Rani Therapeutics (US:RANI)2025-03-31 20:15Forward-Looking Statements This section clarifies that all non-historical statements are forward-looking, subject to inherent risks and uncertainties, with actual results potentially differing materially from projections - All statements in this report, except historical facts, are forward-looking, involving known and unknown risks and uncertainties beyond the company's control13 - Actual results, performance, or achievements may differ materially from those projected in forward-looking statements1315 - Key areas of forward-looking statements encompass clinical trials, product candidates, R&D costs, manufacturing, regulatory approvals, financial performance, and strategic partnerships1418 PART I Item 1. Business Rani Therapeutics, a clinical-stage biotherapeutics company, focuses on oral delivery of biologics via its RaniPill capsule technology, with three completed Phase 1 trials and ongoing pipeline development and collaborations - Rani Therapeutics is a clinical-stage biotherapeutics company advancing technologies for oral administration of biologics and drugs using its proprietary RaniPill capsule technology22599 - The RaniPill platform includes two configurations: RaniPill GO, delivering up to 3 mg drug in microtablet form with three completed Phase 1 trials, and RaniPill HC, for up to 200µL liquid drug, with clinical testing planned mid-202523110600 - Completed Phase 1 clinical trials for RT-111 (ustekinumab biosimilar), RT-102 (parathyroid hormone), and RT-101 (octreotide) demonstrated high bioavailability and good tolerability with no serious adverse events25266380 RT-114 Preclinical Pharmacokinetic Data (Oral vs. Subcutaneous PG-102) | Route | Cmax (µg/mL)/kg | Tmax (days) | AUC (µg/mLday)/kg | | :--- | :--- | :--- | :--- | | RT-114 | 1.51 ± 0.19 | 0.7 ± 0.1 | 5.48 ± 0.33 | | SC | 1.06 ± 0.13 | 1.3 ± 0.3 | 4.92 ± 0.52 | RT-116 (Semaglutide) Preclinical Pharmacokinetic Data (Oral vs. Subcutaneous) | Route | Cmax (ng/mL) | Tmax (days) | Tlast (days) | AUClast (ng/mLday) | | :--- | :--- | :--- | :--- | :--- | | Oral (RT-116) | 941 ± 90 | 1.3 ± 0.3 | 17 ± 2 | 3630 ± 222 | | SC | 948 ± 120 | 1.3 ± 0.3 | 17 ± 1 | 3390 ± 402 | - In June 2024, a Collaboration Agreement was signed with ProGen Co., Ltd. for worldwide development and commercialization of RT-114, with equal sharing of development costs and operating profits/losses3031152153607608761762 - In October and July 2024, securities purchase agreements raised aggregate net proceeds of $9.4 million and $8.9 million, respectively, from Class A common stock and warrants3233604605 - The CEO's annual salary was reduced from $520,000 to $100,000, effective November 1, 2023, and extended through December 31, 2025, or until a $50 million financing threshold is met44629 - The RaniPill capsule offers high bioavailability, a protective pH-sensitive coating, drug protection from GI fluids, delivery in both fed and fasted states, a self-inflating balloon for reliable delivery, and a drug-agnostic design122124 - Product candidates are classified as combination products, with CDER expected to be the lead center for most, and a 505(b)(2) pathway deemed suitable for RT-102 development in the U.S.144145147149 - The company maintains an extensive global patent portfolio covering device aspects, specific biologics, and delivery methods, with patent terms extending into the 2030s and 2040s177178179180181182 Item 1A. Risk Factors The company faces significant risks including going concern doubts, funding needs, uncertain clinical development, intense competition, and intellectual property challenges, which could adversely impact its business and financial condition - There is substantial doubt regarding the company's ability to continue as a going concern, necessitating additional funding that may not be available on acceptable terms17241244641 - The company has incurred significant operating losses since inception (net loss of $56.6 million in 2024) and expects to continue incurring losses, with no commercial product revenue to date19250251254641 - Clinical development is a lengthy, expensive, and uncertain process, with results from earlier studies not always predictive of future trial outcomes, and novel technologies like the RaniPill capsule have limited FDA experience, making regulatory approval unpredictable19265268274312 - The company faces significant competition from major pharmaceutical and biotherapeutics companies, including manufacturers of existing injectables, other oral biologics, and device-based technologies19171172173334339 - Dependence on third-party suppliers for key materials and APIs, and Contract Research Organizations (CROs) for clinical trials, poses risks if these parties fail to meet contractual duties or regulatory requirements19353359360 - Commercial success relies on building and maintaining a strong intellectual property portfolio, but risks include insufficient patent coverage, challenges to patent validity, and potential infringement by competitors20177454457459496 - The company's holding company structure depends on distributions from Rani LLC, and its multi-class common stock structure concentrates voting control, limiting other stockholders' influence20511531 Item 1B. Unresolved Staff Comments This section states that the company has no unresolved comments from the SEC staff regarding its financial reports - There are no unresolved staff comments578 Item 1C. Cybersecurity This section details the company's cybersecurity risk management and strategy, including processes for identifying, assessing, and managing threats to its information systems and data - The company implements and maintains information security processes to identify, assess, and manage material risks from cybersecurity threats to its critical computer networks, hosted services, and data579580 - Mitigation measures include incident detection and response, disaster recovery, encryption, network security, access controls, monitoring, physical security, employee training, and cybersecurity insurance581 - The board of directors oversees cybersecurity risk management, with the CFO leading the information security team and integrating cybersecurity risk into the overall risk management strategy586587588 - Third-party service providers are utilized for threat intelligence and various business functions, with a vendor management program in place to manage associated cybersecurity risks583584 Item 2. Properties This section describes the company's corporate headquarters in San Jose, California, and its leased facilities, detailing square footage and lease terms for various spaces - Corporate headquarters are located in San Jose, California589 - Leases approximately 57,000 square feet of space, including 33,000 sq ft in Fremont, California (63-month term from Feb 2024) and 24,000 sq ft in San Jose, California (annual renewal, leased from related party ICL)589630631775 Item 3. Legal Proceedings This section states that the company is not currently involved in any litigation or legal proceedings that management believes would have a material adverse effect on its business - The company is not currently a party to any litigation or legal proceedings that are likely to have a material adverse effect on its business590793 Item 4. Mine Safety Disclosures This section states that the disclosure requirements for mine safety are not applicable to the company - This item is not applicable591 PART II Item 5. Market for Registrant's Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities This section provides information on the trading market for the company's Class A common stock on Nasdaq, its dividend policy, and the number of stockholders, noting no anticipated cash dividends - The company's Class A common stock is traded on the Nasdaq Stock Market LLC under the symbol "RANI"3593 - The company has never declared or paid cash dividends on its common stock and does not anticipate paying cash dividends in the foreseeable future, intending to retain all future earnings for business operations and expansion548593 - As of March 26, 2025, there were 122 holders of record of Class A common stock and 16 holders of record of Class B common stock4594 Item 6. [Reserved] This item is reserved and contains no information - This item is reserved596 Item 7. Management's Discussion and Analysis of Financial Condition and Results of Operations This section analyzes Rani Therapeutics' financial performance, liquidity, and capital resources for 2024, highlighting a $56.6 million net loss, negative operating cash flows, and substantial doubt about its going concern ability, despite $18.3 million in equity financing and strategic operational changes - The company incurred a net loss of $56.6 million for the year ended December 31, 2024, and had negative cash flows from operations of $35.5 million, leading to substantial doubt about its ability to continue as a going concern641653654689700 Cash, Cash Equivalents, and Marketable Securities (in thousands) | Metric | Dec 31, 2024 | Dec 31, 2023 | | :--------------------------------------- | :----------- | :----------- | | Cash and cash equivalents | $3,762 | $5,864 | | Marketable securities | $23,877 | $42,675 | | Total | $27,639 | $48,539 | - In 2024, the company raised $9.4 million net proceeds from the October Offering and $8.9 million net proceeds from the July Offering, totaling $18.3 million in equity financing604605642643 - The company entered into a Collaboration Agreement with ProGen Co., Ltd. in June 2024 for the worldwide development and commercialization of RT-114, a GLP-1/GLP-2 dual agonist, with equal sharing of development costs and operating profits/losses607608761762 - Preclinical data for RT-114 (GLP-1/GLP-2 dual agonist) demonstrated 111% relative bioavailability compared to subcutaneous administration, with comparable pharmacokinetic profiles and weight loss609622 - Preclinical data for RT-116 (semaglutide via RaniPill HC) showed 107% relative bioavailability compared to subcutaneous administration, with comparable pharmacokinetics and weight loss613625 - A workforce reduction was substantially completed by the end of the second quarter of 2024 as part of a strategic prioritization plan628 - The CEO's annual salary was reduced from $520,000 to $100,000, effective November 1, 2023, and extended through December 31, 2025629 Consolidated Results of Operations (Year Ended December 31, in thousands) | Item | 2024 | 2023 | Change (%) | | :--------------------------------- | :----- | :----- | :--------- | | Contract revenue | $1,028 | $0 | * | | Research and development | $26,682 | $39,624 | (32.7)% | | General and administrative | $23,946 | $26,475 | (9.6)% | | Impairment loss | $3,714 | $0 | * | | Total operating expenses | $54,342 | $66,099 | (17.8)% | | Loss from operations | $(53,314) | $(66,099) | (19.3)% | | Interest income and other, net | $1,763 | $3,301 | (46.6)% | | Interest expense and other, net | $(5,033) | $(5,085) | (1.0)% | | Net loss | $(56,584) | $(67,883) | (16.6)% | | Net loss attributable to Rani Holdings, Inc. | $(30,018) | $(33,970) | (11.6)% | Contractual Obligations and Commitments (as of December 31, 2024, in thousands) | Obligation | Total | Short-term | Long-term | | :-------------------- | :------ | :--------- | :-------- | | Operating leases | $5,096 | $1,459 | $3,637 | | Debt obligations | $26,263 | $15,000 | $11,263 | | Total | $31,359 | $16,459 | $14,900 | Item 7A. Quantitative and Qualitative Disclosures about Market Risk As a smaller reporting company, Rani Therapeutics Holdings, Inc. is not required to provide quantitative and qualitative disclosures about market risk - The company is a smaller reporting company and is not required to provide quantitative and qualitative disclosures about market risk669 Item 8. Financial Statements and Supplementary Data This section presents the complete audited consolidated financial statements for Rani Therapeutics Holdings, Inc. for 2024 and 2023, including balance sheets, statements of operations, comprehensive loss, changes in stockholders' equity, cash flows, and detailed notes - Independent registered public accounting firms issued unqualified opinions on the financial statements but included explanatory paragraphs regarding substantial doubt about the company's ability to continue as a going concern673674680681 Consolidated Balance Sheets (as of December 31, in thousands) | Asset/Liability/Equity | 2024 | 2023 | | :------------------------------------------------ | :----- | :----- | | Cash and cash equivalents | $3,762 | $5,864 | | Marketable securities | $23,877 | $42,675 | | Total current assets | $29,744 | $50,847 | | Property and equipment, net | $1,548 | $6,105 | | Total assets | $36,634 | $57,916 | | Total current liabilities | $19,891 | $7,989 | | Long-term debt, less current portion | $9,613 | $24,484 | | Total liabilities | $33,141 | $32,473 | | Total stockholders' equity | $3,493 | $25,443 | Consolidated Statements of Operations (Year Ended December 31, in thousands) | Item | 2024 | 2023 | | :------------------------------------------------ | :----- | :----- | | Contract revenue | $1,028 | $0 | | Research and development expenses | $26,682 | $39,624 | | General and administrative expenses | $23,946 | $26,475 | | Impairment loss | $3,714 | $0 | | Net loss | $(56,584) | $(67,883) | | Net loss attributable to Rani Holdings, Inc. | $(30,018) | $(33,970) | | Net loss per Class A common share, basic and diluted | $(1.05) | $(1.33) | Consolidated Statements of Cash Flows (Year Ended December 31, in thousands) | Activity | 2024 | 2023 | | :-------------------------------- | :------- | :------- | | Net cash used in operating activities | $(35,496) | $(51,236) | | Net cash provided by investing activities | $19,809 | $29,860 | | Net cash provided by financing activities | $13,585 | $233 | | Net decrease in cash, cash equivalents and restricted cash equivalents | $(2,102) | $(21,143) | - An impairment loss of $3.7 million was recognized in 2024 related to construction-in-progress property and equipment, as its carrying amount exceeded its fair value639742 Tax Attribute Carryforwards (as of December 31, 2024, in thousands) | Attribute | Amount | Expiration Years | | :------------------------------------ | :----- | :--------------- | | Net operating losses, federal (post 2017) | $61,725 | Indefinite | | Net operating loss, state (definite) | $91,958 | 2041 - 2044 | | Research and development tax credits, federal | $2,608 | 2041 - 2044 | | Research and development tax credits, state | $1,806 | Indefinite | Item 9. Changes in and Disagreements with Accountants on Accounting and Financial Disclosure This section confirms that there have been no changes in or disagreements with the company's independent registered public accounting firm on accounting or financial disclosure matters - There have been no changes in or disagreements with accountants on accounting and financial disclosure808 Item 9A. Controls and Procedures Management concluded that the company's disclosure controls and procedures and internal control over financial reporting were effective at a reasonable assurance level as of December 31, 2024, acknowledging inherent limitations of control systems - Disclosure controls and procedures were evaluated and deemed effective at a reasonable assurance level as of December 31, 2024809 - Management concluded that internal control over financial reporting was effective as of December 31, 2024810 - The report highlights that internal control systems, due to inherent limitations, can only provide reasonable assurance and may not prevent or detect all misstatements811814 Item 9B. Other Information This section states that there is no other information to report under this item - No other information is reported under this item815 Item 9C. Disclosure Regarding Foreign Jurisdictions that Prevent Inspections This section states that the disclosure requirements regarding foreign jurisdictions that prevent inspections are not applicable to the company - This item is not applicable816 PART III Item 10. Directors, Executive Officers and Corporate Governance This section incorporates information regarding the company's directors, executive officers, and corporate governance from its definitive Proxy Statement for the 2025 Annual Meeting of Stockholders, including the adoption of a code of business conduct and ethics - Information required by this item is incorporated by reference from the definitive Proxy Statement for the 2025 Annual Meeting of Stockholders818 - The company has adopted a written code of business conduct and ethics applicable to its directors, officers, and employees819 Item 11. Executive Compensation This section incorporates information regarding executive compensation from the company's definitive Proxy Statement for the 2025 Annual Meeting of Stockholders - Information required by this item is incorporated by reference from the definitive Proxy Statement820 Item 12. Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters This section incorporates information regarding security ownership of certain beneficial owners and management, and related stockholder matters, from the company's definitive Proxy Statement for the 2025 Annual Meeting of Stockholders - Information required by this item is incorporated by reference from the definitive Proxy Statement821 Item 13. Certain Relationships and Related Transactions, and Director Independence This section incorporates information regarding certain relationships and related transactions, and director independence, from the company's definitive Proxy Statement for the 2025 Annual Meeting of Stockholders - Information required by this item is incorporated by reference from the definitive Proxy Statement822 Item 14. Principal Accountant Fees and Services This section incorporates information regarding principal accountant fees and services from the company's definitive Proxy Statement for the 2025 Annual Meeting of Stockholders - Information required by this item is incorporated by reference from the definitive Proxy Statement823 Item 15. Exhibit and Financial Statement Schedules This section lists all exhibits and financial statement schedules filed or furnished as part of the 10-K report - This section lists all exhibits and financial statement schedules filed or furnished as part of the 10-K report824826 - Exhibits include financial statements, organizational documents (Certificate of Incorporation, Bylaws), warrant forms, various agreements (e.g., Tax Receivable Agreement, License and Supply Agreements), and certifications826827832 - Certifications of the Principal Executive Officer and Principal Financial Officer are included pursuant to the Sarbanes-Oxley Act of 2002829832 Item 16. Form 10-K Summary This section states that no Form 10-K Summary is provided - No Form 10-K Summary is provided831 Signatures This section confirms the Annual Report on Form 10-K is duly signed by the registrant's authorized officers and directors - The Annual Report on Form 10-K is duly signed by the registrant's authorized officers and directors834837 - Signatories include the Chief Executive Officer (Talat Imran), Chief Financial Officer (Svai Sanford), Chairman of the Board (Mir Imran), and other directors836838 - The report was signed on March 31, 2025838