Financial Performance - Total revenue for the three months ended June 30, 2024, was $33.445 million, a significant increase from $5.249 million for the same period in 2023, representing a growth of 536%[13] - Operating income for the three months ended June 30, 2024, was $13.757 million, compared to an operating loss of $18.638 million for the same period in 2023[13] - Net income for the three months ended June 30, 2024, was $13.836 million, a turnaround from a net loss of $11.387 million in the same period last year[13] - Basic net income per share for the three months ended June 30, 2024, was $0.58, compared to a loss of $2.23 per share for the same period in 2023[13] Expenses - Research and development expenses for the three months ended June 30, 2024, were $12.661 million, down from $17.782 million for the same period in 2023, indicating a reduction of 29%[13] - General and administrative expenses increased to $7.027 million for the three months ended June 30, 2024, compared to $6.105 million for the same period in 2023, reflecting a rise of 15%[13] - The company reported stock-based compensation expense of $3.022 million for the second quarter of 2024, compared to $6.059 million in the same quarter of 2023, reflecting a 50% decrease[21] - Total stock-based compensation expense for the three months ended June 30, 2024, was $1.591 million, compared to $3.022 million for the same period in 2023, representing a decrease of 47.4%[77] Cash Flow and Liquidity - Cash used in operating activities for the second quarter of 2024 was $30.363 million, up from $18.660 million in the second quarter of 2023, indicating a 62% increase in cash outflow[21] - The company reported a total cash, cash equivalents, and restricted cash balance of $88.896 million at the end of June 2024, down from $115.004 million at the end of June 2023[21] - As of June 30, 2024, the Company had cash, cash equivalents, and restricted cash totaling $88.9 million, with an additional $124.4 million raised from a Private Placement in July 2024[26] - The Company reported total outstanding receivables of $31.7 million, representing billings for the Phase 3 DISSOLVE program[92] Mergers and Acquisitions - The company completed a private placement in November 2023, raising approximately $60.25 million through the issuance of 149,330.115 shares of Series A Preferred Stock[23] - The company acquired the assets of Old Cartesian in November 2023, exchanging shares based on a fixed ratio, resulting in the issuance of 224,099 shares of common stock and 384,930.724 shares of Series A Preferred Stock[23] - The total consideration for the merger with Old Cartesian was valued at $168.5 million, which included $155.3 million for Series A Preferred Stock and $10.4 million for stock options[34] - The Company recorded goodwill of $48.2 million related to the merger, primarily attributable to the assembled workforce and deferred tax liabilities[35] Future Outlook and Growth - The company anticipates potential growth opportunities in its market size and product pipeline, although specific projections were not detailed in the report[8] - The company is focused on maximizing the value of its product candidates and expanding its manufacturing capabilities to support future growth[8] - The Company is developing mRNA cell therapies for autoimmune diseases, with ongoing preclinical and clinical development efforts[23] - The Company is in the early stages of product candidate development and has not completed any product candidates to date[26] Risks and Challenges - The company is subject to significant risks typical of the biotechnology industry, including the need for substantial capital for research and development[24] - The Company has not recorded any U.S. federal or state income tax benefits due to uncertainty in realizing future benefits from net losses and credits[110] - The Company may need to seek additional funding sooner than expected if actual results differ from management's estimates[26] Stock and Equity - Weighted-average common shares outstanding for the three months ended June 30, 2024, were 16,723,479, compared to 5,114,747 for the same period in 2023, showing an increase of 227%[13] - The Company has authorized shares of common stock for future issuance totaling 12,794,858, which includes 975,132 shares from warrants and 5,544,719 shares from Series A Preferred Stock[74] - The Reverse Stock Split on April 4, 2024, consolidated every 30 shares of common stock into one share, effective on the Nasdaq Global Market under the symbol "RNAC"[73] - The Series B Preferred Stock will automatically convert into common stock upon stockholder approval, subject to certain beneficial ownership limitations[115] Revenue Recognition - Revenue recognized from the Astellas Agreement during the three months ended June 30, 2024, was $0.5 million, compared to $0.8 million in the same period of 2023[88] - The Company recognized revenue of $32.8 million related to the Sobi License during the three and six months ended June 30, 2024, including a $30.0 million development milestone[92] - The Company received a one-time upfront payment of $75.0 million from Sobi for the exclusive license to develop SEL-212[91] Contractual Obligations - The Company is obligated to pay tiered royalties to Ginkgo and Genovis based on annual net sales of collaboration products, ranging from low-single digit to high-single digit percentages[102][104] - The Company has paid an aggregate of $7 million in upfront and milestone payments under the 3SBio License as of June 30, 2024[109] - The Company plans to terminate the Genovis Agreement effective September 13, 2024, and the AskBio Collaboration Agreement effective December 13, 2023[104][108]
Cartesian Therapeutics(RNAC) - 2024 Q2 - Quarterly Report