Prelude Therapeutics(US:PRLD)2025-08-14 11:23PART I. FINANCIAL INFORMATION Item 1. Financial Statements Unaudited H1 2025 financials report a $63.3 million net loss, increased accumulated deficit, and a going concern warning Balance Sheets Balance Sheet Summary (Unaudited) | (in thousands) | June 30, 2025 | December 31, 2024 | | :--- | :--- | :--- | | Assets | | | | Cash and cash equivalents | $25,752 | $12,474 | | Marketable securities | $47,464 | $121,140 | | Total current assets | $76,876 | $135,895 | | Total assets | $114,918 | $175,515 | | Liabilities & Stockholders' Equity | | | | Total current liabilities | $20,908 | $25,641 | | Total liabilities | $39,080 | $44,056 | | Accumulated deficit | ($646,879) | ($583,563) | | Total stockholders' equity | $75,838 | $131,459 | Statements of Operations and Comprehensive Loss Statement of Operations Summary (Unaudited) | (in thousands, except per share data) | 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 | $25,784 | $29,509 | $54,600 | $56,918 | | General and administrative | $6,410 | $7,655 | $12,200 | $14,589 | | Loss from operations | ($32,194) | ($37,164) | ($66,800) | ($71,507) | | Net loss | ($31,231) | ($34,740) | ($63,316) | ($66,171) | | Net loss per share, basic and diluted | ($0.41) | ($0.46) | ($0.83) | ($0.87) | Statements of Cash Flows Cash Flow Summary (Unaudited) | (in thousands) | Six months ended June 30, 2025 | Six months ended June 30, 2024 | | :--- | :--- | :--- | | Net cash used in operating activities | ($60,306) | ($54,848) | | Net cash provided by investing activities | $73,707 | $57,340 | | Net cash (used in) provided by financing activities | ($123) | $45 | | Net increase in cash, cash equivalents and restricted cash | $13,278 | $2,537 | Notes to Unaudited Interim Financial Statements Notes detail accounting policies, a going concern warning, R&D expenses, workforce reduction, and collaboration agreements - The Company has incurred operating losses since inception, with an accumulated deficit of $646.9 million as of June 30, 202528 - Management has concluded that substantial doubt exists about the Company's ability to continue as a going concern, as its cash, cash equivalents, and marketable securities of $77.3 million are not sufficient to fund operations for at least the next twelve months29 - In May 2024, the Company entered into a license agreement with Pathos AI, Inc. for its PRMT5 inhibitor, PRT811, receiving a $3.0 million upfront payment All performance obligations were satisfied in the second half of 20246871 Research and Development Expenses by Program (Six Months Ended June 30) | (in thousands) | 2025 | 2024 | | :--- | :--- | :--- | | PRT3789 | $8,268 | $8,875 | | PRT7732 | $5,736 | $— | | Discovery programs | $5,756 | $10,603 | | Other | $2,701 | $6,143 | | General costs, including personnel related | $32,139 | $31,297 | | Total research and development | $54,600 | $56,918 | - During the second quarter of 2025, the Company reduced its workforce by approximately 11%, incurring one-time costs of $0.5 million88 Management's Discussion and Analysis of Financial Condition and Results of Operations Management discusses clinical pipeline, Q2/H1 2025 operating expense decreases, liquidity, and Nasdaq delisting Overview - The company is a clinical-stage precision oncology company with a pipeline including PRT3789 (SMARCA2 degrader), PRT7732 (oral SMARCA2 degrader), precision ADC programs, and KAT6A selective degraders919496103 - PRT3789 has completed Phase 1, with updated data expected by year-end 2025 A Phase 2 trial in combination with KEYTRUDA is ongoing95 - The oral SMARCA2 degrader, PRT7732, is advancing rapidly in a Phase 1 trial, with an initial data update expected by year-end 202597 - On March 27, 2025, the company received a delisting notice from Nasdaq for failing to maintain a minimum bid price of $1.00 per share The company has until September 23, 2025, to regain compliance105107 Results of Operations Comparison of Operating Results (Three Months Ended June 30) | (in thousands) | 2025 | 2024 | Change | | :--- | :--- | :--- | :--- | | Research and development | $25,784 | $29,509 | ($3,725) | | General and administrative | $6,410 | $7,655 | ($1,245) | | Total operating expenses | $32,194 | $37,164 | ($4,970) | | Net loss | ($31,231) | ($34,740) | $3,509 | - The decrease in R&D and G&A expenses for Q2 2025 was primarily driven by lower non-cash stock-based compensation expense and a decrease in expenses related to SMARCA2 clinical trials122125 Comparison of Operating Results (Six Months Ended June 30) | (in thousands) | 2025 | 2024 | Change | | :--- | :--- | :--- | :--- | | Research and development | $54,600 | $56,918 | ($2,318) | | General and administrative | $12,200 | $14,589 | ($2,389) | | Total operating expenses | $66,800 | $71,507 | ($4,707) | | Net loss | ($63,316) | ($66,171) | $2,855 | Liquidity and Capital Resources - As of June 30, 2025, the company had $77.3 million in cash, cash equivalents, restricted cash, and marketable securities136 - The company states that its current cash position is not sufficient to fund operating expenses and capital requirements for at least the next twelve months, raising substantial doubt about its ability to continue as a going concern136 - The company has a $400 million effective shelf registration statement and a $75 million Open Market Sales Agreement (ATM facility) in place to potentially raise additional capital140141 Quantitative and Qualitative Disclosures About Market Risk As a smaller reporting company, no market risk disclosures are required for this item - As a smaller reporting company, Prelude Therapeutics is not required to provide quantitative and qualitative disclosures about market risk155 Controls and Procedures Management confirmed effective disclosure controls and procedures with no material changes to internal controls - Management concluded that the company's disclosure controls and procedures were effective as of June 30, 2025156 - There were no changes in internal control over financial reporting during the quarter that have materially affected, or are reasonably likely to materially affect, internal controls157 PART II. OTHER INFORMATION Legal Proceedings The company is not currently involved in any material legal proceedings - The company reports no material legal proceedings160 Risk Factors Key risks include potential Nasdaq delisting and substantial doubt about the company's going concern ability - A significant risk is the potential delisting from Nasdaq The company received a non-compliance notice on March 27, 2025, for its stock price falling below the $1.00 minimum bid requirement162163 - The company has until September 23, 2025, to regain compliance with Nasdaq's minimum bid price rule, after which it may be eligible for an extension164 - The financial statements contain a 'going concern' warning, indicating substantial doubt about the company's ability to continue operations as its current cash will not be sufficient to fund operations for at least the next twelve months167 Unregistered Sales of Equity Securities and Use of Proceeds No unregistered sales of equity securities were reported during the period - None reported169 Exhibits This section lists filed exhibits, including corporate documents, officer certifications, and XBRL data files