Cullinan Oncology(CGEM) - 2024 Q2 - Quarterly Results

Corporate Update and Q2 2024 Highlights This section provides an overview of corporate strategic advancements and key highlights from Q2 2024 Strategic Focus and Pipeline Advancement Cullinan Therapeutics expands into autoimmune diseases, advances oncology pipeline, prioritizes CLN-978, and discontinues CLN-418 development - The company is expanding its focus into autoimmune diseases, alongside its existing oncology pipeline[1] - An Investigational New Drug (IND) application for CLN-978 in systemic lupus erythematosus (SLE) is on track to be filed in the third quarter of 2024[1] - Rheumatoid arthritis (RA) will be pursued as the second autoimmune indication for CLN-978[1] - To focus resources on the most promising programs, the company will discontinue the development of CLN-418[1][5] Portfolio Highlights The company provided key clinical pipeline updates, advancing immunology and oncology programs while discontinuing CLN-418 Immunology: CLN-978 CLN-978 is on track for an SLE IND submission in Q3 2024, with plans to expand into Rheumatoid Arthritis - Remains on track to submit an IND application for the global SLE study to the FDA in Q3 2024[2] - Plans to explore CLN-978 in rheumatoid arthritis (RA) as its second autoimmune indication[2] - Will collaborate with FAU Erlangen-Nuremberg and Università Cattolica del Sacro Cuore, Rome to conduct a clinical trial in RA[2] Oncology Pipeline The oncology pipeline advanced with positive clinical data for key assets, a route change for CLN-049, and CLN-418 discontinuation - CLN-619: Combination therapy data demonstrated objective responses in non-small cell lung cancer (NSCLC) with oncogenic mutations[3] - Zipalertinib: Announced positive initial data from the pivotal Phase 2b portion of the REZILIENT1 study in patients with EGFR ex20ins NSCLC[3] - CLN-049: Dose escalation is now continuing with IV administration in the Phase 1 study due to dose-limiting injection site reactions with subcutaneous administration[4] - CLN-418: Cullinan plans to discontinue development and will return development and commercial rights to Harbour BioMed[5] Corporate Updates The company strengthened its financial position with a $280 million private placement and enhanced board leadership - In April, the company completed an oversubscribed private placement of common stock, grossing $280 million[6] - In August, Mary Thistle was appointed to the Board of Directors, bringing thirty years of operational and business development expertise[6] Second Quarter 2024 Financial Results This section details the company's financial performance and position for the second quarter of 2024 Financial Position Cullinan Therapeutics reported a strong cash position of $664.9 million as of June 30, 2024, with a financial runway extending into 2028 Cash Position | Metric | June 30, 2024 | December 31, 2023 | | :--- | :--- | :--- | | Cash, cash equivalents, investments, and interest receivable | $664.9 million | $468.3 million | - The company expects its cash resources to provide runway into 2028[7] Operating Expenses Operating expenses increased in Q2 2024 due to higher R&D and G&A costs, with year-to-date R&D decreasing from a prior-year fee Research & Development (R&D) Expenses (in millions) | Period | Q2 2024 | Q2 2023 | YTD 2024 | YTD 2023 | | :--- | :--- | :--- | :--- | :--- | | R&D Expenses | $36.3 | $27.4 | $66.9 | $79.5 | - The increase in Q2 R&D expenses was primarily related to increases in clinical costs, chemistry, manufacturing and controls costs, preclinical costs, and personnel costs[8] General & Administrative (G&A) Expenses (in millions) | Period | Q2 2024 | Q2 2023 | YTD 2024 | YTD 2023 | | :--- | :--- | :--- | :--- | :--- | | G&A Expenses | $13.8 | $10.2 | $26.1 | $20.9 | - The increase in G&A expenses was primarily driven by increased personnel costs relating to additional headcount[8] Net Loss Net loss increased to $42.0 million in Q2 2024 due to higher operating expenses, but decreased year-to-date to $79.4 million Net Loss Summary (in millions, except per share data) | Period | Q2 2024 | Q2 2023 | YTD 2024 | YTD 2023 | | :--- | :--- | :--- | :--- | :--- | | Net Loss | $42.0 | $32.2 | $79.4 | $90.4 | | Net Loss per Share | $(0.75) | $(0.82) | $(1.61) | $(2.24) | - Net losses were partially offset by interest income of $8.1 million in Q2 2024 and $13.8 million in the first six months of 2024[8] Shares Outstanding As of July 31, 2024, Cullinan Therapeutics had approximately 58.0 million shares of common stock outstanding, including convertible instruments - As of July 31, 2024, Cullinan had 57,976,641 shares of common stock outstanding[9] - Additionally, there were pre-funded warrants convertible into 315,790 shares and non-voting preferred stock convertible into 6,475,000 shares[9] Financial Statements This section presents the company's condensed consolidated balance sheet and statements of operations Selected Condensed Consolidated Balance Sheet Data This section provides a snapshot of the company's financial position as of June 30, 2024, compared to December 31, 2023, detailing key assets, liabilities, and stockholders' equity Condensed Consolidated Balance Sheet Data (unaudited, in thousands) | | June 30, 2024 | December 31, 2023 | | :--- | :--- | :--- | | Cash, cash equivalents, investments, and interest receivable | $664,943 | $468,264 | | Total assets | $681,216 | $484,182 | | Total current liabilities | $23,476 | $28,137 | | Total liabilities | $24,995 | $30,287 | | Total stockholders' equity | $656,221 | $453,895 | Consolidated Statements of Operations This section presents the company's operational performance for the three and six months ended June 30, 2024, and 2023, outlining operating expenses, other income, and the resulting net loss Consolidated Statements of Operations (unaudited, in thousands, except per share amounts) | | Three Months Ended June 30, 2024 | Three Months Ended June 30, 2023 | Six Months Ended June 30, 2024 | Six Months Ended June 30, 2023 | | :--- | :--- | :--- | :--- | :--- | | Research and development | $36,259 | $27,391 | $66,905 | $79,487 | | General and administrative | $13,768 | $10,214 | $26,111 | $20,874 | | Total operating expenses | $50,027 | $37,605 | $93,016 | $100,361 | | Loss from operations | $(50,027) | $(37,605) | $(93,016) | $(100,361) | | Interest income | $8,071 | $5,322 | $13,764 | $9,830 | | Net loss | $(42,028) | $(32,214) | $(79,368) | $(90,355) | | Net loss per share | $(0.75) | $(0.82) | $(1.61) | $(2.24) |