Shattuck Labs(STTK) - 2025 Q2 - Quarterly Report

PART I FINANCIAL INFORMATION Item 1. Condensed Financial Statements (Unaudited) Unaudited H1 2025 financials reflect a reduced net loss and decreased assets, primarily due to lower R&D expenses and the conclusion of collaboration agreements Condensed Balance Sheets Condensed Balance Sheet Summary (in thousands) | Account | June 30, 2025 | December 31, 2024 | | :--- | :--- | :--- | | Assets | | | | Cash and cash equivalents | $50,467 | $57,387 | | Total current assets | $54,675 | $79,215 | | Total assets | $64,371 | $91,049 | | Liabilities & Equity | | | | Total current liabilities | $5,336 | $8,917 | | Total liabilities | $7,352 | $11,423 | | Total stockholders' equity | $57,019 | $79,626 | - Total assets decreased from $91.0 million at the end of 2024 to $64.4 million as of June 30, 2025, primarily due to a reduction in cash, cash equivalents, and investments[18] Condensed Statements of Operations and Comprehensive Loss Statement of Operations Summary (in thousands, except per share data) | Metric | Q2 2025 | Q2 2024 | H1 2025 | H1 2024 | | :--- | :--- | :--- | :--- | :--- | | Collaboration revenue | $0 | $1,609 | $0 | $2,724 | | Research and development | $8,680 | $19,239 | $18,599 | $35,503 | | General and administrative | $4,352 | $5,332 | $8,822 | $10,227 | | Loss from operations | $(13,032) | $(22,962) | $(27,421) | $(43,006) | | Net loss | $(12,458) | $(21,552) | $(26,160) | $(40,056) | | Net loss per share | $(0.24) | $(0.42) | $(0.51) | $(0.79) | - Net loss for the second quarter of 2025 was $12.5 million, a significant reduction from $21.6 million in the same period of 2024, mainly due to a 55% decrease in R&D expenses[21] Condensed Statements of Changes in Stockholders' Equity - Total stockholders' equity decreased from $79.6 million at December 31, 2024, to $57.0 million at June 30, 2025, primarily driven by the net loss of $26.2 million for the six-month period[23] Condensed Statements of Cash Flows Cash Flow Summary for Six Months Ended June 30 (in thousands) | Cash Flow Activity | 2025 | 2024 | | :--- | :--- | :--- | | Net cash used in operating activities | $(22,463) | $(27,079) | | Net cash provided by (used in) investing activities | $15,600 | $(38,690) | | Net cash (used in) provided by financing activities | $(57) | $836 | | Net decrease in cash and cash equivalents | $(6,920) | $(64,933) | - Cash and cash equivalents decreased by $6.9 million during the first six months of 2025, ending at $50.5 million, compared to a much larger decrease of $64.9 million in the same period of 2024, which included significant purchases of investments[25] Notes to the Unaudited Interim Condensed Financial Statements - The company has incurred losses since inception, with an accumulated deficit of $407.9 million as of June 30, 2025, but management believes current cash of $50.5 million is sufficient to fund operations for at least the next twelve months[27] - All collaboration revenue in 2024 was derived from agreements with Ono Pharmaceutical and ImmunoGen, both completed by December 31, 2024, with no revenue recognized from these agreements in 2025[36][86][91] - On August 4, 2025, the company entered into a securities purchase agreement for a private placement expected to provide upfront gross proceeds of approximately $46 million, including common stock, pre-funded warrants, and common stock warrants[110][113] R&D Expenses by Program for Six Months Ended June 30 (in thousands) | Program | 2025 | 2024 | | :--- | :--- | :--- | | SL-325 | $4,833 | $363 | | SL-172154 (discontinued) | $2,625 | $16,270 | | Other research and development | $4,859 | $8,204 | | Total R&D | $18,599 | $35,503 | Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations Management discusses the strategic pivot to developing SL-325, reduced operating expenses, and liquidity, with a private placement extending funding into 2029 Overview - The company is now focused on developing SL-325, a potentially first-in-class death receptor 3 (DR3) antagonist antibody for treating inflammatory bowel disease (IBD) and other immune-mediated diseases[116] - Shattuck Labs plans to initiate a Phase 1 clinical trial for SL-325 in the third quarter of 2025 and expects to complete enrollment in the full Phase 1 trial in the second quarter of 2026[121] - The company is also developing a series of bispecific antibodies targeting DR3 and other clinically validated targets, with a lead candidate nomination expected in 2025[124][125] Results of Operations Comparison of Operating Results for Q2 (in thousands) | Metric | Q2 2025 | Q2 2024 | Change ($) | Change (%) | | :--- | :--- | :--- | :--- | :--- | | Collaboration Revenue | $0 | $1,609 | $(1,609) | (100.0)% | | R&D Expense | $8,680 | $19,239 | $(10,559) | (54.9)% | | G&A Expense | $4,352 | $5,332 | $(980) | (18.4)% | | Net Loss | $(12,458) | $(21,552) | $9,094 | (42.2)% | Comparison of Operating Results for H1 (in thousands) | Metric | H1 2025 | H1 2024 | Change ($) | Change (%) | | :--- | :--- | :--- | :--- | :--- | | Collaboration Revenue | $0 | $2,724 | $(2,724) | (100.0)% | | R&D Expense | $18,599 | $35,503 | $(16,904) | (47.6)% | | G&A Expense | $8,822 | $10,227 | $(1,405) | (13.7)% | | Net Loss | $(26,160) | $(40,056) | $13,896 | (34.7)% | - The decrease in R&D expenses for H1 2025 was primarily due to a $13.6 million reduction from the discontinuation of SL-172154 and a $4.4 million decrease in compensation from workforce reductions, offset by a $4.5 million increase in spending on SL-325[154] Liquidity and Capital Resources - The company believes its cash and cash equivalents of $50.5 million as of June 30, 2025, are sufficient to fund operations into 2027[162] - The anticipated proceeds from the August 2025 Private Placement, combined with current cash, are expected to extend the company's operational funding into 2029[162] - The company's Registration Statement on Form S-3 expired on July 29, 2025, halting sales under its ATM Facility, and due to its public float, sales are limited to one-third of the market value of its common stock held by non-affiliates until its public float exceeds $75.0 million[158][159] Critical Accounting Policies - There have been no material changes to the company's critical accounting policies, including revenue recognition, accrual for R&D expenses, and valuation of stock-based awards, compared to those disclosed in the 2024 Annual Report on Form 10-K[171][174] Item 3. Quantitative and Qualitative Disclosures About Market Risk As a smaller reporting company, the company is not required to provide market risk disclosures - The company is a smaller reporting company and is not required to provide quantitative and qualitative disclosures about market risk[179] Item 4. Controls and Procedures Disclosure controls were effective as of June 30, 2025, with no material changes in internal control over financial reporting during Q2 2025 - Management concluded that as of June 30, 2025, the company's disclosure controls and procedures were effective at the reasonable assurance level[180] - No changes in internal control over financial reporting occurred during the second quarter of 2025 that have materially affected, or are reasonably likely to materially affect, these controls[181] PART II OTHER INFORMATION Item 1. Legal Proceedings The company reported no legal proceedings as of the reporting date - As of the reporting date, there were no legal proceedings to disclose[183] Item 1A. Risk Factors Key risks include the need for additional funding, potential non-completion of the private placement, and Nasdaq minimum bid price non-compliance - The company requires additional funding to complete development of its product candidates, and the August 2025 Private Placement is subject to closing conditions and may not be completed as expected[185][187] - On August 8, 2025, the company received a notice from Nasdaq for non-compliance with the minimum bid price rule ($1.00 per share), with a deadline of February 4, 2026, to regain compliance[191][192] - The company is subject to limitations on its ability to sell stock under Form S-3, which may restrict sales to no more than one-third of the market value of its common stock held by non-affiliates until its public float exceeds $75.0 million[186] Item 2. Unregistered Sales of Equity Securities and Use of Proceeds No unregistered sales of equity securities or use of proceeds were reported - None reported[194] Item 3. Defaults Upon Senior Securities No defaults upon senior securities were reported - None reported[194] Item 4. Mine Safety Disclosures No mine safety disclosures were reported - None reported[195] Item 5. Other Information The company received a Nasdaq notice for non-compliance with the $1.00 minimum bid price rule, with a compliance deadline of February 4, 2026 - On August 8, 2025, the company received a notice from Nasdaq for failing to meet the minimum bid price requirement of $1.00 per share for 30 consecutive business days[196] - The company has a 180-day compliance period, ending February 4, 2026, to regain compliance by having its closing bid price be at least $1.00 for a minimum of 10 consecutive business days[196] Item 6. Exhibits This section lists exhibits filed with the Form 10-Q, including certifications and Inline XBRL data files - The exhibits filed with the report include certifications from the CEO and CFO, and Inline XBRL documents[202]