prtk-20220331

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

____________________________________________________

Form 10-Q

____________________________________________________


x			Quarterly Report Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934

For the quarterly period ended: March 31, 2022 or


o			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: 001-36066

____________________________________________________

PARATEK PHARMACEUTICALS, INC.

(Exact name of registrant as specified in its charter)

____________________________________________________


Delaware			33-0960223
(State or other jurisdiction of incorporation or organization)			(I.R.S. Employer Identification No.)

____________________________________________________

75 Park Plaza

Boston , MA 02116

(617) 807-6600

(Address, including zip code, and telephone number, including area code, of registrant’s principal executive office)

____________________________________________________

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	PRTK	The Nasdaq Global 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 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 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. o

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Act). Yes o No x

As of April 30, 2022, there were 54,478,506 shares of the registrant's common stock, par value $0.001 per share, outstanding.

Table of Contents

TABLE OF CONTENTS


		Page
PART I FINANCIAL INFORMATION

Item 1.	Financial Statements (unaudited)	2

	Condensed Consolidated Balance Sheets as of March 31, 2022 and December 31, 2021	2

	Condensed Consolidated Statements of Operations and Comprehensive Income (Loss) for the Three Months Ended March 31, 2022 and 2021	3

	Condensed Consolidated Statements of Cash Flows for the Three Months Ended March 31, 2022 and 2021	4

	Condensed Consolidated Statements of Shareholders’ Equity (Deficit) for the Three Months Ended March 31, 2022 and 2021	5

	Notes to Unaudited Condensed Consolidated Financial Statements	6

Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	30

Item 3.	Quantitative and Qualitative Disclosures About Market Risk	41

Item 4.	Controls and Procedures	41

PART II OTHER INFORMATION

Item 1.	Legal Proceedings	43

Item 1A.	Risk Factors	43

Item 6.	Exhibits	44

SIGNATURES		46

Table of Contents

PART I – FINANCIAL INFORMATION

Item 1. Financial Statements

Paratek Pharmaceuticals, Inc.

Condensed Consolidated Balance Sheets

(in thousands, except for share and par value amounts)

(unaudited)


	March 31, 2022		December 31, 2021
Assets
Current assets
Cash and cash equivalents	$	49,033	$	80,367
Marketable securities	30,020		15,107
Restricted cash	250		125
Accounts receivable, net	24,739		29,438
Inventories	12,732		11,020
Other receivables	3,520		3,679
Prepaid and other current assets	12,988		12,364
Total current assets	133,282		152,100
Long-term restricted cash	125		125
Fixed assets, net	762		794
Goodwill	829		829
Right-of-use assets	1,536		1,757
Long-term inventories	32,955		27,767
Other long-term assets	668		497
Total assets	$	170,157	$	183,869
Liabilities and Stockholders’ Deficit
Current liabilities
Accounts payable	$	4,697	$	5,394
Accrued expenses	22,133		23,446
Other current liabilities	2,007		2,457
Total current liabilities	28,837		31,297
Long-term debt	255,949		254,428
Long-term lease liabilities	1,063		1,308
Accrued long-term compensation	21,893		21,846
Other liabilities	2,717		2,777
Total liabilities	$	310,459	$	311,656
Stockholders’ deficit
Preferred stock:
Undesignated preferred stock: $0.001 par value, 5,000,000 shares authorized; no shares issued and outstanding	—		—
Common stock, $0.001 par value; 200,000,000 shares authorized; 53,023,350 shares issued and outstanding as of March 31, 2022; and 200,000,000 shares authorized; 51,711,809 shares issued and outstanding as of December 31, 2021	53		52
Additional paid-in capital	744,618		739,053
Accumulated other comprehensive income	(180)		(9)
Accumulated deficit	(884,793)		(866,883)
Total stockholders’ deficit	(140,302)		(127,787)
Total liabilities and stockholders’ deficit	$	170,157	$	183,869

See accompanying notes to unaudited condensed consolidated financial statements.

Table of Contents

Paratek Pharmaceuticals, Inc.

Condensed Consolidated Statements of Operations and Comprehensive Loss

(in thousands, except share and per share amounts)

(unaudited)


	Three Months Ended March 31,
	2022		2021
Product revenue, net	$	19,918	$	13,207
Government contract service revenue	2,172		973
Government contract grant revenue	2,099		1,613
Collaboration and royalty revenue	672		634
Net revenue	$	24,861	$	16,427
Expenses:
Cost of product revenue	3,494		2,751
Research and development	7,478		5,538
Selling, general and administrative	27,602		22,359
Total operating expenses	38,574		30,648
Loss from operations	(13,713)		(14,221)
Other income and expenses:
Interest income	107		25
Interest expense	(4,479)		(4,307)
Other gains (losses), net	175		157
Net loss	$	(17,910)	$	(18,346)
Other comprehensive income (loss)
Unrealized gain (loss) on available-for-sale securities, net of tax	(171)		(4)
Comprehensive loss	$	(18,081)	$	(18,350)
Basic and diluted net loss per common share	$	(0.35)	$	(0.39)
Weighted average common stock outstanding
Basic and diluted	52,149,538		46,664,374

See accompanying notes to unaudited condensed consolidated financial statements.

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Paratek Pharmaceuticals, Inc.

Condensed Consolidated Statements of Cash Flows

(in thousands)

(unaudited)


	Three Months Ended March 31,
	2022		2021
Operating activities
Net loss	$	(17,910)	$	(18,346)
Adjustments to reconcile net loss to net cash used in operating activities:
Depreciation, amortization and accretion	144		110
Stock-based compensation expense	2,469		1,599
Noncash interest expense	1,521		335
Changes in operating assets and liabilities
Accounts receivable, other receivables, prepaid, and other current assets	4,234		(240)
Inventories	(6,900)		(2,734)
Operating lease right-of-use asset	221		236
Accounts payable and accrued expenses	(2,010)		(421)
Operating lease liability	(245)		(102)
Other liabilities and other assets	(634)		(1,955)
Net cash used in operating activities	(19,110)		(21,518)
Investing activities
Purchase of fixed assets	(36)		(262)
Purchase of marketable securities	(15,160)		—
Proceeds from maturities of marketable securities	—		20,000
Net cash (used) provided by investing activities	(15,196)		19,738
Financing activities
Payment of long-term royalty-backed loan agreement debt issuance costs	—		(397)
Proceeds from sale of common stock, net of costs	3,091		—

Proceeds from the employee stock purchase plan and stock options	6		3
Net cash (used) provided by financing activities	3,097		(394)
Net (decrease) increase in cash, cash equivalents and restricted cash	(31,209)		(2,174)
Cash, cash equivalents and restricted cash at beginning of period	80,617		106,048
Cash, cash equivalents and restricted cash at end of period	$	49,408	$	103,874
SUPPLEMENTAL DISCLOSURES OF CASH FLOW INFORMATION
Cash paid for interest	$	1,181	$	975

SUPPLEMENTAL DISCLOSURES OF NONCASH FINANCING ACTIVITIES

Paid in-kind interest included in accrued expenses	$	1,161	$	—

See accompanying notes to unaudited condensed consolidated financial statements.

Table of Contents

Paratek Pharmaceuticals, Inc.

Condensed Consolidated Statements of Stockholders’ Deficit

(in thousands, except share amounts)

(unaudited)

Common Stock

Additional
Paid-in
Capital

SEC Form 10-Q filed by Paratek Pharmaceuticals Inc.