Lisata Therapeutics(LSTA) - 2025 Q2 - Quarterly Report

PART I - FINANCIAL INFORMATION Item 1. Financial Statements Unaudited consolidated financial statements for H1 2025 show decreased assets, equity, and a reduced net loss Consolidated Balance Sheets Total assets decreased to $25.2 million, with total equity declining to $20.8 million by June 30, 2025 Consolidated Balance Sheet Highlights (in thousands) | Account | June 30, 2025 (Unaudited) | December 31, 2024 | | :--- | :--- | :--- | | Total Current Assets | $24,885 | $34,578 | | Cash and cash equivalents | $16,835 | $16,209 | | Marketable securities | $5,135 | $15,036 | | Total Assets | $25,160 | $35,002 | | Total Current Liabilities | $4,313 | $5,613 | | Total Liabilities | $4,385 | $5,685 | | Total Equity | $20,775 | $29,317 | Consolidated Statements of Operations Net loss decreased to $4.7 million in Q2 2025 and $9.4 million for H1 2025, driven by lower operating expenses Consolidated Statements of Operations Summary (in thousands, except per share data) | Metric | Q2 2025 | Q2 2024 | H1 2025 | H1 2024 | | :--- | :--- | :--- | :--- | :--- | | Revenue | $70 | $0 | $70 | $0 | | Research and development | $2,253 | $2,601 | $4,856 | $5,842 | | General and administrative | $2,685 | $2,922 | $5,930 | $6,282 | | Operating loss | $(4,868) | $(5,523) | $(10,716) | $(12,124) | | Net loss | $(4,659) | $(5,044) | $(9,383) | $(10,445) | | Basic and diluted loss per share | $(0.54) | $(0.61) | $(1.09) | $(1.26) | Consolidated Statements of Cash Flows Net cash used in operations decreased to $9.4 million, with cash and equivalents increasing by $0.6 million to $16.8 million Cash Flow Summary for Six Months Ended June 30 (in thousands) | Activity | 2025 | 2024 | | :--- | :--- | :--- | | Net cash used in operating activities | $(9,358) | $(12,310) | | Net cash provided by investing activities | $9,936 | $18,149 | | Net cash provided by (used in) financing activities | $41 | $(110) | | Net increase in cash and cash equivalents | $626 | $5,700 | | Cash and cash equivalents at end of period | $16,835 | $28,293 | Notes to Unaudited Consolidated Financial Statements Notes detail certepetide development, liquidity, NJ tax loss sale, executive agreements, and a new patent - The company is a clinical-stage pharmaceutical firm focused on its investigational product, certepetide, designed to enhance the delivery of anti-cancer drugs to solid tumors[28] - As of June 30, 2025, the company had approximately $22.0 million in cash, cash equivalents, and marketable securities. Management believes this is sufficient to meet funding requirements for the next year but anticipates needing additional financing by the fourth quarter of 2026[30] - In January 2025, the company sold $10.7 million of its New Jersey net operating losses (NJ NOLs) for net proceeds of $871 thousand, resulting in a $962 thousand deferred income tax benefit[84] - On June 10, 2025, the company amended employment and separation agreements with key executives, including the CEO, CMO, and CAO, updating base salaries and severance terms[90][92][94] - Subsequent to the quarter end, on July 15, 2025, the company was issued a U.S. patent covering the composition of matter of certepetide, which will expire in March 2040[112] Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations Management discusses certepetide's clinical progress, reduced net loss from lower expenses, and future liquidity requirements Overview Overview details Lisata's lead drug, certepetide, its mechanism, and promising preliminary ASCEND trial data for pancreatic cancer - Certepetide is the company's lead investigational drug, designed to activate the CendR active transport mechanism, allowing co-administered anti-cancer drugs to better penetrate solid tumors[114][117] - Preliminary data from Cohort B of the ASCEND trial showed a median Progression-Free Survival (mPFS) of 7.5 months for the certepetide group versus 4.7 months for the placebo group, and an Objective Response Rate (ORR) of 45.2% versus 19% for placebo[122] - Certepetide is currently being evaluated in multiple global Phase 2 clinical trials for various solid tumors, including metastatic pancreatic ductal adenocarcinoma (mPDAC), cholangiocarcinoma, and glioblastoma multiforme[114][123] Results of Operations Comparative analysis shows decreased net loss for Q2 and H1 2025, driven by reduced R&D and G&A expenses Comparison of Results for the Three Months Ended June 30 (in thousands) | Metric | 2025 | 2024 | Change | | :--- | :--- | :--- | :--- | | Revenue | $70 | $0 | $70 | | Research and development | $2,253 | $2,601 | $(348) | | General and administrative | $2,685 | $2,922 | $(237) | | Net loss | $(4,659) | $(5,044) | $385 | Comparison of Results for the Six Months Ended June 30 (in thousands) | Metric | 2025 | 2024 | Change | | :--- | :--- | :--- | :--- | | Revenue | $70 | $0 | $70 | | Research and development | $4,856 | $5,842 | $(986) | | General and administrative | $5,930 | $6,282 | $(352) | | Net loss | $(9,383) | $(10,445) | $1,062 | - The decrease in R&D expenses for H1 2025 was primarily due to reduced CRO expenses, patient treatment costs for the Bolster trial, and lower spend on chemistry, manufacturing and controls (CMC)[134] Analysis of Liquidity and Capital Resources Lisata holds $22.0 million in liquid assets, sufficient for 12 months, but requires additional capital by late 2026, with ATM offering constrained - As of June 30, 2025, the company had cash, cash equivalents, and marketable securities of approximately $22.0 million and working capital of $20.6 million[138] - Management believes current cash on hand is sufficient to fund operating expenses for at least the next 12 months[146] - The company's ATM offering is subject to "Baby Shelf" limitations, restricting sales to one-third of its public float in any 12-month period, which currently amounts to $9.86 million[147][66] Item 3. Quantitative and Qualitative Disclosures About Market Risk The company deems this item not applicable, indicating no significant exposure to market risks requiring disclosure - The company has determined that this disclosure is not applicable[151] 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 controls - Based on an evaluation as of June 30, 2025, the company's principal executive and financial officers concluded that disclosure controls and procedures were effective[153] - There were no changes in internal control over financial reporting during the quarter that have materially affected, or are reasonably likely to materially affect, these controls[154] PART II - OTHER 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 proceedings[156] Item 1A. Risk Factors No material changes have occurred to the risk factors previously reported in the company's 2024 Form 10-K - There have been no material changes to the risk factors previously reported in the company's 2024 Form 10-K[157] Other Items (Items 2, 3, 4, 5, 6) This section covers no unregistered equity sales, defaults, mine safety disclosures, or Rule 10b5-1 trading plan changes by directors or officers - The company reported no unregistered sales of equity securities, defaults upon senior securities, or mine safety disclosures[157][158][159] - During the three months ended June 30, 2025, no director or officer adopted, modified, or terminated a Rule 10b5-1 trading arrangement[160]