Cabaletta Bio(CABA) - 2025 Q2 - Quarterly Report

Financial Performance - Net loss for the six months ended June 30, 2025, was $81,071,000, compared to a net loss of $52,649,000 for the same period in 2024, reflecting a 54% increase in losses[17] - The net loss for the three months ended June 30, 2025, was $45.1 million, compared to a net loss of $27.6 million for the same period in 2024, indicating an increase in loss of $17.5 million[162] - Net cash used in operating activities for the six months ended June 30, 2025, was $61,228,000, compared to $44,777,000 for the same period in 2024, reflecting a 37% increase in cash outflow[25] - Cash used in operating activities was $61.2 million for the six months ended June 30, 2025, compared to $44.8 million in 2024, indicating a 36.6% increase[183] - Interest income decreased by $2.8 million for the six months ended June 30, 2025, primarily due to lower cash and investment balances[170] - The company reported interest income of $1,410,000 for the three months ended June 30, 2025, down from $2,677,000 in the same period of 2024, a decrease of 47%[17] Assets and Liabilities - Total current assets increased to $198,407,000 as of June 30, 2025, compared to $166,675,000 as of December 31, 2024, representing a 19% increase[15] - Total liabilities increased to $46,019,000 as of June 30, 2025, from $32,711,000 as of December 31, 2024, marking a 41% increase[15] - Cash and cash equivalents decreased to $145,612,000 at the end of June 2025 from $163,962,000 at the beginning of the period, a decline of 11%[25] - As of June 30, 2025, the company has incurred an accumulated deficit of $430,172, with cash, cash equivalents, and investments totaling $194,682[32] - As of June 30, 2025, the company had $194.7 million in cash, cash equivalents, and investments, sufficient to fund operations into the second half of 2026[172] Research and Development - Research and development expenses for the three months ended June 30, 2025, were $37,638,000, up 60% from $23,427,000 in the same period of 2024[17] - Total operating expenses for the six months ended June 30, 2025, were $83,042,000, up 42% from $58,310,000 in the same period of 2024[17] - Research and development expenses increased to $37.6 million for the three months ended June 30, 2025, compared to $23.4 million for the same period in 2024, reflecting a change of $14.2 million[162] - Research and development expenses were $66.7 million for the six months ended June 30, 2025, up from $45.4 million in the same period of 2024, representing a 46.9% increase[167] - Manufacturing of preclinical and clinical supplies accounted for $11.6 million in research and development expenses for the three months ended June 30, 2025, compared to $3.8 million in 2024, a change of $7.8 million[162] Stock and Equity - Stockholders' equity rose to $178,481,000 as of June 30, 2025, compared to $152,335,000 as of December 31, 2024, indicating a 17% increase[15] - The company issued 39,200,000 shares of common stock, raising $93,558,000 net of issuance costs during the first half of 2025[25] - The company granted 3,093,050 stock options during the six months ended June 30, 2025, with a weighted average exercise price of $1.71[92] - The aggregate intrinsic value of options outstanding as of June 30, 2025, was $408,000, with 7,092,424 options exercisable at an average exercise price of $9.30[92] - Stock-based compensation for the three months ended June 30, 2025, totaled $5.705 million, an increase of 13.8% from $5.013 million in the same period of 2024[98] Clinical Trials and Regulatory Approvals - The FDA granted clearance for the company's rese-cel IND application for multiple autoimmune diseases, including systemic lupus erythematosus and idiopathic inflammatory myopathies, between March 2023 and January 2025[110] - The RESET-MyositisTM Phase 1/2 clinical trial is actively enrolling patients, targeting approximately 80,000 patients in the U.S. and 85,000 in Europe[111] - The company plans to implement two registrational cohorts in the ongoing RESET-MyositisTM trial, each evaluating approximately 15 patients, to support a future Biologics License Application[113] - The registrational cohorts for myositis will evaluate a single, weight-based infusion of rese-cel at 1 x 10^6 cells/kg, with a primary endpoint based on the total improvement score (TIS) within 26 weeks[114] - The company anticipates aligning with the FDA on the registrational cohort design for studies in SLE/LN in Q3 2025[116] Future Outlook and Challenges - The company expects to continue generating operating losses for the foreseeable future and will need to raise additional capital to fund its operations[32] - The company's cash forecast indicates that current cash, cash equivalents, and investments may not be sufficient to fund operations for at least the next twelve months[32] - The company may face significant delays in clinical development and commercialization of its product candidates if it does not achieve timely regulatory approvals[207] - The company has not generated revenue from engineered T cell therapies and does not expect to do so until regulatory approval is obtained[30] - The company has not generated any revenue from product sales to date and does not expect to do so for several years[147]