarifying questions to the FDA Division of Vaccines and Related
Products Applications, or the Division, in connection with the IND for TARA-002 in LMs. We plan to utilize the robust dataset for
OK-432 in LMs to support the potential filing of a Biological License Application (BLA) for TARA-002 in lymphatic LMs. We are encouraged
by the progress to date and, at the FDA’s request, have submitted the full Clinical Study Report (CSR) of the randomized
Phase 2 study of OK-432 in LMs led by the University of Iowa. We continue to prepare for a potential BLA filing in the second half
of 2021, or to initiate additional clinical work as required by FDA.
TARA-002 was developed
from the same master cell bank of genetically distinct group A Streptococcus pyogenes as OK-432 (marketed as Picibanil® in
Japan and Taiwan by Chugai Pharmaceutical Co., Ltd., or Chugai Pharmaceutical). Following a pre-IND interaction with the Office
of Tissues and Advanced Therapies Division of the Center for Biologics Evaluation and Research, or CBER, the FDA agreed that we
have successfully demonstrated initial manufacturing comparability between TARA-002 and OK-432. This initial comparability will
be confirmed by GMP scale batches, which are currently underway using the same release tests that have already been approved by
the FDA.
The third development
program in our portfolio is intravenous, or IV, Choline Chloride, an investigational phospholipid substrate replacement therapy
initially in development for patients receiving parenteral nutrition, or PN, who have intestinal failure associated liver disease,
or IFALD. IV Choline Chloride has been granted Orphan Drug Designation by the FDA for this indication and has also been granted
Fast Track Designation for the treatment of IFALD. Following a positive end of Phase 2 meeting with the FDA, we received feedback
on the design of the studies necessary to complete the registration package for IV Choline Chloride for the treatment of IFALD,
including a Phase 1 pharmacokinetic study followed by Phase 3 trial. Prior to initiating these clinical studies, we are currently
undertaking a prevalence study in partnership with a large home health organization in the United States to enhance understanding
of the PN patient population and we plan to use this information to determine the next steps for the development program. The goal
of the study is to understand the presence/incidence of liver disease in this patient population.
Our fourth program, vonapanitase,
is a recombinant human elastase. We are reviewing the research and preclinical and clinical data of vonapanitase and have not yet
determined whether to pursue further development of this product candidate in the future.
We have devoted substantial
efforts to the development of these programs and do not have any approved products and have not generated any revenue from product
sales. TARA-002 is in later stage development for LMs and has not yet been approved for use for treatment of LMs, NMIBC or any
other indications. We do not expect to generate revenues prior to 2022, if ever. To finance our current strategic plans, including
the conduct of ongoing and future clinical trials and further research and development costs, we will need to raise additional
capital.
Our Product Candidate Pipeline
The following chart summarizes
the current status of our product candidate pipeline:
** Granted Orphan Drug and Fast Track Designations by the U.S. FDA
† Phase 1 PK study to be conducted prior to commencing Phase 3
Our Corporate Strategy:
We are an oncology and
rare disease company focused on identifying and acquiring or licensing de-risked assets and optimizing and/or accelerating their
development. Leveraging the drug development and commercialization experience of our management team, our goal is to build a leading
biopharmaceutical company focused on bringing life-saving therapies to patients with significant unmet needs.
1. Establish comparability of OK-432
and TARA-002
Utilizing the same genetically
distinct Streptococcus pyogenes strain and proprietary manufacturing process used by Chugai Pharmaceutical to manufacture
OK-432 (marketed as Picibanil® in Japan and Taiwan), we have produced development batches of TARA-002 and conducted comparability
studies using commercial OK-432 manufactured in Japan as a reference. Following a pre-IND interaction with the Office of Tissues
and Advanced Therapies division of the Center for Biologics Evaluation and Research, or CBER, the FDA agreed that we had successfully
demonstrated initial manufacturing comparability between TARA-002 and OK-432. This initial comparability will be confirmed by GMP
scale batches, which are currently underway using the same release tests that have already been accepted by the FDA.
2.Seek FDA approval for
the use of TARA-002 in Lymphatic Malformations
We plan to utilize the robust dataset for OK-432 in LMs to support
the potential filing of a Biological License Application (BLA) for TARA-002 in lymphatic LMs. We are encouraged by the progress
to date and, at the FDA’s request, have submitted the full Clinical Study Report (CSR) of the randomized Phase 2 study of
OK-432 in LMs led by the University of Iowa. We continue to prepare for a potential BLA filing in the second half of 2021, or to
initiate additional clinical work as required by FDA.
3. Pursue development of TARA-002 for
the treatment of non-muscle invasive bladder cancer (NMIBC). Complete toxicology and MOA characterization & immunogenicity
studies in order to file an IND and initiate P1 study
We are developing TARA-002
for the treatment of non-muscle invasive bladder cancer, or NMIBC. Building on existing safety and efficacy data from OK-432, and
subject to the completion of non-clinical studies, including toxicology and MOA characterization & immunogenicity studies,
which are currently underway, as well as acceptance of an Investigational New Drug, or IND, application, we plan to commence a
Phase 1 clinical trial in 2021 to assess the safety and tolerability of TARA-002 in patients with high grade NMIBC.
4. Further characterize the patient population
of IFALD to determine the appropriate strategy/path for IV Choline Chloride as a potential treatment option
Following a positive end
of Phase 2 meeting with the FDA, we received feedback on the design of the studies necessary to complete the registration package
for IV Choline Chloride for the treatment of IFALD, including a Phase 1 pharmacokinetic study followed by Phase 3 trial. Prior
to initiating these clinical studies, we are currently undertaking a prevalence study in partnership with a very large home health
organization in the United States to enhance understanding of the PN patient population and plan to use this information to inform
the next steps for the development program.
5. Explore opportunities to expand our
pipeline
The immunological activity
of TARA-002’s reference product, OK-432, has been effectively interrogated in patients in a long list of indications. We
plan to carefully evaluate the case reports and the literature and perform initial in vitro characterization studies to
better understand the mechanism of action of TARA-002 and its potential activity in indications beyond LMs and NMIBC. We also plan
to engage with regulatory authorities outside of the US to explore the potential opportunities to bring TARA-002 to other geographies.
In addition, our leadership
team has a strong track record of licensing, acquiring and optimizing product candidates and we intend to leverage this skill to
identify opportunities for potential combination opportunities for TARA-002, particularly in NMIBC
Our Pipeline
TARA-002 / OK-432
TARA-002, our lead program,
is an investigational cell therapy developed from the master cell line of the same genetically distinct Streptococcus pyogenes
(group A, type 3) Su strain as OK-432, a the broad immunopotentiator (marketed as Picibanil® in Japan and Taiwan by Chugai
Pharmaceutical Co., Ltd. (Chugai Pharmaceutical)). We expect to utilize the same regulatory starting materials as OK-432 and manufacture
TARA-002 using an updated version of the same proprietary processes used to manufacture OK-432. Functionally, our lead product
is OK-432. We have designated this product as TARA-002 in order to differentiate the regulatory path in the U.S. and other geographies
from that of OK-432 in Japan.
We entered into an agreement
with Chugai Pharmaceutical in June 2019 to support our development of TARA-002. The agreement provides us with exclusive access
to certain materials and documents relating to OK-432 including the master cell bank of Streptococcus pyogenes used in the
manufacture of OK-432. Additionally, the agreement provides technical support during a certain period. We have utilized the materials,
proprietary manufacturing process and technical support provided by Chugai Pharmaceutical to produce TARA-002 at a GMP-compliant
facility in the United States. Under the agreement with Chugai Pharmaceutical, we will have sole responsibility for the development
and commercialization of TARA-002 worldwide, excluding Japan and Taiwan. On July 14, 2020, we entered into an amendment with Chugai
to the Chugai Pharmaceutical agreement. This agreement is exclusive through June 17, 2030 or following any termination of the agreement
by either party.
In Japan, OK-432 is indicated
for: the treatment of lymphangiomas (lymphatic malformations); the prolongation of survival time in patients with gastric cancer
(postoperative cases) or primary lung cancer in combination with chemotherapy; and the reduction of cancerous pleural effusion
or ascites in patients with lung cancer or gastrointestinal cancer respectively, head and neck cancer (maxillary cancer, laryngeal
cancer, pharyngeal cancer, and tongue cancer) and thyroid cancer that are resistant to other drugs.
We plan to pursue development
of TARA-002 for the treatment of lymphatic malformations (LMs) and non-muscle invasive bladder cancer (NMIBC) initially in the
U.S. and plan to also seek approval in Europe and other regions in the future, and may also explore additional indications where
its utility as an immunostimulant has been hypothesized to be of therapeutic benefit.
TARA-002 in NMIBC
Disease Overview:
Bladder cancer is the
sixth most common cancer in the United States, with NMIBC representing approximately 80% of bladder cancer diagnoses. NMIBC is
cancer found in the tissue that lines the inner surface of the bladder that has not spread into the bladder muscle. There are 3
subtypes of NMIBC: Ta (non-invasive papillary carcinoma), Tis (carcinoma in situ or CIS), and T1 (carcinoma invading the lamina
propria). Among the types of NMIBC, Ta accounts for most NMIBC cases (70%), whereas T1 and CIS account for 20% and 10%, respectively.
Based on currently available
treatment data, we believe that there are approximately 30,000 incident cases of High-Grade NMIBC per year that would be appropriate
for treatment with TARA-002 in the U.S. There are 65,000 incident cases of NMIBC in the U.S. every year, of these, approximately
45% (~30,000) are made up of High-Grade tumor types that are considered higher risk, and therefore candidates for immunotherapies,
such as TARA-002). In addition, NMIBC has one of the highest rates of recurrence with 3-year rate estimated at up to 80%.
Treatment:
Treatment for NMIBC is
typically targeted to reduce unresectable persistence, recurrence after resection, and to prevent disease progression to muscle-invasive
bladder cancer. The initial treatment for NMIBC includes cystoscopy and complete transurethral resection of the bladder tumor (TURBT)
for papillary Ta or T1, or biopsy for CIS. A single postoperative instillation of intravesical chemotherapy is recommended in patients
with low risk of progression, and for patients with intermediate and high-risk disease, a longer course of intravesical therapy
is administered. The most efficacious intravesical agent is Bacillus Calmette-Guerin (BCG), a live attenuated form of Mycobacterium
bovis. BCG has been the subject of multiple supply shortages in the past decade due to the inability to meet demand to treat
the large population of patients with NMIBC resulting in strategies to conserve the use of the therapy. There has been a significant
increase in bladder cancer recurrence and progression and an escalated number of patients who needed to be treated by cystectomy
have been reported. As such, with the current BCG shortage and limited effective alternate therapies or dosing strategies, there
continues to be a significant unmet need for treatment options for patients with NMIBC.
Manufacturing:
TARA-002 will be manufactured
using an equivalent, but modernized, proprietary manufacturing process as is used to produce OK-432 by Chugai Pharmaceutical, starting
with a master cell line propagated by us but utilizing the same genetically distinct strain of Streptococcus pyogenes (A
group, type 3) Su strain as OK-432. We have contracted a contract development and manufacturing organization (CDMO), to manufacture
TARA-002. TARA-002 has received initial comparability to OK-432 from the FDA. We are currently conducting confirmatory large scale
GMP manufacturing comparability, which are scheduled to be completed in 2021.
TARA-002 for the Treatment of Lymphatic
Malformations
Disease Overview:
We are pursuing regulatory
approval for TARA-002 for the treatment of lymphatic malformations. Lymphatic malformations are rare, non-malignant cystic masses
that primarily form in the head and neck region of children before the age of two. The International Society for the Study of Vascular
Anomalies classifies LMs as either macrocystic, microcystic, or mixed. Macrocystic and microcystic LMs are differentiated by the
size of the fluid-containing portion of the malformation. Macrocystic LMs are characteristically large, fluid-filled cysts with
a thin endothelial lining. Macrocystic LMs are composed of cysts greater than 2 cm3 in size and present as a soft, fluid-filled
swelling beneath normal or slightly discolored skin. Macrocystic LMs are usually located in the antero-lateral cervical region
of the neck; however, it is possible for this type of LM to originate in other areas of the body. In contrast, microcystic LMs
have very limited internal space with a thick irregular endothelial lining. Microcystic LMs are comprised of cysts less than 2
cm3 in size and are often composed of micro-lymphatic channels that integrate and infiltrate normal soft tissue. Microcystic LMs
can involve both superficial and deep aspects including muscle and bone. Microcystic LMs can thicken or swell causing enlargement
of surrounding soft tissue and bones and can be found on any area of the skin or mucous membrane. Mixed LMs are comprised of varying
degrees of both macrocystic and microcystic LMs.
While the exact prevalence
of LMs is not known, in the United States, the condition is thought to be present in approximately one in every 4,000 live births
and we believe there are approximately 1,400-1,800 LM cases per year.
Treatment:
Outside of Japan and Taiwan,
the standard of care is surgical excision, which is associated with high rates of recurrence and complications. There are no approved
pharmacotherapies for LMs, except in Japan and Taiwan where OK-432 is approved. In these countries, OK-432 has been the standard
of care for LMs for over 25 years.
Treatment of LMs varies
depending on the symptoms and complications that present themselves. The standard of care outside Japan and Taiwan for the treatment
of LMs is either a partial or complete surgical excision of the cysts. While surgery is the standard approach to the treatment
of LMs in the head and neck, the region is a difficult area to operate in because of the large number of important anatomical structures
in the area. Major venous and arterial trunks travel through the neck, as do important nerves. Surgery on such malformations frequently
results in high rates of recurrence and complications including life-long chronic conditions, such as damage to nerves and other
important structures of the head and neck.
Clinical Development
When OK-432 is administered
locally for LMs, it is hypothesized that innate immune cells within the cyst are activated and produce a strong immune cascade.
Neutrophils and monocytes infiltrate the cyst and various cytokines, including interleukins IL-6, IL-8, IL-12, interferon (IFN)-gamma,
tumor necrosis factor (TNF)-alpha, and vascular endothelial growth factor (VEGF) are secreted by immune cells within the cyst in
response to the presence of OK-432. In concert, these immune activities induce a strong local inflammatory reaction in the cyst
wall, resulting in fluid drainage, shrinkage and fibrotic adhesion of the cyst.
A
randomized, phase 2 clinical trial led by the University of Iowa studied the use of OK-432 in patients with LM from 1998 to 2005.
Most eligible subjects were between 6 months and 18 years of age with macrocystic or mixed macrocystic-microcystic LMs (with ≥
50% macrocytic disease) of the head and/or neck. There were three treatment groups: immediate treatment (ITG), delayed treatment
(DTG), and open labeltreatment group. The immediate treatment group received treatment with
OK-432 upon diagnosis. The delayed treatment group received OK-432 treatment following a six-month observation period; the cross-over
design was intended to investigate spontaneous resolution. The open-label treatment group included infants younger than six months
of age, adults older than 18 years of age, patients with LMs involving sites other than the head and neck (such as the axilla,
thorax, and extremities), and patients treated on an emergent basis. The open label treatment group were treated immediately with
OK-432. Response to therapy was measured by quantitating change in lesion size. Clinical success was defined as a complete (90%
to 100%) or substantial (60% to 89%) response to treatment based on radiographically confirmed shrinkage in lesions.
Results presented in this
report were based on a retrospective analysis of source verified data that included the full dataset of subjects enrolled in the
P2 randomized study between January 1998 and August 2005, including data in the published study (Smith et al. 2009) which included
subjects enrolled between January 1998 and November 2004.
Overall, 310 subjects
were enrolled with intent to treat: 246 subjects were randomized to the immediate (ITG, N=171) and delayed (DTG, N=75) treatment
groups; 64 subjects were nonrandomized and assigned to the open-label group. Analysis of the primary efficacy endpoint (N=150)
demonstrated clinical success (complete and/or substantial response) in 69% of patients in the ITG 6 months after enrollment, while
7.5% of patients in the DTG experienced spontaneous regression of a LM during this time interval (p < 0.0001)). When the results
were analyzed by lesion type across all treatment groups, a successful outcome was observed in 84% and 60% of patients with macrocystic
and mixed macrocystic-microcystic LM, respectively. None of the patients with microcystic LM demonstrated clinical success to OK-432
therapy. The results of the retrospective analysis were consistent with the results observed in the original analysis (Smith et
al. 2009).
Figure 1: demonstrates that the primary endpoint
was met showing that 69% of patients in the immediate treatment group had a complete or substantial response to OK-432 while 7.5%
of patients in the delayed treatment group had a complete or substantial response after six months of observation and before treatment.
ǂ Clinical Success was defined as complete or substantial response
** Results were analyzed by lesion type across all treatment groups
Figure 2: illustrates that patients with
radiographically confirmed macrocystic lesions had the greatest likelihood of clinical success and in those patients with mixed
legions, clinical success was also achieved.
ǂ Clinical Success was defined as complete or substantial response
** Results were analyzed by lesion type across all treatment groups
Safety Profile
The most common adverse events with treatment
were local injection site reactions, fever, fatigue, decreased appetite, with resolution within a few days. Treatment emergent
serious adverse events (defined as any SAE occurring or worsening on or after the first dose of study drug and within 35 days after
the last dose of study drug) associated with OK-432 treatment were reported in 4.1% of patients, with the most severe events being
airway obstruction and facial paralysis due to massive swelling post-injection that required tracheostomy and hospitalization.
Both of these events were reported as resolved
The safety findings from the Sponsor-conducted
retrospective analysis are consistent with the original analysis reported in Smith et al. 2009, and with safety data in published
studies in approximately 865 patients with LMs after treatment with OK-432.
Preclinical Development:
A comprehensive preclinical
development program for OK-432, including in vitro and in vivo pharmacology and toxicology studies, was conducted
by Chugai Pharmaceutical to support the filing of a new drug application with the Japan Pharmaceuticals and Medical Devices Agency.
We plan to discuss with the FDA the ability to rely on these studies for the submission of a BLA for TARA-002.
Regulatory Interactions:
In July 2020, the U.S.
Food and Drug Administration, or FDA, granted Rare Pediatric Disease designation for TARA-002 for the treatment of LMs. The FDA
grants Rare Pediatric Disease designation for serious diseases that primarily affect children ages 18 years or younger and fewer
than 200,000 persons in the United States. Under the FDA’s Rare Pediatric Disease Priority Review Voucher program, a sponsor who
receives an approval of a new drug application or biologics license application for a product for the prevention or treatment of
a rare pediatric disease may be eligible for a voucher, which can be redeemed to obtain priority review for any subsequent marketing
application or may be sold or transferred.
We plan to utilize
the robust dataset for OK-432 in LMs to support the potential filing of a Biological License Application (BLA) for TARA-002 in
lymphatic LMs. We are encouraged by the progress to date and, at the FDA’s request, have submitted the full Clinical Study
Report (CSR) of the randomized Phase 2 study of OK-432 in LMs led by the University of Iowa. We continue to prepare for a potential
BLA filing in the second half of 2021, or to initiate additional clinical work as required by FDA.
Manufacturing Plans:
TARA-002 will be manufactured
using an equivalent, but modernized, proprietary manufacturing process as is used to produce OK-432 by Chugai Pharmaceutical.
Starting with a master cell line propagated by us but utilizing the same genetically distinct strain of Streptococcus pyogenes
(A group, type 3) Su strain as OK-432. We have contracted a contract development and manufacturing organization (CDMO), to
manufacture TARA-002. TARA-002 has received initial comparability to OK-432 from the FDA. We are currently conducting confirmatory
large scale GMP manufacturing comparability, which are scheduled to be completed in 2021.
IV Choline Chloride for the treatment of Intestinal
Failure Associated Liver Disease
Background:
IV Choline Chloride is
an intravenous (IV) substrate replacement therapy initially in development for patients receiving parenteral (typically intravenous)
nutrition (PN) who have intestinal failure associated liver disease (IFALD).
Choline is a known important
substrate for phospholipids that are critical for healthy liver function. Because patients receiving PN cannot sufficiently absorb
adequate levels of choline and no available PN components contain sufficient amounts of choline to correct this deficit, they often
experience a prolonged progression to hepatic failure and death, with the only known intervention being a dual small bowel / liver
transplant. If approved, IV Choline Chloride would be the first approved therapy for IFALD. It has been granted Orphan Drug Designations
(ODDs) by the FDA for the treatment of IFALD and the prevention of choline deficiency in PN patients. We are currently undertaking
a prevalence study in partnership with a very large home health organization in the United States to enhance understanding of the
PN patient population.
We have entered into a
license agreement with Dr. Alan Buchman for exclusive rights to the IND, ODDs and other regulatory assets related to IV Choline
Chloride, as well as exclusive rights to the data from previously conducted phase 1 and phase 2 clinical trials led by Dr. Buchman.
The results of a randomized,
controlled, phase 2 clinical trial demonstrated that treatment with IV Choline Chloride resulted in normalization of plasma-free
choline concentrations, improvement of hepatic steatosis, and a clinically meaningful and statistically significant improvement
in cholestasis in patients dependent on PN.
We had an end of phase 2 meeting with the FDA
in November 2018 and received the FDA’s support for the design of studies necessary to complete the registration package
for IV Choline Chloride for the treatment of IFALD, including a Phase 1 pharmacokinetic study followed by Phase 3 trial.
Disease Overview:
Intestinal Failure Associated
Liver Disease or IFALD is a rare hepatic/metabolic disease. IFALD, which occurs in patients dependent upon PN, is characterized
by choline deficiency, hepatic steatosis, cholestasis, and rapid progression of liver disease through to hepatic failure and death,
in the absence of intestine-liver transplant. IFALD carries a relatively poor prognosis, with a 15-34% death rate within one to
four years. When IFALD presents in children, mortality is even higher, with studies reporting death rates of 23-40% within 18 months.
A patient is considered to have IFALD if she/he:
According to recent Medicare diagnosis data, we estimate that
there are about 5,000 IFALD patients in the U.S.
Many patients receiving
PN are entirely dependent on PN for their nutritional needs. PN delivers nearly all the macro and micro-nutrients necessary for
survival in their patients, with the notable exception of choline. Consequently, patients dependent on PN support have been shown
to be choline deficient. Patients dependent upon PN are unable to synthesize sufficient levels of choline and malabsorption limits
the bioavailability of choline chloride from the PN diet. The American Society for Parenteral and Enteral Nutrition and the Academy
of Nutrition and Dietetics’ Dietitians in Nutrition Support both recommend that choline be required in PN products; however,
there are currently no FDA-approved choline chloride PN products.
Dependence on PN and resulting
choline deficiency often leads to IFALD, which is the most common adverse outcome in chronic PN adult patients that is associated
with death. Low free choline plasma concentrations are associated with alanine aminotransferase (“ALT”), aspartate
aminotransferase (“AST”), and alkaline phosphatase (“ALP”) elevations as well as steatosis (fatty liver)
and Cholestasis (when bile from the liver stops or slows), all indicators of ongoing liver damage.
Clinical History:
In a Phase 2 randomized,
double-blind, controlled 24-week clinical trial, patients (n=15) receiving nightly PN for > 85% of their nutritional needs (for
at least 12 weeks prior to entry) were randomized to receive via IV infusion (10-12 hours) their usual PN with placebo (n = 8),
or PN to which 2g IV Choline Chloride was added (n = 7).
In the IV Choline Chloride
group, mean choline levels were within or greater than the estimated normal range (i.e., 6.7 to 26.9 nmol/mL) throughout the 24-week
trial and quickly returned to baseline levels when treatment was discontinued.
Steatosis:
Upon conversion of the
quantification of computed tomography (CT) values to magnetic resonance imaging proton density fat fraction (MRI-PDFF), significant
differences in the least square (LS) mean change from baseline in estimated MRI-PDFF were observed in the IV Choline Chloride group
in comparison to placebo group at Week 4 through Week 24, demonstrating a clinically meaningful and statistically significant reduction
in steatosis. When LS mean percent changes from baseline in MRI-PDFF were compared between treatment groups, significant differences
in LS mean changes (range, 31.7% to 53.6%) were observed from Weeks 4 to 24 with p-values of 0.0009 to 0.0297 favoring the IV Choline
Chloride group.
Figure 3. Liver CT Images: Before and After Treatment with
IV Choline Chloride
Alkaline Phosphatase:
At baseline, LS mean ALP
concentration was 239.3 ± 118.93 in the IV Choline Chloride group and 148.1 ± 100.2 in the placebo group. The MMRM
analyses demonstrated statistically significant decreases in ALP concentrations at Week 12 (p = 0.008), Week 16 (p = 0.005), Week
20 (p = 0.007), and Week 24 (p = 0.005) for the IV Choline Chloride group, demonstrating a reduction in cholestasis. A trend towards
significance was observed at Week 4 (p = 0.076) and Week 6 (p = 0.056). At Week 34, 10 weeks after discontinuation of IV Choline
Chloride treatment, LS mean change from baseline in ALP concentrations still demonstrated statistically significant decreases (p
= 0.002), demonstrating a significant improvement in cholestasis with treatment with IV Choline Chloride (Figure 4).
In the subgroup of subjects with ALP concentration
> 1.5x upper limit of normal (ULN) at baseline, (n=7), mean values at baseline were comparable between the IV Choline Chloride
and placebo groups (294.20 ± 87.947 versus 277.00 ± 128.693, respectively). In the sub-group analysis, improvement
in ALP was consistent and substantial, with 20-30% improvement over 12-24 weeks of treatment.
Figure 4. Improvement in Cholestasis1:
All Patients
1 Protara Therapeutics re-analysis of patient CRF’s, data on file
* mixed model for repeated measurement (“MMRM”) method used for imputation
Preclinical Development:
Table 1. Preclinical Studies Conducted by us
for IV Choline Chloride
Study Type Brief Description
Evaluation of Transporter Inhibition by Choline Chloride in Caco-2 Cells
Evaluation of Cytochrome P450 Induction by Choline Chloride in Human Hepatocytes
Evaluation of Transporter Inhibition by Choline Chloride in Caco-2 Cells
Assessment of Choline as a Substrate of Human BSEP Mediated Transport
GLP Combined Single-dose IV Neurobehavioral and Respiratory Study
Clinical Development Plan:
We have reached
agreement with FDA on a number of key aspects of the overall clinical program necessary for registration, including a Phase 1
pharmacokinetic study and a Phase 3 study. We are currently undertaking a prevalence study in partnership with a large home
health organization in the United States to enhance understanding of the PN patient population, and plans to use this
information to determine the appropriate next steps for the development program.
Manufacturing Plans:
We have manufactured sufficient
amounts of GMP drug substance and drug product to initiate the planned clinical trials. Scale up for commercial demand is ready
and will commence when appropriate. Our end-to-end manufacturing of IV Choline Chloride is conducted in the United States by a
GMP-compliant CDMO.
Vonapanitase
As a result of the Merger,
we acquired the product candidate, vonapanitase, a recombinant human elastase that we previously pursued development for the improvement
of vascular access outcomes in patients with chronic kidney disease, undergoing or preparing for hemodialysis, and as a treatment
for patients with symptomatic peripheral artery disease. We are reviewing the research, preclinical and clinical data of vonapanitase
and has not yet determined whether to pursue any further development of this product candidate in the future.
Collaborations and License Agreements
Chugai Agreement
On June 17, 2019, we entered
into an agreement (the “Chugai Agreement”) with Chugai Pharmaceutical, a company organized and existing under the laws
of Japan. Chugai Pharmaceutical has developed and commercialized a therapeutic product, OK-432 (Existing Product), in Japan and
Taiwan (the “Chugai Territory”), and owns and controls certain materials and documents related to the Existing Product
(the “Chugai Materials”). Pursuant to the Chugai Agreement, Chugai Pharmaceutical will provide us with certain materials
and documents relating to the Existing Product and will provide certain technical services to us for our development and commercialization
in territories other than the Chugai Territory (the “Protara Territory”) of a new therapeutic product (the “New
Product” or “TARA-002”) comparable to the Existing Product beginning on the effective date of the Chugai Agreement
and ending on June 30, 2020, or any other date to be agreed to by the parties (the “Chugai Service Period”), Chugai
Pharmaceutical will exclusively provide the Existing Product and Chugai Materials to us and will not provide the Existing Product
or Chugai Materials to any third parties during the Chugai Service Period, other than for medical, compassionate use and/or non-commercial
research purposes. Additionally, beginning on the effective date of the Chugai Agreement and ending on the fifth anniversary of
such date or upon the termination of the Chugai Agreement, whichever comes earlier, Chugai Pharmaceutical shall not provide Chugai
Materials or technical support to any third party for the purpose of development and commercialization in the Protara Territory
of a therapeutic product comparable to the Existing Product. We are responsible, at our sole cost and expense, for the development
and commercialization of the New Product in the Protara Territory.
On July 14, 2020, we entered
into an amended agreement with Chugai Pharmaceutical (the “Amended Chugai Agreement”) with an effective date as of
June 30, 2020. The Chugai Amendment extended the date through which Chugai will exclusively provide the Existing Product and materials
to us from June 30, 2020 to June 30, 2021, extended the date through which Chugai will not provide materials or technical support
to any third party for the purpose of development and commercialization in a given area from the fifth anniversary to the eleventh
anniversary of the original effective date (extended to June 17, 2030) and provides that, in addition to the designated fee provided
upon the initial indication approval in the Chugai Pharmaceutical Agreement, we will pay Chugai a designated fee for each additional
indication approval.
As consideration for Chugai
Pharmaceutical’s performance under the Chugai Agreement, we agreed to pay Chugai Pharmaceutical a payment in the low, single-digit
millions, which payments shall be made in two installments with an initial payment in July 2020, and the remaining majority of
the payment payable upon FDA approval of the New Product.
We granted Chugai Pharmaceutical
a right of first refusal on terms to be negotiated between the parties for a license related to the New Product-relevant information,
data and documentation and inventions to develop and commercialize the New Product in the Chugai Territory. We will be responsible
for manufacturing and supplying or causing our CDMO to manufacture and supply the New Product to Chugai Pharmaceutical.
The Chugai Agreement shall
remain in full force and effect until the first anniversary of the date of FDA approval of the New Product, unless terminated sooner
(the “Chugai Term”). Following the Chugai Service Period and during the Chugai Term, Chugai Pharmaceutical may terminate
the Chugai Agreement, in whole or in part, without cause, by providing us 90 days prior written notice. Following such termination,
we would maintain exclusive access to Chugai Materials, subject to the termination clauses outlined below. We may terminate the
Chugai Agreement, in whole only, by providing Chugai Pharmaceutical 90 days prior written notice if (i) we decide to discontinue
the New Product development; (ii) we decide that the FDA’s requirements for the New Product are not likely to be met; or
(iii) the FDA identifies a safety issue regarding the New Product.
In addition, either party
may terminate the Chugai Agreement, in whole or in part, in the event that the other party materially breaches the Chugai Agreement
and fails to cure the breach within 30 days of written notice. Either party may terminate the Chugai Agreement in its entirety
immediately upon notice to the other party if such other party: (i) is dissolved or liquidated or takes any corporate action for
such purpose; (ii) becomes insolvent or is generally unable to pay, or fails to pay, its debts as they become due; (iii) files
or has filed against it a petition for voluntary or involuntary bankruptcy or otherwise becomes subject to any proceeding under
any domestic or foreign bankruptcy or insolvency laws; (iv) makes or seeks to make a general assignment for the benefit of creditors;
or (v) applies for or has a receiver, trustee, custodian or similar agent appointed by order of any court to take charge of or
sell any material portion of its property or business.
In the event that we undergo