Protagonist Therapeutic Inc (PTGX)

Protagonist Therapeutic Inc Q1 2025 Financial Analysis

Report Date: 2025-05-07
Period Covered: Quarter ended March 31, 2025
Form Type: 10-Q

Executive Summary

• Revenue: $28.32 M from license and collaboration agreements (primarily Takeda)
• Operating Expense: $47.63 M (R&D $35.89 M; G&A $11.74 M)
• Net Loss: $11.66 M vs. net income $207.34 M in Q1 2024
• Cash & Marketable Securities: $697.9 M
• Debt: None

Profit & Loss Analysis

• Revenue Drivers: Recognition of $28.32 M under ASC 606 for Takeda collaboration, including $25.50 M in upfront and milestone allocations, and $0.55 M for services.
• Cost Dynamics: R&D spending rose by $2.16 M YOY, driven by preclinical discovery (e.g., PN881) and ongoing trials. G&A fell by $3.17 M as one-time legal/advisory fees in Q1 2024 did not recur.
• Interest Income: Increased to $7.57 M from $4.38 M, reflecting a higher invested cash balance.
• Tax Impact: $3.33 M expense driven by 15.4% effective rate on collaboration income in Q1 2024; no tax benefit in Q1 2025 due to net loss.

Reasons for Loss

• High Burn in R&D: Continued investment in peptide candidates (icotrokinra, rusfertide, PN881) with no approved products.
• Shift in Revenue Recognition: Q1 2024 benefit from a $25.41 M upfront Takeda payment vs. proportionate recognition in Q1 2025.
• Flat Operating Leverage: Reduced G&A was offset by higher program costs and stock-based comp.

Pros and Cons

Pros:

• Large cash runway (>12 months) with $697.9 M liquid assets.
• Upcoming catalysts: potential NDA submissions for icotrokinra and rusfertide in late 2025.
• No debt – zero leverage.

Cons:

• High quarterly cash burn (~$31 M net) driven by R&D.
• Dependence on milestone payments and partnerships (Takeda, J&J) for revenue.
• Regulatory risk: clinical and approval timelines remain uncertain.

Conclusion

Protagonist Therapeutic maintains a strong cash position and no debt, but incurred a net loss in Q1 2025 due to high R&D investment and timing of collaboration revenue recognition. The next 12 months will be pivotal, with potential NDA filings and milestone receipts that could materially affect the financial profile.

• License & Collaboration Revenue: $28.321 M
• R&D Expense: $35.893 M
• G&A Expense: $11.738 M
• Interest Income: $7.573 M
• Income Tax Expense: $3.326 M
• Net Loss: $11.655 M

Protagonist Therapeutic is on a high-burn, high-catalyst trajectory: cash reserves (~$698 M) support current R&D programs through the next year, but reliance on milestone-based revenue and partnerships poses timing risk. Key upcoming NDA milestones (icotrokinra, rusfertide) offer upside, yet clinical and regulatory uncertainties remain. Continued capital discipline and successful trial readouts will determine financial health beyond current runway.