Atara Biotherapeutics: Another Dip Buying Opportunity Following CRL For CMC Issues

Summary

• Atara has just announced a CRL by FDA for EBVALLO. EBVALLO is already approved in Europe since December 2022 and the cause of the CRL seems minor and easily addressable.
• The CRL has a major impact on cash runway, considering delay in milestone payments related to approval as well as future royalties. Nevertheless, ATRA remains eligible for these future payments.
• This forced ATRA to suspend its CAR-T pipeline in search for strategic alternatives. On the bright side, this creates another short-term catalyst and allows ATRA to focus resources on EBVALLO.
• ATRA estimates that available cash along a newly announced $15M equity line of credit are sufficient to fund operations through approval, but the risk of further cash raise is real.

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Thesis overview

This is my 4th coverage of Atara Biotherapeutics (NASDAQ:ATRA). In my first coverage, I was bullish on ATRA for the potential in multiple sclerosis. As we all know by now, I was very wrong. Fortunately, trading the

Analyst’s Disclosure:I/we have a beneficial long position in the shares of ATRA either through stock ownership, options, or other derivatives. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from Seeking Alpha). I have no business relationship with any company whose stock is mentioned in this article.