Centessa Pharmaceuticals(CNTA) - 2023 Q3 - Quarterly Report

Financial Position - Centessa Pharmaceuticals has cash, cash equivalents, and short-term investments of $281.3 million as of September 30, 2023, expected to fund operations into 2026[406]. - As of September 30, 2023, the company had cash, cash equivalents, and short-term investments totaling $281.3 million[445]. - The company has filed a shelf registration statement covering the offering of up to $350.0 million in various securities, including ordinary shares and debt securities[449]. Revenue and Profitability - The company has not generated any revenue and relies on successful development and commercialization of product candidates for future profitability[408]. - The company expects to incur significant expenses and operating losses as it advances its clinical and preclinical programs[406]. - The company recorded a net loss of $38.6 million for the three months ended September 30, 2023, compared to a net loss of $53.9 million for the same period in 2022, reflecting a 28.4% improvement[422]. Research and Development - SerpinPC, a treatment for hemophilia, has shown favorable safety and efficacy in ongoing Phase 2a studies, with plans to present new data in December 2023[386][393]. - The registrational program for SerpinPC includes global studies, with the first subjects dosed in July and October 2023 for different hemophilia types[393]. - ORX750, an orally administered OX2 receptor agonist for narcolepsy, has demonstrated significant activity in preclinical models, with clinical development expected to begin in 2024[399]. - LB101, the first LockBody product candidate, is undergoing a Phase 1/2a study for advanced solid tumors, with the first subject dosed in March 2023[395]. - LB206, a second LockBody candidate for solid tumors, was announced in August 2023, showing promising preclinical data[389]. - The company has deprioritized several programs, including CBS001 and CBS004, while continuing to evaluate strategic partnerships for their development[405]. - The company expects to incur significant expenses related to ongoing development activities and anticipates a long-term increase in expenses as it continues research and development efforts[457]. Expenses - Research and development expenses for the three months ended September 30, 2023, were $28.2 million, a decrease of 23.2% from $36.7 million in the same period of 2022[433]. - Research and development expenses for the nine months ended September 30, 2023, totaled $94.7 million, a decrease of 25.6% from $127.2 million for the same period in 2022[437]. - The company incurred $13.0 million in research and development expenses for the SerpinPC program during the three months ended September 30, 2023, compared to $5.6 million in the same period of 2022, reflecting a 132.5% increase[426]. - General and administrative expenses for the three months ended September 30, 2023, were $12.0 million, slightly down from $12.3 million in the same period of 2022[428]. - General and administrative expenses for the nine months ended September 30, 2023, were $41.4 million, unchanged from the same period in 2022, with personnel expenses increasing by $2.6 million due to higher share-based compensation[440]. Income and Tax - Interest income increased to $3.0 million for the three months ended September 30, 2023, compared to $0.1 million in the same period of 2022[429]. - Interest income for the nine months ended September 30, 2023, was $7.5 million, up from $0.2 million in the same period of 2022, reflecting interest earned from cash and cash equivalents and short-term marketable securities[441]. - Interest expense for the three months ended September 30, 2023, was $2.5 million, an increase of 30.4% from $1.9 million in the same period of 2022[429]. - Interest expense increased to $7.3 million for the first nine months of 2023, up $2.3 million from the same period in 2022, due to a higher average interest rate on the Note Purchase Agreement[442]. - The company recorded an income tax benefit of $2.8 million for the three months ended September 30, 2023, compared to a benefit of $0.1 million in the same period of 2022[431]. - The income tax benefit for the nine months ended September 30, 2023, was $26.2 million, significantly higher than the $83 thousand benefit recorded in the same period of 2022[444]. Cash Flow - Net cash used in operating activities for the nine months ended September 30, 2023, was $129.3 million, an improvement from $149.0 million in the same period of 2022[452]. - Net cash used in investing activities was $108.7 million for the nine months ended September 30, 2023, primarily due to investments in U.S. Treasury securities[454]. Company Classification - The company is classified as an emerging growth company under the JOBS Act, allowing it to delay the adoption of new accounting standards until they apply to private companies[480]. - The company will remain an emerging growth company until it reaches total annual gross revenues of $1.235 billion or more or meets other specified criteria[480]. Other - The company has provided a full valuation allowance for its U.K. deferred tax assets due to a history of cumulative net losses, while it released a previously recorded valuation allowance for its U.S. deferred tax assets in Q2 2023[478]. - As of September 30, 2023, the company reported no material contractual obligations or commitments beyond those disclosed in Note 6[479].