Quince Therapeutics(QNCX) - 2024 Q4 - Annual Report

Market Opportunity - The global market for A-T treatments represents a peak commercial opportunity of over $1 billion[507]. - A-T patient population in the U.S. is estimated to be approximately 4,600 based on third-party analysis[519]. Clinical Trials - The Phase 3 NEAT clinical trial for eDSP has enrolled 60 participants as of March 24, 2025, with topline results expected in Q4 2025[508]. - The company initiated the Phase 3 NEAT clinical trial in June 2024 and plans to start a Phase 2 clinical trial for DMD in 2025[510]. - The company received Fast Track designation from the FDA for the eDSP System for A-T treatment in June 2024[510]. - The company paid a cash milestone payment of$5 million to former EryDel shareholders upon enrolling the first patient in the Phase 3 NEAT clinical trial[655]. Financial Performance - The company incurred a net loss of $56.8 million in 2024, compared to a net loss of$31.4 million in 2023, representing an 81% increase in losses[550]. - Cash, cash equivalents, and short-term investments decreased to $40.8 million as of December 31, 2024, down from$75.1 million in 2023[551]. - The company has an accumulated deficit of $376.5 million as of December 31, 2024, indicating ongoing financial challenges[550]. - The company reported total operating expenses of$57.3 million for 2024, an increase of approximately 65.3% from $34.6 million in 2023[590]. - The company recorded a net loss of$56.8 million for the year ended December 31, 2024, which included non-cash items totaling $25.4 million[564]. - The company reported total liabilities of$71.012 million as of December 31, 2024, which included $56.691 million in contingent consideration and$14.321 million in long-term debt[653]. Research and Development - Research and development expenses increased by 97% to $18.6 million in 2024 from$9.4 million in 2023, primarily due to costs associated with the Phase 3 NEAT clinical trial[537]. - The company expects research and development expenses to remain at current levels as it continues the Phase 3 NEAT clinical trial and expands into new indications[518]. - Research and development expenses primarily consist of personnel costs and are expensed as incurred, with significant variability in payment flows due to contracts with third-party service providers[633]. Funding and Capital Needs - The company anticipates needing additional funding to support operations and development efforts, with substantial doubt about its ability to continue as a going concern within the next year[551]. - The Company anticipates that its cash and cash equivalents balance as of December 31, 2024, will not be sufficient to fund operations and capital expenditures for at least the next twelve months, necessitating additional funding[602]. - Management expects to incur additional losses in the future to fund operations and may need to raise additional capital through equity securities or debt financings[606]. Asset and Liability Management - As of December 31, 2024, the company reported total assets of $114.5 million, a decrease from$167.9 million in 2023, reflecting a decline of approximately 31.8%[589]. - The company has a contingent consideration balance of $56.7 million as of December 31, 2024, with a change in fair value of$4.0 million for the year[584]. - The fair value adjustment for contingent consideration increased by $4.0 million in 2024, primarily due to changes in probability assessments related to achieving various milestones[544]. Goodwill and Impairment - The company recognized a non-cash goodwill impairment charge of$17.1 million during 2024[532]. - A non-cash goodwill impairment charge of $17.1 million was recorded in 2024, reflecting a significant decline in market capitalization since the acquisition of EryDel[542]. Stock and Equity - The Company has authorized the issuance of 100 million shares of common stock, with 44,001,643 shares issued and outstanding as of December 31, 2024[691]. - The Company operates three stock plans, with a total of 16,171,478 shares reserved for future issuance as of December 31, 2024[691]. - The Company has not declared any dividends on common stock since its inception[691]. Debt and Loans - The company guaranteed an EIB Loan of up to €30.0 million, with only tranches A (€3.0 million) and B (€7.0 million) drawn as of December 31, 2024[559][560]. - The EIB Loan bears fixed interest rates ranging from 7.0$10.4 million) outstanding as of December 31, 2024[560]. - The Company became a guarantor of the EIB Loan, with a maximum borrowing capacity of €30 million, of which €10 million ($10.4 million) was outstanding as of December 31, 2024[680]. Miscellaneous - The Company operates as one reportable segment focused on developing and commercializing its proprietary AIDE technology platform[614]. - The Company adopted ASU 2023-07 during the year ended December 31, 2024, which requires public entities to disclose significant expenses and other segment items on an interim and annual basis[642].