Lyell(US:LYEL)2025-05-13 20:41PART I—FINANCIAL INFORMATION Item 1. Financial Statements (unaudited) This section presents the unaudited condensed consolidated financial statements for the quarter ended March 31, 2025, including balance sheets, statements of operations, and cash flows Condensed Consolidated Balance Sheets As of March 31, 2025, total assets decreased to $429.8 million from $490.9 million, primarily due to a reduction in marketable securities | | March 31, 2025 (in thousands) | December 31, 2024 (in thousands) | | :--- | :--- | :--- | | Total Current Assets | $309,178 | $379,594 | | Total Assets | $429,798 | $490,859 | | Total Current Liabilities | $41,285 | $53,788 | | Total Liabilities | $93,277 | $108,035 | | Total Stockholders' Equity | $336,521 | $382,824 | Condensed Consolidated Statements of Operations and Comprehensive Loss For Q1 2025, the company reported a net loss of $52.2 million, an improvement from $60.7 million in Q1 2024, mainly due to a non-recurring impairment in the prior year | | Three Months Ended March 31, 2025 (in thousands) | Three Months Ended March 31, 2024 (in thousands) | | :--- | :--- | :--- | | Revenue | $7 | $3 | | Research and development | $43,447 | $43,174 | | General and administrative | $14,046 | $13,494 | | Loss from operations | ($57,367) | ($55,575) | | Net loss | ($52,195) | ($60,667) | | Net loss per common share, basic and diluted | ($0.18) | ($0.24) | Condensed Consolidated Statements of Stockholders' Equity Total stockholders' equity decreased from $382.8 million to $336.5 million as of March 31, 2025, primarily driven by the net loss for the quarter - The primary driver for the decrease in stockholders' equity during the first quarter of 2025 was the net loss of $52.2 million26 Condensed Consolidated Statements of Cash Flows Net cash used in operating activities increased to $54.7 million in Q1 2025, while net cash provided by investing activities was $69.5 million, leading to a $14.7 million increase in total cash | Cash Flow Activity (in thousands) | Three Months Ended March 31, 2025 | Three Months Ended March 31, 2024 | | :--- | :--- | :--- | | Net cash used in operating activities | $(54,738) | $(42,016) | | Net cash provided by investing activities | $69,466 | $21,994 | | Net cash provided by financing activities | $1 | $27 | | Net increase (decrease) in cash, cash equivalents and restricted cash | $14,729 | $(19,995) | Notes to Unaudited Condensed Consolidated Financial Statements The notes detail accounting policies, the ImmPACT Bio acquisition, collaboration agreements, and an ATM equity offering, confirming sufficient liquidity for the next 12 months - The company believes its available cash, cash equivalents, and marketable securities as of March 31, 2025, will be adequate to fund operations for at least the next 12 months35 - Following the acquisition of ImmPACT Bio, a contingent consideration payable of $6.4 million was recorded related to potential future equity issuance upon achieving clinical or regulatory milestones43 - The company has success payment agreements with Fred Hutch and Stanford, with potential aggregate payments of up to $200.0 million each, contingent on the company's stock price reaching certain thresholds484953 - In February 2024, the company entered into an at-the-market (ATM) sales agreement to offer and sell up to $150.0 million of its common stock, with no sales made to date75 Management's Discussion and Analysis of Financial Condition and Results of Operations This section provides an overview of the company's clinical-stage cell therapy business, financial performance, and liquidity, highlighting the lead program LYL314 and manufacturing strategy Overview Lyell is a clinical-stage cell therapy company focused on its lead CAR T-cell product candidate, LYL314, for B-cell lymphomas, with a pivotal trial planned for mid-2025 - The company's lead program is LYL314, a dual-targeting CD19/CD20 CAR T-cell product candidate for B-cell lymphomas, acquired from ImmPACT Bio99107 - A pivotal trial for LYL314 in 3rd-line+ large B-cell lymphoma is expected to start in mid-2025, with a second pivotal trial in the 2nd-line setting planned by early 2026102139 | Best Overall Response (N=17) | Result | | :--- | :--- | | Overall Responses, n (%) | 16 (94%) | | Complete Responses, n (%) | 12 (71%) | | Partial Responses, n (%) | 4 (24%) | | Stable Disease, n (%) | 1 (6%) | - Manufacturing for LYL314 has been transferred to the company's LyFE Manufacturing Center in Bothell, Washington, and the acquired West Hills facility was closed, resulting in a workforce reduction of approximately 73 employees139144 Results of Operations Q1 2025 R&D expenses slightly increased to $43.4 million, while G&A expenses rose to $14.0 million, and net loss decreased to $52.2 million due to a non-recurring impairment in Q1 2024 | Expense (in thousands) | Q1 2025 | Q1 2024 | Change | | :--- | :--- | :--- | :--- | | Research and development | $43,447 | $43,174 | $273 | | General and administrative | $14,046 | $13,494 | $552 | - The slight increase in R&D expenses was primarily due to a $3.1 million increase in personnel-related expenses, mainly from severance costs related to the closure of the West Hills manufacturing facility161 - The decrease in net loss was largely due to a non-recurring $13.0 million impairment of other investments in Q1 2024160168 Liquidity and Capital Resources As of March 31, 2025, the company held $330.1 million in cash and marketable securities, deemed sufficient for at least the next 12 months, with an ATM program for future funding - As of March 31, 2025, the company had $330.1 million in cash, cash equivalents, and marketable securities169 - Management believes existing cash, cash equivalents, and marketable securities will be sufficient to meet working capital and capital expenditure needs for at least the next 12 months171 - An at-the-market (ATM) sales agreement is in place for up to $150.0 million, with no sales made to date170 | Cash Flow Activity (in thousands) | Three Months Ended March 31, 2025 | Three Months Ended March 31, 2024 | | :--- | :--- | :--- | | Operating activities | $(54,738) | $(42,016) | | Investing activities | $69,466 | $21,994 | | Financing activities | $1 | $27 | Quantitative and Qualitative Disclosures About Market Risk The company's primary market risk is interest rate sensitivity on short-term cash and marketable securities, which is not considered significant, and foreign currency risk is minimal - The primary market risk is interest rate sensitivity on cash and marketable securities, which is not considered significant due to their short-term nature183 - Foreign currency exchange risk is not significant as operations are U.S.-based and expenses are in USD184 Controls and Procedures Management concluded that disclosure controls and procedures were effective as of March 31, 2025, with no material changes to internal control over financial reporting during the quarter - Management concluded that disclosure controls and procedures were effective as of March 31, 2025186 - No material changes to internal control over financial reporting occurred during the quarter ended March 31, 2025187 PART II—OTHER INFORMATION Legal Proceedings The company is not currently involved in any material legal proceedings and is unaware of any contemplated actions - The company is not currently party to any material legal proceedings189 Risk Factors This section outlines significant risks including financial condition, limited operating history, reliance on unproven product candidates, manufacturing complexities, competition, regulatory hurdles, and intellectual property protection - The company is a clinical-stage entity with a history of substantial losses and anticipates incurring substantial and increasing net losses for the foreseeable future193 - The company will require substantial additional capital to achieve its goals, and failure to obtain it could force delays or termination of product development200 - The company's product candidates are based on novel, unproven technologies, making development time, cost, and regulatory approval difficult to predict214 - The company faces risks in manufacturing complex cell therapies, including challenges with the recent transfer of LYL314 manufacturing to its LyFE facility and the closure of its Los Angeles facility243247 - The company received a Nasdaq notification for non-compliance with the $1.00 minimum bid price requirement and may be delisted if compliance is not regained, with a reverse stock split being considered403 Unregistered Sales of Equity Securities and Use of Proceeds The company reports no unregistered sales of equity securities during the period - None428 Defaults Upon Senior Securities Not applicable - Not applicable429 Mine Safety Disclosures Not applicable - Not applicable430 Other Information During the first quarter of 2025, no directors or executive officers adopted or terminated a Rule 10b5-1 trading arrangement - No directors or executive officers adopted or terminated a Rule 10b5-1 trading plan in Q1 2025431 Exhibits This section lists the exhibits filed with the Form 10-Q, including certifications by the Principal Executive Officer and Principal Financial Officer - Lists exhibits filed with the report, including officer certifications under Rules 13a-14(a) and 15d-14(a), and Section 1350434