Financial Performance - The company has not generated any revenue from product sales since its inception in February 2022, incurring significant operating losses and negative cash flows [159]. - As of March 31, 2025, the company reported net losses of $24.1 million and an accumulated deficit of $147.8 million [160]. - The net loss for the three months ended March 31, 2025, was $24.1 million, compared to a net loss of $22.7 million in 2024, indicating an increase in loss of $1.4 million [186]. - The company expects to incur significant operating losses and expenses as it advances clinical development, projecting a $2.6 million increase in workforce expenses due to headcount growth [192]. Funding and Capital - The company completed its initial public offering in June 2024, raising net proceeds of $157.6 million from the sale of 9,200,000 shares of common stock [159]. - The company has raised aggregate gross proceeds of $424.4 million from various financings as of March 31, 2025 [159]. - The company raised aggregate gross proceeds of $424.4 million from the issuance of convertible promissory notes and the sale of convertible preferred stock and common stock [193]. - The company anticipates needing to raise substantial additional capital in the future to support ongoing activities and product development [201]. - The company expects its existing cash resources to be sufficient to fund operations through at least 12 months from the issuance of the financial statements [200]. Research and Development - The company is conducting a Phase 2a proof-of-concept trial for RAP-219 in patients with refractory focal epilepsy, with topline results expected in Q3 2025 [157]. - The FDA placed a clinical hold on the IND for a Phase 2a trial of RAP-219 for diabetic peripheral neuropathic pain, requesting additional information [157]. - The company has two advanced discovery-stage nicotinic acetylcholine receptor programs targeting chronic pain and hearing disorders [158]. - Research and development expenses increased to $19.6 million for the three months ended March 31, 2025, compared to $12.5 million for the same period in 2024, representing a $7.1 million increase [186]. - The increase in research and development expenses was primarily driven by a $4.1 million rise in costs associated with the RAP-219 program, including clinical trial costs for multiple trials [187]. - The company anticipates substantial increases in research and development expenses as it advances RAP-219 through clinical development and regulatory approval [176]. Operating Expenses - Total operating expenses for the three months ended March 31, 2025, were $27.1 million, compared to $17.1 million in 2024, resulting in a $10.0 million increase [186]. - General and administrative expenses rose to $7.5 million for the three months ended March 31, 2025, up from $4.6 million in 2024, reflecting a $2.9 million increase [190]. - The company expects general and administrative expenses to continue increasing to support product candidate development and research activities [180]. Cash Flow and Investments - As of March 31, 2025, the company had cash and cash equivalents of $285.4 million, excluding restricted cash [193]. - For the three months ended March 31, 2025, the company incurred a net loss of $24.1 million, with cash used in operating activities amounting to $20.2 million [195]. - Net cash provided by investing activities for the three months ended March 31, 2025, was $21.0 million, primarily from maturities of short-term investments [197]. - During the three months ended March 31, 2024, the company had a net cash provided by financing activities of $63.7 million, primarily from the issuance of Series B convertible preferred stock [199]. Agreements and Collaborations - The company has entered into a license agreement with Janssen Pharmaceutical NV, which includes potential milestone payments totaling up to $141 million for TARPg8 products [167][168]. - The company made a non-refundable payment of $1.0 million to Janssen Pharmaceutical NV as part of a licensing agreement, with potential milestone payments totaling up to $76.0 million for development [205]. - The NeuroPace Agreement allows the company to utilize data from RNS systems in clinical trials, with an exclusivity provision preventing NeuroPace from providing similar services to competitors [170][171]. Other Financial Information - The company has recorded a full valuation allowance against its net deferred tax assets, with federal net operating loss carryforwards of approximately $13.7 million as of December 31, 2024 [185]. - The change in fair value of preferred stock tranche right liabilities was settled in March 2024, resulting in no further recognition of changes in fair value in the financial statements [183]. - Future minimum operating lease payments under non-cancelable leases total $9.3 million, with a weighted average remaining lease term of 4.4 years [203][204].
Rapport Therapeutics, Inc.(RAPP) - 2025 Q1 - Quarterly Report