Our second quarter of 2022 and recent key events are as follows:

•In June 2022, we recognized $15 million in milestone revenues related to variable consideration in the contracts where uncertainties have been resolved and the development milestones were expected to be achieved.

•In June 2022, BMS nominated an undisclosed target resulting in a $5 million payment.

•In June 2022, argenx initiated a phase 2 study evaluating efgartigimod with ENHANZE in subjects with bullous pemphigoid.

•In April 2022, Roche initiated a phase 3 study evaluating OCREVUS (ocrelizumab) with ENHANZE in subjects with multiple sclerosis.

•In May 2022, we completed the acquisition of Antares resulting in an expansion of our commercial portfolio of proprietary and partnered products and the potential for future growth through new agreements

Proprietary Products and Product Candidates

Hylenex Recombinant (hyaluronidase human injection)

XYOSTED® (testosterone enanthate) Injection

NOCDURNA® (desmopressin acetate) Sublingual Tablets

TLANDO® (testosterone undecanoate) Oral Formulation

In December 2006, we and Roche entered into a collaboration and license agreement under which Roche obtained a worldwide license to develop and commercialize product combinations of rHuPH20 and up to twelve Roche target compounds (the Roche Collaboration). Under this agreement, Roche elected a total of eight targets, two of which are exclusive.

In August 2019, Roche initiated a Phase 1 study evaluating OCREVUS® (ocrelizumab) with ENHANZE technology in subjects with multiple sclerosis. In April 2022, Roche initiated a phase 3 study evaluating OCREVUS with ENHANZE technology in subjects with multiple sclerosis.

In October 2019, Roche nominated a new undisclosed exclusive target to be studied using ENHANZE technology. In November 2021, Roche initiated a Phase 1 study with the undisclosed target and ENHANZE.

In September 2014, HYQVIA was approved by the FDA for treatment of adult patients with primary immunodeficiency in the U.S. HYQVIA is the first subcutaneous immune globulin (IG) treatment approved for adult primary immunodeficiency patients with a dosing regimen requiring only one infusion up to once per month (every three to four weeks) and one injection site per infusion in most patients, to deliver a full therapeutic dose of IG.

In October 2021, Baxalta initiated a Phase 1 single-dose, single-center, open-label, three-arm study to assess the tolerability and safety of immune globulin subcutaneous (human), 20% solution with ENHANZE (TAK-881) at various infusion rates in healthy adult subjects.

In July 2022, Baxalta announced positive topline results from pivotal Phase 3 trial evaluating HYQVIA, for maintenance treatment of chronic inflammatory demyelinating polyradiculoneuropathy (CIDP)

In December 2012, we and Pfizer entered into a collaboration and license agreement, under which Pfizer has the worldwide license to develop and commercialize products combining our rHuPH20 enzyme with Pfizer proprietary biologics in primary care and specialty care indications. Pfizer has elected five targets and has returned two targets.

In December 2019, Janssen elected EGFR and cMET as a bispecific antibody (amivantamab) target on an exclusive basis, which is being studied in solid tumors. In November 2020, Janssen initiated a Phase 1 study of amivantamab and ENHANZE.

In December 2015, we and Lilly entered into a collaboration and license agreement, under which Lilly has the worldwide license to develop and commercialize products combining our rHuPH20 enzyme with Lilly proprietary biologics directed to up to five targets. Targets may be selected on an exclusive basis. Lilly has elected two targets on an exclusive basis and one target on a semi-exclusive basis. In August 2017, Lilly initiated a Phase 1 study of an investigational therapy in combination with rHuPH20.

In December 2017, we and Alexion entered into a collaboration and license agreement, under which Alexion has the worldwide license to develop and commercialize products combining our rHuPH20 enzyme with Alexion's portfolio of products directed at up to four targets and has access to three targets.

Teva License, Development and Supply Agreements

In October 2020, we entered into an exclusive license and commercial supply agreement with Ferring for the marketed product NOCDURNA® (desmopressin acetate) in the U.S., Under the terms of the license agreement, we paid Ferring an upfront payment of $5.0 million upon execution and paid an additional $2.5 million on October 1, 2021. Ferring is eligible for tiered royalties and additional commercial milestone payments potentially totaling up to $17.5 million based on our net sales of NOCDURNA® in the U.S.

for the treatment of hypogonadism in adult males. Following a review of our product portfolio, we decided not to exercise the option which expired on June 30, 2022.

For a further discussion of the collaboration agreements, refer to Note 5, Revenue.

Impact of COVID-19 to our Business

Three Months Ended June 30, 2022 Compared to Three Months Ended June 30, 2021

Product Sales, Net - Product sales, net were as follows (in thousands):

Revenues Under Collaborative Agreements - Revenues under collaborative agreements were as follows (in thousands):

Six Months Ended June 30, 2022 Compared to Six Months Ended June 30, 2021

Product Sales, Net - Product sales, net were as follows (in thousands):

Revenues Under Collaborative Agreements - Revenues under collaborative agreements were as follows (in thousands):

full six months of income tax expense in the current year whereas in the prior year period there was minimal income tax expense due to a full valuation allowance in place.

We may, in the future, draw on our existing line of credit, offer and sell additional equity, debt securities and warrants to purchase any of such securities, either individually or in units to raise capital to raise funds for additional working capital, capital expenditures, share repurchases, acquisitions or for other general corporate purposes.

Revolving Credit and Term Loan Facilities (May 2022)

Critical Accounting Policies and Estimates

Refer to Note 2, Summary of Significant Accounting Policies, of our condensed consolidated financial statements for a discussion of recent accounting pronouncements and their effect, if any.

Risks Related To Our Business

Use of our partnered or proprietary products and product candidates could be associated with side effects or adverse events or product recalls.*

storage and transportation of our products. If anything should impede their ability to meet their commitments this could impact our business performance.*

If we or any party to a key collaboration agreement fail to perform material obligations under such agreement, or if a key collaboration agreement, is terminated for any reason, our business could significantly suffer.

Hylenex and our partners' ENHANZE products and product candidates rely on the rHuPH20 enzyme, and any adverse development regarding rHuPH20 could substantially impact multiple areas of our business, including current and potential ENHANZE collaborations, as well as any proprietary programs.*

Our partnered or proprietary product candidates may not receive regulatory approvals or their development may be delayed for a variety of reasons, including delayed or unsuccessful clinical trials, regulatory requirements or safety concerns. If we or our partners fail to obtain, or have delays in obtaining, regulatory approvals for any product candidates, our business, financial condition and results of operations may be materially adversely affected.*

If a proprietary or partnered product candidate is not approved in a timely fashion or obtained on commercially viable terms, or if development of any product candidate is terminated due to difficulties or delays encountered in the regulatory approval process, it could have a material adverse impact on our business, financial condition and results of operation and we

Failure to comply with regulatory requirements may result in adverse regulatory actions including but not limited to, any of the following:

Failure to successfully integrate the Antares business, or failure of the Antares business to perform could adversely impact our stock price and future business and operations.*

We may need to raise additional capital in the future and there can be no assurance that we will be able to obtain such funds.*

The conditional conversion feature of the Convertible Notes, if triggered, may adversely affect our financial condition and operating results.

Conversion of our Convertible Notes may dilute the ownership interest of existing stockholders or may otherwise depress the price of our common stock.

Assuming that existing or future proprietary or partnered product candidates obtain the necessary regulatory approvals for commercial sale, a number of factors may affect the market acceptance of these newly-approved products, including, among others:

Our ability to license our ENHANZE and device technologies to our partners depends on the validity of our patents and other proprietary rights.*

Future acquisitions could disrupt our business and harm our financial condition.

Our effective tax rate may fluctuate, and we may incur obligations in tax jurisdictions in excess of accrued amounts.

Risks Related To Ownership of Our Common Stock

Our stock price is subject to significant volatility.

Future transactions where we raise capital may negatively affect our stock price.

Anti-takeover provisions in our charter documents, the Indentures and Delaware law may make an acquisition of us more difficult.*

These provisions may deter an acquisition of us that might otherwise be attractive to stockholders.

Risks Related to Our Industry

In addition, the FDA imposes a number of complex regulatory requirements on entities that advertise and promote pharmaceuticals including, but not limited to, standards and regulations for direct-to-consumer advertising, off-label promotion, industry-sponsored scientific and educational activities, and promotional activities involving the Internet.

Because some of our and our partners' products and product candidates are considered to be drug/device combination products, the approval and post-approval requirements that we and they are required to comply with can be more complex.*

In addition, any sales of products outside the U.S. will also likely subject us to the FCPA and foreign equivalents of the healthcare laws mentioned above, among other foreign laws.

We primarily rely on patents to protect our intellectual property rights. The strength of this protection, however, is uncertain. For example, it is not certain that:

We may become involved in interference proceedings in the U.S. Patent and Trademark Office, or other proceedings in other jurisdictions, to determine the priority, validity or enforceability of our patents. In addition, costly litigation could be necessary to protect our patent position.

If third party reimbursement and customer contracts are not available, our proprietary and partnered products may not be accepted in the market resulting in commercial performance below that which was expected or projected.

In the U.S., our business may be impacted by changes in federal reimbursement policy resulting from executive actions, federal regulations, or federal demonstration projects.

Our inability to attract, hire and retain key management and scientific personnel could negatively affect our business.

Our operations might be interrupted by the occurrence of a natural disaster or other catastrophic event.

Cyberattacks, security breaches or system breakdowns may disrupt our operations and harm our operating results and reputation.

© Edgar Online, source Glimpses