Protagonist Therapeutics, Inc Leases Disclosure
Note 8. Lease
The Company applies ASC Topic 842 to recognize assets and liabilities for leases with lease terms of more than 12 months on the balance sheet. The Company has elected to account for each separate lease component and non-lease component as one single component for all lease assets. Leases with terms of 12 months or less are not recorded on the balance sheet, and the related lease expenses are recognized on a straight-line basis over the lease term.
The Company has one operating lease agreement originally entered into in March 2017 for approximately 42,900 square feet for laboratory and office space located in Newark, California. In July 2021, the Company entered into a second amendment to its original facility lease agreement, as amended, for 15,000 square feet of additional office space in Newark, California.
On May 6, 2024, the Company amended its facility lease agreement (the “Amended Lease”) to extend the lease term for its existing office and laboratory space from to 66 months and lease approximately 17,700 rentable square feet of additional office space, all located in Newark, California. The Company began occupying the additional space under the Amended Lease on July 1, 2024. The Amended Lease, which expires in November 2029, provides for an agreed-upon period of rent abatement and a tenant improvement allowance of $1.8 million. As a result of this amendment, the Company recorded an additional right-of-use-asset and the related liability of $10.5 million for the year ended December 31, 2024.
The Company provided the landlord with a $225,000 letter of credit collateralized by restricted cash as security deposit for the operating lease agreement. No additional security deposit was required pursuant to the Amended Lease. The Company is responsible for its proportional share of operating expenses and tax obligations.
Balance sheet information related to the Company’s operating lease is as follows for the periods presented (in thousands):
December 31, | ||||||
Operating Leases: | 2025 | 2024 | ||||
Operating lease right-of-use asset | $ | 7,829 | $ | 9,417 | ||
Operating lease liability - current | $ | 2,283 | $ | 510 | ||
Operating lease liability - noncurrent | 8,040 | 10,356 | ||||
Total operating lease liabilities | $ | 10,323 | $ | 10,866 | ||
Weighted-average remaining lease term (years) | 3.9 | 4.9 | ||||
Weighted-average discount rate | 5.7% | 5.7% | ||||
Other information related to the Company’s operating lease is as follows for the periods presented (in thousands):
Year Ended December 31, | |||||||||
| 2025 | 2024 | 2023 | ||||||
Operating lease cost | $ | 2,308 | $ | 2,459 | $ | 2,335 | |||
Short-term rent expense | — | 51 | — | ||||||
Less: Sublease income | — | (34) | (137) | ||||||
Total lease expense | $ | 2,308 | $ | 2,476 | $ | 2,198 | |||
Supplemental cash flow information is as follows for the periods presented (in thousands):
Year Ended December 31, | |||||||||
| 2025 | 2024 | 2023 | ||||||
Operating cash flow used by operating leases | $ | 903 | $ | 2,226 | $ | 2,743 | |||
New operating lease asset obtained in exchange for operating lease liability | $ | — | $ | 10,511 | $ | — | |||
Future lease payments required under lease obligations as of December 31, 2025 are as follows (in thousands):
Year Ending December 31: | | Amount | |
2026 | $ | 2,787 | |
2027 | 2,884 | ||
2028 | 2,985 | ||
2029 | 2,828 | ||
Thereafter |
| — | |
Total future minimum lease payments | 11,484 | ||
Less: Imputed interest | (1,161) | ||
Present value of lease liabilities | $ | 10,323 | |
Historical Timeline
| Fiscal Year | Filed | |
|---|---|---|
| 2025 | Feb 25, 2026 | Showing above |
| 2024 | Feb 21, 2025 | |
| 2023 | Feb 27, 2024 | |
| 2022 | Mar 15, 2023 | |
| 2021 | Feb 28, 2022 | |
| 2020 | Mar 10, 2021 | |
| 2019 | Mar 10, 2020 | |
About Leases Disclosures
Lease disclosures under ASC 842 provide a comprehensive view of a company's leased asset portfolio, including the split between operating and finance leases, discount rates used to present-value future payments, and the maturity schedule of lease obligations. This section reveals a significant source of off-balance-sheet commitments that were largely hidden before the current standard.
Key signals: the weighted-average discount rate affects the size of recorded lease liabilities — a higher rate reduces the reported obligation, so compare the chosen rate against the company's incremental borrowing rate. The operating versus finance lease mix affects both EBITDA and operating income presentation. Watch the maturity table for concentration risk: large payment cliffs in specific years may create cash flow pressure. Variable lease payments excluded from the liability measurement represent real obligations that do not appear on the balance sheet. Compare total lease costs against prior-year operating lease expense to assess the true economic burden.