Silence Therapeutics PLC(SLN) - 2025 Q1 - Quarterly Report

PART I – FINANCIAL INFORMATION Financial Statements Silence Therapeutics reported Q1 2025 revenue of $0.1 million, a net loss of $28.5 million, and cash and equivalents of $64.9 million Condensed Consolidated Statements of Operations (in thousands) | | Three months ended March 31, 2025 | Three months ended March 31, 2024 | | :--- | :--- | :--- | | Revenue | $142 | $15,699 | | Gross profit | $88 | $12,899 | | Research and development costs | $(20,813) | $(11,845) | | General and administrative expenses | $(7,684) | $(6,635) | | Operating loss | $(28,409) | $(5,581) | | Net Loss | $(28,530) | $(2,312) | | Loss per share (basic and diluted) | $(0.20) | $(0.02) | Condensed Consolidated Balance Sheet Highlights (in thousands) | | March 31, 2025 | December 31, 2024 | | :--- | :--- | :--- | | Cash and cash equivalents | $64,886 | $121,330 | | Short-term investments | $71,648 | $26,004 | | Total current assets | $169,790 | $187,366 | | Total assets | $185,298 | $202,635 | | Total liabilities | $(72,555) | $(68,612) | | Total shareholders' equity | $112,743 | $134,023 | Condensed Consolidated Statements of Cash Flows Highlights (in thousands) | | Three months ended March 31, 2025 | Three months ended March 31, 2024 | | :--- | :--- | :--- | | Net cash used in operating activities | $(12,309) | $(9,143) | | Net cash used in investing activities | $(44,381) | $(49,908) | | Net cash provided by financing activities | $14 | $133,020 | - The company believes its current cash, cash equivalents, and short-term investments of $136.5 million are sufficient to fund operating expenses for at least the next twelve months from the financial statement issuance date[34][35] Management's Discussion and Analysis of Financial Condition and Results of Operations Management discusses the company's siRNA therapeutic pipeline, Q1 2025 financial performance, and liquidity, including a $120 million private placement Overview and Business Developments Silence Therapeutics develops siRNA therapeutics via its mRNAi GOLD™ platform, advancing Divesiran (PV) and Zerlasiran (Lp(a)) in clinical trials - Divesiran (SLN124) for polycythemia vera (PV) is currently in the Phase 2 portion of the SANRECO clinical trial, with enrollment expected to complete by year-end 2025[68][75] - Zerlasiran (SLN360) for high Lp(a) has received positive regulatory feedback on its Phase 3 study design, and the company is actively engaged in global partnership discussions for its development and commercialization[69][70] - A Phase 1 study of SLN312, licensed to AstraZeneca, is ongoing[75] Collaborations AstraZeneca collaboration continues with a $10 million milestone, while Mallinckrodt and Hansoh collaborations concluded, returning rights to Silence - AstraZeneca collaboration: A Phase 1 trial for an undisclosed program triggered a $10 million milestone payment in February 2024, with the collaboration allowing for up to 10 targets in total[74] - Mallinckrodt collaboration: Concluded in March 2024 as Mallinckrodt will not pursue further development of SLN501, with Silence having previously reacquired rights to two other preclinical complement targets[78][81] - Hansoh collaboration: Concluded in December 2024 after Hansoh decided not to pursue further development, with Silence retaining exclusive global rights for all three targets from the collaboration[79][84] Results of Operations Q1 2025 revenue decreased to $0.1 million due to fewer milestones, while R&D costs increased by $9.0 million, leading to a $28.4 million operating loss Comparison of Operations (in thousands) | | Three months ended March 31, 2025 | Three months ended March 31, 2024 | Change | | :--- | :--- | :--- | :--- | | Revenue | $142 | $15,699 | $(15,557) | | Research and development costs | $(20,813) | $(11,845) | $(8,968) | | General and administrative expenses | $(7,684) | $(6,635) | $(1,049) | | Operating loss | $(28,409) | $(5,581) | $(22,828) | - The $15.6 million decrease in revenue was mainly due to a $14.5 million reduction in revenue from the AstraZeneca collaboration, as no similar milestones were achieved in Q1 2025 compared to Q1 2024[105] - R&D costs increased by $9.0 million, largely due to the advancement of clinical trials and an increase in contract manufacturing activities for proprietary programs[108] Liquidity and Capital Resources As of March 31, 2025, the company held $136.5 million in cash and investments, projected to fund operations into 2028, bolstered by a $120 million private placement - The company had cash, cash equivalents, and short-term investments of $136.5 million as of March 31, 2025[115] - In February 2024, the company raised gross proceeds of approximately $120.0 million from a private placement of ADSs[118][124] - Management believes existing capital resources will fund operations into 2028, which includes receipt of anticipated milestones from collaboration agreements of $20 million in the next three years[115] Quantitative and Qualitative Disclosures about Market Risk The company manages market risks including credit, liquidity, currency, and interest rate fluctuations through conservative financial practices - The company's primary market risks are credit, liquidity, currency (USD, GBP, EUR), and interest rate risk[143] - Currency risk is managed by maintaining cash balances in different currencies to meet foreseeable expenses and considering forward exchange contracts for significant receipts[145] - Interest rate risk is not expected to significantly affect operating results or cash flows due to the conservative nature of the investment portfolio[146] Controls and Procedures Management concluded that disclosure controls and procedures were effective as of March 31, 2025, with no material changes to internal controls - The Chief Executive Officer and Chief Financial Officer concluded that the company's disclosure controls and procedures were effective as of March 31, 2025[149] - No material changes to internal control over financial reporting occurred during the three months ended March 31, 2025[150] PART II – OTHER INFORMATION Legal Proceedings The company is not currently a party to any material legal proceedings - As of the report date, the company is not party to any material legal proceedings[153] Risk Factors The company faces evolving risks from stringent U.S. and foreign data privacy laws, including GDPR, cross-border data transfers, and regulations on generative AI - The company is subject to stringent data privacy laws like the EU/U.K. GDPR, which carry potential fines of up to 4% of annual global revenue for non-compliance[155][158] - Transferring personal data from Europe to the U.S. is significantly restricted and subject to legal challenges, which could interrupt operations or require relocating data processing activities at significant expense[159][160] - The use of generative AI by employees is subject to evolving privacy laws and regulations, which could result in additional compliance costs or competitive disadvantages if its use is restricted[163] - A new U.S. Department of Justice rule restricts certain data transactions involving countries of concern (e.g., China, Russia), which may impact vendor engagements, data sharing, and investor agreements[161] Unregistered Sales of Equity Securities and Use of Proceeds There were no unregistered sales of equity securities during the period - None[169] Other Information There is no other information to report for the period - None[172] Exhibits This section lists exhibits filed with the Form 10-Q, including CEO and CFO certifications and Inline XBRL documents - Exhibits filed include CEO and CFO certifications pursuant to Sarbanes-Oxley Act Sections 302 and 906[174]