Compass Therapeutics(CMPX) - 2025 Q1 - Quarterly Report

PART I. FINANCIAL INFORMATION Financial Statements (Unaudited) Unaudited Q1 2025 financials show a net loss of $16.6 million, up from $10.8 million in Q1 2024, and decreased total assets Condensed Consolidated Balance Sheets (Unaudited) Total assets decreased to $131.5 million by March 31, 2025, from $140.4 million, due to reduced cash and securities Condensed Consolidated Balance Sheet Highlights (in thousands) | Account | March 31, 2025 (unaudited) | December 31, 2024 | | :--- | :--- | :--- | | Cash and cash equivalents | $41,048 | $43,483 | | Marketable securities | $71,587 | $83,239 | | Total Assets | $131,451 | $140,403 | | Accrued expenses | $13,214 | $6,287 | | Total Liabilities | $21,172 | $15,170 | | Total Stockholders' Equity | $110,279 | $125,233 | Condensed Consolidated Statements of Operations and Comprehensive Loss (Unaudited) Q1 2025 net loss increased to $16.6 million from $10.8 million in Q1 2024, due to higher operating expenses Statement of Operations Summary (in thousands, except per share data) | Metric | Three Months Ended March 31, 2025 | Three Months Ended March 31, 2024 | | :--- | :--- | :--- | | Research and development | $13,054 | $9,522 | | General and administrative | $4,912 | $3,248 | | Total operating expenses | $17,966 | $12,770 | | Loss from operations | ($17,966) | ($12,770) | | Other income | $1,333 | $1,983 | | Net loss | ($16,633) | ($10,787) | | Net loss per share | ($0.12) | ($0.08) | Condensed Consolidated Statements of Stockholders' Equity (Unaudited) Stockholders' equity decreased to $110.3 million from $125.2 million, primarily due to the $16.6 million net loss - The primary drivers for the change in stockholders' equity during the first quarter of 2025 were the net loss of $16.6 million and stock-based compensation of $2.5 million[16] Condensed Consolidated Statements of Cash Flows (Unaudited) Q1 2025 saw $13.2 million cash used in operations, $11.6 million from investing, leading to a $2.4 million net cash decrease Summary of Cash Flows (in thousands) | Activity | Three Months Ended March 31, 2025 | Three Months Ended March 31, 2024 | | :--- | :--- | :--- | | Net cash used in operating activities | ($13,208) | ($13,888) | | Net cash provided by (used in) investing activities | $11,588 | ($4,099) | | Net cash (used in) provided by financing activities | ($815) | $17,433 | | Net change in cash and cash equivalents | ($2,435) | ($554) | Notes to Unaudited Condensed Consolidated Financial Statements Notes detail the company's oncology focus, cash runway into Q1 2027, collaboration agreements, and stock compensation - The company is a clinical-stage, oncology-focused biopharmaceutical company developing antibody-based therapeutics, focusing on the relationship between angiogenesis and the immune system[21] - As of March 31, 2025, the company had $113 million in cash, cash equivalents, and marketable securities, which is expected to fund operations and capital expenditures into the first quarter of 2027[25] - Accrued project expenses increased significantly to $11.4 million as of March 31, 2025, from $2.9 million at year-end 2024, primarily due to $10.4 million in accrued manufacturing expenses for tovecimig[35] - Under the ABL Bio agreement for tovecimig, Compass may be required to pay up to $96 million in development/regulatory milestones and $303 million in commercial milestones for oncology indications[51] - As of March 31, 2025, the company has $27.6 million in remaining unrecognized stock-based compensation cost to be recognized in future periods[43] Management's Discussion and Analysis of Financial Condition and Results of Operations Management discusses pipeline, tovecimig's Phase 2/3 success, Q1 2025 net loss of $16.6 million, and funding into Q1 2027 - The company's pipeline includes three clinical candidates (tovecimig, CTX-471, CTX-8371) and one in IND-enabling studies (CTX-10726)[57] - On April 1, 2025, the company announced that its lead candidate, tovecimig, met the primary endpoint in a Phase 2/3 study for biliary tract cancer (BTC), showing a statistically significant improvement in Overall Response Rate (ORR) of 17.1% versus 5.3% for paclitaxel alone (p=0.031)[58] - The company expects to report secondary endpoints for the tovecimig study, including PFS, OS, and DoR, in the fourth quarter of 2025[59] - With $113 million in cash, cash equivalents, and marketable securities as of March 31, 2025, the company expects to fund operations into the first quarter of 2027[63][87] Results of Operations Q1 2025 operating expenses increased by $5.2 million to $18.0 million, driven by higher R&D and G&A costs Comparison of Operations (in thousands) | Metric | Three Months Ended March 31, 2025 | Three Months Ended March 31, 2024 | Change | | :--- | :--- | :--- | :--- | | Research and development | $13,054 | $9,522 | $3,532 | | General and administrative | $4,912 | $3,248 | $1,664 | | Total operating expenses | $17,966 | $12,770 | $5,196 | | Net loss | ($16,633) | ($10,787) | ($5,846) | - The $3.5 million increase in R&D expenses was primarily due to $2.0 million more in manufacturing expenses for tovecimig and $1.3 million for the new CTX-10726 program[75] R&D Expenses by Program (in thousands) | Program | Three Months Ended March 31, 2025 | Three Months Ended March 31, 2024 | | :--- | :--- | :--- | | Tovecimig | $6,934 | $5,681 | | CTX-471 | $1,905 | $1,144 | | CTX-8371 | $940 | $985 | | CTX-10726 | $1,278 | $— | | Unallocated R&D | $1,997 | $1,712 | | Total R&D Expenses | $13,054 | $9,522 | - General and administrative expenses increased by $1.7 million (51%), mainly from $1.0 million more in stock compensation expense and higher bonus expense[77] Liquidity and Capital Resources As of March 31, 2025, the company had $113 million in cash, with Q1 2025 operations using $13.2 million, funding into Q1 2027 - The company has funded operations primarily through the sale of equity securities, receiving $430 million in gross proceeds through March 31, 2025[80] Cash Flow Summary (in thousands) | Activity | Three Months Ended March 31, 2025 | Three Months Ended March 31, 2024 | | :--- | :--- | :--- | | Cash used in operating activities | ($13,208) | ($13,888) | | Cash provided by (used in) investing activities | $11,588 | ($4,099) | | Cash (used in) provided by financing activities | ($815) | $17,433 | - Future funding requirements are substantial and depend on factors like clinical trial progress, regulatory approvals, and commercialization costs. The company may need to raise additional funds, which could lead to dilution or restrictive covenants[86][88] Quantitative and Qualitative Disclosures About Market Risk This section is not applicable as the company qualifies as a smaller reporting company - The company is a smaller reporting company and is not required to provide the information under this item[90] Controls and Procedures Management concluded disclosure controls and procedures were effective as of March 31, 2025, with no material changes to internal controls - The Principal Executive Officer and Principal Financial Officer concluded that the company's disclosure controls and procedures were effective as of March 31, 2025[91] - No changes occurred in the internal control over financial reporting during the quarter ended March 31, 2025, that materially affected, or are reasonably likely to materially affect, these controls[92] PART II. OTHER INFORMATION Legal Proceedings As of the filing date, the company is not involved in any material legal proceedings - The company is not currently involved in any material legal proceedings[95] Risk Factors No material changes to risk factors, except for a new risk concerning potential adverse impact of U.S. tariff programs - A new risk factor has been added regarding recently announced U.S. tariff programs, which could lead to trade tensions and have a material adverse effect on global economic conditions and the company's operations[96][97] Unregistered Sales of Equity Securities and Use of Proceeds The company reported no unregistered sales of equity securities during the period - None[99] Defaults Upon Senior Securities The company reported no defaults upon senior securities - None[100] Mine Safety Disclosures This item is not applicable to the company - Not applicable[101] Other Information No directors or officers adopted, terminated, or modified Rule 10b5-1 trading arrangements during Q1 2025 - No directors or officers adopted, terminated, or modified a Rule 10b5-1 trading arrangement during the three-month period ended March 31, 2025[102] Exhibits This section lists exhibits filed with Form 10-Q, including corporate documents and officer certifications