Tenaya Therapeutics(TNYA) - 2025 Q2 - Quarterly Report

PART I—FINANCIAL INFORMATION Item 1. Financial Statements Presents Tenaya Therapeutics' unaudited condensed financial statements for the three and six months ended June 30, 2025 Condensed Balance Sheet Highlights (in thousands) | Account | June 30, 2025 | December 31, 2024 | | :--- | :--- | :--- | | Assets | | | | Cash and cash equivalents | $62,671 | $4,323 | | Total current assets | $75,875 | $67,375 | | Total assets | $122,151 | $119,940 | | Liabilities & Equity | | | | Total current liabilities | $12,654 | $15,975 | | Total liabilities | $22,323 | $27,086 | | Accumulated deficit | $(564,558) | $(514,411) | | Total stockholders' equity | $99,828 | $92,854 | Condensed Statements of Operations Highlights (in thousands) | Metric | Three Months Ended June 30, 2025 | Three Months Ended June 30, 2024 | Six Months Ended June 30, 2025 | Six Months Ended June 30, 2024 | | :--- | :--- | :--- | :--- | :--- | | Research and development | $17,370 | $22,649 | $38,446 | $47,704 | | General and administrative | $6,712 | $8,174 | $13,174 | $16,881 | | Loss from operations | $(24,082) | $(30,823) | $(51,620) | $(64,585) | | Net loss | $(23,283) | $(29,431) | $(50,147) | $(61,659) | | Net loss per share | $(0.14) | $(0.34) | $(0.37) | $(0.74) | Condensed Statements of Cash Flows Highlights (Six Months Ended June 30, in thousands) | Cash Flow Activity | 2025 | 2024 | | :--- | :--- | :--- | | Net cash used in operating activities | $(38,725) | $(52,277) | | Net cash provided by investing activities | $47,290 | $17,126 | | Net cash provided by financing activities | $49,783 | $47,341 | | Net change in cash | $58,348 | $12,190 | Notes to Unaudited Condensed Financial Statements Detailed notes provide context for financial statements, covering business, liquidity, accounting policies, financing, and material events - The company is a clinical-stage biotechnology firm focused on therapies for heart disease, with lead candidates TN-201, TN-401, and TN-301[27] - In March 2025, the company completed an underwritten offering of common stock and warrants, receiving net proceeds of approximately $48.8 million[29][71] - Management believes that existing cash, investments, and available funds under its loan agreement are sufficient to fund operations for at least the next twelve months, supported by recent cost containment measures including a workforce reduction[31] - In January 2025, the company repriced approximately 4.1 million employee stock options to an exercise price of $1.21, resulting in an incremental stock-based compensation expense of $1.3 million[55][57] - A workforce reduction was initiated in March 2025, with expected aggregate charges of $1.6 million to $2.7 million, primarily for severance, with $1.1 million recognized in the first six months of 2025[84] Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations Management discusses business overview, clinical development of lead gene therapy candidates, financial results, liquidity, and capital resources Overview Tenaya, a clinical-stage biotech, focuses on developing heart disease therapies, with TN-201 and TN-401 gene therapies in Phase 1b/2 trials - The company's primary focus is on the clinical development of its lead gene therapy candidates, TN-201 (for HCM) and TN-401 (for ARVC)[95] - For the TN-201 MyPEAK-1 trial, enrollment in both dose cohorts is complete, with initial data from the higher-dose Cohort 2 expected in Q4 2025[97] - For the TN-401 RIDGE-1 trial, the first patient in the higher-dose Cohort 2 was dosed in July 2025, with initial clinical data from Cohort 1 expected in Q4 2025[103] Results of Operations Details financial performance for Q2 and H1 2025, showing decreased operating expenses and a lower net loss due to workforce reductions Comparison of Operating Expenses (in thousands) | Expense Category | Three Months Ended June 30, 2025 | Three Months Ended June 30, 2024 | Six Months Ended June 30, 2025 | Six Months Ended June 30, 2024 | | :--- | :--- | :--- | :--- | :--- | | Research and development | $17,370 | $22,649 | $38,446 | $47,704 | | General and administrative | $6,712 | $8,174 | $13,174 | $16,881 | | Total operating expenses | $24,082 | $30,823 | $51,620 | $64,585 | - The decrease in R&D expenses for Q2 2025 was primarily driven by a $2.6 million reduction in manufacturing costs and a $1.1 million decrease in clinical trial costs, reflecting the impact of workforce reductions[124] - The decrease in R&D expenses for H1 2025 was primarily due to a $3.7 million reduction in manufacturing costs and a $3.0 million decrease in clinical trial costs[131] Liquidity and Capital Resources As of June 30, 2025, Tenaya held $71.7 million in cash and investments, with management confirming sufficient funds for the next twelve months - As of June 30, 2025, the company had cash, cash equivalents, and investments in marketable securities of $71.7 million and an accumulated deficit of $564.6 million[129] - The company believes its existing cash and available funds from its Loan Agreement with SVB will be sufficient to meet working capital needs for at least the next twelve months[138] - Recent financing activities include a March 2025 follow-on offering (net proceeds of ~$48.8 million) and sales under an "at-the-market" (ATM) offering in January 2025 (net proceeds of $0.9 million)[134][136] Item 3. Quantitative and Qualitative Disclosures About Market Risk As a smaller reporting company, Tenaya is exempt from providing quantitative and qualitative disclosures about market risk - The company is a smaller reporting company and is not required to provide quantitative and qualitative disclosures about market risk[157] Item 4. Controls and Procedures Management confirmed effective disclosure controls and procedures as of June 30, 2025, with no material changes in internal control over financial reporting - Management concluded that as of the end of the period, the company's disclosure controls and procedures were effective[158] - There were no changes in internal control over financial reporting during the quarter ended June 30, 2025, that have materially affected, or are reasonably likely to materially affect, internal controls[159] PART II—OTHER INFORMATION Item 1. Legal Proceedings The company is not currently involved in any material litigation or legal proceedings that would adversely affect its business - The company is not currently involved in any material legal proceedings[162] Item 1A. Risk Factors Outlines significant risks: early development, net losses, capital dependence, clinical trial uncertainties, manufacturing, regulatory, competition, IP, and delisting risk - The company has a limited operating history, no products approved for sale, and has incurred a significant accumulated deficit of $564.6 million as of June 30, 2025[166][170] - The company requires substantial additional capital to finance operations and may be forced to delay or eliminate programs if funding is not available on acceptable terms[178] - The company received a notice from Nasdaq on April 15, 2025, for failing to meet the minimum bid price requirement of $1.00 per share, and its common stock could be delisted if compliance is not regained[403][405] - The company faces potential patent infringement claims related to its TN-201 product candidate and the use of AAV vectors, which could result in liability for damages or require obtaining a license[340][341] Item 2. Unregistered Sales of Equity Securities and Use of Proceeds No previously undisclosed unregistered equity security sales occurred during the reporting period - There were no sales of unregistered equity securities during the reporting period that were not previously reported[426] Item 3. Defaults Upon Senior Securities This item is not applicable to the company Item 4. Mine Safety Disclosures This item is not applicable to the company Item 5. Other Information No director or officer adopted or terminated a Rule 10b5-1 or non-Rule 10b5-1 trading arrangement during the quarter - No director or officer adopted or terminated a Rule 10b5-1 trading arrangement during the quarter[432] Item 6. Exhibits Lists exhibits filed with Form 10-Q, including certifications by executive officers and XBRL data files