PUMA BIOTECHNOLOGY, INC. (Form: 10-Q, Received: 11/09/2015 16:27:06)

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q

x	QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended September 30, 2015

¨	TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from to

Commission File Number: 001-35703

PUMA BIOTECHNOLOGY, INC.

(Exact name of registrant as specified in its charter)

Delaware

77-0683487

(State or other jurisdiction of

incorporation or organization)

(I.R.S. Employer

Identification Number)

10880 Wilshire Boulevard, Suite 2150, Los Angeles, CA 90024

(Address of principal executive offices) (Zip code)

(424) 248-6500

(Registrant’s telephone number, including area code)

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes x No ¨ .

Indicate by check mark whether the registrant has submitted electronically and posted on its corporate website, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files). Yes x No ¨

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer or a smaller reporting company. See definitions of “large accelerated filer,” “accelerated filer” and “smaller reporting company” in Rule 12b-2 of the Exchange Act.

Large accelerated filer	x	Accelerated filer	¨

Non-accelerated filer	¨ (Do not check if a smaller reporting company)	Smaller reporting company	¨

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ¨ No x .

Indicate the number of shares outstanding of each of the registrant’s classes of common stock, as of the latest practicable date. 32,435,748 shares of Common Stock, par value $0.0001 per share, were outstanding as of November 2, 2015.

PUMA BIOTECHNOLOGY, INC.

- INDEX -

		Page
PART I – FINANCIAL INFORMATION:
Item 1.	Financial Statements:	1
	Condensed Consolidated Balance Sheets as of September 30, 2015 (Unaudited) and December 31, 2014	1
	Condensed Consolidated Statements of Operations for the Three and Nine Months Ended September 30, 2015 and 2014 (Unaudited)	2
	Condensed Consolidated Statements of Comprehensive Loss for the Three and Nine Months Ended September 30, 2015 and 2014 (Unaudited)	3
	Condensed Consolidated Statement of Stockholders’ Equity for the Nine Months Ended September 30, 2015 (Unaudited)	4
	Condensed Consolidated Statements of Cash Flows for the Nine Months Ended September 30, 2015 and 2014 (Unaudited)	5
	Notes to Condensed Consolidated Financial Statements	6
Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	14
Item 3.	Quantitative and Qualitative Disclosures About Market Risk	20
Item 4.	Controls and Procedures	20
PART II – OTHER INFORMATION:
Item 1.	Legal Proceedings	22
Item 1A.	Risk Factors	22
Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds	22
Item 3.	Defaults Upon Senior Securities	22
Item 4.	Mine Safety Disclosures	23
Item 5.	Other Information	23
Item 6.	Exhibits	24
Signatures		25

CAUTIONARY STATEMENT REGARDING FORWARD-LOOKING STATEMENTS

This Quarterly Report contains forward-looking statements within the meaning of Section 21E of the Securities Exchange Act of 1934, as amended, or the Exchange Act. Any statements about our expectations, beliefs, plans, objectives, assumptions or future events or performance are not historical facts and may be forward looking. These forward-looking statements include, but are not limited to, statements about:

●

the development of our drug candidates, including when we expect to undertake, initiate and complete clinical trials of our product candidates;

●

the anticipated timing of regulatory filings;

●

the regulatory approval of our drug candidates;

●

our use of clinical research organizations and other contractors;

●

our ability to find collaborative partners for research, development and commercialization of potential products;

●

our ability to market any of our products;

●

our history of operating losses;

●

our expectations regarding our costs and expenses;

●

our anticipated capital requirements and estimates regarding our needs for additional financing;

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our ability to compete against other companies and research institutions;

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our ability to secure adequate protection for our intellectual property;

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our intention to vigorously defend against a purported securities class action lawsuit;

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our ability to attract and retain key personnel; and

●

our ability to obtain adequate financing.

These statements are often, but not always, made through the use of words or phrases such as “anticipate,” “estimate,” “plan,” “project,” “continuing,” “ongoing,” “expect,” “believe,” “intend” and similar words or phrases. Accordingly, these statements involve estimates, assumptions and uncertainties that could cause actual results to differ materially from those expressed in them. Discussions containing these forward-looking statements may be found throughout this Quarterly Report on Form 10-Q, including, in Part I, the section entitled “Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations.” These forward-looking statements involve risks and uncertainties, including the risks discussed in Part I, Item 1A. “Risk Factors” of our Annual Report on Form 10-K for the year ended December 31, 2014 and Part II, Item 1A. “Risk Factors” of our Quarterly Report on Form 10-Q for the quarter ended June 30, 2015 and this Quarterly Report on Form 10-Q that could cause our actual results to differ materially from those in the forward-looking statements. Such risks should be considered in evaluating our prospects and future financial performance. We undertake no obligation to update the forward-looking statements or to reflect events or circumstances after the date of this document.

Part I – FI NANCIAL INFORMATION

Item 1. Financial Statements

PUMA BIOTECHNOLOGY, INC. AND SUBSIDIARY

CONDENSED CONSOLIDATED BALANCE SHEETS

(in thousands, except share data)

	September 30, 2015 (unaudited)			December 31, 2014 (Note 1)
ASSETS
Current assets:
Cash and cash equivalents	$	23,598		$	38,539
Marketable securities		224,177			102,788
Prepaid expenses and other, current		6,888			6,292
Licensor receivable		—			1,760
Total current assets		254,663			149,379
Property and equipment, net		2,532			2,157
Prepaid expenses and other, long-term		10,117			10,007
Restricted cash		4,312			1,215
Total assets	$	271,624		$	162,758
LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities:
Accounts payable	$	9,783		$	14,997
Accrued expenses		15,548			29,444
Total current liabilities		25,331			44,441
Deferred rent		1,452			1,269
Total liabilities		26,783			45,710
Stockholders' equity:
Common stock - $.0001 par value; 100,000,000 shares authorized; 32,423,527 shares issued and outstanding at September 30, 2015 and 30,548,309 issued and outstanding at December 31, 2014		3			3
Additional paid-in capital		703,651			399,191
Receivables from the exercises of options		—			(835	)
Accumulated other comprehensive loss		(32	)		(95	)
Accumulated deficit		(458,781	)		(281,216	)
Total stockholders' equity		244,841			117,048
Total liabilities and stockholders' equity	$	271,624		$	162,758

See Accompanying Notes to the Condensed Consolidated Financial Statements

PUMA BIOTECHNOLOGY, INC. AND SUBSIDIARY

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS

(in thousands except share and per share data)

( unaudited )

	For the Three Months Ended September 30,						For the Nine Months Ended September 30,
	2015			2014			2015			2014
Operating expenses:
General and administrative	$	8,809		$	3,867		$	22,212		$	11,296
Research and development		51,924			32,092			156,033			83,387
Totals		60,733			35,959			178,245			94,683
Loss from operations		(60,733	)		(35,959	)		(178,245	)		(94,683	)
Other income (expenses):
Interest income		318			111			654			223
Other income (expense)		(2	)		4			26			(22	)
Totals		316			115			680			201
Net loss	$	(60,417	)	$	(35,844	)	$	(177,565	)	$	(94,482	)
Net loss applicable to common stock	$	(60,417	)	$	(35,844	)	$	(177,565	)	$	(94,482	)
Net loss per common share—basic and diluted	$	(1.87	)	$	(1.19	)	$	(5.55	)	$	(3.16	)
Weighted-average common shares outstanding—basic and diluted		32,303,203			30,117,819			32,018,869			29,936,254

See Accompanying Notes to the Condensed Consolidated Financial Statements

PUMA BIOTECHNOLOGY, INC. AND SUBSIDIARY

CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE LOSS

(in thousands)

(unaudited)

	For the Three Months Ended September 30,						For the Nine Months Ended September 30,
	2015			2014			2015			2014
Net loss	$	(60,417	)	$	(35,844	)	$	(177,565	)	$	(94,482	)
Other comprehensive loss
Unrealized gain (loss) on available-for-sale securities		149			(41	)		63			(121	)
Comprehensive loss	$	(60,268	)	$	(35,885	)	$	(177,502	)	$	(94,603	)

See Accompanying Notes to the Condensed Consolidated Financial Statements

PUMA BIOTECHNOLOGY, INC. AND SUBSIDIARY

CONDENSED CONSOLIDATED STATEMENT OF STOCKHOLDERS’ EQUITY

(in thousands except share data)

(unaudited)

	Common Stock
	Shares		Amount		Additional Paid-in Capital		Receivables from the Exercises of Options			Accumulated Other Comprehensive Loss			Accumulated Deficit			Total
Balance at December 31, 2014		30,548,309	$	3	$	399,191	$	(835	)	$	(95	)	$	(281,216	)	$	117,048
Stock-based compensation		—		—		73,254		—			—			—			73,254
Exercises of stock options		720,253		—		26,073		835			—			—			26,908
Issuance of performance shares		4,965		—		—		—			—			—			—
Issuance of shares of common stock through equity placement at $190.00 per share, net of issuance costs		1,150,000		—		205,133		—			—			—			205,133
Unrealized gain on available for sale securities		—		—		—		—			63			—			63
Net loss		—		—		—		—			—			(177,565	)		(177,565	)
Balance at September 30, 2015		32,423,527	$	3	$	703,651	$	—		$	(32	)	$	(458,781	)	$	244,841

See Accompanying Notes to the Condensed Consolidated Financial Statements

PUMA BIOTECHNOLOGY, INC. AND SUBSIDIARY

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

(in thousands)

(unaudited)

	For the Nine Months Ended September 30,
	2015			2014
Operating activities:
Net loss	$	(177,565	)	$	(94,482	)
Adjustments to reconcile net loss to net cash used in operating activities:
Depreciation and amortization		568			438
Build-out allowance received from landlord		179			—
Stock-based compensation		73,254			22,779
Changes in operating assets and liabilities:
Licensor receivable		1,760			8,053
Prepaid expenses and other		(706	)		(5,593	)
Accounts payable		(5,214	)		7,756
Accrued expenses		(13,896	)		2,332
Accrual of deferred rent		183			(25	)
Net cash used in operating activities		(121,437	)		(58,742	)
Investing activities:
Purchase of property and equipment		(943	)		(554	)
Restricted cash		(3,097	)		(1	)
Expenditures for leasehold improvements		(179	)		(110	)
Purchase of available-for-sale securities		(211,783	)		(132,260	)
Sale/maturity of available-for-sale securities		90,457			47,446
Net cash used in investing activities		(125,545	)		(85,479	)
Financing activities:
Net proceeds from issuance of common stock		205,133			129,440
Net proceeds from exercise of options		26,908			—
Net cash provided by financing activities		232,041			129,440
Net decrease in cash and cash equivalents		(14,941	)		(14,781	)
Cash and cash equivalents, beginning of period		38,539			43,044
Cash and cash equivalents, end of period	$	23,598		$	28,263

See Accompanying Notes to the Condensed Consolidated Financial Statements

PUMA BIOTECHNOLOGY, INC. AND SUBSIDIARY

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

Note 1—Business and Basis of Presentation:

Business:

Puma Biotechnology, Inc., or Puma, is a biopharmaceutical company based in Los Angeles, California with a focus on the acquisition, development and commercialization of innovative products to enhance cancer care. The Company aims to acquire proprietary rights to these products, by license or otherwise, fund their research and development and bring the products to market.

In November 2012, the Company established and incorporated Puma Biotechnology Ltd., a wholly owned subsidiary, for the sole purpose of serving as Puma’s legal representative in the United Kingdom and the European Union in connection with Puma’s clinical trial activity in those countries.

Basis of Presentation:

The Company is initially focused on developing neratinib for the treatment of patients with human epidermal growth factor receptor type 2, or HER2-positive, breast cancer, HER2 mutated non-small cell lung cancer, HER2-negative breast cancer that has a HER2 mutation and other solid tumors that have an activating mutation in HER2. The Company has reported a net loss of approximately $60.4 million and $177.6 million and negative cash flows from operations of approximately $36.8 million and $121.4 million for the three and nine months ended September 30, 2015, respectively. Management believes that the Company will continue to incur net losses and negative net cash flows from operating activities through the drug development process.

The accompanying unaudited condensed consolidated interim financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America, or GAAP, pursuant to the rules and regulations of the Securities and Exchange Commission, or the SEC, for interim financial information. Accordingly, the financial statements do not include all information and footnotes required by GAAP for complete annual financial statements. In the opinion of management, the accompanying unaudited condensed consolidated interim financial statements reflect all adjustments, consisting of normal recurring adjustments, considered necessary for a fair presentation. Interim operating results are not necessarily indicative of results that may be expected for the year ending December 31, 2015, or for any subsequent period. These unaudited condensed consolidated interim financial statements should be read in conjunction with the Company’s audited consolidated financial statements and notes thereto included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2014. The condensed consolidated balance sheet at December 31, 2014, has been derived from the audited consolidated financial statements included in the Annual Report on Form 10-K for the fiscal year ended December 31, 2014.

The Company’s continued operations will depend on its ability to raise funds through various potential sources, such as equity and debt financing. Through September 30, 2015, the Company’s financing was primarily through public offerings of Company common stock and private equity placements. The Company sold additional shares of its common stock through an underwritten public offering in January 2015 (see Note 6). As a result, the Company received net proceeds of approximately $205.1 million. Given the current and desired pace of clinical development of its product candidates, management believes that the cash and cash equivalents and marketable securities on hand at September 30, 2015, are sufficient to fund clinical development through 2016 and into 2017. The Company may need additional financing until it can achieve profitability, if ever. There can be no assurance that additional capital will be available on favorable terms or at all or that any additional capital that the Company is able to obtain will be sufficient to meet its needs. If it is unable to raise additional capital, the Company could likely be forced to curtail desired development activities, which will delay the development of its product candidates.

Note 2—Significant Accounting Policies:

The significant accounting policies followed in the preparation of these condensed consolidated financial statements are as follows:

Use of Estimates:

The preparation of financial statements in conformity with accounting principles generally accepted in the United States, or GAAP, requires management to make estimates and assumptions that affect reported amounts of assets and liabilities, and disclosure of contingent assets and liabilities at the date of the balance sheet, and reported amounts of expenses for the period presented. Accordingly, actual results could differ from those estimates. Significant estimates include accrued expenses for the cost of services provided by consultants who manage clinical trials and conduct research and clinical trials on behalf of the Company that are billed on a delayed basis. As the actual costs become known, the Company adjusts its estimated cost in that period. The value of stock-based

compensation includes estimates based on f uture events , which are difficult to predict. It is at least reasonably possible that a change in the estimates used to record accrued expenses and to value the stock-based compensation will occur in the near term.

Principles of Consolidation:

The condensed consolidated financial statements include the accounts of the Company and its wholly owned subsidiary. All significant intercompany balances and transactions have been eliminated in consolidation.

Cash and Cash Equivalents:

The Company considers all highly liquid investments with original maturities of three months or less to be cash equivalents. Cash equivalents are carried at cost, which approximates fair value.

Licensor Receivable:

The Company licenses its lead product candidate, neratinib, from Pfizer, Inc., or Licensor. At the time the license agreement was entered, Licensor agreed to pay certain external “out of pocket” clinical trial costs in excess of an agreed upon “cap” for clinical trials that were ongoing at the time the license agreement with the Licensor was reached. In July 2014, the license agreement was amended to make the Company solely responsible for the expenses incurred or accrued in conducting the ongoing legacy clinical trials after December 31, 2013, and to fix the future royalty rate that must be paid to the Licensor upon commercialization in the low to mid-teens. The balance of licensor receivable at December 31, 2014, of approximately $1.8 million, represented the unpaid portion of these trial costs that remained Licensor’s responsibility after the amendment of the license agreement. The amounts were fully collected during June 2015.

Investment Securities:

The Company classifies all investment securities (short term and long term) as available-for-sale, as the sale of such securities may be required prior to maturity to implement management’s strategies. These securities are carried at fair value, with the unrealized gains and losses reported as a component of accumulated other comprehensive income (loss) in stockholders’ equity until realized. Realized gains and losses from the sale of available-for-sale securities, if any, are determined on a specific identification basis. A decline in the market value of any available-for-sale security below cost that is determined to be other than temporary results in a revaluation of its carrying amount to fair value. The impairment is charged to earnings and a new cost basis for the security is established. Premiums and discounts are amortized or accreted over the life of the related security as an adjustment to yield using the straight-line method. Interest income is recognized when earned.

Assets Measured at Fair Value on a Recurring Basis:

Accounting Standards Codification, or “ASC,” 820, Fair Value Measurement , or ASC 820, provides a single definition of fair value and a common framework for measuring fair value as well as new disclosure requirements for fair value measurements used in financial statements. Under ASC 820, fair value is determined based upon the exit price that would be received by a company to sell an asset or paid by a company to transfer a liability in an orderly transaction between market participants, exclusive of any transaction costs. Fair value measurements are determined by either the principal market or the most advantageous market. The principal market is the market with the greatest level of activity and volume for the asset or liability. Absent a principal market to measure fair value, the Company uses the most advantageous market, which is the market from which the Company would receive the highest selling price for the asset or pay the lowest price to settle the liability, after considering transaction costs. However, when using the most advantageous market, transaction costs are only considered to determine which market is the most advantageous and these costs are then excluded when applying a fair value measurement. ASC 820 creates a three-level hierarchy to prioritize the inputs used in the valuation techniques to derive fair values. The basis for fair value measurements for each level within the hierarchy is described below, with Level 1 having the highest priority and Level 3 having the lowest.

Level 1:		Quoted prices in active markets for identical assets or liabilities.

Level 2:		Quoted prices for similar assets or liabilities in active markets; quoted prices for identical or similar instruments in markets that are not active; and model-derived valuations in which all significant inputs are observable in active markets.

Level 3:		Valuations derived from valuation techniques in which one or more significant inputs are unobservable.

Following are the major categories of assets measured at fair value on a recurring basis as of September 30, 2015 and December 31, 2014, using quoted prices in active markets for identical assets (Level 1), significant other observable inputs (Level 2), and significant unobservable inputs (Level 3) (in thousands):

September 30, 2015	Level 1		Level 2		Level 3		Total
Cash equivalents	$	20,135	$	—	$	—	$	20,135
Commercial paper		—		2,992		—		2,992
Marketable securities - U.S. government		—		11,525		—		11,525
Marketable securities - corporate bonds		—		209,660		—		209,660
	$	20,135	$	224,177	$	—	$	244,312

December 31, 2014	Level 1		Level 2		Level 3		Total
Cash equivalents	$	20,874	$	—	$	—	$	20,874
Marketable securities - U.S. government		—		11,496		—		11,496
Marketable securities - corporate bonds		—		91,292		—		91,292
	$	20,874	$	102,788	$	—	$	123,662

The Company’s investments in commercial paper, corporate bonds and U.S. government securities are exposed to price fluctuations. The fair value measurements for commercial paper, corporate bonds and U.S. government securities are based upon the quoted prices of similar items in active markets multiplied by the number of securities owned, exclusive of any transaction costs and without any adjustments to reflect discounts that may be applied to selling a large block of securities at one time.

Concentration of Risk:

Financial instruments, which potentially subject the Company to concentrations of credit risk, principally consist of cash and cash equivalents. The Company’s cash and cash equivalents in excess of the Federal Deposit Insurance Corporation and the Securities Investor Protection Corporation insured limits at September 30, 2015, were approximately $27.8 million. The Company does not believe it is exposed to any significant credit risk due to the quality of the financial instruments in which the money is held. Pursuant to the Company’s internal investment policy, investments must be rated A-1/P-1 or better by Standard and Poor’s Corporation and Moody’s Investors Service at the time of purchase.

Property and Equipment:

Property and equipment are recorded at cost and depreciated over estimated useful lives ranging from three to five years using the straight-line method. Leasehold improvements are recorded at cost and amortized over the shorter of their useful lives or the term of the lease by use of the straight-line method. Maintenance and repair costs are charged to operations as incurred.

The Company assesses the impairment of long-lived assets, primarily property and equipment, whenever events or changes in business circumstances indicate that carrying amounts of the assets may not be fully recoverable. When such events occur, management determines whether there has been impairment by comparing the asset’s carrying value with its fair value, as measured by the anticipated undiscounted net cash flows of the asset. Should impairment exist, the asset is written down to its estimated fair value. The Company has not recognized any impairment losses through September 30, 2015.

Research and Development Expenses:

Research and development expenses are charged to operations as incurred. The major components of research and development costs include clinical manufacturing costs, clinical trial expenses, consulting and other third-party costs, salaries and employee benefits, stock-based compensation expense, supplies and materials, and allocations of various overhead costs. Clinical trial expenses include, but are not limited to, investigator fees, site costs, comparator drug costs, and clinical research organization, or CRO, costs. In the normal course of business, the Company contracts with third parties to perform various clinical trial activities in the ongoing development of potential products. The financial terms of these agreements are subject to negotiation and variations from contract to contract and may result in uneven payment flows. Payments under the contracts depend on factors such as the achievement of certain events, the successful enrollment of patients and the completion of portions of the clinical trial or similar conditions. The Company’s accruals for clinical trials are based on estimates of the services received and efforts expended pursuant to contracts with numerous clinical trial sites, cooperative groups and CROs. The objective of the Company’s accrual policy is to match the recording of expenses in the condensed consolidated financial statements to the actual services received and efforts expended. As actual costs become known, the Company adjusts its accruals in that period.

In instances where t he Company enters into agreements with third parties for clinical trials and other consulting activities, upfront amounts are recorded to prepaid expenses and other in the accompanying condensed c onsolidated b alance s heets and expensed as services are perf ormed or as the underlying goods are delivered. If the Company does not expect the services to be rendered or goods to be delivered, any remaining capitalized amounts for non-refundable upfront payments are charged to expense immediately. Amounts due under such arrangements may be either fixed fee or fee for service, and may include upfront payments, monthly payments and payments upon the completion of milestones or receipt of deliverables.

Costs related to the acquisition of technology rights and patents for which development work is still in process are charged to operations as incurred and considered a component of research and development costs.

Stock-Based Compensation:

Stock option awards:

ASC 718, Compensation-Stock Compensation , or ASC 718, requires the fair value of all share-based payments to employees, including grants of stock options, to be recognized in the statement of operations over the requisite service period. Under ASC 718, employee option grants are generally valued at the grant date and those valuations do not change once they have been established. The fair value of each option award is estimated on the grant date using the Black-Scholes Option Pricing Method. As allowed by ASC 718 for companies with a short period of publicly traded stock history, the Company’s estimate of expected volatility is based on the average expected volatilities of a sampling of seven companies with similar attributes to the Company, including industry, stage of life cycle, size and financial leverage. The risk-free rate for periods within the contractual life of the option is based on the U.S. Treasury yield curve in effect at the time of grant valuation. Option forfeitures are calculated when the option is granted to reduce the option expense to be recognized over the life of the award and updated upon receipt of further information as to the amount of options expected to be forfeited. The option expense is “trued-up” upon the actual forfeiture of a stock option grant. Due to its limited history, the Company uses the simplified method to determine the expected life of the option grants.

Performance shares:

The performance shares are valued on the grant date and the fair value of the performance award is equal to the market price of the Company’s common stock on the grant date. The performance share expense is recognized based on the Company’s estimate of a range of probabilities that the Company’s closing common stock price on the vesting dates will be lower or higher than the Company’s common stock price on the grant date. Based on the range of probabilities, the expense is calculated and recognized over the three-year vesting period.

Net Loss per Common Share:

Basic net loss per common share is computed by dividing net loss applicable to common stockholders by the weighted average number of common shares outstanding during the periods presented as required by ASC 260, Earnings per Share . Diluted earnings per common share are the same as basic earnings per share because the assumed exercise of the Company’s outstanding options are anti-dilutive. For the three and nine months ended September 30, 2015, potentially dilutive securities excluded from the calculations were 4,444,258 shares issuable upon exercise of options, 18,942 shares issuable as performance awards and 2,116,250 shares issuable upon exercise of a warrant. For the three and nine months ended September 30, 2014, potentially dilutive securities excluded from the earnings per common share calculation were 3,778,307 issuable upon exercise of options, 28,411 issuable as performance shares and 2,116,250 shares issuable upon exercise of a warrant.

Deferred Rent:

The Company has entered into operating lease agreements for its corporate offices in Los Angeles and South San Francisco that contain provisions for future rent increases, leasehold improvement allowances and rent abatements. The Company records monthly rent expense equal to the total of the payments due over the lease term, divided by the number of months of the lease term. The difference between the rent expense recorded and the amount paid is credited or charged to deferred rent, which is reflected as a separate line item in the accompanying condensed consolidated balance sheets. Additionally, the Company recorded as deferred rent the cost of the leasehold improvements paid by the landlord, which is amortized on a straight-line basis over the term of the lease.

Issuance of Common Stock Upon Exercise of Stock Option Grants:

When a stock option grant is exercised, the Company notifies its transfer agent to release the required number of common stock shares from the reserve for the Company’s 2011 Incentive Award Plan. The Company records the transaction for the cash received and the issuance of common shares. Should there be a delay in the cash receipts due to the settlement period, the Company records a receivable from the exercise of an option as part of stockholders’ equity on the condensed consolidated balance sheet.

Recently Issued Accounting Standards

In August 2014, the Financial Accounting Standards Board, or the FASB, issued guidance requiring management to evaluate on a regular basis whether any conditions or events have arisen that could raise substantial doubt about the entity’s ability to continue as a going concern. The guidance (1) provides a definition for the term “substantial doubt,” (2) requires an evaluation every reporting period, interim periods included, (3) provides principles for considering the mitigating effect of management’s plans to alleviate the substantial doubt, (4) requires certain disclosures if the substantial doubt is alleviated as a result of management’s plans, (5) requires an express statement, as well as other disclosures, if the substantial doubt is not alleviated, and (6) requires an assessment period of one year from the date the financial statements are issued. The standard is effective for the Company’s reporting year beginning January 1, 2017 and early adoption is permitted. The Company does not expect the adoption of this standard to have a material impact on its consolidated financial statements.

In May 2014, the FASB issued guidance for revenue recognition for contracts, superseding the previous revenue recognition requirements, along with most existing industry-specific guidance. The guidance requires an entity to review contracts in five steps: (1) identify the contract, (2) identify performance obligations, (3) determine the transaction price, (4) allocate the transaction price, and (5) recognize revenue. The new standard will result in enhanced disclosures regarding the nature, amount, timing and uncertainty of revenue arising from contracts with customers. The standard is effective for our reporting year beginning January 1, 2017 and early adoption is not permitted. On July 9, 2015, the FASB voted to defer the effective date of the above mentioned revenue recognition guidance by one year to December 15, 2017 for interim and annual reporting periods beginning after the date and permitted early adoption of the standard, but not before the original effective date of December 15, 2016. The Company is currently evaluating the impact, if any, that this standard will have on its consolidated financial statements.

In June 2014, the FASB issued ASU No. 2014-10, Development Stage Entities , or ASU No. 2014-10, which eliminated certain financial reporting requirements of companies previously identified as development stage entities ( Topic 915 ). The amendments in this ASU simplify accounting guidance by removing all incremental financial reporting requirements for development stage entities. The amendments also reduce data maintenance and, for those entities subject to audit, audit costs by eliminating the requirement for development stage entities to present inception-to-date information in the statements of income, cash flows, and stockholders’ equity. For public entities, these amendments begin to be effective for periods after December 31, 2014. Early application of each of the amendments is permitted for any annual reporting period or interim period for which the entity’s financial statements have not yet been issued (public business entities) or made available for issuance (other entities). Upon adoption, entities will no longer present or disclose any information required by Topic 915. The Company adopted this standard on December 31, 2014, and it did not have a material impact on its consolidated financial statements.

Note 3—Prepaid Expenses and Other:

Prepaid expenses and other consisted of the following (in thousands):

	September 30, 2015		December 31, 2014
Current:
CRO services	$	2,946	$	2,451
Other clinical development		2,798		2,525
Insurance		247		1,007
Other		897		309
		6,888		6,292
Long-term:
CRO services		5,786		6,352
Other clinical development		3,418		3,464
Insurance		94		130
Other		819		61
		10,117		10,007
Totals	$	17,005	$	16,299

Note 4—Property and Equipment:

Property and equipment consisted of the following (in thousands):

Property and Equipment:	September 30, 2015			December 31, 2014
Leasehold improvements	$	1,502		$	1,217
Computer equipment		1,590			1,272
Telephone equipment		169			145
Furniture and fixtures		1,164			848
		4,425			3,482
Less: accumulated depreciation and amortization		(1,893	)		(1,325	)
Totals	$	2,532		$	2,157

Note 5—Accrued Expenses:

Accrued expenses consisted of the following (in thousands):

	September 30, 2015		December 31, 2014
Accrued CRO services	$	8,813	$	7,764
Accrued other clinical development		2,610		2,541
Accrued legal fees		334		195
Accrued compensation		3,735		2,449
Payroll taxes withheld for options exercised		—		16,414
Other		56		81
Totals	$	15,548	$	29,444

Accrued CRO services represent the Company’s estimate of such costs and will be adjusted in the period the actual costs become known. Accrued compensation includes estimated bonus and earned but unused vacation for full-time employees. When actual performance bonuses are paid out to employees on the employee’s anniversary of hire, the bonus expense will be adjusted to reflect the actual expense for the year. Additionally, vacation is accrued at the rate the employee earns vacation and reduced as vacation is used by the employee.

Note 6—Stockholders’ Equity:

Common Stock:

January 2015 Common Stock Offering. On January 21, 2015, the Company entered into an underwriting agreement with Merrill Lynch, Pierce, Fenner & Smith Incorporated and J.P. Morgan Securities LLC, as representatives of several underwriters, providing for the offer and sale in a firm-commitment underwritten public offering of 1,000,000 shares of the Company’s common stock, par value $0.0001 per share, at a price of $190.00 per share, less the underwriting discount. The underwriters exercised the option granted to the underwriters to purchase an additional 150,000 shares of Company common stock from the Company at $190.00 per share, less the underwriting discount. The transaction was completed on January 27, 2015; the Company received net proceeds of approximately $205.1 million, which is comprised of gross proceeds of approximately $218.5 million, offset by the underwriting discount and offering expenses of $13.4 million payable by the Company.

Stock-Based Compensation:

The Company’s 2011 Incentive Award Plan, or the 2011 Plan, was adopted by the Board of Directors and stockholders of the Company on September 15, 2011. An amendment to the 2011 Plan was adopted by the Board of Directors on June 4, 2014 and the stockholders of the Company on June 10, 2014 which increased the number of shares reserved from 3,529,412 to 6,529,412. A second amendment to the 2011 Plan was adopted by the Board of Directors on April 20, 2015 and the stockholders of the Company on June 9, 2015, which increased the shares reserved from 6,529,412 to 10,529,412. Pursuant to the amended 2011 Plan (referred to hereafter as the 2011 Plan), the Company may grant incentive stock options and nonqualified stock options, as well as other forms of equity-based compensation such as performance shares. Incentive stock options may be granted only to employees, while consultants, employees, officers and directors are eligible for the grant of nonqualified options under the 2011 Plan. The maximum term of stock options granted under the 2011 Plan is 10 years. The exercise price of incentive stock options granted under the 2011 Plan must be at least equal to the fair value of such shares on the date of grant. The performance shares are valued at market value less par value and

vest over three years, with the number of shares to be issued determined by the market price on the vesting date. The maximum number of shares issuable pursuant to a performance share award is establis hed on the grant date.

Employee stock-based compensation for the three and nine months ended September 30, 2015 and 2014, were as follows (in thousands, except share and per share data):

	Three Months Ended September 30,				Nine Months Ended September 30,
	2015		2014		2015		2014
Stock-based compensation:
Options -
Research and development, or R&D	$	19,867	$	8,726	$	60,594	$	17,690
General and administrative, or G&A		4,747		1,377		12,173		4,081
Performance shares - R&D		342		346		487		1,008
Total stock-based compensation expense	$	24,956	$	10,449	$	73,254	$	22,779
Impact on basic and diluted net loss per share	$	0.77	$	0.35	$	2.29	$	0.76
Weighted average shares (basic and diluted)		32,303,203		30,117,819		32,018,869		29,936,254

Performance Shares:

During January 2014, performance share awards were granted to certain employees that provide for a maximum of 28,411 common stock shares to be issued. These shares vest over three years on the first, second and third anniversary of December 15, 2013. On each vesting date, if the Company’s closing common stock price is equal to $102.46 per share, one-third of the 28,411 shares will be awarded. If the Company’s closing common stock price is either lesser or greater than $102.46 per share, the number of common stock shares to be issued will be adjusted to be less than one-third of the 28,411 shares. No shares will be awarded if the Company’s closing common stock price is less than $47.53 per share at the vesting dates. The performance shares are valued on the grant date and the fair value of the performance award is equal to the market price of the Company’s common stock on the grant date. The performance share expense is recognized based on the Company’s estimate of a range of probabilities that the Company’s closing common stock price will be lower or higher than $102.46 on the vesting dates. Based on the range of probabilities, the expense is calculated and recognized over the three-year vesting period. On December 15, 2014, the first vesting occurred and the calculations were performed. As a result, 4,965 shares of common stock were issued to the employees and 4,504 performance shares were cancelled.

			Weighted
			Average
			Grant-Date
Performance shares	Shares		Fair Value
Nonvested shares at December 31, 2014		18,942	$	102.46
Granted		—		—
Vested/Issued		—		—
Cancelled		—		—
Nonvested shares at September 30, 2015		18,942	$	102.46

Stock Options:

The fair value of options granted to employees was estimated using the Black-Scholes Option Pricing Method (see Note 2—Significant Accounting Policies) with the following weighted-average assumptions used during the nine months ended September 30, 2015 and 2014:

	2015			2014
Dividend yield		0.0	%		0.0	%
Expected volatility		63.4	%		81.8	%
Risk-free interest rate		1.6	%		1.8	%
Expected life in years		5.85			5.85

Activity with respect to options granted under the 2011 Plan is summarized as follows:

	Shares			Weighted Average Exercise Price		Weighted Average Remaining Contractual Term (years)		Aggregate Intrinsic Value (in thousands)
Outstanding at December 31, 2014		3,978,126		$	89.55		8.7	$	431,635
Granted		1,402,786		$	153.65		9.5		—
Forfeited		(214,110	)	$	188.10		—		—
Exercised		(720,253	)	$	36.20		—	$	93,368
Expired		(2,291	)	$	117.84
Outstanding at September 30, 2015		4,444,258		$	70.12		8.5	$	80,264
Nonvested at September 30, 2015		2,802,984		$	150.43		9.2	$	10,135
Exercisable at September 30, 2015		1,641,274		$	50.87		7.3	$	70,129

At September 30, 2015, total estimated unrecognized employee compensation cost related to nonvested stock options and performance shares granted prior to that date were approximately $208.2 million and $0.7 million, respectively. These unrecognized expenses are expected to be recognized over a weighted-average period of 2.2 years for stock options and 0.9 years for performance shares. The weighted-average grant date fair value of options granted during the nine months ended September 30, 2015 and 2014, were $89.17 per share and $86.83 per share, respectively.

				Weighted
				Average
				Grant-Date
Stock options	Shares			Fair Value
Nonvested shares at December 31, 2014		2,591,565		$	81.33
Granted		1,402,786			89.17
Vested/Issued		(977,257	)		61.22
Forfeited		(214,110	)		110.20
Nonvested shares at September 30, 2015		2,802,984			90.95

Note 7—401(k) Savings Plan:

During 2012, the Company adopted a 401(k) savings plan for the benefit of its employees. The Company is required to make matching contributions to the 401(k) plan equal to 100% of the first 3% of wages deferred by each participating employee and 50% on the next 2% of wages deferred by each participating employee. The Company incurred expenses for employer matching contributions of approximately $0.5 million and $0.4 million for the nine months ended September 30, 2015 and 2014, respectively.

Note 8—Commitments and Contingencies:

In July 2015, the Company amended its lease with CA-10880 Wilshire Limited Partnership to expand the rented square feet in its Los Angeles office by approximately 26,000 square feet. The lease is expected to commence on or about April 1, 2016, and increases the monthly rent in the Los Angeles location by approximately $150,000 per month with annual increases of approximately 3% per year for the 10-year lease term.

In addition, in July 2015, the Company amended its office lease with PR 701 Gateway, LLC (as successor in interest to DWF III Gateway, LLC) to expand the rented square feet in its South San Francisco location by approximately 13,000 square feet. The lease is expected to commence on or about April 1, 2016, and increases the monthly rent in the South San Francisco location by approximately $51,400 with annual increases of approximately 3% per year for the 10-year lease term.

Item 2.

MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDI TION AND RESULTS OF OPERATIONS

The following discussion and analysis of our financial condition and results of operations should be read in conjunction with our unaudited condensed consolidated financial statements and the notes thereto included in Item 1 in this Quarterly Report on Form 10-Q. The following discussion should also be read in conjunction with our audited consolidated financial statements and the notes thereto and “Management’s Discussion and Analysis of Financial Condition and Results of Operations” included in our Annual Report on Form 10-K for the year ended December 31, 2014.

Unless otherwise provided in this Quarterly Report, references to the “Company,” “we,” “us,” and “our” refer to Puma Biotechnology, Inc., a Delaware corporation, together with its wholly-owned subsidiary, Puma Biotechnology Ltd.

Overview

We are a biopharmaceutical company based in Los Angeles, California with a focus on the acquisition, development and commercialization of innovative products to enhance cancer care. We aim to acquire proprietary rights to these products, by license or otherwise, fund their research and development, or R&D, and bring the products to market. Our efforts and resources to date have been focused primarily on acquiring and developing our pharmaceutical technologies, raising capital and recruiting personnel. We have had no product sales to date and we will have no product sales until we receive approval from the United States Food and Drug Administration, or FDA, or equivalent foreign regulatory bodies to begin selling our pharmaceutical candidates. Developing pharmaceutical products, however, is a lengthy and very expensive process. Assuming we do not encounter any unforeseen safety issues during the course of developing our product candidates, we do not expect to receive approval of a product candidate until approximately late 2016.

We currently license the rights to three drug candidates:

●

PB272 (neratinib (oral)), which we are developing for the treatment of patients with human epidermal growth factor receptor type 2, or HER2, positive breast cancer, and patients with non-small cell lung cancer, breast cancer and other solid tumors that have a HER2 mutation;

●

PB272 (neratinib (intravenous)), which we are developing for the treatment of patients with advanced cancer; and

●

PB357, which we believe can serve as a backup compound to PB272, and which we are evaluating for further development.

A large portion of our expenses to date have been related to the clinical development of our lead product candidate, PB272 (neratinib (oral)), and the transition of the neratinib program from Pfizer, Inc., or the Licensor. Additionally, our expenses to date have been related to hiring staff, commencing company-sponsored clinical trials and the build out of our corporate infrastructure. As we proceed with clinical development of PB272 (neratinib (oral)), and as we further develop PB272 (neratinib (intravenous)) and PB357, our second and third product candidates, respectively, we expect our R&D expenses and expenses related to our third-party contractors will continue to increase.

To the extent we are successful in acquiring additional product candidates for our development pipeline, our need to finance R&D will increase. Accordingly, our success depends not only on the safety and efficacy of our product candidates, but also on our ability to finance product development. Our major sources of working capital have been proceeds from public offerings of our common stock and sales of our common stock in private placements.

Critical Accounting Policies

As of the date of the filing of this quarterly report, we believe there have been no material changes to our critical accounting policies and estimates during the nine months ended September 30, 2015, from our accounting policies at December 31, 2014, as reported in our Annual Report on Form 10-K for the fiscal year ended December 31, 2014.

Summary of Expenses

General and administrative, or G&A, expenses consist primarily of salaries and related personnel costs (including stock-based compensation expense), professional fees, business insurance, rent, general legal activities, and other corporate expenses.

R&D expenses consist primarily of amounts paid to Clinical Research Organizations, or CROs, who assist with managing the clinical trials on our behalf, other clinical development costs and salaries and related personnel costs (including stock-based compensation expense) and include costs associated with services provided by consultants who conduct clinical services on our behalf and contract organizations for manufacturing of clinical materials. We expense our R&D costs as they are incurred.

Results of Operations

Three Months Ended September 30, 2015 Compared to Three Months Ended September 30, 2014

General and administrative expenses:

For the three months ended September 30, 2015, G&A expenses were approximately $8.8 million, compared to approximately $3.9 million for the three months ended September 30, 2014. G&A expenses for the three months ended September 30, 2015 and 2014 were as follows:

General and administrative expenses	Three months ended September 30,				Period to period
(in thousands)	2015		2014		percentage change
Payroll and related costs	$	1,101	$	759		45.1	%
Professional fees and expenses		1,807		939		92.4	%
Facility and equipment costs		582		433		34.4	%
Employee stock-based compensation expense		4,747		1,377		244.7	%
Other		572		359		59.3	%
	$	8,809	$	3,867		127.8	%

For the three months ended September 30, 2015, G&A expenses increased approximately $4.9 million compared to the same period in 2014. Approximately $3.4 million of this increase is related to an increase in stock-based compensation expense, attributable to our increased headcount and additional incentive awards to existing employees, as well as the increase in our stock price per share which affects the valuation of new grants. The remaining approximately $1.5 million increase in G&A expense for the three months ended September 30, 2015 compared to the same period in 2014 was primarily attributable to:

●

an approximately $0.9 million increase in professional fees and expenses, which consist primarily of legal, auditing, consulting and investor relations fees. We expect these fees to increase as we defend against the recent class action lawsuit filed against us and as we continue to implement compliance measures related to the Sarbanes Oxley Act of 2002, as amended, or Sarbanes Oxley.

●

an approximately $0.3 million increase in payroll and related costs as administrative headcount increased from 14 to 16 to support corporate growth and to prepare for the filing of our NDA with the FDA, which we anticipate will occur in the first quarter of 2016. We expect these payroll and related costs to continue to increase as we continue these preparations.

●

an approximately $0.1 million increase in facility and equipment costs. As described in Note 8 – Commitments and Contingencies to our condensed consolidated financial statements included in this report, we recently amended two of our office leases and beginning in April 2016 we expect our facility and equipment costs will increase pursuant to the terms of those amended leases.

Research and development expenses:

For the three months ended September 30, 2015, R&D expenses were approximately $51.9 million, compared to approximately $32.1 million for the three months ended September 30, 2014. R&D expenses for the three months ended September 30, 2015 and 2014 were as follows:

Research and development expenses	Three months ended September 30,				Period to period
(in thousands)	2015		2014		percentage change
Clinical trial expenses	$	20,554	$	15,456		33.0	%
Internal clinical development		6,229		3,751		66.1	%
Internal regulatory affairs and quality assurance		2,358		2,011		17.3	%
Consultants and contractors		2,220		1,552		43.0	%
Internal chemical manufacturing		354		249		42.2	%
Employee stock-based compensation		20,209		9,073		122.7	%
	$	51,924	$	32,092		61.8	%

For the three months ended September 30, 2015, R&D expenses increased approximately $19.8 million compared to the same period in 2014. Approximately $11.1 million of this increase is related to the increase in stock-based compensation expense which has increased as a result of our increased headcount as well as the increase in our stock price per share which affects the valuation of new grants. The remaining approximately $8.7 million increase in R&D expense for the three months ended September 30, 2015 compared to the same period in 2014 was primarily attributable to:

●

an approximately $5.1 million increase in clinical trial expenses as a result of an increase of approximately $4.1 million for CRO professional fees and pass-through costs and approximately $1.0 million for clinical and pre-clinical services.

●

an approximately $3.0 million increase for i nternal clinical development, internal regulatory affairs and quality assurance, and internal chemical manufacturing. This increase represents an increase in full-time R&D headcount to 1 26 from 99 for the three months ended September 30 , 2015, compared to the same period in 2014. We expect R&D expenses to continue to increase as we recognize the additional expenses associated with our ongoing clinical trials and as we hire additional R&D employees during the remainder of 2015 and into 2016 to support the filing of an NDA with the FDA and a Marketing Auth orization Application with the European Medicines Agency.

●

an approximately $0.6 million increase in consultants and contractors related expenses due to increased activity in our clinical trials and in preparation of filing an NDA with the FDA, which we anticipate will occur in the first quarter of 2016.

While expenditures on current and future clinical development programs, particularly our PB272 program, are expected to be substantial and to increase, they are subject to many uncertainties, including the results of clinical trials and whether we develop any of our drug candidates with a partner or independently. As a result of such uncertainties, we cannot predict with any significant degree of certainty the duration and completion costs of our research and development projects or whether, when and to what extent we will generate revenue from the commercialization and sale of any of our product candidates. The duration and cost of clinical trials may vary significantly over the life of a project as a result of unanticipated events arising during clinical development and a variety of other factors, including:

●

the number of trials and studies in a clinical program;

●

the number of patients who participate in the trials;

●

the number of sites included in the trials;

●

the rates of patient recruitment and enrollment;

●

the duration of patient treatment and follow-up;

●

the costs of manufacturing our drug candidates; and

●

the costs, requirements, timing of, and ability to secure regulatory approvals.

Nine Months Ended September 30, 2015 Compared to Nine Months Ended September 30, 2014

General and administrative expenses:

For the nine months ended September 30, 2015, G&A expenses were approximately $22.2 million, compared to approximately $11.3 million for the nine months ended September 30, 2014. G&A expenses for the nine months ended September 30, 2015 and 2014 were as follows:

General and administrative expenses	Nine months ended September 30,				Period to period
(in thousands)	2015		2014		percentage change
Payroll and related costs	$	2,965	$	2,255		31.5	%
Professional fees and expenses		3,536		2,287		54.6	%
Facility and equipment costs		1,697		1,313		29.2	%
Employee stock-based compensation expense		12,173		4,081		198.3	%
Other		1,841		1,360		35.4	%
	$	22,212	$	11,296		96.6	%

For the nine months ended September 30, 2015, G&A expenses increased approximately $10.9 million compared to the same period in 2014. Approximately $8.1 million of this increase is related to stock-based compensation expense attributable to our increased headcount and additional incentive awards to existing employees, as well as the increase in our stock price per share which affects the valuation of new grants. The remaining approximately $2.8 million increase in G&A expense for the nine months ended September 30, 2015 compared to the same period in 2014 was primarily attributable to:

●

an approximately $1.2 million increase in professional fees and expenses. Professional fees and expenses consist of legal, auditing and consulting fees for compliance with the Sarbanes-Oxley, and investor relations.

●

an approximately $0.7 million increase in payroll and related costs as administrative headcount increased to 16 from 14 to support our corporate growth and to prepare for the filing of our NDA with the FDA, which we anticipate will occur in the first quarter of 2016.

●

an approximately $0.4 million increase in facility and equipment costs.

Research and development expenses:

For the nine months ended September 30, 2015, R&D expenses were approximately $156.0 million, compared to approximately $83.4 million for the nine months ended September 30, 2014. R&D expenses for the nine months ended September 30, 2015 and 2014 were as follows:

Research and development expenses	Nine months ended September 30,				Period to period
(in thousands)	2015		2014		percentage change
Clinical trial expenses	$	63,587	$	44,174		43.9	%
Internal clinical development		17,514		10,530		66.3	%
Internal regulatory affairs and quality assurance		6,488		5,512		17.7	%
Consultants and contractors		6,467		3,804		70.0	%
Internal chemical manufacturing		896		668		34.1	%
Employee stock-based compensation		61,081		18,699		226.7	%
	$	156,033	$	83,387		87.1	%

For the nine months ended September 30, 2015, R&D expenses increased approximately $72.6 million compared to the same period in 2014. Approximately $42.4 million of this increase is related to the increase in stock-based compensation expense which has increased as a result of our increased headcount as well as the increase in our stock price per share which affects the valuation of new grants. The remaining approximately $30.2 million increase in R&D expense for the nine months ended September 30, 2015 compared to the same period in 2014 was primarily attributable to:

●

an approximately $19.4 million increase in clinical trial expenses. This increase was comprised of an increase of approximately $8.9 million for CRO professional fees and pass-through costs and approximately $6.7 million for clinical and pre-clinical services, approximately $2.7 million for drugs supply and logistics and approximately $1.1 million for the final reimbursement from the licensor for the licensor legacy clinical trials during the nine months ended September 30, 2014.

●

an approximately $8.2 million increase in internal clinical development, internal regulatory affairs and quality assurance, and internal chemical manufacturing. This increase represents an increase in full-time R&D headcount to 126 from 99 for the nine months ended September 30, 2015, compared to the same period in 2014.

●

an approximately $2.6 million increase in consultants and contractors related expenses due to increased activity in our clinical trials and in preparation of filing an NDA with the FDA, which we anticipate will occur in the first quarter of 2016.

Interest income:

For the three and nine months ended September 30, 2015, we recognized approximately $318,000 and approximately $654,000 in interest income, respectively, compared to approximately $111,000 and $223,000 for the same periods in 2014. The increase in interest income is due to higher cash and cash equivalents and marketable securities balances and using longer-term higher yielding investments.

Liquidity and Capital Resources

The following table summarizes our liquidity and capital resources as of September 30, 2015 and December 31, 2014, and is intended to supplement the more detailed discussion that follows:

Liquidity and capital resources (in thousands)	September 30, 2015			December 31, 2014
Cash and cash equivalents	$	23,598		$	38,539
Marketable securities		224,177			102,788
Working capital		229,332			104,938
Stockholders' equity		244,841			117,048

	Nine months ended			Nine months ended
	September 30, 2015			September 30, 2014
Cash provided by (used in):
Operating activities	$	(121,437	)	$	(58,742	)
Investing activities		(125,545	)		(85,479	)
Financing activities		232,041			129,440
Decrease in cash and cash equivalents	$	(14,941	)	$	(14,781	)

Operating Activities:

For the nine months ended September 30, 2015 and September 30, 2014, we reported net loss of approximately $177.6 million and $94.5 million, respectively, and net cash used in operating activities of approximately $121.4 million and $58.7 million, respectively. Included in the approximately $121.4 million cash used in operating activities in the nine months ended September 30, 2015, was an employee payroll tax payment of approximately $16.4 million related to the exercise of stock options by employees. The taxes withheld by the stockbroker were received by us during the last week of December 2014 and transmitted to the various taxing authorities in January 2015. The remaining approximately $105.0 million of cash used in operating activities reflects the increased costs associated with expanding our clinical trials and preparing for the filing of an NDA, which we anticipate to occur in the first quarter of 2016.

The approximately $105 million of cash used in operating activities for the nine months ended September 30, 2015, consisted primarily of approximately $74.0 million of non-cash items such as depreciation and amortization and stock-based compensation, an increase in the liability for deferred rent of approximately $0.2 million, an increase in prepaid expenses and other of approximately $0.7 and a decrease in accrued expenses and accounts payable of approximately $19.1 million during the nine months ended September 30, 2015.

For the nine months ended September 30, 2014, the net cash used in operating activities, noted above, consisted of approximately $23.2 million of non-cash items such as depreciation and amortization and stock-based compensation, and an increase in accounts payable and accrued expenses of approximately $10.1 million. Cash used in operating activities included an increase in prepaid expenses of approximately $5.6 million. Offsetting that increase was a decrease in licensor receivable of approximately $8.1 million which was paid by the licensor in conjunction with the amended license agreement that was signed in July 2014.

Investing Activities:

During the nine months ended September 30, 2015, net cash used in investing activities was approximately $125.5 million compared to approximately $85.5 million for the same period in 2014. The approximately $125.5 million net cash invested during the nine months ended September 30, 2015 was made up of approximately $211.8 million used for investments of excess cash made in accordance with our investment policy, offset by $90.5 million of cash received from investments that matured and approximately $1.1 million used to purchase property, equipment and leasehold improvements. Additionally, approximately $3.1 million was used in restricted cash as we moved those funds to secure the amended leases for additional office space (see Note 8 – Commitments and Contingencies to our condensed consolidated financial statements). For the nine months ended September 30, 2014, the net cash used in investing activities consisted of approximately $132.3 million used in the purchase of available-for-sale securities, offset by approximately $47.4 million received from the maturity of available-for-sale securities, and $0.6 million used to purchase property, equipment and leasehold improvements.

Financing Activities:

During the nine months ended September 30, 2015, we received net proceeds of approximately $205.1 million from the closing of the January 2015 public offering of our common stock, compared to approximately $129.4 million received from the closing of the February 2014 public offering of our common stock during the same period in 2014. During the nine months ended September 30, 2015, we received proceeds from the exercise of stock options of approximately $26.9 million.

Current and Future Financing Needs:

We have incurred negative cash flow from operations since we started our business. We have spent, and expect to continue to spend, substantial amounts in connection with implementing our business strategy, including our planned product development efforts, our clinical trials and our R&D efforts. Given the current and desired pace of clinical development of our product candidates, over the next 12 months we estimate that our R&D spending will be approximately $115 million to $130 million, excluding stock-based compensation. We anticipate spending approximately $12 million to $14 million for general and administrative expenses over the next 12 months, excluding stock-based compensation. The actual amount of funds we will need to operate is subject to many factors, some of which are beyond our control.

While we believe that the approximately $247.8 million in cash, cash equivalents and marketable securities as of September 30, 2015, will be sufficient to enable us to meet our anticipated expenditures through 2016 and into 2017, we may seek to obtain additional capital through the sale of debt or equity securities, if necessary, especially in conjunction with opportunistic acquisitions or licensing arrangements. We expect to continue incurring significant losses for the foreseeable future and our continuing operations will depend on whether we are able to raise additional funds through additional equity or debt financing or by entering into a strategic alliance with a third party concerning one or more of our product candidates. Through September 30, 2015, a significant portion of our financing has been through public offerings and private placements of our equity securities. We will continue to fund operations from cash on hand and through the similar sources of capital previously described. We can give no assurances that any additional capital

raised will be sufficient to meet our needs. Further, in light of current economic conditions, including the lack of access to the capital markets being experienced by small companies, particularly in our industry, there can b e no assurance that such capital will be available to us on favorable terms or at all. If we are unable to raise additional funds in the future, we may be forced to delay or discontinue the development of one or more of our product candidates and forego at tractive business opportunities. Any additional sources of financing will likely involve the sale of our equity securities, which will have a dilutive effect on our stockholders.

In addition, we have based our estimate of funding our capital requirements on assumptions that may prove to be wrong. We may need to obtain additional funds sooner than planned or in greater amounts than we currently anticipate. Potential sources of financing include strategic relationships, public or private sales of equity or debt and other sources of funds. We may seek to access the public or private equity markets when conditions are favorable due to our long-term capital requirements. We do not have any committed sources of financing at this time, and it is uncertain whether additional funding will be available when we need it on terms that will be acceptable to us, or at all. If we raise funds by selling additional shares of common stock or other securities convertible into common stock, the ownership interests of our existing stockholders will be diluted. If we are not able to obtain financing when needed, we may be unable to carry out our business plan. As a result, we may have to significantly limit our operations, and our business, financial condition and results of operations would be materially harmed. In such an event, we would be required to undertake a thorough review of our programs, and the opportunities presented by such programs, and allocate our resources in the manner most prudent.

Contractual Obligations:

In July 2015, we amended our lease with CA-10880 Wilshire Limited Partnership to expand the rented square feet in our office by approximately 26,000 square feet. The lease is expected to commence on or about April 1, 2016, and increases the monthly rent in the Los Angeles location by approximately $150,000 per month with annual increases of approximately 3% per year for the 10-year lease term.

In addition, in July 2015, amended our office lease with PR 701 Gateway, LLC (as successor in interest to DWF III Gateway, LLC) to expand the rented square feet in our South San Francisco location by approximately 13,000 square feet. The lease is expected to commence on or about April 1, 2016, and increases the monthly rent in the South San Francisco location by approximately $51,400 with annual increases of approximately 3% per year for the 10-year lease term.

Non-GAAP Financial Measures:

In addition to our operating results, as calculated in accordance with accounting principles generally accepted in the United States of America, or GAAP, we use certain non-GAAP financial measures when planning, monitoring, and evaluating our operational performance. The following table presents our net loss and net loss per share, as calculated in accordance with GAAP, as adjusted to remove the impact of employee stock-based compensation. These non-GAAP financial measures are not, and should not be viewed as, substitutes for GAAP reporting measures. We believe these non-GAAP measures enhance understanding of our financial performance, are more indicative of our operational performance and facilitate a better comparison among fiscal periods.

For the three and nine months ended September 30, 2015, stock-based compensation represented approximately 41.1% and 41.1% of our loss from operations, respectively, compared to 29.1% and 24.1% for the three and nine months ended September 30, 2014, respectively. This cost is related to our employee hiring practice and the fair market value of the stock option grants on the day granted.

Reconciliation of GAAP Net Loss to Non-GAAP Adjusted Net Loss and

GAAP Net Loss Per Share to Non-GAAP Adjusted Net Loss Per Share

(in thousands except share and per share data)



	Three months ended September 30,						Nine months ended September 30,
	2015			2014			2015			2014
GAAP net loss	$	(60,417	)	$	(35,844	)	$	(177,565	)	$	(94,482	)
Adjustments:
Stock-based compensation -
General and administrative		4,747			1,377			12,173			4,081		(1)
Research and development		20,209			9,073			61,081			18,699		(2)
Non-GAAP adjusted net loss	$	(35,461	)	$	(25,394	)	$	(104,311	)	$	(71,702	)

GAAP net loss per share — basic and diluted	$	(1.87	)	$	(1.19	)	$	(5.55	)	$	(3.16	)
Adjustment to net loss (as detailed above)		0.77			0.35			2.29			0.76
Non-GAAP adjusted net loss per share	$	(1.10	)	$	(0.84	)	$	(3.26	)	$	(2.40	)	(3)

(1) To reflect a non-cash charge to operating expense for general and administrative stock-based compensation.
(2) To reflect a non-cash charge to operating expense for research and development stock-based compensation.
(3) Non-GAAP adjusted net loss per share was calculated based on 32,303,203 and 30,117,819 weighted average common shares outstanding for the three months ended September 30, 2015 and 2014, respectively, and 32,018,869 and 29,936,254 weighted average common shares outstanding for the nine months ended September 30, 2015 and 2014, respectively.

Off-Balance Sheet Arrangements

We do not have any “off-balance sheet agreements,” as defined by SEC regulations.

Item 3.

QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

The primary objective of our investing activities is to preserve principal while maximizing the income we receive from our investments without significantly increasing the risk of loss. Some of the investable securities permitted under our cash management policy may be subject to market risk for changes in interest rates. To mitigate this risk, we maintain a portfolio of cash equivalents and available-for-sale investments in a variety of securities, which may include investment grade commercial paper, money market funds, government debt issued by the United States of America, state debt, certificates of deposit and investment grade corporate debt. Presently, we are exposed to minimal market risks associated with interest rate changes because of the relatively short maturities of our investments and we do not expect interest rate fluctuations to materially affect the aggregate value of our financial instruments. We manage our sensitivity to these risks by maintaining investment grade short-term investments. We do not purchase or hold derivative or commodity instruments or other financial instruments for trading purposes. Additionally, we periodically monitor our investments for adverse material holdings related to the underlying financial solvency of the issuer. As of September 30, 2015, our investments consisted primarily of corporate obligations. Our results of operations and financial condition would not be significantly impacted by either a 10% increase or 10% decrease in interest rates due mainly to the short-term nature of our investment portfolio. We have not used derivative financial instruments in our investment portfolio. Additionally, we do not invest in foreign currencies or other foreign investments.

Item 4.

CONTROLS AND PROCEDURES

Evaluation of Disclosure Controls and Procedures

We maintain disclosure controls and procedures designed to ensure that information required to be disclosed in our reports under the Exchange Act is recorded, processed, summarized and reported within the timelines specified in the SEC’s rules and forms, and that such information is accumulated and communicated to our management, including our Chief Executive Officer (the Company’s principal executive officer) and Senior Vice President, Finance and Administration and Treasurer (the Company’s principal financial and accounting officer), as appropriate, to allow timely decisions regarding required disclosure. In designing and evaluating the disclosure controls and procedures, management recognized that any controls and procedures, no matter how well designed and operated, can only provide reasonable assurance of achieving the desired control objectives, and in reaching a reasonable level of assurance, management necessarily was required to apply its judgment in evaluating the cost-benefit relationship of possible controls and procedures.

Under the supervision and with the participation of our management, including our Chief Executive Officer and Senior Vice President , Finance and Administration and Treasurer , we have evaluated the effectiveness of our disclosure controls and procedures (as defined under Exchange Act Rule 13a-15(e)), as of September 30 , 2015 . Based on that evaluation, our Chief Executive Officer and Se nior Vice President, Finance and Administration and Treasurer have concluded that these disclosure controls and procedures were effective as of September 30 , 2015 .

Changes in Internal Control over Financial Reporting

There was no change in our internal control over financial reporting that occurred during the fiscal quarter ended September 30, 2015, that has materially affected, or is reasonably likely to materially affect, our internal control over financial reporting.

PART II – OTHER INFORMATION

Item 1.

LEGAL PROCEEDINGS

Hsu vs. Puma Biotechnology, Inc., et. al.

On June 3, 2015, Hsingching Hsu, individually and on behalf of all others similarly situated, filed a class action lawsuit against us and certain of our executive officers in the United States District Court for the Central District of California (Case No. 8:15-cv-00865-AG-JCG). On October 16, 2015, lead Plaintiff Norfolk Pension Fund filed an amended complaint on behalf of all persons who purchased our securities between July 22, 2014 and May 29, 2015. The amended complaint alleges that we and certain of our executive officers made false and/or misleading statements and failed to disclose material adverse facts about our business, operations, prospects and performance in violation of Sections 10(b) (and Rule 10b-5 promulgated thereunder) and 20(a) of the Exchange Act. The plaintiff seeks damages, interest, costs, attorneys' fees, and other unspecified equitable relief. We intend to vigorously defend this matter.

Item 1A.

RISK FACTORS

Under Item 1A of our Annual Report on Form 10-K for the year ended December 31, 2014, which was filed with the SEC on March 2, 2015, and Item IA of our Quarterly Report on Form 10-Q for the quarter ended June 30, 2015, which was filed with the SEC on August 10, 2015, we identified important factors that could affect our financial performance and could cause our actual results for future periods to differ materially from our anticipated results or other expectations, including those expressed in any forward-looking statements made in this Form 10-Q. Other than the additional risks set forth below, there has been no material change to our risk factors set forth in our Annual Report on Form 10-K for the year ended December 31, 2014 and our Quarterly Report on Form 10-Q for the quarter ended June 30, 2015. However, the risks described in our Annual Report and Quarterly Reports are not the only risks we face. Additional risks and uncertainties that we currently deem to be immaterial or not currently known to us, as well as other risks reported from time to time in our reports to the SEC, also could cause our actual results to differ materially from our anticipated results or other expectations.

We and certain of our executive officers have been named as defendants in a purported securities class action lawsuit, which could cause us to incur substantial costs and divert management's attention, financial resources and other company assets.

In the past, securities class action litigation has often been brought against a company following periods of volatility in the market price of its securities. This risk is especially relevant for us because pharmaceutical companies have experienced significant stock price volatility in recent years. On June 3, 2015, we and certain of our executive officers were named as defendants in a purported securities class action lawsuit. The amended complaint, filed on October 16, 2015, on behalf of all persons who purchased our securities between July 22, 2014 and May 29, 2015, generally alleges that we and such executive officers made false and/or misleading statements and failed to disclose material adverse facts about our business, operations, prospects and performance. This lawsuit and any future lawsuits to which we may become a party are subject to inherent uncertainties and will likely be expensive and time-consuming to investigate, defend and resolve, and will divert our management's attention and financial and other resources. The outcome of litigation is necessarily uncertain, and we could be forced to expend significant resources in the defense of this and other suits, and we may not prevail. Any litigation to which we are a party may result in an onerous or unfavorable judgment that may not be reversed upon appeal or in payments of substantial monetary damages or fines, or we may decide to settle this or other lawsuits on similarly unfavorable terms, which could adversely affect our business, financial condition, results of operations or stock price. See Item 1. "Legal Proceedings" above for additional information regarding the class action.

Item 2.

UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS

Recent Sales of Unregistered Securities

We did not sell any of our equity securities without registration under the Securities Act of 1933, as amended, during the quarter ended September 30, 2015.

Purchases of Equity Securities by the Issuer and Affiliated Purchasers

Neither we nor any “affiliated purchasers” within the definition of Rule 10b-18(a)(3) made any purchases of our equity securities during the quarter ended September 30, 2015.

Item 3 .

DEFAULTS UPON SENIOR SECURITIES

None.

Item 4.

MINE SAFETY DISCLOSURES

Not applicable.

Item 5.

OTHER INFORMATION

None.

Item 6.

EXHIBITS

(a)	Exhibits required by Item 601 of Regulation S-K.

Exhibit		Description

10.1		Fourth Amendment to Lease, dated July 31, 2015, by and between CA-10880 Wilshire Limited Partnership and the Company

10.2		Third Amendment to Lease, dated July 21, 2015, by and between PR 701 Gateway, LLC (as successor in interest to DFW III Gateway, LLC) and the Company

10.3+		Letter Agreement, dated August 21, 2015, between the Company and Steven Lo

31.1		Certification of Principal Executive Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002, with respect to the registrant's Quarterly Report on Form 10-Q for the quarter ended September 30, 2015

31.2		Certification of Principal Financial Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002, with respect to the registrant's Quarterly Report on Form 10-Q for the quarter ended September 30, 2015

32.1		Certification of Principal Executive Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002

32.2		Certification of Principal Financial Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002

101.INS		XBRL Instance Document

101.SCH		XBRL Taxonomy Extension Schema Document

101.CAL		XBRL Taxonomy Extension Calculation Linkbase Document

101.DEF		XBRL Taxonomy Extension Definition Linkbase Document

101.LAB		XBRL Taxonomy Extension Label Linkbase Document

101.PRE		XBRL Taxonomy Extension Linkbase Document

+		Management contract or compensatory plan or arrangement.

SIGNAT URES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.

	PUMA BIOTECHNOLOGY, INC.
Date: November 9, 2015	By:	/s/ Alan H. Auerbach
		Alan H. Auerbach
		President and Chief Executive Officer
		(Principal Executive Officer)
Date: November 9, 2015	By:	/s/ Charles R. Eyler
		Charles R. Eyler
		Senior Vice President, Finance and Administration and Treasurer
		(Principal Financial and Accounting Officer)

Exhibit 10.1

FOURTH AMENDMENT

THIS FOURTH AMENDMENT (this “ Amendment ”) is made and entered into as of July 31, 2015, by and between CA-10880 WILSHIRE LIMITED PARTNERSHIP , a Delaware limited partnership (“Landlord”), and PUMA BIOTECHNOLOGY, INC., a Delaware corporation (“Tenant”).

RECITALS

Landlord and Tenant are parties to that certain lease dated October 4, 2011 (the “Original Lease”), as previously amended by Commencement Letter dated January 10, 2012, First Amendment dated November 28, 2012 (the “ First Amendment ”), Commencement Letter dated January 9, 2013, Second Amendment dated December 2, 2013 (the “ Second Amendment ”), Commencement Letter dated January 14, 2014 and Third Amendment dated March 18, 2014 (the “ Third Amendment ”) (as amended, the “ Lease ”). Pursuant to the Lease, Landlord has leased to Tenant space currently containing approximately 25,683 rentable square feet (the “ Existing Premises ”) described as Suite Nos. 2000, 2020, 2050 and 2150 on the 20 ^th and 21st floors of the building commonly known as 10880 Wilshire Boulevard located at 10880 Wilshire Boulevard, Los Angeles, California (the “ Building ”).

B.	The Lease will expire by its terms on December 31, 2018 (the “ Existing Expiration Date ”), and the parties wish to extend the term of the Lease on the following terms and conditions.

The parties wish to expand the Premises (defined in the Lease) to include additional space, containing approximately 26,057 rentable square feet described as Suite No. 1700 on the 17th floor of the Building and shown on Exhibit A attached hereto (the “ Expansion Space ”), on the following terms and conditions.

NOW, THEREFORE, in consideration of the above recitals which by this reference are incorporated herein, the mutual covenants and conditions contained herein and other valuable consideration, the receipt and sufficiency of which are hereby acknowledged, Landlord and Tenant agree as follows:

1.	Extension . The term of the Lease is hereby extended through March 31, 2026 (the “Extended Expiration Date” ). The portion of the term of the Lease beginning on January 1, 2019 (the “ Extension Date ”) and ending on the Extended Expiration Date shall be referred to herein as the “Extended Term” .

2.	Expansion.

2.1.

Effect of Expansion . Effective as of the Expansion Effective Date, the Premises shall be increased from 25,683 rentable square feet on the 20 ^th and 21st floors to 51,740 rentable square feet on the 17 ^th , 20 ^th and 21st floors by the addition of the Expansion Space, and, from and after the Expansion Effective Date, the Existing Premises and the Expansion Space shall collectively be deemed the Premises. The term of the Lease for the Expansion Space (the “ Expansion Term ”) shall commence on the Expansion Effective Date and, unless sooner terminated in accordance with the Lease, end on the Extended Expiration Date. From and after the Expansion Effective Date, the Expansion Space shall be subject to all the terms and conditions of the Lease except as provided herein. Except as may be expressly provided herein, (a) Tenant shall not be entitled to receive, with respect to the Expansion Space, any allowance, free rent or other financial concession granted with respect to the Existing Premises, and (b) no representation or warranty made by Landlord with respect to the Existing Premises shall apply to the Expansion Space.

2.2.

Expansion Effective Date . As used herein, “Expansion Effective Date” means the earlier of (i) the date on which Tenant first occupies the Expansion Space for the purpose of conducting its business operations therein, or (ii) April 1, 2016 .

2.3.

Confirmation Letter . At any time after the Expansion Effective Date, Landlord may deliver to Tenant a notice substantially in the form of Exhibit C attached hereto, as a confirmation of the information set forth therein. Tenant shall execute and return (or, by written notice to Landlord, reasonably object to) such notice within 10 days after receiving it.

3.	Base Rent .

3.1.

Existing Premises from and after April 1, 2016. With respect to the Existing Premises from and after April 1, 2016, the Base Rent schedules set forth in Section 2., “Base Rent” of the Third Amendment, Section 2., “Base Rent” of the Second Amendment, Section 2., “Base Rent” of the First Amendment, and Section 1.4., “Base Rent” of the Original Lease shall be deleted in their entirety and the schedule of Base Rent for the Existing Premises shall be as follows:

Period	Annual Rate Per Square Foot (rounded to the nearest 100 ^th of a dollar)		Monthly Base Rent
April 1, 2016 through March 31, 2017	$	51.60	$	110,436.90
April 1, 2017 through March 31, 2018	$	53.15	$	113,754.29
April 1, 2018 through March 31, 2019	$	54.74	$	117,157.29
April 1, 2019 through March 31, 2020	$	56.38	$	120,667.30
April 1, 2020 through March 31, 2021	$	58.08	$	124,305.72
April 1, 2021 through March 31, 2022	$	59.82	$	128,029.76
April 1, 2022 through March 31, 2023	$	61.61	$	131,860.80
April 1, 2023 through March 31, 2024	$	63.46	$	135,820.27
April 1, 2024 through March 31, 2025	$	65.37	$	139,908.14
April 1, 2025 through the Extended Expiration Date (i.e. March 31, 2026)	$	67.33	$	144,103.03

All such Base Rent shall be payable by Tenant in accordance with the terms of the Lease.

3.2.

Expansion Space During Expansion Term. With respect to the Expansion Space during the Expansion Term, the schedule of Base Rent shall be as follows:

Period During the Expansion Term	Annual Rate Per Square Foot (rounded to the nearest 100 ^th of a dollar)		Monthly Base Rent
Expansion Effective Date through March 31, 2017	$	51.60	$	112,045.10
April 1, 2017 through March 31, 2018	$	53.15	$	115,410.80
April 1, 2018 through March 31, 2019	$	54.74	$	118,863.35
April 1, 2019 through March 31, 2020	$	56.38	$	122,424.47
April 1, 2020 through March 31, 2021	$	58.08	$	126,115.88
April 1, 2021 through March 31, 2022	$	59.82	$	129,894.15
April 1, 2022 through March 31, 2023	$	61.61	$	133,780.98
April 1, 2023 through March 31, 2024	$	63.46	$	137,798.10
April 1, 2024 through March 31, 2025	$	65.37	$	141,945.51
April 1, 2025 through the Extended Expiration Date (i.e. March 31, 2026)	$	67.33	$	146,201.48

All such Base Rent shall be payable by Tenant in accordance with the terms of the Lease.

Base Rent Abatement Applicable to the Expansion Space. Notwithstanding anything in this Amendment to the contrary, so long as Tenant is not in Default (as defined in Section 19 of the Original Lease), Tenant shall be entitled to an abatement of Base Rent in the amount of $112,045.10 per month applicable to seven (7) consecutive full calendar months of the Expansion Term commencing with the second (2nd) full calendar month of the Expansion Term. The total amount of Base Rent abated in accordance with the foregoing shall equal $784,315.70 (the “Abated Base Rent” ). Only Base Rent shall be abated pursuant to this Section, and all Additional Rent (as defined in Section 3 of the Original Lease) and other costs and charges specified in this Amendment and/or the Lease shall remain as due and payable pursuant to the provisions of this Amendment and/or the Lease.

4.	Cash Security Deposit; Letters of Credit .

4.1.

Cash Security Deposit. Landlord, pursuant to the terms of the Lease, currently retains a cash Security Deposit in the amount of$36,434.00 as security for Tenant's performance of its obligations under the Lease. Landlord and Tenant acknowledge that such Security Deposit was not previously reduced on January I, 2015 as contemplated by Section 3 of the First Amendment. Within thirty (30) days after following the satisfaction of Tenant's obligations under Section 4.2.A below, Landlord shall return such Security Deposit to Tenant by way of a check or credit against Base Rent next due under the Lease.

4.2.

Replacement or Amendment of Existing Letter of Credit.

Increase in Letter of Credit Amount . Pursuant to Section 6 of Exhibit F to the Original Lease, Tenant provided Landlord with a Letter of Credit (defined in Section 6.1 of Exhibit F to the Original Lease) issued by Wells Fargo Bank N.A. and described as Irrevocable Standby Letter of Credit Number IS0005128 dated November 16, 2011. Landlord and Tenant acknowledge that the Letter of Credit Amount (defined in Section 6.1 of Exhibit F to the Original Lease) was not previously reduced and, as such, the current Letter of Credit Amount is $1,000,000.00. Concurrently with Tenant's execution of this Amendment, Tenant shall increase the Letter of Credit Amount from $1,000,000.00 to $2,500,000.00 by way of either an amendment to the Letter of Credit or a replacement Letter of Credit that satisfies all of the requirements of Section 6 of Exhibit F to the Original Lease. If Tenant elects to provide Landlord with a replacement Letter of Credit, Landlord, thirty (30) days after its' receipt of the replacement Letter of Credit, shall return the existing Letter of Credit to the issuer of the existing Letter of Credit to Wells Fargo Bank along with Landlord's authorization to cancel the existing Letter of Credit. Notwithstanding the forgoing, if Wells Fargo Bank is the issuer of the replacement Letter of Credit, Landlord, upon receipt of Wells Fargo Bank's written commitment to issue the replacement Letter of Credit, shall work together in good faith with Wells Fargo Bank to exchange the existing Letter of Credit for the replacement Letter of Credit in accordance with commonly accepted industry practices.

Reduction in Letter of Credit Amount . Section 6.6 of Exhibit F to the Original Lease (entitled Reduction in Letter of Credit Amount) is hereby amended to read as follows:

“Provided that, during the 12 month period immediately preceding the effective date of any reduction of the Letter of Credit, no Default has occurred under this Lease which was not cured by Tenant within any applicable notice and cure periods (the “LC Reduction Conditions”), Tenant may reduce the Letter of Credit Amount so that the reduced Letter of Credit Amounts will be as follows: (a) $2,000,000.00 effective as of April 1, 2018; (b) $1,500,000.00 effective as of April 1, 2019; and (c) $1,000,000.00 effective as of April 1, 2021. If Tenant is not entitled to reduce the Letter of Credit Amount as of a particular reduction effective date due to Tenant's failure to satisfy the LC Reduction Conditions described above, then any subsequent reduction(s) Tenant is entitled to hereunder shall be reduced by the amount of the reduction Tenant would have been entitled to had Tenant satisfied the LC Reduction Conditions necessary for such earlier reduction. Notwithstanding anything to the contrary contained herein, if Tenant has been in Default under this Lease at any time prior to the effective date of any reduction of the Letter of Credit Amount and Tenant has failed to cure such Default within any applicable notice and cure period, then Tenant shall have no further right to reduce the Letter of Credit Amount as described herein. Any reduction in the Letter of Credit Amount shall be accomplished by Tenant providing Landlord with a substitute letter of credit in the reduced amount or an amendment to the then existing Letter of Credit reflecting the reduced amount.”

5.	Tenant's Share. With respect to the Expansion Space during the Expansion Term, Tenant's Share shall be 4.4317%.

6.	Expenses and Taxes.

6.1.

Existing Premises from and after April1, 2016. With respect to the Existing Premises from and after April 1, 2016, Tenant shall pay for Tenant's Share of Expenses and Taxes in accordance with the terms of the Lease; provided, however, that, with respect to the Existing Premises from and after April 1, 2016, the Base Year for Expenses and Taxes shall be calendar year 2016.

6.2.

Expansion Space During Expansion Term. With respect to the Expansion Space during the Expansion Term, Tenant shall pay for Tenant's Share of Expenses and Taxes in accordance with the terms of the Lease; provided, however, that, with respect to the Expansion Space during the Expansion Term, the Base Year for Expenses and Taxes shall be calendar year 2016 .

7.	Improvements to Existing Premises and Expansion Space.

7.1.

Configuration and Condition of Existing Premises and Expansion Space. Tenant acknowledges that it is in possession of the Existing Premises and that it has inspected the Expansion Space, and agrees to accept each such space in its existing configuration and condition, without any representation by Landlord regarding its configuration or condition and without any obligation on the part of Landlord to perform or pay for any alteration or improvement, except as may be otherwise expressly provided in this Amendment.

7.2.

Responsibility for Improvements to Existing Premises and Expansion Space.

Landlord shall perform improvements to the Existing Premises and the Expansion Space in accordance with Exhibit B attached hereto.

8.	Other Pertinent Provisions. Landlord and Tenant agree that, effective as of the date of this Amendment (unless different effective date(s) is/are specifically referenced in this Section), the Lease shall be amended in the following additional respects:

8.1.

California Public Resources Code § 25402.10. If Tenant (or any party claiming by, through or under Tenant) pays directly to the provider for any energy consumed at the Building, Tenant, promptly upon request, shall deliver to Landlord (or, at Landlord's option, execute and deliver to Landlord an instrument enabling Landlord to obtain from such provider) any data about such consumption that Landlord, in its reasonable judgment, is required to disclose to a prospective buyer, tenant or mortgage lender under California Public Resources Code § 25402.10 or any similar law.

8.2.

California Civil Code Section 1938. Pursuant to California Civil Code § 1938, Landlord hereby states that the Existing Premises and the Expansion Space have not undergone inspection by a Certified Access Specialist (CASp) (defined in California Civil Code § 55.52).

8.3.

Parking. With respect to the Existing Premises, Tenant currently has the right, but not the obligation, to lease up to an aggregate of 56 unreserved parking passes; provided, however, Tenant may convert up to three (3) of such 56 unreserved passes into three (3) reserved parking passes in the Parking Facility (as defined in Section 24 of the Original Lease). Such rights shall remain in place through the Extended Term. With respect to the Expansion Space during the Expansion Term, subject to the terms and conditions set forth in Section 24 of the Original Lease, as amended herein, Tenant shall have the right, but not the obligation, to lease up to 78 additional unreserved parking passes. Prior to the Expansion Effective Date, Tenant shall notify Landlord in writing of the number of additional unreserved parking passes which Tenant initially elects to lease during the Expansion Term. Thereafter, Tenant may increase or decrease the number of additional unreserved parking passes to be used by Tenant pursuant to this Section 8.3 upon a minimum of 30 days prior written notice to Landlord. Tenant shall pay Landlord the current rate of $180.00 per unreserved parking pass per month, plus applicable taxes, if any. Such parking rate shall be subject to increase from time to time to reflect the prevailing market rates consistently charged in the Parking Facility.

8.4.

Notice Addresses. Any notice required under the terms of the Lease to be given to Landlord shall be sent to the following addresses:

CA-10880 WILSHIRE LIMITED PARTNERSHIP

c/o Equity Office

10880 Wilshire Boulevard

Suite 1010

Los Angeles, CA 90024

Attention: Property Manager

With copies to:

CA-10880 WILSHIRE LIMITED PARTNERSHIP

c/o Equity Office

222 South Riverside Plaza

Suite 2000

Chicago, IL 60606

Attention: Managing Counsel

and

Equity Office

222 South Riverside Plaza

Suite 2000

Chicago, IL 60606

Attention: Lease Administration

8.5.

Extension Option . Tenant shall have the right extend the Extended Term for the entire Premises only for one additional period of five (5) years pursuant to the terms and conditions set forth in Section 3., “Extension Option” of EXHIBIT F, “ADDITIONAL PROVISIONS” of the Original Lease ; provided, however, all references to the phrase (a) “Term” shall be deleted and the phrase “Extended Term” shall be substituted therefore; and (b) “Expiration Date” shall be deleted and the phrase “Extended Expiration Date” shall be substituted therefore.

8.6.

Acceleration Option. Section 4., “Acceleration Option” of EXHIBIT F, “ADDITIONAL PROVISIONS” of the Original Lease is hereby deleted in its entirety and of no further force and effect.

9.	Miscellaneous .

9.1.

This Amendment and the attached exhibits, which are hereby incorporated into and made a part of this Amendment, set forth the entire agreement between the parties with respect to the matters set forth herein. There have been no additional oral or written representations or agreements. Tenant shall not be entitled, in connection with entering into this Amendment, to any free rent, allowance, alteration, improvement or similar economic incentive to which Tenant may have been entitled in connection with entering into the Lease, except as may be otherwise expressly provided in this Amendment.

9.2.

Except as herein modified or amended, the provisions, conditions and terms of the Lease shall remain unchanged and in full force and effect.

9.3.

In the case of any inconsistency between the provisions of the Lease and this Amendment, the provisions of this Amendment shall govern and control.

9.4.

Submission of this Amendment by Landlord is not an offer to enter into this Amendment but rather is a solicitation for such an offer by Tenant. Landlord shall not be bound by this Amendment until Landlord has executed and delivered it to Tenant.

9.5.

Capitalized terms used but not defined in this Amendment shall have the meanings given in the Lease.

9.6.

Tenant shall indemnify and hold Landlord, its trustees, members, principals, beneficiaries, partners, officers, directors, employees, mortgagee(s) and agents, and the respective principals and members of any such agents harmless from all claims of any brokers (other than L.A. Realty Partners) claiming to have represented Tenant in connection with this Amendment. Landlord shall indemnify and hold Tenant, its trustees, members, principals, beneficiaries, partners, officers, directors, employees, and agents, and the respective principals and members of any such agents harmless from all claims of any brokers claiming to have represented Landlord in connection with this Amendment. Tenant acknowledges that any assistance rendered by any agent or employee of any affiliate of Landlord in connection with this Amendment has been made as an accommodation to Tenant solely in furtherance of consummating the transaction on behalf of Landlord, and not as agent for Tenant.

9.7.

Each signatory of this Amendment represents hereby that he or she has the authority to execute and deliver it on behalf of the party hereto for which such signatory is acting.

[SIGNATURES ARE ON FOLLOWING PAGE]

IN WITNESS WHEREOF, Landlord and Tenant have duly executed this Amendment as of the day and year first above written.

LANDLORD:
CA-10880 WILSHIRE LIMITED PARTNERSHIP, a
Delaware limited partnership

By: EOP Owner GP L.L.C., a Delaware limited liability company, its general partner

	By:	/s/ Frank Campbell
		Name:	Frank Campbell
		Title:	Managing Director

		TENANT:

		PUMA BIOTECHNOLOGY, INC. , a Delaware corporation

		By:		/s/ Alan H. Auerbach
		Name:		Alan H. Auerbach
		Title:		Chief Executive Officer and President

		By:		/s/ Charles R. Eyler
		Name:		Charles R. Eyler
		Title:		Senior Vice President – Finance & Treasurer

EXHIBIT A

OUTLINE AND LOCATION OF EXPANSION SPACE

TO BE ATTACHED

EXHIBIT B

WORK LETTER

As used in this Exhibit B (this “ Work Letter ”), the following terms shall have the following meanings: “Agreement” means the Amendment of which this Work Letter is a part. The “Premises” shall mean the Existing Premises and the Expansion Space. “Tenant Improvements” means all improvements to be constructed in the Premises pursuant to this Work Letter. “Tenant Improvement Work” means the construction of the Tenant Improvements, together with any related work (including demolition) that is necessary to construct the Tenant Improvements.

1 ALLOWANCE.

1.1 Allowance. Tenant shall be entitled to a one-time tenant improvement allowance (the “Allowance”) in the aggregate amount of $1,818,380.00 (i.e., $55.00 per rentable square foot of the Expansion Space plus $15.00 per rentable square foot of the Existing Premises) to be applied toward (a) the Allowance Items (defined in Section 1.2 below) and/or (b) a credit against Base Rent applicable to the Expansion Space coming due under the Agreement from and after the last day of the eighth (8 ^th ) full calendar month of the Expansion Term and/or (c) the cost of purchasing furniture, fixtures, and equipment to be used in the Premises by Tenant and/or (d) costs associated with the installation of telephone and data cabling, and/or (e) costs associated with moving into the Expansion Space. Notwithstanding the foregoing, the total portion of the Allowance that is applied toward items (b), (c), (d) and/or (e) shall not exceed, in the aggregate, $645,815.00 (i.e., $10.00 per rentable square foot of the Expansion Space plus $15.00 per rentable square foot of the Existing Premises). Tenant, by written notice to Landlord (the “Allowance Notice”) shall advise Landlord of the manner in which Tenant desires to apply the Allowance. Any portion of the Allowance that is applied toward the cost of the Tenant Improvement Work shall applied in accordance with Section 1.2 below. Any portion of the Allowance that is applied as a credit against Base Rent shall be applied against the installment of Base Rent for the ninth (9th) full calendar month of the Expansion Term and, if necessary, consecutive calendar months thereafter. Any portion of the Allowance that is applied toward items (c), (d) and (e) shall be disbursed to Tenant within 45 days after Landlord's receipt of paid invoices from Tenant with respect to Tenant's actual costs of items (c), (d) and (e) as described above; provided that Tenant shall also be required to provide Landlord with unconditional waivers of mechanics liens with respect to any items that relate to work of a type for which a mechanics lien could be potentially be filed. Tenant shall be responsible for all costs associated with the Tenant Improvement Work, including the costs of the Allowance Items, to the extent such costs exceed the lesser of (i) the Allowance, or (ii) the aggregate amount that Landlord is required to disburse for such purpose pursuant to this Work Letter. Notwithstanding any contrary provision of this Agreement, if Tenant fails to use the entire Allowance by December 31, 2016, the unused amount shall revert to Landlord and Tenant shall have no further rights with respect thereto.

1.2 Disbursement of the Allowance. Except as otherwise provided in this Work Letter, the Allowance shall be disbursed by Landlord only for the following items (the “Allowance Items”): (a) the fees of the Architect (defined in Sectio n 2.1 below) and the Engineers (defined in Section 2.1 below); (b) plan-check, permit and license fees relating to performance of the Tenant Improvement Work; (c) the cost of performing the Tenant Improvement Work, including after hours charges, testing and inspection costs, freight elevator usage, hoisting and trash removal costs, and contractors' fees and general conditions; (d) the cost of any change to the base, shell or core of the Expansion Space, Existing Premises or Building required by the Plans (defined in Section 2.1 below) (including if such change is due to the fact that such work is prepared on an unoccupied basis), including all direct architectural and/or engineering fees and expenses incurred in connection therewith; (e) the cost of any change to the Plans or Tenant Improvement Work required by Law; (f) the Landlord Supervision Fee (defined in Section 3.2.2 below); (g) sales and use taxes; and (h) all other costs expended by Landlord in connection with the performance of the Tenant Improvement Work.

2 PLANS AND PRICING.

2.1 Selection of Architect. Landlord shall retain the architect/space planner (the “Architect” ) and the engineering consultants (the “Engineers” ) of Landlord's choice to prepare all architectural plans for the Premises and all engineering working drawings relating to the structural, mechanical, electrical, plumbing, HVAC, life-safety, and sprinkler work in the Premises. The plans and drawings to be prepared by the Architect and the Engineers shall be referred to in this Work Letter as the “Plans.” Tenant shall be responsible for ensuring that all elements of the design of the Plans are suitable for

Tenant's use of the Premises, and neither the preparation of the Plans by the Architect or the Engineers nor Landlord's approval of the Plans shall relieve Tenant from such responsibility.

2.2 [Intentionally Omitted.]

2.3 [Intentionally Omitted.]

2.4 Additional Programming Information. Landlord and Tenant acknowledge that they have approved the space plan for the Premises prepared by , dated , 2015, job number (the “Space Plan”). Tenant shall deliver to Landlord, in writing, all information that, together with the Space Plan, is necessary, in the judgment of Landlord, the Architect and the Engineers, to complete the architectural, engineering and final architectural working drawings for the Premises in a form that is sufficient to enable subcontractors to bid on the work and to obtain all applicable permits for the Tenant Improvement Work (the “Construction Drawings”), including electrical requirements, telephone requirements, special HVAC requirements, plumbing requirements, and all interior and special finishes (collectively, the “Additional Programming Information”). The Additional Programming Information shall be consistent with Landlord's requirements for avoiding aesthetic, engineering or other conflicts with the design and function of the balance of the Building (collectively, the “Landlord Requirements”) and shall otherwise be subject to Landlord's reasonable approval. Landlord shall provide Tenant with notice approving or reasonably disapproving the Additional Programming Information within five (5) business days after the later of Landlord's receipt thereof or the mutual execution and delivery of this Agreement. If Landlord disapproves the Additional Programming Information, Landlord's notice of disapproval shall describe with reasonable specificity the basis for such disapproval and the changes that would be necessary to resolve Landlord's objections. If Landlord disapproves the Additional Programming Information, Tenant shall modify the Additional Programming Information and resubmit it for Landlord's review and approval. Such procedure shall be repeated as necessary until Landlord has approved the Additional Programming Information. If requested by Tenant, Landlord, in its sole and absolute discretion, may assist Tenant, or cause the Architect and/or the Engineers to assist Tenant, in preparing all or a portion of the Additional Programming Information; provided, however, that, whether or not the Additional Programming Information is prepared with such assistance, Tenant shall be solely responsible for the timely preparation and delivery of the Additional Programming Information and for all elements thereof and, subject to Section 1 above, all costs relating thereto.

2.5 Construction Drawings. After approving the Additional Programming Information, Landlord shall cause the Architect and the Engineers to prepare and deliver to Tenant Construction Drawings that conform to the Space Plan and the approved Additional Programming Information. Such preparation and delivery shall occur within 15 business days after the later of Landlord's approval of the Additional Programming Information or the mutual execution and delivery of this Agreement. Tenant shall approve or disapprove the Construction Drawings by notice to Landlord. If Tenant disapproves the Construction Drawings, Tenant's notice of disapproval shall specify any revisions Tenant desires in the Construction Drawings. After receiving such notice of disapproval, Landlord shall cause the Architect and/or the Engineers to revise the Construction Drawings, taking into account the reasons for Tenant's disapproval (provided, however, that Landlord shall not be required to cause the Architect or the Engineers to make any revision to the Construction Drawings that is inconsistent with the Landlord Requirements or that Landlord otherwise reasonably disapproves), and resubmit the Construction Drawings to Tenant for its approval. Such revision and resubmission shall occur within five (5) business days after the later of Landlord's receipt of Tenant's notice of disapproval or the mutual execution and delivery of this Agreement if such revision is not material, and within such longer period of time as may be reasonably necessary (but not more than 15 business days after the later of such receipt or such mutual execution and delivery) if such revision is material. Such procedure shall be repeated as necessary until Tenant has approved the Construction Drawings. The Construction Drawings approved by Landlord and Tenant are referred to in this Work Letter as the “Approved Construction Drawings”.

2.6 Construction Pricing. Within 10 business days after the Construction Drawings are approved by Landlord and Tenant, Landlord shall provide Tenant with Landlord's reasonable estimate (the “Construction Pricing Proposal”) of the cost of all Allowance Items to be incurred by Tenant in connection with the performance of the Tenant Improvement Work pursuant to the Approved Construction Drawings. Tenant shall provide Landlord with notice approving or disapproving the Construction Pricing Proposal. If Tenant disapproves the Construction Pricing Proposal, Tenant's notice of disapproval shall be accompanied by proposed revisions to the Approved Construction Drawings that Tenant requests in order to resolve its objections to the Construction Pricing Proposal, and Landlord shall respond as required under Section 2.7 below. Such procedure shall be repeated as necessary until the Construction Pricing Proposal is approved by Tenant. Upon Tenant's approval of the Construction Pricing Proposal, Landlord may purchase the items set forth in the Construction Pricing Proposal and commence construction relating to such items.

2.7 Revisions to Approved Construction Drawings. If Tenant requests any revision to the Approved Construction Drawings, Landlord shall provide Tenant with notice approving or reasonably disapproving such revision, and, if Landlord approves such revision, Landlord shall have such revision made and delivered to Tenant, together with notice of any resulting change in the most recent Construction Pricing Proposal, if any, within 10 business days after the later of Landlord's receipt of such request or the mutual execution and delivery of this Agreement if such revision is not material, and within such longer period of time as may be reasonably necessary (but not more than 15 business days after the later of such receipt or such execution and delivery) if such revision is material, whereupon Tenant, within one (1) business day, shall notify Landlord whether it desires to proceed with such revision. If Landlord has commenced performance of the Tenant Improvement Work, then, in the absence of such authorization, Landlord shall have the option to continue such performance disregarding such revision. Landlord shall not revise the Approved Construction Drawings without Tenant's consent, which shall not be unreasonably withheld, conditioned or delayed.

2.8 Time Deadlines. Tenant shall use its best efforts to cooperate with Landlord and its architect, engineers and other consultants to complete all phases of the Plans, approve the Construction Pricing Proposal and obtain the permits for the Tenant Improvement Work as soon as possible after the execution of this Agreement, and Tenant shall meet with Landlord, in accordance with a schedule determined by Landlord, to discuss the parties' progress.

3 CONSTRUCTION.

3.1 Contractor. A contractor designated by Landlord (the “Contractor”) shall perform the Tenant Improvement Work. In addition, Landlord may select and/or approve of any subcontractors, mechanics and materialmen used in connection with the performance of the Tenant Improvement Work.

3.2 Construction.

3.2.1 Over-Allowance Amount. If the Construction Pricing Proposal exceeds the Allowance, then, concurrently with its delivery to Landlord of approval of the Construction Pricing Proposal, Tenant shall deliver to Landlord cash in the amount of such excess (the “Over-Allowance Amount”). Any Over-Allowance Amount shall be disbursed by Landlord before the Allowance and pursuant to the same procedure as the Allowance. After the Construction Pricing Proposal is approved by Tenant, if any revision is made to the Approved Construction Drawings or the Tenant Improvement Work that increases the Construction Pricing Proposal, or if the Construction Pricing Proposal is otherwise increased to reflect the actual cost of all Allowance Items to be incurred by Tenant in connection with the performance of the Tenant Improvement Work pursuant to the Approved Construction Drawings, then Tenant shall deliver any resulting Over-Allowance Amount (or any resulting increase in the Over-Allowance Amount) to Landlord immediately upon Landlord's request.

3.2.2 Landlord's Retention of Contractor. Landlord shall independently retain the Contractor to perform the Tenant Improvement Work in accordance with the Approved Construction Drawings. Tenant shall pay a construction supervision and management fee (the “Landlord Supervision Fee”) to Landlord in an amount equal to two percent (2%) of the aggregate amount of all Allowance Items other than the Landlord Supervision Fee.

3.2.3 Contractor's Warranties. Tenant waives all claims against Landlord relating to any defects in the Tenant Improvements; provided, however, that if, within 30 days after substantial completion of the Tenant Improvement Work, Tenant provides notice to Landlord of any non-latent defect in the Tenant Improvements, or if, within 11 months after substantial completion of the Tenant Improvement Work, Tenant provides notice to Landlord of any latent defect in the Tenant Improvements, then Landlord shall, at its option, either (a) assign to Tenant any right Landlord may have under the Construction Contract (defined below) to require the Contractor to correct, or pay for the correction of, such defect, or (b) at Tenant's expense, use reasonable efforts to enforce such right directly against the Contractor for Tenant's benefit. As used in this Work Letter, “Construction Contract” means the construction contract between Landlord and the Contractor pursuant to which the Tenant Improvements will be constructed.

4 COMPLETION.

Tenant acknowledges and agrees that the Tenant Improvement Work may be performed during Building HVAC Hours before or after the Expansion Effective Date. Landlord and Tenant shall cooperate with each other in order to enable the Tenant Improvement Work to be performed in a timely manner and with as little inconvenience to the operation of Tenant's business as is reasonably possible. Notwithstanding any contrary provision of this Agreement, any delay in the completion of the Tenant Improvement Work or inconvenience suffered by Tenant during the performance of the Tenant Improvement Work shall not delay the Expansion Effective Date, nor shall it subject Landlord to any liability for any loss or damage resulting therefrom or entitle Tenant to any credit, abatement or adjustment of rent or other sums payable under the Lease.

5 MISCELLANEOUS.

Notwithstanding any contrary provision of this Agreement, if Tenant defaults under this Agreement before the Tenant Improvement Work is completed, Landlord's obligations under this Work Letter shall be excused until such default is cured and Tenant shall be responsible for any resulting delay in the completion of the Tenant Improvement Work. This Work Letter shall not apply to any space other than the Existing Premises and the Expansion Space.

EX HI BIT C

10880 WILSHIRE BOULEVARD

CONFIRMATION LETTER

, 2015

PUMA BIOTECHNOLOGY, INC.

10880 Wilshire Boulevard

Suite 2150

Los Angeles, California

Re:

Fourth Amendment (the “Amendment”) dated ,2015, between CA-10880 WILSHIRE LIMITED PARTNERSHIP, a Delaware limited partnership (“Landlord”), and PUMA BIOTECHNOLOGY, INC., a Delaware corporation (“Tenant”), concerning Suite 1700 (the “Expansion Space” ) on the 17th floor of the building located at 10880 Wilshire Boulevard, Los Angeles, California.

Lease ID:

Business Unit Number:

Dear:

In accordance with the Amendment, Tenant accepts possession of the Expansion Space and confirms the following:

1. The Expansion Effective Date is and the Extended Expiration Date is

Please acknowledge the foregoing by signing all three (3) counterparts of this letter in the space provided below and returning two (2) fully executed counterparts to my attention. Please note that, pursuant to Section 2.3 of the Amendment, if Tenant fails to execute and return (or, by notice to Landlord, reasonably object to) this letter within 10 days after receiving it, Tenant shall be deemed to have executed and returned it without exception.

Agreed and Accepted as of , 2015.

“Tenant”:			“Landlord”:
			EQUITY OFFICE MANAGEMENT, L.L.C.,
PUMA BIOTECHNOLOGY, INC., a			as agent for CA-10880 Wilshire Limited
Delaware corporation			Partnership

By:			By:
Name:			Name:
Title:			Title:

Exhibit C

EXHIBIT D

FORM OF LETTER OF CREDIT

[Name of Financial Institution]

		Irrevocable Standby
		Letter of Credit
		No.
		Issuance Date:
		Expiration Date:
		Applicant:			PUMA
		BIOTECHNOLOGY, INC., a Delaware corporation

Beneficiary

CA-10880 WILSHIRE LIMITED PARTNERSHIP, a Delaware limited partnership

Equity Office

222 South Riverside Plaza, Suite 2000

Chicago, Illinois 60606

Attention: Treasury Department.

A copy of any notices

and amendments should be sent to:

CA-10880 Wilshire Limited Partnership

c/o Equity Office

10880 Wilshire Boulevard

Suite 1010

Los Angeles, CA 90024

Attention: Property Manager

Ladies/Gentlemen:

We hereby establish our Irrevocable Standby Letter of Credit in your favor for the account of the above referenced Applicant in the amount of U.S. Dollars ($ ) available for payment at sight by your draft drawn on us when accompanied by the following documents:

1.	An original copy of this Irrevocable Standby Letter of Credit.

Beneficiary's dated statement purportedly signed by an authorized signatory or agent reading: “This draw in the amount of U.S. Dollars ($ ) under your Irrevocable Standby Letter of Credit No. represents funds due and owing to us pursuant to the terms of that certain lease by and between CA-10880 WILSHIRE LIMITED PARTNERSHIP, a Delaware limited partnership, as landlord, and PUMA BIOTECHNOLOGY, INC., a Delaware corporation, as tenant, and/or any amendment to the lease or any other agreement between such parties related to the lease.”

It is a condition of this Irrevocable Standby Letter of Credit that it will be considered automatically renewed for a one year period upon the expiration date set forth above and upon each anniversary of such date, unless at least 45 days prior to such expiration date or applicable anniversary thereof, we notify you in writing, by certified mail return receipt requested or by recognized overnight courier service at the addresses set forth above, that we elect not to so renew this Irrevocable Standby Letter of Credit. In addition to the foregoing, we understand and agree that you shall be entitled to draw upon this Irrevocable Standby Letter of Credit in accordance with 1 and 2 above in the event that we elect not to renew this Irrevocable Standby Letter of Credit and, in addition, you provide us with a dated statement purportedly signed by an authorized signatory or agent of Beneficiary stating that the Applicant has failed to provide you with an acceptable substitute irrevocable standby letter of credit in accordance with the terms of the above referenced lease. We further acknowledge and agree that: (a) upon receipt of the documentation required herein, we will honor your draws against this Irrevocable Standby Letter of Credit without inquiry into the accuracy of Beneficiary's signed statement

Exhibit D

and regardless of whether Applicant disputes the content of such statement; (b) this Irrevocable Standby Letter of Credit shall permit partial draws and, in the event you elect to draw upon less than the full stated amount hereof, the stated amount of this Irrevocable Standby Letter of Credit shall be automatically reduced by the amount of such partial draw; and (c) you shall be entitled to transfer your interest in this Irrevocable Standby Letter of Credit from time to time and more than one time without our approval and without charge. In the event of a transfer, we reserve the right to require reasonable evidence of such transfer as a condition to any draw hereunder.

This Irrevocable Standby Letter of Credit is subject to the International Standby Practices

(ISP98) ICC Publication No. 590.

We hereby engage with you to honor drafts and documents drawn under and in compliance with the terms of this Irrevocable Standby Letter of Credit.

All communications to us with respect to this Irrevocable Standby Letter of Credit must be addressed to our office located at to the attention of .

		Very truly yours,

Exhibit D

Exhibit 10.2

THIRD AMENDMENT TO LEASE

THIS THIRD AMENDMENT (this “Amendment” ) is made and entered into as of July 21, 2015, by and between PR 701 GATEWAY, LLC, a Delaware limited liability company (“Landlord”), and PUMA BIOTECHNOLOGY, INC., a Delaware corporation (“Tenant”) .

RECITALS

A .

Landlord (as successor in interest to DFW III GATEWAY, LLC, a Delaware limited liability company) and Tenant are parties to that certain Office Lease dated May 16, 2012 (the “Original Lease”), which Original Lease has been previously amended by that certain First Amendment to Lease dated as of May 19, 2014 (“First Amendment”) and that certain Second Amendment to Lease dated as of June 10, 2014 (collectively, the “Lease”). Pursuant to the Lease, Landlord has leased to Tenant space currently containing approximately 16,712 rentable square feet (the “Original Leased Premises”) described as Suite Nos. 250 and 275 on the second (2 ^nd ) floor of the building located at 70 l Gateway Boulevard, South San Francisco, California (the “Building” ).

B.	Tenant and Landlord agree to relocate Tenant from the Original Leased Premises to approximately 29,470 rentable square feet of space described as the entire fifth (5 ^th ) floor of the Building and shown on Exhibit A attached hereto (the “Substitution Space”) .

C.	The Lease by its terms shall expire on October 31, 2021 (“Prior Termination Date”), and the parties desire to extend the Term, all on the following terms and conditions.

NOW, THEREFORE, in consideration of the mutual covenants and agreements herein contained and other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, Landlord and Tenant agree as follows:

1.	Substitution.

1.1

Effective as of the Substitution Effective Date (hereinafter defined), the Substitution Space is substituted for the Original Leased Premises and, from and after the Substitution Effective Date, the Premises, as defined in the Lease, shall be deemed to mean the Substitution Space containing approximately 29,470 rentable square feet and described as the entire fifth (5 ^th ) floor of the Building.

1.2

The Term for the Substitution Space shall commence on the Substitution Effective Date and, unless sooner terminated pursuant to the terms of the Lease, shall end on the Extended Termination Date (as hereinafter defined). The Substitution Space is subject to all the terms and conditions of the Lease except as expressly modified herein and except that Tenant shall not be entitled to receive any allowances, abatements or other financial concessions granted with respect to the Original Leased Premises unless such concessions are expressly provided for herein with respect to the Substitution Space. Effective as of the Substitution Effective Date, the Lease shall be terminated with respect to the Original Leased Premises, and, unless otherwise specified in this Amendment, “Premises”, as defined in the Lease and as used herein, shall mean the Substitution Space. Tenant shall vacate the Original Leased Premises as of the Substitution Effective Date (such date that Tenant is required to vacate the Original Leased Premises being referred to herein as the “Original Leased Premises Vacation Date”) and return the same to Landlord in “broom clean” condition and otherwise in accordance with the terms and conditions of the Lease.

2.	Substitution Effective Date.

2.1

The “Substitution Effective Date” shall be the earlier to occur of (i) ninety (90) days following the Substitution Space Delivery Date (defined below), or (ii) upon Tenant's occupancy of the Substitution Space for the purpose of conducting business therein.

2.2

The “Substitution Space Delivery Date” shall be the date which Landlord delivers the Substitution Space to Tenant, which is anticipated to be January 1, 2016. The Substitution Space Delivery Date shall be delayed to the extent that Landlord fails to deliver possession of the Substitution Space as a result of holding over by prior occupants. Any such delay in the Substitution Space Delivery Date shall not subject Landlord to any liability for any loss or damage resulting therefrom.

2.3

Upon Landlord's request, Tenant shall execute and return to Landlord, within five (5) days after receipt thereof by Tenant, a Substitution Effective Date Memorandum, in the form of Exhibit C attached hereto, but Tenant's failure or refusal to do so shall not negate Tenant's acceptance of the Substitution Space or affect determination of the Substitution Effective Date.

Extension. The Term of the Lease is extended through the last day of the one hundred twentieth (120th) full calendar month following the Substitution Effective Date (“Extended Termination Date”), unless sooner terminated in accordance with the terms of the Lease. That portion of the Term commencing the day immediately following the Prior Termination Date (“Extension Date”) and ending on the Extended Termination Date shall be referred to herein as the “Extended Term”.

4.	Minimum Monthly Rent. As of the Substitution Effective Date, the schedule of Minimum Monthly Rent payable with respect to the Substitution Space during the remainder of the current Term and the Extended Term is the following:

Period (following the Substitution Effective Date)	Rentable Square Footage		Monthly Rate Per Square Foot		Minimum Monthly Rent
Substitution Effective Date- Month 12	29,470	$	3.45	$	101,671.50
Month 13 - Month 24	29,470	$	3.55	$	104,618.50
Month 25 - Month 36	29,470	$	3.66	$	107,860.20
Month 37 - Month 48	29,470	$	3.77	$	111,101.90
Month 49 - Month 60	29,470	$	3.88	$	114,343.60
Month 61 - Month 72	29,470	$	4.00	$	117,880.00
Month 73 – Month 84	29,470	$	4.12	$	121,416.40
Month 85 - Month 96	29,470	$	4.24	$	124,952.80
Month 97 - Month 108	29,470	$	4.37	$	128,783.90
Month 109 - Month 120	29,470	$	4.50	$	132,615.00

All such Minimum Monthly Rent shall be payable by Tenant in accordance with the terms of the Lease, as amended hereby; provided that concurrently with Tenant's execution and delivery of this Amendment to Landlord, Tenant shall pay to Landlord the Minimum Monthly Rent with respect to the Substitution Space (the “Prepaid Rent”) payable for the fifth (5 ^th ) full calendar month following the Substitution Effective Date. Notwithstanding anything in the Lease, as amended hereby, to the contrary, so long as Tenant is not in default under the Lease, as amended hereby, Tenant shall be entitled to an abatement of Minimum Monthly Rent with respect to the Substitution Space in the monthly amount of $101,671.50 for the first four (4) full calendar months following the Substitution Effective Date. The maximum total amount of Minimum Monthly Rent abated with respect to the Substitution Space in accordance with the foregoing shall equal $406,686.00 (the “Abated Minimum Monthly Rent”). If Tenant defaults under the Lease, as amended hereby, at any time during the Term (as extended) and fails to cure such default within any applicable cure period under the Lease, then all Abated Minimum Monthly Rent shall immediately become due and payable. Only Minimum Monthly Rent shall be abated pursuant to this Section, as more particularly described herein, and all other rent and other costs and charges specified in the Lease, as amended hereby, shall remain as due and payable pursuant to the provisions of the Lease, as amended hereby.

Letter of Credit. Landlord is currently holding the sum of $150,000.00 (the “Existing Security Deposit”) as a security deposit pursuant to the terms of the Lease. Concurrent with Tenant's execution and delivery of this Amendment to Landlord, and in addition to the Existing Security Deposit, Tenant shall deliver to Landlord, as collateral for the full performance by Tenant of all of its obligations under the Lease, as amended hereby, and for all losses and damages Landlord may suffer as a result of Tenant's failure to comply with one or more provisions of the Lease, as amended hereby, including, but not limited to, any post lease termination damages under Section 1951.2 of the California Civil Code, an Irrevocable Standby Letter of Credit (the “Letter of Credit”) in the amount of One Million Four Hundred Forty-One Thousand Three Hundred Eighty and No/Dollars ($1,441,380.00). The following terms and conditions shall apply to the Letter of Credit:

5.1

The Letter of Credit shall be in favor of Landlord, shall be issued by a bank acceptable to Landlord with a Standard & Poors rating of “A” or better, shall comply with all of the terms and conditions of this Section 5 and shall otherwise be in the form acceptable to Landlord.

5.2

The Letter of Credit or any replacement Letter of Credit shall be irrevocable for the term thereof and shall automatically renew on a year to year basis until a period ending not earlier than two (2) months subsequent to the termination date of the Lease (the “LOC Expiration Date”) without any action whatsoever on the part of

Landlord; provided that the issuing bank shall have the right not to renew the Letter of Credit by giving written notice to Landlord not less than sixty (60) days prior to the expiration of the then current term of the Letter of Credit that it does not intend to renew the Letter of Credit. Tenant understands that the election by the issuing bank not to renew the Letter of Credit shall not, in any event, diminish the obligation of Tenant to deposit the Security Deposit, if any, or maintain such an irrevocable Letter of Credit in favor of Landlord through the LOC Expiration Date.

5.3

Landlord, or its then authorized representative, upon Tenant's failure to comply with one or more provisions of the Lease, as amended hereby, or as otherwise specifically agreed by Landlord and Tenant pursuant to the Lease or any amendment hereof, without prejudice to any other remedy provided in the Lease or by applicable laws, shall have the right from time to time to make one or more draws on the Letter of Credit and use all or part of the proceeds in accordance with Section 5.4 below. In addition, if Tenant fails to furnish a renewal or replacement letter of credit complying with all of the provisions of this Section 5 at least sixty (60) days prior to the stated expiration date of the Letter of Credit then held by Landlord, Landlord may draw upon such Letter of Credit and hold the proceeds thereof (and such proceeds need not be segregated) in accordance with the terms of this Section 5. Funds may be drawn down on the Letter of Credit upon presentation to the issuing bank of Landlord's (or Landlord's then authorized representative's) certification that Landlord is entitled to such funds pursuant to the Lease and/or any amendment to the Lease or any other agreement between the parties pertaining the Lease, and otherwise in a form set forth in the Letter of Credit approved by Landlord.

5.4

Tenant shall have the right to reduce the amount of the Letter of Credit in accordance with this Section 5.4 if (a) Tenant has timely paid all Rent due under the Lease, as amended hereby, during the twelve (12) month period immediately preceding the effective date of any reduction of the Letter of Credit, and (b) Tenant either (i) delivers to Landlord written documentation reasonably satisfactory evidencing that Tenant has received formal written approval from the U.S. Food and Drug Administration to market its lead drug candidate Neratinib to the public (the “FDA Reduction Condition”); or (ii) provides to Landlord Tenant's Financial Information (defined below) reflecting four (4) consecutive quarters of positive Earnings Before Interest, Taxes, Depreciation and Amortization (“EBITDA”) equal to or greater than $200,000,000.00 (the “EBITDA Reduction Condition”). In the event that Tenant fully satisfies the condition set forth in clause (a) above (the “General Reduction Condition”) and the FDA Reduction Condition, then Tenant shall have the right to reduce the amount of the Letter of Credit by $500,000.00 effective as of the third (3 ^rd ) anniversary of the Substitution Effective Date (“Reduction Effective Date”). In addition, in the event that Tenant fully satisfies the General Reduction Condition and the EBITDA Reduction Condition, Tenant shall have the right to reduce the amount of the Letter of Credit by $500,000.00 effective as the Reduction Effective Date. By way of example, if Tenant meets the General Reduction Condition and the FDA Reduction Condition, but does not meet the EBITDA Reduction Condition, Tenant shall have the right to reduce the Letter of Credit by $500,000.00 effective as the Reduction Effective Date. However, if Tenant meets the General Reduction Condition, the FDA Reduction Condition and the EBITDA Reduction Condition, Tenant shall have the right to reduce the Letter of Credit by $1,000,000.00 effective as of the Reduction Effective Date. If Tenant does not have the right to reduce the Letter of Credit effective as of the Reduction Effective Date due to Tenant's failure to meet the General Reduction Condition, the FDA Reduction Condition and/or the EBITDA Reduction Condition, the Reduction Effective Date shall be tolled for a period of twelve (12) months and Tenant shall once again have the right to satisfy the FDA Reduction Condition and/or the EBITDA Reduction Condition and reduce the Letter of Credit as of the next succeeding anniversary of the Substitution Effective Date; provided, however, in no event shall Tenant have the right to reduce the Letter of Credit by more than $1,000,000.00. If Tenant is entitled to a reduction in the Letter of Credit, Tenant shall provide Landlord with written notice requesting that the Letter of Credit be reduced as provided above (the “Reduction Notice”). If Tenant is requesting a reduction of the Letter of Credit based on satisfaction of the EBITDA Reduction Condition, concurrent with Tenant's delivery of the Reduction Notice, Tenant shall deliver to Landlord Tenant's financial statements prepared in accordance with generally accepted accounting principles and certified by an officer of Tenant as being a true and correct copy of Tenant's most recent audited financial statements (as audited by a nationally recognized public accounting firm reasonably acceptable to Landlord), and any other financial information requested by Landlord, evidencing Tenant's full satisfaction of the EBITDA Reduction Condition (“Tenant's Financial Information”). If Tenant provides Landlord with a Reduction Notice, and Tenant is entitled to reduce the Letter of Credit as provided herein, any reduction in the Letter of Credit amount shall be accomplished by Tenant providing Landlord with an amendment to the Letter of Credit or a substitute Letter of Credit in the reduced amount, which substitute Letter of Credit shall comply with the requirements of this Section 5.

5.5

Tenant acknowledges and agrees (and the Letter of Credit shall so state) that the Letter of Credit shall be honored by the issuing bank without inquiry as to the truth of the statements set forth in such draw request and regardless of whether the Tenant disputes the content of such statement. The proceeds of the Letter of Credit shall constitute

Landlord's sole and separate property (and not Tenant's property or the property of Tenant's bankruptcy estate) and Landlord may immediately upon any draw (and without notice to Tenant) apply or offset the proceeds of the Letter of Credit: (a) against any rent or other amounts payable by Tenant under the Lease, as amended hereby, that is not paid when due; (b) against all losses and damages that Landlord has suffered or that Landlord reasonably estimates that it may suffer as a result of Tenant's failure to comply with one or more provisions of the Lease, as amended hereby, including any damages arising under Section 1951.2 of the California Civil Code following termination of the Lease; (c) against any costs incurred by Landlord in connection with the Lease (including attorneys' fees); and (d) against any other amount that Landlord may spend or become obligated to spend by reason of Tenant's default. Provided Tenant has performed all of its obligations under the Lease, as amended hereby, Landlord agrees to pay to Tenant within sixty (60) days after the LOC Expiration Date the amount of any proceeds of the Letter of Credit received by Landlord and not applied as allowed above; provided, that if prior to the LOC Expiration Date a voluntary petition is filed by Tenant or any guarantor, or an involuntary petition is filed against Tenant or any guarantor by any of Tenant's or guarantor's creditors, under the Federal Bankruptcy Code, then Landlord shall not be obligated to make such payment in the amount of the unused Letter of Credit proceeds until either all preference issues relating to payments under the Lease have been resolved in such bankruptcy or reorganization case or such bankruptcy or reorganization case has been dismissed, in each case pursuant to a final court order not subject to appeal or any stay pending appeal.

5.6

If, as result of any application or use by Landlord of all or any part of the Letter of Credit, the amount of the Letter of Credit shall be less than the amount set forth in this Section 5, Tenant shall, within five (5) days thereafter, provide Landlord with additional letter(s) of credit in an amount equal to the deficiency (or a replacement letter of credit in the total amount required pursuant to this Section 5), and any such additional (or replacement) letter of credit shall comply with all of the provisions of this Section 5, and if Tenant fails to comply with the foregoing, notwithstanding anything to the contrary contained in the Lease, as amended hereby, the same shall constitute an incurable Event of Default by Tenant. Tenant further covenants and warrants that it will neither assign nor encumber the Letter of Credit or any part thereof and that neither Landlord nor its successors or assigns will be bound by any such assignment, encumbrance, attempted assignment or attempted encumbrance.

5.7

Landlord may, at any time and without notice to Tenant and without first obtaining Tenant's consent thereto, transfer all or any portion of its interest in and to the Letter of Credit to another party, person or entity, including Landlord's mortgagee and/or to have the Letter of Credit reissued in the name of Landlord's mortgagee. If Landlord transfers its interest in the Building and transfers the Letter of Credit (or any proceeds thereof then held by Landlord) in whole or in part to the transferee, Landlord shall, without any further agreement between the parties hereto, thereupon be released by Tenant from all liability therefor. The provisions hereof shall apply to every transfer or assignment of all or any part of the Letter of Credit to a new landlord. In connection with any such transfer of the Letter of Credit by Landlord, Tenant shall, at Tenant's sole cost and expense, execute and submit to the issuer of the Letter of Credit such applications, documents and instruments as may be necessary to effectuate such transfer. Tenant shall be responsible for paying the issuer's transfer and processing fees in connection with any transfer of the Letter of Credit and, if Landlord advances any such fees (without having any obligation to do so), Tenant shall reimburse Landlord for any such transfer or processing fees within ten (10) days after Landlord's written request therefor.

5.8

If the Letter of Credit expires earlier than the LOC Expiration Date, or the issuing bank notifies Landlord that it shall not renew the Letter of Credit, Landlord shall accept a renewal thereof or substitute letter of credit (such renewal or substitute Letter of Credit to be in effect not later than sixty (60) days prior to the expiration thereof), irrevocable and automatically renewable through the LOC Expiration Date upon the same terms as the expiring Letter of Credit or upon such other terms as may be acceptable to Landlord. However, if (a) the Letter of Credit is not timely renewed, or (b) a substitute Letter of Credit, complying with all of the terms and conditions of this Section 5 is not timely received, Landlord may present such Letter of Credit to the issuing bank, and the entire sum so obtained shall be paid to Landlord, to be held by Landlord in accordance with Article 8 of the Original Lease. Notwithstanding the foregoing, Landlord shall be entitled to receive from Tenant all attorneys' fees and costs incurred in connection with the review of any proposed substitute Letter of Credit pursuant to this Section.

5.9

Landlord and Tenant (a) acknowledge and agree that in no event or circumstance shall the Letter of Credit or any renewal thereof or substitute therefor or any proceeds thereof be deemed to be or treated as a “security deposit” under any law applicable to security deposits in the commercial context including Section 1950.7 of the California Civil Code, as such section now exist or as may be hereafter amended or succeeded (“Security Deposit Laws”), (b) acknowledge and agree that the Letter of Credit (including any renewal thereof or substitute therefor or any proceeds thereof) is not intended to serve as a security deposit, and the Security Deposit Laws shall have no applicability or relevancy thereto, and (c) waive any and all rights, duties and obligations either party may now or, in the future, will have relating to or arising from the Security Deposit Laws. Tenant hereby waives the provisions

of Section 1950.7 of the California Civil Code and all other provisions of applicable laws, now or hereafter in effect, which (i) establish the time frame by which Landlord must refund a security deposit under a lease, and/or (ii) provide that Landlord may claim from the security deposit only those sums reasonably necessary to remedy defaults in the payment of rent, to repair damage caused by Tenant or to clean the Premises, it being agreed that Landlord may, in addition, claim those sums specified above in this Section 5 and/or those sums reasonably necessary to compensate Landlord for any loss or damage caused by Tenant's breach of the Lease, as amended hereby, or the acts or omission of Tenant or any of Tenant's Pa r ties, including my damages Landlord suffers following termination of the Lease.

5.10

Notwithstanding anything to the contrary contained in the Lease, as amended hereby, in the event that at any time the financial institution which issues said Letter of Credit is declared insolvent by the FDIC or is closed for any reason, Tenant must immediately provide a substitute letter of credit that satisfies the requirements of the Lease hereby from a financial institution acceptable to Landlord, in Landlord's sole discretion.

6.	Tenant's Proportionate Share. For the period commencing with the Substitution Effective Date and ending on the Extended Termination Date, Tenant's Proportionate Share for the Substitution Space is 17.31%.

Additional Rent. For the period commencing with the Substitution Effective Date and ending on the Extended Termination Date, Tenant shall pay all additional rent payable under the Lease, including Tenant's Proportionate Share of Operating Costs, Taxes and Insurance Costs applicable to the Substitution Space in accordance with the terms of the Lease; provided, however, during such period, the Base Year for the computation of Tenant's Proportionate Share of Operating Costs, Taxes and Insurance Costs applicable to the Substitution Space is 2016.

8.	Parking Allocation. As of the Substitution Effective Date, Tenant's Parking Allocation set forth in Section 1.17 of the Original Lease, as amended by Section 8 of the First Amendment, shall be ninety-seven (97) parking spaces.

9.	Improvements to Substitution Space.

9.1

Condition of Substitution Space. Tenant has inspected the Substitution Space and agrees to accept the same “as is” without any agreements, representations, understandings or obligations on the part of Landlord to perform any alterations, repairs or improvements, except as may be expressly provided otherwise in this Amendment. Tenant hereby acknowledges and agrees that Landlord has fulfilled all of its obligations pursuant to Exhibit C of the Original Lease, Section 7 of the First Amendment and Exhibit B to the First Amendment.

9.2

Responsibility for Improvements to Substitution Space. Tenant may perform improvements to the Substitution Space in accordance with the terms of Exhibit B attached hereto (the “Tenant Alterations” ), and Tenant shall be entitled to an improvement allowance in connection with such work as more fully described in Exhibit B .

10.

Early Access to Substitution Space. Subject to the terms of this Section 10 and provided that this Amendment has been fully executed by all parties and Tenant has delivered all Prepaid Rent, the Letter of Credit, and insurance certificates required hereunder, Landlord grants Tenant the right to enter the Substitution Space, at Tenant's sole risk, upon the Substitution Space Delivery Date, solely for the purpose of installing telecommunications and data cabling, equipment, furnishings and other personalty and for performing the Tenant Alterations. Such possession prior to the Substitution Effective Date shall be subject to all of the terms and conditions of the Lease, as amended hereby, except that Tenant shall not be required to pay Minimum Monthly Rent with respect to the period of time prior to the Substitution Effective Date during which Tenant occupies the Substitution Space solely for such purposes. However, Tenant shall be liable for any utilities or special services provided to Tenant with respect to the Substitution Space during such period. Notwithstanding the foregoing, if Tenant takes possession of the Substitution Space before the Substitution Effective Date for any purpose other than as expressly provided in this Section, such possession shall be subject to the terms and conditions of the Lease, as amended hereby, and Tenant shall pay Minimum Monthly Rent and any other charges payable hereunder with respect to the Substitution Space to Landlord for each day of possession before the Substitution Effective Date.

11.	Holding Over. If Tenant continues to occupy the Original Leased Premises after the Original

Leased Premises Vacation Date, occupancy of the Original Leased Premises subsequent to the

Original Leased Premises Vacation Date shall be that of a tenancy at sufferance and in no event for month-to-month or year-to-year, but Tenant shall, throughout the entire holdover period, be subject to all the terms and provisions of the Lease and shall pay for its use and occupancy an amount (on a per month basis without reduction for any partial months during any such holdover) equal to twice the sum of the Minimum Monthly Rent and Tenant's Proportionate Share of Operating Costs, Taxes and Insurance Costs due for the period immediately preceding such holding over, provided that in no event shall

Minimum Monthly Rent and Tenant's Proportionate Share of Operating Costs, Taxes and Insurance Costs during the holdover period be less than the fair market rental for the Original Leased Premises. No holding over by Tenant in the Original Leased Premises or payments of money by Tenant to Landlord after the Original Leased Premises Vacation Date shall be construed to prevent Landlord from recovery of immediate possession of the Original Leased Premises by summary proceedings or otherwise. In addition to the obligation to pay the amounts set forth above during any such holdover period, Tenant also shall be liable to Landlord for all damage, including any consequential damage, which Landlord may suffer by reason of any holding over by Tenant in the Original Leased Premises, and Tenant shall indemnify Landlord against any and all claims made by any other tenant or prospective tenant against Landlord for delay by Landlord in delivering possession of the Original Leased Premises to such other tenant or prospective tenant.

12.	Temporary Space.

12.1

Tenant shall have the option to lease as temporary space certain premises containing approximately 7,017 rentable square feet described as Suite 100 and located on the first ( ^1st ) floor of the Building (the “Temporary Space”) for a term (the “Temporary Space Term”) commencing on the Substitution Space Delivery Date and continuing though and including the Substitution Effective Date (such date being referred to herein as the “Temporary Space Expiration Date”). If Tenant elects to lease the Temporary Space, Tenant must provide Landlord notice of its election (the “Temporary Space Notice”) on or before September 30, 2015.

12.2

During the period of Tenant's use of the Temporary Space, Tenant shall pay Minimum Monthly Rent for the Temporary Space in an amount equal to $21,051.00 per month. During the period of Tenant's use of the Temporary Space, Tenant shall not be required to pay: (i) Tenant's Proportionate Share of Operating Costs, Taxes and Insurance Costs as all are related to the Temporary Space (but in any event Tenant shall be responsible for all other rents due hereunder). Further, Tenant shall not be entitled to receive any allowances, abatement or other financial concession granted with respect to the Original Leased Premises or Substitution Space as to the Temporary Space. However, except as otherwise provided herein, the Temporary Space shall be subject to all of the terms and conditions of the Lease, including, without limitation, the insurance and indemnity provisions hereof.

12.3

Tenant has inspected the Temporary Space and agrees to accept the same “as-is” without any agreements, representations, understandings or obligations on the part of Landlord to perform any alterations, repairs or improvements. Tenant shall vacate the Temporary Space on or prior to the Temporary Space Expiration Date and deliver up the Temporary Space to Landlord in as good condition as the Temporary Space was delivered to Tenant, ordinary wear and tear excepted. Tenant shall have no right to hold over or otherwise occupy the Temporary Space at any time following the expiration or earlier termination of the Temporary Space Term and in the event of any such holdover, Landlord shall immediately be entitled to institute dispossessory proceedings to recover possession of the Temporary Space, without first providing notice thereof to Tenant. In the event of holding over by Tenant after expiration or termination of the Temporary Space Term without the written authorization of Landlord, Section 33.2 of the Original Lease shall apply and the Minimum Monthly Rent rate applicable to determine the holdover rate shall be the rate then in effect for the Premises. During any such holdover, Tenant's occupancy of the Temporary Space shall be deemed that of a tenant at sufferance, and in no event, during the Temporary Space Term or during any holdover by Tenant, shall Tenant be determined to be a tenant-at-will under applicable law. While Tenant is occupying the Temporary Space, Landlord or Landlord's authorized agents shall be entitled to enter the Temporary Space pursuant to the terms and conditions contained in Section 22.1 of the Original Lease; provided, however, that (i) Landlord may, subject to Section 22.1 of the Original Lease, display the Temporary Space to prospective tenants during regular business hours, and (ii) Landlord's restoration obligations following damage caused by a casualty as described in Article 19 of the Original Lease shall in no event apply to any Temporary Space.

12.4

If Tenant timely elects to lease the Temporary Space, Tenant shall, at Landlord's request, execute and deliver a memorandum agreement setting forth the actual Temporary Space Effective Date and other appropriate terms.

13.	Other Pertinent Provisions. Landlord and Tenant agree that, effective as of the date of this Amendment (unless different effective date(s) is/are specifically referenced in this Section), the Lease shall be amended in the following additional respects:

13.1

Landlord's Address. Landlord's Notice Address set forth in Section 1.2 of the Original Lease, is hereby deleted in its entirety and is replaced with the following:

“PR 701 Gateway, LLC

c/o Jones Lang LaSalle

One Front Street

San Francisco, California 94111

Attention: Todd Robinette, Regional Manager

Telephone No.: (415) 395-4987

Email:

and:

PR 701 Gateway, LLC

c/o Jones Lang LaSalle

200 E. Randolph Drive

Chicago, Illinois

Attention: General Counsel - Americas

Telecopy No.: (312) 228-2276

With a copy to:

PR 701 Gateway, LLC

c/o Prudential Real Estate Investors

Four Embarcadero Center, 27th Floor

San Francisco, California 94111

Attention: Kristin Paul, Vice President

Telephone: (415) 291-5087

Email: kristin.paul@prudential.com

and a copy to:

PR 701 Gateway, LLC

c/o Prudential Real Estate Investors

7 Giralda Farms

Madison, New Jersey 07940

Attn: Frances Felice, Esq.

Telephone: (973) 683-1714

Email: frances.felice@prudential.com”

13.2

Landlord's Address for Payment of Rent. Notwithstanding anything to the contrary contained in Section 5.1 of the Original Lease, all rent due under the Lease shall be made payable by Tenant to Landlord at the following address:

If paying by check:

JP Morgan Chase

2710 Media Center Drive, Building #6

Suite 120

Los Angeles, California 90065

Lockbox No. ******

If paying by wire/ACH:

Controlled Disbursement Routing No.: *********

ABA for Wire: *********

ABA for ACH: *********

Deposit Routing: *********

13.3

Directory and Premises Signage. Landlord shall provide Tenant with Building standard directory signage on the Building's main lobby directory and a Building standard tenant identification sign at the entry of the Substitution Space. Such signage (and any replacement or modification thereof) shall consist of Building standard materials and shall comply with Landlord's then current Building specifications. Any required maintenance, repair or changes (which changes shall be subject to Landlord's prior written approval) to such signage shall be performed by Landlord at Tenant's sole cost and expense, which costs shall paid to Landlord within five (5) days of Landlord's demand. At Landlord's option, upon the expiration or earlier termination of the Lease, Tenant shall, at Tenant's sole cost and expense, remove any such signage and repair any damage to the Building caused by such signage

13.4 Building Signage.

13.4.1

Effective as of the Substitution Effective Date, Tenant shall be entitled to one tenant identification sign to be located on the top of the Building (the “Building Signage”) . The exact location of the Building Signage shall be subject to all applicable federal, state and city laws, codes, ordinances, rules and regulations (collectively, “Regulations”) and Landlord's prior written approval. The Building Signage

shall not be illuminated. Such right to the Building Signage is subject to the following terms and conditions: (a) Tenant shall submit plans and drawings for the Building Signage to Landlord and to the City of South San Francisco and to any other public authorities having jurisdiction and shall obtain written approval from Landlord and each such jurisdiction prior to installation, and shall fully comply with all applicable Regulations; (b) Tenant shall, at Tenant's sole cost and expense, design, construct and install the Building Signage; (c) the size, color and design of the Building Signage shall be subject to Landlord's prior written approval; and (d) Tenant shall maintain the Building Signage in good condition and repair, and all costs of maintenance and repair shall be borne by Tenant. Maintenance shall include, without limitation, cleaning. Notwithstanding the foregoing, Tenant shall not be liable for any fee in connection with Tenant's right to display the Building Signage in accordance with the Lease. At Landlord's option, Tenant's right to the Building Signage may be revoked and terminated upon occurrence of any of the following events: (i) Tenant shall be in default under the Lease beyond any applicable cure period; (ii) Tenant occupies less than a full floor within the Building, (iii) Tenant subleases more than 8,000 rentable square feet of the Substitution Space; or (iii) the Lease shall terminate or otherwise no longer be in effect.

13.4.2

Upon the expiration or earlier termination of the Lease or at such other time that Tenant's signage rights are terminated pursuant to the terms hereof, if Tenant· fails to remove the Building Signage and repair the Building in accordance with the terms of the Lease, Landlord shall cause the Building Signage to be removed from the Building and the Building to be repaired and restored to the condition which existed prior to the installation of the Building Signage (including, if necessary, the replacement of any precast concrete panels), all at the sole cost and expense of Tenant and otherwise in accordance with the Lease, without further notice from Landlord. Notwithstanding anything to the contrary contained in the Lease, Tenant shall pay all costs and expenses for such removal and restoration within five (5) business days following delivery of an invoice therefor. The rights provided in this Section 13.3 shall be non-transferable unless otherwise agreed by Landlord in writing in its sole discretion.

13.5

Option to Extend. The Option to Extend described in Exhibit “F” to the Original Lease shall be in effect during the Extended Term; provided, however, (i) all references in Exhibit “F” to “Term” are hereby amended to be “Extended Term”, and (ii) the first sentence of Section 2 of “Exhibit F” is amended so that Tenant must give Landlord the Extension Option Notice at least three hundred sixty five (365) days, but not more than four hundred fifty (450) days, prior to the expiration of the Extended Term.

13.6

Tenant's Insurance. Tenant's insurance required under the Lease, as amended hereby, shall include the Substitution Space. Tenant shall provide Landlord with a certificate of insurance evidencing Tenant's insurance upon delivery of this Amendment, executed by Tenant to Landlord, and thereafter as necessary to assure that Landlord always has current certificates evidencing Tenant's insurance.

13.7

24/7 Access. Tenant shall have access to the Building and the Premises for Tenant and its employees 24 hours per day/7 days per week, subject to the terms of the Lease and such security or monitoring systems as Landlord may reasonably impose, including, without limitation, sign-in procedures and/or presentation of identification cards to the extent applicable.

14.	Miscellaneous.

14.1

This Amendment, including Exhibit A (Outline and Location of Substitution Space), Exhibit B (Tenant Alterations) and Exhibit C (Substitution Effective Date Memorandum) attached hereto, sets forth the entire agreement between the parties with respect to the matters set forth herein. There have been no additional oral or written representations or agreements. Under no circumstances shall Tenant be entitled to any rent abatement, improvement allowance, leasehold improvements, or other work to the Premises, or any similar economic incentives that may have been provided Tenant in connection with entering into the Lease, unless specifically set forth in this Amendment.

14.2

Except as herein modified or amended, the provisions, conditions and terms of the Lease shall remain unchanged and in full force and effect. In the case of any inconsistency between the provisions of the Lease and this Amendment, the provisions of this Amendment shall govern and control. The capitalized terms used in this Amendment shall have the same definitions as set forth in the Lease to the extent that such capitalized terms are defined therein and not redefined in this Amendment.

14.3

14.4

Tenant hereby represents to Landlord that it has not dealt with any broker in connection with this Amendment other than L.A. Realty Partners. Tenant agrees to indemnify and hold Landlord its members, principals, beneficiaries, partners, officers, directors, employees, mortgagee(s) and agents, and the respective principals and members of any such agents harmless from all claims of any other brokers claiming to have represented Tenant in connection with this Amendment.

14.5

Each signatory of this Amendment represents hereby that he or she has the authority to execute and deliver the same on behalf of the party hereto for which such signatory is acting.

14.6

Tenant hereby represents, warrants and covenants to Landlord that, as of the date hereof and throughout the Term, it is not (i) an “employee benefit plan” as defined in Section 3(3) of the Employee Retirement Income Security Act of 1974, as amended (“ERISA”), that is subject to Title I of ERISA, (ii) a “plan” as defined in Section 4975(e)(1) of the Internal Revenue Code of 1986, as amended (the “Code”), that is subject to Section 4975 of the Code, or (iii) an entity deemed to hold “plan assets” of any such employee benefit plan or plan. In addition, Tenant represents, warrants and covenants to Landlord that it is not a “governmental plan” as defined in Section 3(32) of ERISA and is not subject to State statutes regulating investments of and fiduciary obligations with respect to government plans which would be violated by the transactions contemplated by the Lease, as amended hereby.

14.7

Each signatory of this Amendment represents hereby that he or she has the authority to execute and deliver the same on behalf of the party hereto for which such signatory is acting. Tenant represents and warrants that Tenant is not, and shall not during the Term, as the same may be extended, become, a person or entity with whom Landlord is restricted from doing business under the Uniting and Strengthening America by Providing Appropriate Tools Required to Intercept and Obstruct Terrorism Act of 2001, H. R. 3162, Public Law 107-56 (commonly known as the “USA Patriot Act”) and Executive Order Number 13224 on Terrorism Financing, effective September 24, 2001 and regulations promulgated pursuant thereto (collectively, “Anti-Terrorism Laws”), including without limitation persons and entities named on the Office of Foreign Asset Control Specially Designated Nationals and Blocked Persons List (collectively, “Prohibited Persons”). Tenant is not currently engaged in any transactions or dealings, or otherwise associated with, any Prohibited Persons in connection with the use or occupancy of the Premises or Building. Tenant will not, during the Term of the Lease, as the same may be extended, engage in any transactions or dealings, or be otherwise associated with, any Prohibited Persons in connection with the use or occupancy of the Premises or Building. If at any time after the date hereof Tenant becomes a Prohibited Person, then Tenant shall notify Landlord within five (5) business days after becoming aware of such designation. If Tenant breaches any representation or covenant set forth in this Section, or Tenant hereafter becomes a Prohibited Person, then in any such event, same shall constitute a default under the Lease, entitling Landlord to any and all remedies under the Lease or at law or in equity (including the right to terminate the Lease without affording Tenant any notice or cure period that may be provided in the Lease).

14.8

Pursuant to California Civil Code Section 1938, Landlord hereby notifies Tenant that as of the date of this Amendment, the Premises have not undergone inspection by a “Certified Access Specialist” to determine whether the Premises meet all applicable construction-related accessibility standards under California Civil Code Section 55.53. To allow for compliance with building performance benchmarking and disclosure regulations, and to facilitate implementation of sustainable improvements to the Building, Tenant shall: (a) retain copies of its “utility data”, which includes, but is not limited to, Tenant's utility bills and invoices pertaining to Tenant's energy, water, and trash usage at the Building during the Term (as the same may be further extended), and (b) upon request, provide Landlord with copies of such “utility data”. Tenant further agrees, upon Landlord's request, to execute utility release forms provided by the applicable utility or municipality to expedite the data collection process.

14.9

Redress for any claim against Landlord under the Lease and this Amendment shall be limited to and enforceable only against and to the extent of Landlord's interest in the Building. The obligations of Landlord under the Lease are not intended to and shall not be personally binding on, nor shall any resort be had to the private properties of, any of its trustees or board of directors and officers, as the case may be, its investment manager, the general partners thereof, or any beneficiaries, stockholders, employees, or agents of Landlord or the investment manager, and in no case shall Landlord be liable to Tenant hereunder for any lost profits, damage to business, or any form of special, indirect or consequential damage.

IN WITNESS WHEREOF, Landlord and Tenant have entered into and executed this Amendment as of the date first written above.

LANDLORD:		TENANT:

PR 701 GATEWAY, LLC, a Delaware limited liability company		PUMA BIOTECHNOLOGY, INC. , a Delaware corporation

By:	PRISA LHC, LLC, a Delaware limited liability company
Its:	Sole Member

By:	/s/ Kristin Paul	By:	/s/ Charles R. Eyler
Name:	Kristin Paul	Name:	Charles R. Eyler
Title:	Vice President	Title:	SVP Finance
Date:	31 July, 2015	Date:	28 July, 2015

EXHIBIT A - OUTLINE AND LOCATION OF SUBSTITUTION SPACE

attached to and made a part of the Amendment dated as of July 21, 2015,

between PR 701 GATEWAY, LLC, a Delaware limited liability company,

as Landlord and PUMA BIOTECHNOLOGY, INC., a Delaware corporation, as Tenant

Exhibit A is intended only to show the general layout of the Substitution Space as of the beginning of the Substitution Effective Date. It does not in any way supersede any of Landlord's rights set forth in the Lease with respect to arrangements and/or locations of public parts of the Building and changes in such arrangements and/or locations. It is not to be scaled; any measurements or distances shown should be taken as approximate.

A-1

EXHIBIT B – TENANT ALTERATIONS

attached to and made a part of the Amendment dated as of July 21, 2015, between

PR 701 GATEWAY, LLC, a Delaware limited liability company, as Landlord and

PUMA BIOTECHNOLOGY, INC., a Delaware corporation, as Tenant

1. Tenant, following the delivery of the Substitution Space by Landlord and the full and final execution and delivery of the Amendment to which this Exhibit B is attached and all Prepaid Rent, the Letter of Credit and insurance certificates required under the Amendment, shall have the right to perform alterations and improvements in the Substitution Space (the “Tenant Alterations”). Notwithstanding the foregoing, Tenant and its contractors shall not have the right to perform the Tenant Alterations in the Substitution Space unless and until Tenant has complied with all of the terms and conditions of Article 12 of the Original Lease, including, without limitation, approval by Landlord of the final plans for the Tenant Alterations and the contractors to be retained by Tenant to perform such Tenant Alterations. Tenant shall be responsible for all elements of the design of Tenant's plans (including, without limitation, compliance with law, functionality of design, the structural integrity of the design, the configuration of the Substitution Space and the placement of Tenant's furniture, appliances and equipment), and Landlord's approval of Tenant's plans shall in no event relieve Tenant of the responsibility for such design. In addition to the foregoing, Tenant shall be solely liable for all costs and expenses associated with or otherwise caused by Tenant's performance and installment of the Tenant Alterations (including, without limitation, any legal compliance requirements arising outside of the Substitution Space). Landlord's approval of the contractors to perform the Tenant Alterations shall not be unreasonably withheld. The parties agree that Landlord's approval of the general contractor to perform the Tenant Alterations shall not be considered to be unreasonably withheld if any such general contractor (a) does not have trade references reasonably acceptable to Landlord, (b) does not maintain insurance as required pursuant to the terms of the Lease, (c) does not have the ability to be bonded for the work in an amount of no less than one hundred fifty percent (150%) of the total estimated cost of the Tenant Alterations, (d) does not provide current financial statements reasonably acceptable to Landlord, or (e) is not licensed as a contractor in the state/municipality in which the Premises is located. Tenant acknowledges the foregoing is not intended to be an exclusive list of the reasons why Landlord may reasonably withhold its consent to a general contractor.

2. Provided Tenant is not in default, Landlord agrees to contribute up to $1,178,800.00 (i.e., $40.00 per rentable square foot of the Substitution Space) (the “Allowance”) toward the cost of performing the Tenant Alterations in preparation of Tenant's occupancy of the Substitution Space. The Allowance may only be used for the cost of preparing design and construction documents and mechanical and electrical plans for the Tenant Alterations and for hard costs in connection with the Tenant Alterations. The Allowance shall be paid to Tenant or, at Landlord's option, to the order of the general contractor that performed the Tenant Alterations, within thirty (30) days following receipt by Landlord of (a) receipted bills covering all labor and materials expended and used in the Tenant Alterations; (b) a sworn contractor's affidavit from the general contractor and a request to disburse from Tenant containing an approval by Tenant of the work done; (c) full and final waivers of lien; (d) as-built plans of the Tenant Alterations; and (e) the certification of Tenant and its architect that the Tenant Alterations have been installed in a good and workmanlike manner in accordance with the approved plans, and in accordance with applicable laws, codes and ordinances. The Allowance shall be disbursed in the amount reflected on the receipted bills meeting the requirements above. Notwithstanding anything herein to the contrary, Landlord shall not be obligated to disburse any portion of the Allowance during the continuance of an uncured default under the Lease, and Landlord's obligation to disburse shall only resume when and if such default is cured.

3. Notwithstanding anything to the contrary set forth herein, upon completion of the Tenant Alterations and application of the Allowance to the costs related thereto pursuant to this Exhibit B, if any portion of the Allowance is then remaining (the “Unused Allowance”), Tenant shall be entitled to apply up to $15.00 per rentable square foot of the Substitution Space (that is, up to $442,050.00) of such Unused Allowance (if any) as follows: (i) to the cost of purchasing and installing Tenant's voice and data cabling and wiring at the Substitution Space, (ii) to the cost of purchasing and installing Building Signage, (iii) the cost of purchasing and installing furniture, fixtures and equipment (collectively, the “FF&E”), which FF&E shall be located at all times at the Substitution Space and for use by Tenant in the Substitution Space, (iv) to the cost of moving from the Original Leased Premises into the Substitution Space, including reprinting stationary on hand and moving Tenant's furniture, equipment and other personal property into the Substitution Space; and (v) provided Tenant delivers written notice to Landlord by no later than December 31, 2016, to the next installment(s) of Minimum Monthly Rent payable by Tenant under the Lease, as amended. However, in no event shall Landlord have any obligation to apply any portion of the Unused Allowance to Minimum Monthly Rent if Tenant does not deliver such written notice to Landlord by December 31, 2016 and any unused amount remaining after such date shall accrue to the sole benefit of Landlord, it being understood that Tenant shall not be entitled to any credit, abatement or other concession in connection therewith. Tenant shall be responsible for all applicable state sales or use taxes, if any, payable in connection with the Tenant Alterations and/or Allowance. To the extent any Unused Allowance is applied to any FF&E,

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Landlord shall own all the FF&E until the expiration of the Lease (provided that Tenant, not Landlord, shall be responsible for all costs associated with such FF&E, including, without limitation, the cost of insuring the same, all maintenance and repair costs and taxes), at which time the FF&E shall become the property of Tenant as if by bill of sale hereunder. Tenant shall maintain and repair the FF&E in good and working order and shall insure the FF&E to the same extent Tenant is required to insure Tenant's personal property pursuant to the terms of the Lease. In the event that the Lease is terminated prior to the Extended Termination Date, Tenant, at Landlord's election, shall pay to Landlord the unamortized portion of the costs of the FF&E (no later than the termination date of the Lease), or, at Landlord's election, the FF&E shall remain the property of Landlord and Tenant shall and, in such event, hereby does, waive all of its rights thereto.

4. If Tenant does not submit a request for payment of the entire Allowance to Landlord in accordance with the provisions contained in this Exhibit B by December 31, 2016, any unused amount shall accrue to the sole benefit of Landlord, it being understood that Tenant shall not be entitled to any credit, abatement or other concession in connection therewith. Tenant shall be responsible for all applicable state sales or use taxes, if any, payable in connection with the Tenant Alterations and/or Allowance. Landlord shall be entitled to deduct from the Allowance a construction management fee for Landlord's oversight of the Tenant Alterations in an amount equal to one percent (1%) of the total cost of the Tenant Alterations.

5. Tenant agrees to accept the Substitution Space in its “as-is” condition and configuration, it being agreed that Landlord shall not be required to perform any work or, except as provided above with respect to the Allowance, incur any costs in connection with the construction or demolition of any improvements in the Substitution Space.

6. This Exhibit B shall not be deemed applicable to any additional space added to the Premises at any time or from time to time, whether by any options under the Lease or otherwise, or to any portion of the Original Leased Premises or any additions to the Premises in the event of a renewal or extension of the original Term of the Lease, whether by any options under the Lease or otherwise, unless expressly so provided in the Lease or any amendment or supplement to the Lease.

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EXHIBIT C – FORM OF SUBSTITUTION EFFECTIVE DATE MEMORANDUM

attached to and made a part of the Amendment dated as of July 21, 2015,

between PR 701 GATEWAY, LLC, a Delaware limited liability company,

as Landlord and PUMA BIOTECHNOLOGY, INC., a Delaware corporation, as Tenant

SUBSTITUTION EFFECTIVE DATE MEMORANDUM

THIS MEMORANDUM is made as of , by and between PR 701 GATEWAY, LLC, a Delaware limited liability company (“Landlord”), and PUMA BIOTECHNOLOGY, INC., a Delaware corporation (“Tenant”).

Recitals:

Landlord (as successor in interest to DFW III GATEWAY, LLC, a Delaware limited liability company) and Tenant are parties to that certain Office Lease dated May 16, 2012 (the “Original Lease”), which Original Lease has been previously amended by that certain Acknowledgement of Commencement Date dated as of November 12, 2012, that certain First Amendment to Lease dated as of May 19, 2014, that certain Second Amendment to Lease dated as of June 10, 2014 and that certain Second Expansion Date Memorandum dated as of February 17, 2015 and that certain Third Amendment (“Third Amendment”) dated as of July 21, 2015 (collectively, the “Lease”). Pursuant to the Lease, Landlord leased to Tenant space currently containing approximately 16,712 rentable square feet (the “Original Leased Premises”) described as Suite Nos. 250 and 275 on the second (2 ^nd ) floor of the building located at 701 Gateway Boulevard, South San Francisco, California (the “Building”).

B.	Pursuant to the Third Amendment, Landlord and Tenant agreed to relocate Tenant from the Original Leased Premises to approximately 29,470 rentable square feet of space described as the entire fifth (5 ^th ) floor of the Building (the “Substitution Space”).

C.	Tenant is in possession of the Substitution Space and the Substitution Effective Date, as defined in the Amendment, has occurred.

D.	Landlord and Tenant desire to enter into this Memorandum confirming the Substitution Effective Date and the Extended Termination Date, and other matters under the Amendment.

NOW, THEREFORE, Landlord and Tenant agree as follows:

The actual Substitution Effective Date is ________________.

The actual Extended Termination Date is _________________.

The schedule of Minimum Monthly Rent with respect to the Substitution Space set forth in Section 4 of the Third Amendment is deleted in its entirety, and the following is substituted therefor:

[insert rent schedule]

Capitalized terms not defined herein shall have the same meaning as set forth in the Lease.

IN WITNESS WHEREOF, the parties hereto have caused this Memorandum to be executed as of the date and year first above written.

LANDLORD:		TENANT:

PR 701 GATEWAY, LLC, a Delaware limited liability company		PUMA BIOTECHNOLOGY, INC. a Delaware corporation

By:	PRISA LHC, LLC, a Delaware limited liability company
Its:	Sole Member

By:	DO NOT SIGN	By:	DO NOT SIGN
Name:		Name:

Its:		Its:

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Exhibit 10.3

8/17/2015

Steven Lo

via E-mail

Re: Employment Offer Letter

Dear Steven:

Puma Biotechnology, Inc., a Delaware corporation (the “ Company ”) is pleased to offer you the Full-Time, Exempt position of Chief Commercial Officer of the Company, with terms as noted below. Please confirm your acceptance of this offer by signing and returning a copy of this letter on or before August 24, 2015 :

1. Effective Date, Position, Duties and Responsibilities . The terms will become effective on the date you start your employment (the “ Effective Date ”), which shall be no later than September 8, 2015 . As of the Effective Date, the Company will employ you as its Chief Commercial Officer . In such capacity, you will have such duties and responsibilities as are normally associated with such position. Your duties may be changed from time to time by the Company in its discretion. You will report to the President and CEO or such other individual as the Company may designate, and will work at the Company’s offices located in South San Francisco, California, or such other location as the Company may designate, except for travel to other locations as may be necessary to fulfill your responsibilities. Although your initial title and duties are described above, the Company may assign you additional or different duties and/or titles from time-to-time.

2. Base Compensation . During your employment with the Company, the Company will pay you a base salary of $425,000 per year (the “ Base Salary ”), less payroll deductions and all required withholdings, payable in installments in accordance with the Company’s normal payroll practices (but in no event less often than monthly) and prorated for any partial pay period of employment. Your Base Salary may be subject to adjustment pursuant to the Company’s policies as in effect from time to time.

3. Annual Bonus . In addition to the Base Salary set forth above, you will be eligible to receive an annual discretionary cash bonus (pro-rated for any partial year of service), based on the attainment of performance metrics and/or individual performance objectives, in each case, established and evaluated by the Company in its sole discretion (the “ Annual Bonus ”). Your target Annual Bonus shall be 40% of your Base Salary, but the actual amount of your Annual Bonus may be more or less (and may equal zero), depending on the attainment of applicable performance criteria. Payment of any Annual Bonus(es), to the extent any Annual Bonus(es) become payable, will be contingent upon your continued employment through the applicable payment date.

4. Stock Option . In connection with entering into this offer letter, following the commencement of your employment with the Company and provided that you are employed by the Company on the date of grant, the Company will grant you an option to purchase 150,000 shares of the Company’s common stock (the “ Stock Option ”) at a per share exercise price equal to the Fair Market Value of a share of the Company’s common stock on the date of grant (as determined in accordance with the Company’s 2011 Incentive Award Plan). Subject to your continued employment with the Company through the applicable vesting date, 1/4 ^th of the shares underlying the Stock Option will vest on the first anniversary of the Effective Date and 1/48 ^th of the shares underlying the Stock Option will vest on each monthly anniversary of the Effective Date thereafter. Subject to the foregoing, the terms and conditions of the Stock Option will be set forth in a separate award agreement in such form as is prescribed by the Company, to be entered into by the Company and you.

5. Signing Bonus. In connection with entering into this offer letter, you will be paid a signing bonus to $1,051,249 (the “Signing Bonus”) within twenty days after the Effective Date. You and the Company acknowledge and agree that the Signing Bonus will not be earned in whole unless and until you are continuously, actively employed by the Company through the fourth anniversary of the Effective Date. If your employment is terminated by the Company with Cause at any time prior to or on the first anniversary of the Effective Date, or by you for any reason prior to or on the first anniversary of the Effective Date, you will not be entitled to retain any portion of the Signing Bonus and you will be obligated to immediately repay to the Company the Signing Bonus, in full, on the

10880 Wilshire Blvd. Suite 2150 Los Angeles, CA 90024

424.248.6500 Phone 424.248.6501 Fax

date of termination. In the event that your employment is terminated by the Company with Cause or by you (a) after the first anniversary of the Effective Date but prior to or on the second anniversary of the Effective Date, the Company will allow you to retain 25 % of the unearned bonus, and you hereby agree to repay to the Company, on the date of termination, 75 % of the bonus; or (b) after the second anniversary of the Effective Date but prior to the third anniversary of the Effective Date, the Company will allow you to retain 50 % of the unearned bonus, and you hereby agree to repay to the Company, on the date of termination, 50 % of the Signing Bonus ; or (c) after the third anniversary of the Effective Date but prior to the fourth anniversary of the Effective Date, the Company will allow you to retain 75% of the unearned bonus, and you hereby agree to repay to the Company, on the date of termination, 25% of the Signing Bonus. For purposes of this Section 5 only, Cause shall mean: (1) your conviction or plea of nolo contender to a misdemeanor involving moral turpitude or any felony, (2) your commission of any act of theft, embezzlement or misappropriation of Company assets, (3) your material breach of any agreement with the Company, (4) your failure to follow the reasonable and lawful written direction of any superior, provided that you are given five days notice and opportunity to cure such failure, if curable, prior to termination, (5) your willful failure to perform the essential duties of your position, or (6) your commission of an act of unlawful discrimination, harassment or retaliation. This does not alter the at-will nature of your employment.

6. Benefits and Vacation . You will be eligible to participate in all health, welfare, savings and retirement plans, practices, policies and programs maintained or sponsored by the Company from time to time for the benefit of its similarly situated employees, subject to the terms and conditions thereof. To the extent that you properly elect to participate in the Company’s applicable medical, dental and/or prescription benefit plans, the Company will pay the premiums for you and your dependents under such plans while you remain employed by the Company, provided, however, that the Company shall have no obligation to pay any such premiums if doing so would result in a violation of law and/or the imposition of penalty or excise taxes on the Company. In addition, you will be eligible for other standard benefits, such as sick leave, vacations and holidays, in each case, to the extent available under, and in accordance with, Company policy applicable generally to other similarly situated employees of the Company. Notwithstanding the foregoing, nothing contained in this Section 6 shall, or shall be construed so as to, obligate the Company or its affiliates to adopt, sponsor, maintain or continue any benefit plans or programs at any time.

7. Termination .

(a) If your employment with the Company is terminated by the Company without Cause or by you for Good Reason (each, a “ Qualifying Termination ”), and you execute and fail to revoke during any applicable revocation period a general release of all claims against the Company and its affiliates in a form reasonably acceptable to the Company (the “ Release ”) within 60 days following such termination of employment, then you shall be entitled to receive (i) an amount (the “ Severance ”) equal to your Base Salary at the rate in effect immediately prior to your date of termination during the period of time commencing on the termination date and ending on the 12-month anniversary of your termination date, (ii) if you timely elect to receive continued healthcare coverage pursuant to the provisions of the Consolidated Omnibus Budget Reconciliation Act of 1985, as amended (“ COBRA ”), the Company shall directly pay, or reimburse you for, the premium for you and your covered dependents through the earlier of (A) the 12-month anniversary of your termination date and (B) the date you and your covered dependents, if any, become eligible for healthcare coverage under another employer’s plan(s) and (iii) if the Qualifying Termination occurs on or within 18 months following a Change in Control (as defined in the Plan), all outstanding Company equity awards held by you on your date of termination shall immediately become fully vested and, to the extent applicable, exercisable. For the avoidance of doubt, all such equity awards will remain outstanding and eligible to vest following your date of termination shall actually vest and become exercisable (if applicable) and non-forfeitable upon the effectiveness of the Release. The Severance shall be made in substantially equal installments in accordance with the Company’s standard payroll policies, less applicable withholdings, with such installments to commence on the first payroll date following the 60th day following your date of termination, with the first installment to include any amount(s) that would have otherwise been paid prior to such first payroll date. In addition, (A) if any plan pursuant to which the benefits in subsection (ii) are provided is not, or ceases prior to the expiration of the period of continuation coverage to be, exempt from the application of Section 409A (as defined below) under Treasury Regulation Section 1.409A-1(a)(5), or (B) the Company is otherwise unable to continue to cover you under its group health plans without incurring penalties (including without limitation, pursuant to Section 2716 of the Public Health Service Act), then, in either case, an amount equal to each remaining Company subsidy shall thereafter be paid to you in substantially equal monthly installments over the continuation coverage period (or the remaining portion thereof).

(b) For purposes of this offer letter, “ Cause ” shall have the meaning set forth in the Plan.

(c) For purposes of this offer letter, “ Good Reason ” shall mean the occurrence of any one or more of the following events without your prior written consent, unless the Company corrects in all material respects the circumstances constituting Good Reason (provided such circumstances are capable of correction) in accordance with the correction provisions described below:

(i) a material diminution in your Base Salary, excluding any reduction applicable equally to all executive officers of the Company following a material decline in the Company’s earnings, public image, or performance;

(ii) a material diminution in your authority, duties or responsibilities; or

(iii) a change in the geographic location at which you must perform services to a location that is greater than 50 miles from the Company’s principal place of business as of the Effective Date;

provided , however , that no termination shall be deemed a termination by you for Good Reason unless and until (x) you provide the Board with written notice of the circumstances constituting Good Reason within 90 days after the date that you first become aware of the existence of such circumstances; (y) the Company fails to correct the circumstance so identified within 30 days after the receipt of such notice (if capable of correction); and (z) the effective date of your termination of employment occurs no later than 90 days after the date that you first become aware of the event or circumstances constituting Good Reason.

(d) No amount that is deferred compensation subject to Section 409A of the Internal Revenue Code of 1986, as amended (the “ Code ”) shall be payable pursuant to this offer letter unless your termination of employment constitutes a “separation from service” from the Company within the meaning of Section 409A of the Code and the Department of Treasury regulations and other guidance promulgated thereunder (“ Section 409A ”). For purposes of Section 409A, your right to receive any installment payments under this offer letter shall be treated as a right to receive a series of separate payments and, accordingly, each such installment payment shall at all times be considered a separate and distinct payment.

(e) Notwithstanding the foregoing, no compensation or benefits, including without limitation any severance payments or benefits described above, shall be paid to you during the 6-month period following your “separation from service” from the Company if the Company determines that paying such amounts at the time or times indicated in this letter would be a prohibited distribution under Section 409A(a)(2)(B)(i) of the Code. If the payment of any such amounts is delayed as a result of the previous sentence, then on the first business day following the end of such 6-month period (or such earlier date upon which such amount can be paid under Section 409A without resulting in a prohibited distribution, including as a result of your death), the Company shall pay you a lump-sum amount equal to the cumulative amount that would have otherwise been payable to you during such period.

8. Confidential and Proprietary Information . This offer of employment is contingent upon your execution of the Proprietary Information and Inventions Agreement, attached hereto as Exhibit A .

9. Non-Solicitation . You further agree that during the term of such employment and for one (1) year after your employment is terminated, you will not directly or indirectly solicit, induce, or encourage any employee, consultant, agent, customer, vendor, or other parties doing business with the Company to terminate their employment, agency, or other relationship with the Company or to render services for or transfer their business from the Company and you will not initiate discussion with any such person for any such purpose or authorize or knowingly cooperate with the taking of any such actions by any other individual or entity.

10. At-Will Employment; Amendment . Your employment with the Company is “at-will,” and either you or the Company may terminate your employment for any reason whatsoever (or for no reason) upon written notice of such termination to the other party. This at-will employment relationship cannot be changed except in a writing signed by you and an authorized representative of the Company. This agreement may not be amended except by a signed writing executed by the parties hereto.

11. Company Rules and Regulations . As an employee of the Company, you agree to abide by all Company rules, regulations and policies as set forth in the Company’s employee handbook or as otherwise promulgated.

12. W ithholding . The Company may withhold from any amounts payable under this offer letter such Federal, state, local or foreign taxes as shall be required to be withheld pursuant to any applicable law or regulation.

13. Entire Agreement . As of the Effective Date, this offer letter, together with the Stock Option Agreement and Proprietary Information and Inventions Agreement, comprises the final, complete and exclusive agreement between you and the Company with respect to the subject matter hereof and replaces and supersedes any and all other agreements, offers or promises, whether oral or written, made to you by any representative of the Company. You agree that any such agreement, offer or promise between you and any representative of the Company is hereby terminated and will be of no further force or effect, and you acknowledge and agree that upon your execution of this offer letter, you will have no right or interest in or with respect to any such agreement, offer or promise.

14. Choice of Law . This offer letter shall be interpreted and construed in accordance with California law without regard to any conflicts of laws principles.

15. P roof of Right to Work . As required by law, this offer of employment is subject to satisfactory proof of your right to work in the United States.

16. Background Check and Drug Screening . This offer of employment is expressly contingent upon your completion of a pre-employment background check conducted by an outside service bureau and a drug screening test, in each case with results that are satisfactory to the Company in its sole discretion. Refusal to submit to the background check or drug screening test will result in your disqualification from further employment consideration. In addition, failure to successfully complete the background check or drug screening test will cause this offer of employment to be withdrawn, or your employment to be terminated if you already have started work.

[ SIGNATURE PAGE FOLLOWS ]

Please confirm your agreement to the foregoing by signing and dating the enclosed duplicate original of this offer letter in the space provided below for your signature and returning it to the Company’s President and Chief Executive Officer. Please retain one fully-executed original for your files.

Sincerely,

Puma Biotechnology, Inc. a Delaware corporation

By:		/s/ Alan H. Auerbach
Name:		Alan H. Auerbach
Title:		President and Chief Executive Officer

Accepted and Agreed,
This 21 ^st day of August , 2015

By:		/s/ Steven Lo
		Steven Lo

Exhibit A

Proprietary Information and Inventions Agreement

PUMA BIOTECHNOLOGY, INC.

Proprietary Information and Inventions Agreement

In consideration of my employment by Puma Biotechnology, Inc. (the “ Company ”) (the definition of “ Company ” for the purposes of this Agreement shall include Puma Biotechnology, Inc., its affiliates, and subsidiaries) and access to Proprietary Information (defined below) being given to me by the Company, I hereby agree to this Proprietary Information and Inventions Agreement as of 9/8/2015 (the “ Agreement ”), as follows:

1. Proprietary Information .

The term “ Proprietary Information ” shall mean all information received by me in the course of my employment by the Company, including without limitation all trade secrets, inventions, confidential knowledge, data or any other information or materials that the Company treats or considers as proprietary, whether or not such Proprietary Information is patentable or copyrightable, however it is embodied and irrespective of whether it is labeled as “proprietary” or “confidential”. By way of illustration but not limitation, “ Proprietary Information ” includes (a) inventions, trade secrets, know-how, ideas, confidential knowledge, improvements, discoveries, developments, processes, designs, techniques, formulas, formulations, source and object codes, data, programs, trademarks and works of authorship; organisms, plasmids, cosmids, bacteriophages, expression vectors, cells, cell lines, tissues, materials, substrates, media, delivery methods or transfection methods and other biological materials and the progeny and clones of the foregoing biological materials, assays, compounds, peptides, proteins, DNA, RNA, and their constructs, and sequence, amino acid, genomic, and structural information relating thereto; crystals, optically active materials, ceramics, metals, metal oxides and organic and inorganic chemical and other physical materials and derivatives and salt forms of the foregoing (hereinafter the Proprietary Information described in clause (a) shall collectively be referred to as “ Inventions ”); (b) information regarding the Company’s plans for research, regulatory, development, manufacturing, engineering, marketing and selling efforts, the Company’s business plans and plans for new products, budgets and unpublished financial statements, licenses, contractual arrangements, prices and costs, suppliers, distributors and customers; and information regarding the skills, background and compensation of other employees of the Company and (c) all Third Party Information (as defined in Section 3).

2. Recognition of Company’s Rights; Nondisclosure .

I acknowledge that as a result of my responsibilities at the Company, I am likely to be exposed and given access to the Proprietary Information of the Company. I understand and agree that my access to the Proprietary Information is for the sole and exclusive purpose of producing technology and performing other work for the benefit of the Company and that the Company has a substantial ongoing investment in the development and acquisition of such Proprietary Information, which investment would be irreparably and adversely affected if this Agreement were breached. At all times during the term of my employment and thereafter, I will hold the Company’s Proprietary Information in the strictest confidence and will not, except with the written permission of the Chief Executive Officer of the Company, disclose (which term throughout this Agreement includes, but is not limited to, lecturing upon or publishing) any such Proprietary Information to anyone other than Company personnel who need to know such information in connection with their work for the Company or use such Proprietary Information except in connection with any work for the Company.

I further acknowledge that Proprietary Information is solely the property of the Company and I agree that at no time either during the period of my employment nor thereafter will I challenge or engage in any other acts which question or impugn the validity or ownership of the Company’s rights in any Proprietary Information. I further acknowledge that any and all improvements or modifications to Proprietary Information that I generate, make, conceive, develop or reduce to practice or to specific form, whether alone or in conjunction with others, either during or after the period of my employment with the Company shall constitute Proprietary Information.

3. Third Party Information .

I understand that the Company has received and in the future will receive from third parties confidential or proprietary information (“ Third Party Information ”) that is subject to a duty on the Company’s part to maintain the confidentiality of such information and to use it only for certain limited purposes. During the term of my employment and thereafter, I will treat all Third Party Information as Proprietary Information for purposes of this Agreement.

4. Assignment of Inventions .

(a) Except as provided below in Section 4(b) of this Agreement, I hereby assign to the Company all my right, title and interest in and to any and all Inventions, whether or not patentable or registrable under copyright or similar statutes, that I make, conceive or reduce to practice, reduce to specific form or learn, either alone or jointly with others, in the course of my employment by

the Company, whether developed in whole or in part using the Company’s equipment, supplies, facilities, trade secret information or Proprietary Information; or relating at the time of conception or reduction to practice to the Company’s business, or actual or demonstrably anticipated research or development of the Company; or resulting from any work performed by me for the Company (collectively, the “ Employment Inventions ”). I recognize that this Agreement does not require assignment of any invention which qualifies fully for protection under Section 2870 of the California Labor Code (hereinafter “ Section 2870 ”), which provides as follows:

(i) Any provision in an employment agreement which provides that an employee shall assign, or offer to assign, any of his or her rights in an invention to his or her employer shall not apply to an invention that the employee developed entirely on his or her own time without using the employer’s equipment, supplies, facilities, or trade secret information, except for those inventions that either:

(1) relate at the time of conception or reduction to practice of the invention to the employer’s business, or actual or demonstrably anticipated research or development of the employer; or

(2) result from any work performed by the employee for the employer.

(ii) To the extent a provision in an employment agreement purports to require an employee to assign an invention otherwise excluded from being required to be assigned under subdivision (a), the provision is against the public policy of California and is unenforceable.

(b) I have set forth on Exhibit A attached hereto, a complete list of all restrictions, express or implied, which would prevent me from complying with all of the requirements of Section 4(a) of this Agreement in whole or in part. If full disclosure of such restrictions, express or implied, in Exhibit A would cause me to violate any prior confidentiality agreement, I understand that I am to describe such restrictions in Exhibit A at the most specific level possible without violating any such restrictions. Exhibit A is incorporated into this Agreement by reference as if fully set forth herein. I will promptly inform the Company in writing of any such restrictions that arise between the time I sign this Agreement and the time my employment with the Company commences.

(c) I also assign to or assign as directed by the Company all my right, title and interest in and to all Employment Inventions, full title to which is required to be in the United States by a contract between the Company and the United States or any of its agencies.

(d) I acknowledge that all original works of authorship which are made by me (solely or jointly with others) within the scope of my employment and which are protectable by copyright are “ works made for hire ,” as that term is defined in the United States Copyright Act (17 U.S.C., Section 101).

5. Enforcement of Proprietary Rights .

To assist the Company in exercising its ownership rights to all Proprietary Information or Employment Inventions that I generate, make, conceive, reduce to practice or to specific form, alter or modify, I will, if requested by the Company, execute, verify and deliver assignments of all rights in the United States and elsewhere, including but not limited to patent and copyright rights, in such Proprietary Information or Employment Inventions to the Company or its designees. I will also assist the Company in every proper way to obtain and from time to time enforce its United States and foreign rights relating to Proprietary Information or Employment Inventions in any and all countries, irrespective of whether I had any role in the development or modification of such Proprietary Information or Employment Inventions. To that end, I will execute, verify and deliver such documents and perform such other acts (including appearances as a witness) as the Company may reasonably request for use in applying for, obtaining, perfecting, evidencing, sustaining and enforcing such proprietary rights and the assignment thereof to the Company. My obligation to assist the Company with respect to all its rights in Proprietary Information or Employment Inventions in any and all countries shall continue beyond the termination of my employment, but the Company shall compensate me at a reasonable rate after my termination for the time actually spent by me at the Company’s request on such assistance.

In the event the Company is unable for any reason, after good faith and all reasonable effort, to secure my signature on any document needed in connection with the actions specified in this Section 5 , I hereby irrevocably designate and appoint the Company and its duly authorized officers and agents as my agent and attorney in fact, which appointment is coupled with an interest, to act for and in my behalf to execute, verify and file any such documents and to do all other lawfully permitted acts to further the purposes of the preceding paragraph thereon with the same legal force and effect as if executed by me. I hereby waive and quitclaim to the Company any and all claims, of any nature whatsoever, which I now or may hereafter have for infringement of any proprietary rights assigned hereunder to the Company.

6. Obligation to Keep Company Informed .

I will promptly disclose to the Company fully and in writing and will hold in trust for the sole right and benefit of the Company any and all Employment Inventions that I make, conceive, develop or reduce to practice or to specific form, whether alone or in conjunction with others, during or after the period of my employment with the Company. In addition, after any termination of my employment, I will promptly disclose to the Company fully and in writing, the full particulars of all patent applications filed by me which disclose or claim Proprietary Information or Employment Inventions.

I will also promptly disclose to the Company fully and in writing any inventions containing or disclosing Proprietary Information that I believe fully qualify for protection under Section 2870; and I will at that time provide to the Company in writing all evidence necessary to substantiate that belief. I understand that the Company will keep in confidence and will not disclose to third parties without my consent any proprietary information disclosed in writing to the Company pursuant to this Agreement relating to Inventions that qualify fully for protection under the provisions of Section 2870. I will preserve the confidentiality of any Employment Invention that does not fully qualify for protection under Section 2870.

7. Prior Inventions .

The term “ Prior Inventions ” shall mean any and all inventions, trade secrets, know-how, know-how, ideas, confidential knowledge, improvements, discoveries, developments, processes, designs, techniques, formulas, formulations, source and object codes, data, programs, trademarks and works of authorship; organisms, plasmids, cosmids, bacteriophages, expression vectors, cells, cell lines, tissues, materials, substrates, media, delivery methods or transfection methods and other biological materials and the progeny and clones of the foregoing biological materials, assays, compounds, peptides, proteins, DNA, RNA, and their constructs, and sequence, amino acid, genomic, and structural information relating thereto; crystals, optically active materials, ceramics, metals, metal oxides and organic and inorganic chemical and other physical materials and derivatives and salt forms of the foregoing, which I have, alone or jointly with others, conceived, developed or reduced to practice or caused to be conceived, developed or reduced to practice prior to the commencement of my employment with the Company. To preclude any possible uncertainty over what is a Prior Invention, I have set forth on Exhibit B attached hereto a complete list of all Prior Inventions that I consider to be in whole or part my property or the property of third parties, and that I wish to have excluded from the scope of this Agreement. If full disclosure of any such Prior Invention on Exhibit B would cause me to violate any prior confidentiality agreement, I understand that I am to describe such Prior Inventions in Exhibit B at the most specific level possible without violating any such prior confidentiality agreements. Exhibit B is incorporated into this Agreement as if fully set forth herein. I will promptly inform the Company in writing of any Prior Inventions that occur between the time I sign this Agreement and the time my employment with the Company commences.

8. Unauthorized Use or Disclosure .

I shall immediately notify my supervisor or any officer of the Company if I learn of any possible unauthorized use or disclosure of Proprietary Information and shall cooperate fully with the Company to enforce the provisions of this Agreement.

9. Authorized Disclosure .

Should I be subject to any governmental, administrative or court order or action purporting to require or authorize the disclosure of any Proprietary Information, in whole or in part, I will immediately notify the Company’s legal department and will immediately provide the Company with all documents and other pertinent information in my possession or control to permit the Company to take such steps as it deems necessary in its sole discretion to block or pursue the confidentiality of such disclosure.

10. Additional Activities .

I agree that during the period of my employment by the Company I will not, without the Company’s express written consent, engage in any employment or business activity other than for the Company, except as may be provided in any written agreement between me and an authorized officer of the Company with the Company executed as of the same date, and for the period of my employment by the Company and for one (1) year after the date of termination of my employment by the Company, I will not use any Proprietary Information in order to (i) induce any employee of the Company to leave the employ of the Company or (ii) solicit the business of any client or customer of the Company (other than on behalf of the Company) with whom I had contact during the course of my employment with the Company.

11. No Improper Use of Materials .

I acknowledge that the Company forbids me to use or disclose any information that is proprietary to any competitor of the Company or to any other third party. Therefore, during my employment by the Company, I will not use or disclose any confidential information or trade secrets, if any, of any former employer or any other person to whom I have an obligation of confidentiality and I

will not bring onto the premises of the Company any unpublished documents or any property belonging to any former employer or any other person to whom I have an obligation of confidentiality unless consented to in writing by that former employer or person. To preclude any possible uncertainty, I have set forth on Exhibit C attached hereto, a complete list of all devices, materials, and documents of a former employer or other person or institution to whom I have an obligation of confidentiality that may be used in providing services to the Company pursuant to the express written authorization of my former employer or such other person. I will promptly notify the Company in writing of any devices, materials, and documents that are required to be set forth in Exhibit C that arise between the time I sign this Agreement and the time my employment with the Company commences. Exhibit C is incorporated into this Agreement by reference as if fully set forth herein. In addition, I will not seek nor knowingly use any information from job applicants, Company employees or other third parties, including but not limited to vendors, that is confidential to the present or former employers of such applicants or former employers of the employees or to such third parties.

12. No Conflicting Obligation .

I represent that my performance of all the terms of this Agreement and my position as an employee of the Company does not and will not breach any agreement to keep in confidence information acquired by me in confidence or in trust prior to my employment by the Company. I have not entered into, and I agree I will not enter into, any agreement either written or oral in conflict herewith.

13. Return of Company Materials .

When I leave the employ of the Company, I will deliver to the Company any and all copies and originals of drawings, notes, memoranda, lab notebooks, specifications, correspondence (including email and quickmail messages), devices, equipment, formulas, documents, molecules, cells, organisms, plasmids, cosmids, bacteriophages, expression vectors, cell lines, peptides, proteins, DNA, RNA, and their constructs and other biological materials, and the progeny and clones of the foregoing biological materials and sequence, amino acid, genomic, and structural information relating thereto; crystals, optically active materials, ceramics, metals, metal oxides and organic and inorganic chemical and other physical materials and derivatives and salt forms of the foregoing, and any other material containing or disclosing any Inventions, Employment Inventions or Proprietary Information. I further agree that any property situated on the Company’s premises and owned by the Company, including disks and other storage media, quickmail, email, voicemail, filing cabinets or other work areas, is subject to inspection by Company personnel at any time with or without notice. Prior to leaving, I will reasonably cooperate with the Company in completing and signing the Company’s documentation for separating staff members.

14. Name and License .

I hereby grant to the Company a non-exclusive worldwide license to use my name and likeness on or in connection with any advertising and promotional materials distributed by or on behalf of the Company in any medium while serving as an employee or director of the Company or thereafter, if such materials describe my prior role as employee or director of the Company.

15. Potential Liability .

I have been informed and acknowledge that the unauthorized taking of the Company’s trade secrets (a) could result in civil liability under California Civil Code Section 3426, and that, if willful, could result in an award for triple the amount of the Company’s damages and attorneys’ fees; and (b) is a crime under California Penal Code Section 499c(c), punishable by imprisonment for a time not exceeding one year, or by a fine not exceeding five thousand dollars ($5,000), or by both.

16. Legal and Equitable Remedies .

Because my services are personal and unique and because I may have access to and become acquainted with the Proprietary Information of the Company, and due to the irreparable injury which would be suffered by the Company as a result of a breach of this Agreement, the Company shall have the right to enforce this Agreement and any of its provisions by injunction, specific performance or other equitable relief, without bond and without prejudice to any other rights and remedies that the Company may have for a breach of this Agreement.

17. Notices .

Any notices required or permitted hereunder shall be given to the appropriate party at the address specified below or at such other address as the party shall specify in writing. Such notice shall be deemed given upon personal delivery to the appropriate address or if sent by certified or registered mail, three (3) days after the date of mailing.

18. Employment at Will .

I understand and agree that my employment with the Company is at-will. Therefore, my employment can terminate, with or without cause, and with or without notice, at any time, at my option or the Company’s option, and that the Company can terminate or change all other terms and conditions of my employment, with or without cause, and with or without notice, at any time. I understand that the nature of my employment relationship with the Company will be governed by this Section 18 and that this Section 18 constitutes the entire agreement, arrangement and understanding between me and the Company on this subject matter and supersedes any prior or contemporaneous agreement, arrangement, and understanding on this subject matter. This at-will relationship will remain in effect throughout my employment with the Company or any of its subsidiaries or affiliates, unless it is modified by a written agreement signed by both the Company’s President and me which expressly alters it. This at-will relationship may not be modified by any oral or implied agreement, or by any Company policies, practices or patterns or conduct.

19. General Provisions .

(a) Governing Law and Forum .

This Agreement will be governed by and construed according to the substantive laws of the State of California without resort to conflict of law principles and I hereby consent to the jurisdiction of the courts of California, both state and federal, for any claim sounding in tort or contract or created by state or federal law related in any way to my or the Company’s rights and obligations under the Agreement.

(b) Entire Agreement .

This Agreement, including all exhibits hereto, is the final, complete and exclusive agreement of the parties with respect to the subject matter hereof and supersedes and merges all prior discussions between us. No modification of or amendment to this Agreement, nor any waiver of any rights under this Agreement, will be effective unless in writing signed by the party to be charged. Any subsequent change or changes in my duties, salary or compensation will not affect the validity or scope of this Agreement. As used in this Agreement, the period of my employment includes any time during which I may be retained by the Company as a consultant.

Whenever possible, each provision of this Agreement will be interpreted in such manner as to be effective and valid under applicable law, but if any provision of this Agreement is held to be prohibited by or invalid under applicable law, such provision will be ineffective only to the extent of such prohibition or invalidity, without invalidating the remainder of this Agreement.

(d) Assignment .

This Agreement may not be assigned by me but is fully assignable by the Company.

(e) Successors and Assigns .

This Agreement will be binding upon my heirs, executors, administrators and other legal representatives and will be for the benefit of the Company, its successors, and its assigns.

(f) Survival .

The provisions of this Agreement shall survive the termination of my employment and the assignment of this Agreement by the Company to any successor in interest or other assignee.

(g) Waiver .

No waiver by the Company of any breach of this Agreement shall be a waiver of any preceding or succeeding breach. No waiver by the Company of any right under this Agreement shall be construed as a waiver of any other right. The Company shall not be required to give notice to enforce strict adherence to all terms of this Agreement.

(h) Effective Date .

Agreement shall be effective as of the earliest of (1) the first day of my employment by the Company; or (2) the first day of my use of the facilities, technology, expertise, data or Proprietary Information of the Company; or (3) the day I sign this Agreement.

(i) Descriptive Headings .

The descriptive headings of this Agreement are for convenience only, and shall be of no force or effect in construing or interpreting any of the provisions of this Agreement.

[ Signature Page Follows ]

I UNDERSTAND THAT THIS AGREEMENT AFFECTS MY RIGHTS TO INVENTIONS I MIGHT HAVE MADE DURING MY PAST EMPLOYMENT, AND MAKE DURING MY EMPLOYMENT, AND RESTRICTS MY RIGHT TO DISCLOSE OR USE THE COMPANY’S PROPRIETARY INFORMATION DURING OR SUBSEQUENT TO MY EMPLOYMENT.

I HAVE READ THIS AGREEMENT CAREFULLY AND UNDERSTAND ITS TERMS. I HAVE COMPLETELY FILLED OUT AND SIGNED EXHIBITS A, B, AND C TO THIS AGREEMENT AS APPROPRIATE.

IN WITNESS WHEREOF , the parties have duly executed this Agreement as of the day and year first set forth above.

Company:
Puma Biotechnology, Inc. a Delaware corporation

By:
Name:	Alan Auerbach	Name:	Steven Lo
Title:	CEO and President

Address: 10880 Wilshire Blvd, Suite 2150 Los Angeles, CA 90024		Address: Steven Lo

[Signature Page to Puma Biotechnology, Inc. Proprietary Information and Inventions Agreement]

EXHIBIT A

Puma Biotechnology, Inc.

10880 Wilshire Blvd, Suite 2150

Los Angeles, CA 90024

Attention: Board of Directors

Directors:

The following is a complete list of all restrictions which would prevent me, in whole or in part, from assigning to or as directed by the Company (as defined in the attached Agreement) all my right, title and interest in and to any and all Employment Inventions (as required by Section 4 of the Agreement):

		No restrictions.
		Restrictions:





		Number of additional sheets attached.

Date:

Very truly yours,

Steven Lo

Puma Biotechnology, Inc. Proprietary Information and Inventions Agreement

EXHIBIT B

Puma Biotechnology, Inc.

10880 Wilshire Blvd, Suite 2150

Los Angeles, CA 90024

Attention: Board of Directors

Directors:

The following is a complete list of all Prior Inventions (as defined in the attached Agreement):

		No Prior Inventions
		Prior Inventions:





		Number of additional sheets attached.

Date:

Very truly yours,

Steven Lo

Puma Biotechnology, Inc. Proprietary Information and Inventions Agreement

EXHIBIT C

Puma Biotechnology, Inc.

10880 Wilshire Blvd, Suite 2150

Los Angeles, CA 90024

Attention: Board of Directors

Directors:

I propose to bring or have already brought to my employment with the Company (as defined in the attached Agreement) the following devices, materials and documents of my former employer(s) or other person(s) or institution(s) to whom I have an obligation of confidentiality that are not generally available to the public, which materials and documents may be used in providing services to the Company pursuant to the express written authorization of my former employer(s) or such other person(s) or institution(s) (copies of all such authorizations are attached hereto):

		No materials.
		Materials:





		Number of additional sheets attached.

		Number of pages of authorizations attached.

Date:

Very truly yours,

Steven Lo

Puma Biotechnology, Inc. Proprietary Information and Inventions Agreement

Exhibit 31.1

CERTIFICATION OF PRINCIPAL EXECUTIVE OFFICER

PURSUANT TO SECTION 302 OF THE SARBANES-OXLEY ACT OF 2002

I, Alan H. Auerbach, certify that:

1. I have reviewed this Quarterly Report on Form 10-Q of Puma Biotechnology, Inc. for the quarter ended September 30, 2015;

2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4. The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

(a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

(b) Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

(c) Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

(d) Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

5. The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):

(a) All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

(b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

Date: November 9, 2015

/s/ Alan H. Auerbach

Alan H. Auerbach

Principal Executive Officer

Exhibit 31.2

CERTIFICATION OF PRINCIPAL FINANCIAL OFFICER

PURSUANT TO SECTION 302 OF THE SARBANES-OXLEY ACT OF 2002

I, Charles R. Eyler, certify that:

1. I have reviewed this Quarterly Report on Form 10-Q of Puma Biotechnology, Inc. for the quarter ended September 30, 2015;

(b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

Date: November 9, 2015

/s/ Charles R. Eyler

Charles R. Eyler

Principal Financial and Accounting Officer

Exhibit 32.1

CERTIFICATION

PURSUANT TO 18 U.S.C. SECTION 1350, AS ADOPTED PURSUANT TO

SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

The following certification is being furnished solely to accompany the Quarterly Report on Form 10-Q of Puma Biotechnology, Inc. for the quarter ended September 30, 2015, pursuant to 18 U.S.C. § 1350 and in accordance with SEC Release No. 33-8238. This certification shall not be deemed “filed” for purposes of Section 18 of the Securities Exchange Act of 1934, as amended, nor shall it be incorporated by reference in any filing of Puma Biotechnology, Inc. under the Securities Act of 1933, as amended, whether made before or after the date hereof, regardless of any general incorporation language in such filing.

Certification of Principal Executive Officer

I, Alan H. Auerbach, certify, pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that the Quarterly Report on Form 10-Q of Puma Biotechnology, Inc. for the quarter ended September 30, 2015, fully complies with the requirements of Section 13(a) or 15(d), as applicable, of the Securities Exchange Act of 1934, as amended, and that the information contained in such report fairly presents, in all material respects, the financial condition and results of operations of Puma Biotechnology, Inc.

Date: November 9, 2015

/s/ Alan H. Auerbach

Alan H. Auerbach

Principal Executive Officer

A signed original of this written statement required by Section 906 has been provided to Puma Biotechnology, Inc. and will be retained by Puma Biotechnology, Inc. and furnished to the Securities and Exchange Commission or its staff upon request.

Exhibit 32.2

CERTIFICATION

PURSUANT TO 18 U.S.C. SECTION 1350, AS ADOPTED PURSUANT TO

SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

Certification of Principal Financial Officer

I, Charles R. Eyler, certify, pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that the Quarterly Report on Form 10-Q of Puma Biotechnology, Inc. for the quarter ended September 30, 2015, fully complies with the requirements of Section 13(a) or 15(d), as applicable, of the Securities Exchange Act of 1934, as amended, and that the information contained in such report fairly presents, in all material respects, the financial condition and results of operations of Puma Biotechnology, Inc.

Date: November 9, 2015

/s/ Charles R. Eyler

Charles R. Eyler

Principal Financial and Accounting Officer