Executive Summary / Key Takeaways

• Protagonist Therapeutics is leveraging its proprietary peptide engineering platform to advance a diverse pipeline of novel therapeutics, with two lead candidates, icotrokinra and rusfertide, in late-stage development and regulatory review.
• Icotrokinra, an oral IL-23R antagonist partnered with Janssen, has seen NDA and MAA submissions for moderate-to-severe plaque psoriasis, demonstrating superiority over deucravacitinib in Phase 3 trials and showing promise in ulcerative colitis and Crohn's disease.
• Rusfertide, an injectable hepcidin mimetic co-developed with Takeda for polycythemia vera (PV), achieved Breakthrough Therapy designation and positive Phase 3 VERIFY trial results, significantly reducing phlebotomy dependence and improving patient-reported outcomes.
• While 2025 revenue is projected to significantly decrease from 2024 due to the timing of large collaboration payments, the company maintains a strong liquidity position with $678.8 million in cash, cash equivalents, and marketable securities as of September 30, 2025, providing a runway through at least the end of 2028.
• The company's strategic focus on peptide innovation, coupled with key partnerships, positions it to potentially disrupt established markets with oral and targeted therapies, though it faces inherent risks associated with clinical development, regulatory approvals, and macroeconomic uncertainties.

Peptide Innovation: A Differentiated Approach in Biopharma

Protagonist Therapeutics is carving out a distinct niche in the biopharmaceutical landscape, focusing on the discovery and late-stage development of peptide therapeutics. The company's core strategy revolves around its proprietary peptide engineering technology platform, which enables the creation of novel chemical entities designed to overcome limitations of traditional small molecule and large antibody approaches. This platform is a foundational strength, allowing Protagonist to pursue medical challenges in areas like hematology and blood disorders, inflammatory and immunomodulatory diseases, and metabolic disorders.

The company's historical journey, from its incorporation in 2006 and IPO in 2016, has been marked by strategic partnerships and a disciplined focus on its platform. Early collaborations, notably with Janssen Biotech, Inc. (JNJ) for IL-23R antagonists, and more recently with Takeda Pharmaceuticals, Inc. (TAK) for rusfertide, underscore a model of leveraging external expertise and resources to accelerate development. This approach has allowed Protagonist to build a pipeline with multiple assets in advanced clinical stages, aiming to deliver differentiated, patient-friendly therapeutic options.

Technological Edge: Precision Peptides for Unmet Needs

Protagonist's proprietary peptide engineering technology is a significant competitive differentiator. This platform allows for the design of structurally constrained peptides that combine the advantages of small molecules (e.g., oral delivery, targeted action) with those of antibodies (e.g., high potency, specificity), while mitigating their respective drawbacks (e.g., instability, injectability). This technological prowess is evident across its pipeline.

For rusfertide (formerly PTG-300), a mimetic of the natural hormone hepcidin, the platform engineered a peptide with superior drug-like properties, including enhanced potency, half-life, solubility, stability, and ease of synthesis compared to natural hepcidin. Notably, rusfertide demonstrated a significantly longer half-life of 21 to 42 hours in Phase 1 studies, compared to the expected 5 to 8 hours for natural hepcidin. This extended half-life is crucial for a once-weekly injectable regimen, improving patient convenience and compliance.

In the inflammatory disease space, icotrokinra, an oral IL-23R antagonist, exemplifies the platform's ability to create oral alternatives to injectable biologics. This oral delivery mechanism offers the potential for increased convenience and compliance, allowing for earlier introduction of targeted therapy. In Phase 3 trials for plaque psoriasis, icotrokinra demonstrated superiority over deucravacitinib, a notable achievement in a competitive therapeutic area. Furthermore, the ongoing ICONIC-ASCEND trial is the first head-to-head study evaluating an oral pill against an injectable biologic (ustekinumab), highlighting the ambition and potential of Protagonist's oral peptide approach.

The development of PN-943, an oral gut-restricted alpha-4-beta-7 integrin antagonist, further showcases the platform's versatility. PN-943 demonstrated a threefold increase in potency over its predecessor, PTG-100, in preclinical and Phase 1 studies. This improved potency means PN-943 can achieve the efficacious 74% blood receptor occupancy observed with PTG-100 in ulcerative colitis patients at significantly lower doses, potentially enhancing its safety profile and therapeutic index.

Protagonist's R&D initiatives continue to expand this technological advantage. PN-881, a potential best-in-class oral IL-17 antagonist, recently entered Phase 1, targeting multiple IL-17 dimers for immune-mediated skin diseases. The obesity triple agonist peptide, PN-477, selected as a development candidate in June 2025, is designed for an optimal balance of weight loss, GI tolerability, and fat-to-lean mass ratio, with both once-daily oral and once-weekly subcutaneous options. An oral hepcidin mimetic is also expected to be nominated by year-end 2025, complementing rusfertide. These advancements underscore the platform's ability to generate a continuous stream of differentiated candidates, strengthening Protagonist's competitive moat and offering diverse avenues for future revenue generation.

Competitive Landscape and Strategic Positioning

Protagonist operates in highly competitive biopharmaceutical markets, vying with established giants and innovative biotechs. In inflammatory diseases, icotrokinra and PN-943 face competition from companies like AbbVie (ABBV) and Johnson & Johnson, which have extensive portfolios of injectable biologics for IBD and psoriasis. While these larger players boast superior commercialization infrastructure and global reach, Protagonist differentiates itself through its focus on oral, targeted peptide therapies. The potential for icotrokinra to demonstrate superiority over deucravacitinib and its head-to-head study against ustekinumab highlight a strategic intent to challenge existing treatment paradigms with potentially more convenient and effective options.

In the hematology space, rusfertide competes with therapies from companies like Incyte (INCY) and Novartis (NVS) for polycythemia vera (PV) and other blood disorders. Protagonist's rusfertide is the first investigational therapy to show statistically significant improvements in patient-reported fatigue and symptom burden in PV, alongside its efficacy in hematocrit control and phlebotomy reduction. This positions rusfertide as a potential drug of choice for patients whose current therapies are ineffective or who suffer from iron deficiency due to frequent phlebotomies. While Incyte and Novartis have established presences, rusfertide's targeted mechanism and Breakthrough Therapy designation offer a strong competitive edge in addressing unmet needs in PV.

Protagonist's strategic partnerships are crucial in this competitive environment. The collaborations with Janssen and Takeda provide access to significant financial resources, development expertise, and commercialization capabilities that a clinical-stage company might otherwise lack. These partnerships enable Protagonist to share development costs and risks, while retaining substantial milestone payments and royalties, or even profit-sharing arrangements in key territories. For instance, the Takeda agreement for rusfertide includes potential milestones up to $305 million and tiered royalties, with an option for Protagonist to opt-out of profit-sharing for higher royalties and additional milestone payments, demonstrating a flexible and value-maximizing partnership structure.

Financial Performance and Liquidity

Protagonist's financial performance reflects its stage as a discovery and late-stage development biopharmaceutical company. For the nine months ended September 30, 2025, the company reported license and collaboration revenue of $38.58 million. This figure represents a significant decrease from the $263.80 million reported for the same period in 2024. The substantial revenue in 2024 was primarily driven by a $300 million upfront payment from the Takeda Collaboration Agreement and a $165 million milestone payment from Janssen, both recognized in that year. Consequently, revenue for the full year 2025 is expected to be substantially lower, impacting net income.

The company continues to incur significant research and development (R&D) expenses, which increased by 9% to $112.90 million for the nine months ended September 30, 2025. This increase was largely due to an $18.60 million rise in preclinical and drug discovery research, supporting new candidates like PN-881 and PN-477, partially offset by an $8.90 million decrease in rusfertide expenses as the Phase 3 VERIFY trial neared completion. General and administrative (G&A) expenses decreased by 3% to $33.40 million, primarily due to the absence of one-time advisory and legal fees related to the Takeda agreement incurred in 2024.

Despite the expected revenue reduction in 2025, Protagonist maintains a robust liquidity position. As of September 30, 2025, the company held $678.80 million in cash, cash equivalents, and marketable securities. This strong cash balance is anticipated to fund operations for at least the next twelve months from the 10-Q filing date of November 6, 2025, based on current operating plans and financial forecasts.

Cash provided by operating activities for the nine months ended September 30, 2025, was $94.60 million, a decrease from $213.33 million in the prior year, reflecting the timing of large collaboration payments. The company's cumulative net losses, totaling $426.30 million from inception through September 30, 2025, underscore the capital-intensive nature of drug development.

Outlook and Risks

The outlook for Protagonist Therapeutics is characterized by several key clinical and regulatory milestones. For icotrokinra, the NDA and MAA submissions in 2025 for plaque psoriasis are pivotal, with potential milestone payments from Janssen upon FDA approval ($50 million for the first indication). Ongoing Phase 3 trials for psoriatic arthritis, ulcerative colitis, and Crohn's disease, including a head-to-head study against ustekinumab, could further expand its market potential. Rusfertide's NDA filing for PV is expected by the end of 2025, following its Breakthrough Therapy designation and compelling Phase 3 VERIFY data, with additional milestones anticipated from Takeda upon regulatory approvals. The company is also advancing its wholly-owned pipeline, with PN-881 in Phase 1 and PN-477 entering IND-enabling studies, targeting Phase 1 initiation in 2026.

However, Protagonist faces inherent risks common to the biopharmaceutical industry. Disruptions at regulatory agencies, such as the ongoing U.S. federal government shutdown that commenced in October 2025 and mass layoffs of federal employees, could significantly delay regulatory reviews and approvals. Macroeconomic uncertainties, including geopolitical instability, high interest rates, and potential tariffs on imported pharmaceuticals, could increase operational costs and impact access to capital. The company's stock price has historically been volatile, and future fluctuations are likely. Furthermore, the reliance on third-party service providers and manufacturers introduces risks if these partners face economic difficulties. While the current cash position provides a solid runway, future funding may be required to fully advance its early discovery pipeline and potential in-licensing opportunities, with no guarantee of favorable terms.

Conclusion

Protagonist Therapeutics stands at a critical juncture, poised to transition from a development-focused entity to one with potentially commercialized products. Its proprietary peptide engineering platform remains the bedrock of its strategy, enabling the creation of highly differentiated and potent therapeutic candidates that address significant unmet medical needs. The late-stage progress of icotrokinra and rusfertide, supported by robust clinical data and strategic partnerships, underscores the potential for substantial market penetration in inflammatory and hematological disorders.

Despite the anticipated dip in 2025 revenue due to the timing of collaboration payments, Protagonist's strong liquidity provides a solid foundation for continued R&D and pipeline advancement. The company's technological leadership in peptide therapeutics, offering advantages like oral delivery and targeted mechanisms, positions it favorably against traditional small molecule and antibody competitors. While regulatory and macroeconomic headwinds present challenges, the successful execution of its clinical and regulatory milestones, particularly the upcoming NDA approval decisions for icotrokinra and rusfertide, will be paramount in realizing the full investment potential of this innovative biopharmaceutical company.