sensei(US:SNSE)2025-08-05 20:30PART I FINANCIAL INFORMATION This section covers unaudited financial statements, management's analysis, market risk disclosures, and internal controls Item 1. Condensed Consolidated Financial Statements (Unaudited) Net loss improved to $11.8 million in H1 2025, assets decreased, and substantial doubt exists about the company's going concern Condensed Consolidated Balance Sheets Balance sheet shows total assets decreased to $31.8 million by June 30, 2025, mainly from reduced marketable securities Condensed Consolidated Balance Sheets (in thousands) | | June 30, 2025 | December 31, 2024 | | :--- | :--- | :--- | | Assets | | | | Cash and cash equivalents | $12,557 | $9,994 | | Marketable securities | $16,071 | $31,341 | | Total current assets | $29,572 | $41,929 | | Total assets | $31,783 | $45,361 | | Liabilities and Stockholders' Equity | | | | Total current liabilities | $3,873 | $5,448 | | Total liabilities | $4,469 | $6,975 | | Total stockholders' equity | $27,314 | $38,386 | | Total liabilities and stockholders' equity | $31,783 | $45,361 | Condensed Consolidated Statements of Operations and Comprehensive Loss Net loss improved to $11.8 million for H1 2025 from $15.1 million in 2024, primarily due to reduced operating expenses Statement of Operations Highlights (in thousands, except per share data) | | Three Months Ended June 30, | | Six Months Ended June 30, | | | :--- | :--- | :--- | :--- | :--- | | | 2025 | 2024 | 2025 | 2024 | | Research and development | $2,533 | $4,584 | $6,258 | $9,501 | | General and administrative | $2,673 | $3,203 | $6,222 | $7,016 | | Loss from operations | ($5,206) | ($7,787) | ($12,480) | ($16,517) | | Net loss | ($4,936) | ($7,142) | ($11,800) | ($15,134) | | Net loss per common share | ($3.91) | ($5.69) | ($9.36) | ($12.07) | Condensed Consolidated Statements of Cash Flows Net cash increased by $2.56 million for H1 2025, driven by investing activities offsetting operating cash usage Cash Flow Summary for the Six Months Ended June 30 (in thousands) | | 2025 | 2024 | | :--- | :--- | :--- | | Net cash used in operating activities | ($13,003) | ($13,408) | | Net cash provided by investing activities | $15,948 | $12,677 | | Net cash used in financing activities | ($382) | ($389) | | Net increase (decrease) in cash | $2,563 | ($1,120) | Notes to Condensed Consolidated Financial Statements Notes highlight substantial doubt about going concern, a 1-for-20 reverse stock split, and a November 2024 restructuring - The company has concluded there is substantial doubt about its ability to continue as a going concern, as it will not have sufficient cash to fund operations beyond one year from the issuance of the financial statements without additional financing2425 - On June 16, 2025, the company effected a 1-for-20 reverse stock split of its common stock, with all historical share and per-share amounts adjusted to reflect this split26 - In November 2024, the company initiated a restructuring to focus resources on its lead candidate, solnerstotug, involving closing a research site and reducing its workforce by approximately 46%76 Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations Management discusses solnerstotug, restructuring, decreased net loss, and critical liquidity concerns with going concern doubt Overview Overview details the company's clinical-stage biotech focus on solnerstotug and the impact of its November 2024 restructuring - The company is a clinical-stage biotechnology firm focused on its TMAb™ (Tumor Microenvironment Activated Biologics) platform to develop cancer therapeutics81 - The lead product candidate, solnerstotug, is in a Phase 1/2 clinical trial, with updated data expected by the end of 2025 and Phase 2 studies planned for 2026, contingent on additional capital82 - A November 2024 restructuring decreased operating expenses and focused resources on solnerstotug, involving a 46% workforce reduction and pausing preclinical candidates84 Results of Operations Operating expenses significantly decreased in 2025 compared to 2024 for both periods, primarily due to the November 2024 restructuring Comparison of Operating Expenses (in thousands) | | Three Months Ended June 30, | | Six Months Ended June 30, | | | :--- | :--- | :--- | :--- | :--- | | | 2025 | 2024 | 2025 | 2024 | | Research and development | $2,533 | $4,584 | $6,258 | $9,501 | | General and administrative | $2,673 | $3,203 | $6,222 | $7,016 | | Total operating expenses | $5,206 | $7,787 | $12,480 | $16,517 | - The decrease in operating expenses for both the three and six-month periods of 2025 compared to 2024 was primarily driven by lower personnel costs (including stock-based compensation), reduced facilities and equipment costs, and lower manufacturing and research fees, all resulting from the November 2024 restructuring102103106107 Liquidity and Capital Resources Liquidity is constrained with $28.6 million cash and $273.9 million accumulated deficit, raising substantial doubt about funding operations beyond Q2 2026 - As of June 30, 2025, the company had cash, cash equivalents, and marketable securities of $28.6 million and an accumulated deficit of $273.9 million109 - Based on current operating plans, the company expects its existing cash to fund operations and capital expenditures only into the second quarter of 2026122 - Management has concluded that there is substantial doubt about the company's ability to continue as a going concern and will require additional financing to support its operations122 Item 3. Quantitative and Qualitative Disclosures About Market Risk The company, as a smaller reporting entity, is exempt from providing quantitative and qualitative disclosures about market risk - As a smaller reporting company, the company is not required to provide the information otherwise required under this item136 Item 4. Controls and Procedures Management concluded that disclosure controls and procedures were effective as of June 30, 2025, with no material changes to internal control over financial reporting during the quarter - Management, including the principal executive officer and principal financial officer, evaluated the effectiveness of disclosure controls and procedures and concluded they were effective at a reasonable assurance level as of June 30, 2025139 - No material changes in internal control over financial reporting occurred during the three months ended June 30, 2025140 PART II OTHER INFORMATION This section covers legal proceedings, significant risk factors, unregistered equity sales, and other miscellaneous information Item 1. Legal Proceedings The company is not currently involved in any material legal proceedings - The company is not currently a party to any material legal proceedings143 Item 1A. Risk Factors Key risks include financial instability, funding needs, early-stage product development, third-party reliance, and regulatory hurdles Risks Related to Our Financial Position Financial risks include urgent funding needs, a history of substantial losses, and material uncertainty about the company's going concern ability - The company requires substantial additional funding to continue operations; failure to obtain capital could force it to delay, reduce, or terminate development and commercialization efforts150 - The company has a history of significant losses, with a net loss of $11.8 million for the first six months of 2025 and an accumulated deficit of $273.9 million as of June 30, 2025162 - There is substantial doubt about the company's ability to continue as a going concern, as its current cash, cash equivalents, and marketable securities are only expected to fund operations into the second quarter of 2026170 Risks Related to the Development of our Product Candidates Product development risks include early-stage candidates, high dependence on solnerstotug, lengthy regulatory processes, and potential changes in interim data - The company's development efforts are in early stages, and its business is highly dependent on the success of its product candidates, particularly solnerstotug, which requires significant additional development and regulatory approval176190 - The regulatory approval process for product candidates is lengthy, expensive, and unpredictable, with no guarantee of success183 - Interim and preliminary data from clinical trials may change as more patient data becomes available, and positive early results are not predictive of final outcomes200202 Risks Related to our Dependence on Third Parties Risks arise from reliance on third-party CROs for clinical trials, CMOs for production, and supply agreements for combination therapies - The company relies on third-party Contract Research Organizations (CROs) to conduct its clinical trials, and poor performance by these CROs could delay or prevent regulatory approval222223 - The company depends on Contract Manufacturing Organizations (CMOs) for the production of its product candidates, including solnerstotug, which creates risks related to supply sufficiency, cost, and quality control236 - The clinical trial of solnerstotug in combination with cemiplimab is dependent on a supply agreement with Regeneron, and any disruption could delay development232234 Item 2. Unregistered Sales of Equity Securities and Use of Proceeds The company reports no unregistered sales of equity securities during the period - There were no recent sales of unregistered equity securities407 Item 3. Defaults Upon Senior Securities The company reports no defaults upon senior securities - None410 Item 4. Mine Safety Disclosures This item is not applicable to the company - Not applicable411 Item 5. Other Information No officers or directors adopted, modified, or terminated a Rule 10b5-1 trading plan during the quarter ended June 30, 2025 - No officers or directors adopted, modified, or terminated a Rule 10b5-1 trading arrangement or a non-Rule 10b5-1 trading arrangement during the fiscal quarter412 Item 6. Exhibits This section lists the exhibits filed with the Form 10-Q, including the company's articles of incorporation, bylaws, and certifications from the Principal Executive Officer and Principal Financial Officer as required by the Sarbanes-Oxley Act - The exhibits filed with the report include certifications from the Principal Executive Officer and Principal Financial Officer pursuant to Sarbanes-Oxley Act Sections 302 and 906415