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Kronos Bio(KRON) - 2024 Q3 - Quarterly Report
KRONKronos Bio(KRON)2024-11-13 21:10

Financial Performance - The company reported net losses of 14.1millionforthethreemonthsendedSeptember30,2024,comparedto14.1 million for the three months ended September 30, 2024, compared to 31.4 million for the same period in 2023, indicating a reduction in losses [102]. - Revenue for the three months ended September 30, 2024, was 2.4million,anincreaseof2.4 million, an increase of 1.5 million compared to 0.9millionforthesameperiodin2023[125].−FortheninemonthsendedSeptember30,2024,revenuewas0.9 million for the same period in 2023 [125]. - For the nine months ended September 30, 2024, revenue was 7.6 million, an increase of 3.6millionfrom3.6 million from 4.0 million in the same period of 2023 [132]. - Total operating expenses for the nine months ended September 30, 2024, were 73.3million,downfrom73.3 million, down from 98.5 million in 2023, a decrease of 25.2million[131].−Researchanddevelopmentexpensesdecreasedto25.2 million [131]. - Research and development expenses decreased to 12.3 million for the three months ended September 30, 2024, down from 25.3millionin2023,areductionof25.3 million in 2023, a reduction of 13.1 million [128]. - General and administrative expenses were 5.8millionforthethreemonthsendedSeptember30,2024,comparedto5.8 million for the three months ended September 30, 2024, compared to 9.4 million in 2023, a decrease of 3.6million[129].−ResearchanddevelopmentexpensesfortheninemonthsendedSeptember30,2024,were3.6 million [129]. - Research and development expenses for the nine months ended September 30, 2024, were 40.3 million, a decrease of 25.6millionfrom25.6 million from 65.8 million in 2023 [134]. - General and administrative expenses for the nine months ended September 30, 2024, were 19.7million,downfrom19.7 million, down from 29.8 million in 2023, a decrease of 10.1million[135].−Thecompanyrecognizedanon−cashimpairmentchargeof10.1 million [135]. - The company recognized a non-cash impairment charge of 7.1 million during the nine months ended September 30, 2024 [136]. - The company recorded total restructuring costs of 6.2millionduringtheninemonthsendedSeptember30,2024,includingnon−cashstock−basedcompensationof6.2 million during the nine months ended September 30, 2024, including non-cash stock-based compensation of 4.4 million [138]. Cash Flow and Capital Resources - As of September 30, 2024, the company had an accumulated deficit of 569.1millionandcash,cashequivalents,andinvestmentstotaling569.1 million and cash, cash equivalents, and investments totaling 124.9 million [102]. - Cash used in operating activities for the nine months ended September 30, 2024, was 52.6million,withanetlossof52.6 million, with a net loss of 60.3 million adjusted for non-cash charges of 12.7million[146].−CashprovidedbyinvestingactivitiesfortheninemonthsendedSeptember30,2024,was12.7 million [146]. - Cash provided by investing activities for the nine months ended September 30, 2024, was 63.1 million, primarily from purchases and maturities of marketable securities [148]. - The company incurred cash used in operating activities of 53.6millionfortheninemonthsendedSeptember30,2023,withanetlossof53.6 million for the nine months ended September 30, 2023, with a net loss of 87.4 million adjusted for non-cash charges of 22.6million[147].−CashprovidedbyfinancingactivitiesfortheninemonthsendedSeptember30,2024,was22.6 million [147]. - Cash provided by financing activities for the nine months ended September 30, 2024, was 0.2 million, compared to 0.4millionforthesameperiodin2023[150][151].−Thecompanyintendstoraiseadditionalcapitalthroughequitysecuritiesordebtfinancingtocontinueoperations,withpotentialdilutionofexistingstockholders′interests[143].−Thecompany’sfutureviabilitydependsonitsabilitytogeneratecashfromoperationsorraiseadditionalcapital,withsignificantrisksiffinancingisnotavailable[144].−AsofSeptember30,2024,thecompanyhadcash,cashequivalents,andinvestmentstotaling0.4 million for the same period in 2023 [150][151]. - The company intends to raise additional capital through equity securities or debt financing to continue operations, with potential dilution of existing stockholders' interests [143]. - The company’s future viability depends on its ability to generate cash from operations or raise additional capital, with significant risks if financing is not available [144]. - As of September 30, 2024, the company had cash, cash equivalents, and investments totaling 124.9 million, expected to fund operations for the next 12 months [140]. Strategic Initiatives - The company announced the discontinuation of its clinical trial for istisociclib due to safety concerns, with five out of seven patients experiencing neurological events [96]. - The company has initiated a formal process to evaluate potential strategic alternatives, including acquisitions or mergers, following the discontinuation of istisociclib [96]. - The company entered into a collaboration agreement with Genentech, receiving an upfront payment of 20.0millionandbeingeligibleforupto20.0 million and being eligible for up to 177.0 million in milestone payments [105]. - The term of the discovery research programs with Genentech is up to 24 months, with a possible six-month extension [106]. - The increase in revenue was primarily due to the Collaboration and License Agreement with Genentech, which began in January 2023 [125]. Research and Development - KB-9558 is in preclinical development for multiple myeloma and HPV-driven tumors, while KB-7898 is being developed for Sjogren's disease [98][99]. - The company’s primary use of cash has historically been for research and development expenditures related to therapeutic discovery and clinical development [141]. - The company has not yet commercialized any products and does not expect to generate revenue from product sales for several years [140]. Financial Obligations and Risks - The company has significant contractual obligations, including lease agreements with escalating payments, impacting future cash flows [152][154]. - Stock-based compensation is recognized over the requisite service period, generally the vesting period, using the straight-line method [169]. - The fair value of stock options is estimated using the Black-Scholes model, considering expected term, expected volatility, risk-free interest rate, and expected dividend yield [170][171][172]. - Impairment of long-lived assets is evaluated when events indicate that carrying amounts may not be recoverable, with losses recognized when future cash flows are less than carrying amounts [173]. - The company has never paid dividends on its common stock and has no plans to do so, resulting in an expected dividend yield of zero [172]. - The company is classified as a smaller reporting company and is not required to provide certain market risk disclosures [176].