Faeth Therapeutics, Inc.

Previous wording

We are an immuno-oncology company focused on the discovery and development of next-generation therapeutics for cancer patients. Through our TMAb™ (Tumor Microenvironment Activated Biologics) platform, we are developing highly selective therapeutics designed to disable immunosuppressive signals or activate immunostimulatory signals selectively in the tumor microenvironment. Our strategy is to generate novel product candidates that incorporate next-generation technologies or approaches using our robust set of R&D capabilities. We plan to efficiently develop these product candidates by incorporating state-of-the-art biomarker approaches and mechanistic understanding into clinical trial designs targeted to well-defined patient populations.

Current wording

We are a clinical-stage biotechnology company focused on the discovery and development of next-generation therapeutics for cancer patients. Through our TMAb™ (Tumor Microenvironment Activated Biologics) platform, we are developing highly selective therapeutics designed to disable immunosuppressive signals or activate immunostimulatory signals selectively in the tumor microenvironment. Our strategy is to generate novel product candidates that incorporate next-generation technologies or approaches. We plan to efficiently develop these product candidates by incorporating state-of-the-art biomarker approaches and mechanistic understanding into clinical trial designs targeted to well-defined patient populations.

Previous wording

SNS-101 is our conditionally active monoclonal antibody targeting the immune checkpoint VISTA (V-domain Ig suppressor of T-cell activation). In May 2023, we initiated a first-in-human Phase 1/2 open-label, multi-center, dose escalation and expansion trial to evaluate the safety, tolerability, pharmacokinetics, pharmacodynamics and efficacy of SNS-101 as monotherapy and/or in combination with cemiplimab in patients with advanced solid tumors.

Current wording

In May 2023, we initiated a first-in-human Phase 1/2 open-label, multi-center, dose escalation and expansion trial to evaluate the safety, tolerability, pharmacokinetics, pharmacodynamics and efficacy of solnerstotug as monotherapy and/or in combination with cemiplimab in patients with advanced solid tumors.

Previous wording

SNS-102 is our conditionally active monoclonal antibody targeting VSIG4 (V-Set and Immunoglobulin Domain Containing 4), an immune checkpoint often expressed on macrophages. We have selected a product candidate that is 585-fold more selective for VSIG4 at low pH conditions. A counter-receptor has been provisionally identified and is being confirmed.

Current wording

SNS-102 is our conditionally active monoclonal antibody targeting VSIG4 (V-Set and Immunoglobulin Domain Containing 4), an immune checkpoint often expressed on macrophages.

Previous wording

SNS-103 is our conditionally active monoclonal antibody targeting ENTPDase1 (ecto-nucleoside triphosphate diphosphohydrolase-1), also known as CD39. In 2023, we selected a product candidate from a set of lead-optimized antibodies.

Current wording

SNS-103 is our conditionally active monoclonal antibody targeting ENTPDase1 (ecto-nucleoside triphosphate diphosphohydrolase-1), also known as CD39.

Previous wording

SNS-201 is a bispecific antibody that is being designed to conditionally activate Cluster of Differentiation 28 (CD28). It is a bispecific format with monovalent CD28 engagement and bivalent pH-selective VISTA binding for efficient engagement at low pH. In 2023, we selected a product candidate from a set of lead-optimized bispecific antibodies.

Current wording

SNS-201 is a bispecific antibody that is being designed to conditionally activate Cluster of Differentiation 28 (CD28). It is a bispecific format with monovalent CD28 engagement and bivalent pH-selective VISTA binding for efficient engagement at low pH.

Previous wording

We have incurred significant operating losses over the last several years. Our net loss was $34.1 million and $48.6 million for the years ended December 31, 2023 and 2022, respectively. As of December 31, 2023, we had an accumulated deficit of $231.9 million. We expect to continue to incur significant expenses and operating losses for the foreseeable future. We anticipate that our expenses will increase significantly in connection with our ongoing activities, as we:

Current wording

We have incurred significant operating losses over the last several years. Our net loss was $30.2 million and $34.1 million for the years ended December 31, 2024 and 2023, respectively. As of December 31, 2024, we had an accumulated deficit of $262.1 million. We expect to continue to incur significant expenses and operating losses for the foreseeable future. We anticipate that our expenses will increase significantly in connection with our ongoing activities, as we:

Previous wording

conduct clinical trials of product candidates, including SNS-101;

Current wording

conduct clinical trials of product candidates, including solnerstotug;

Previous wording

Our direct external research and development expenses consist primarily of external costs, such as fees paid to CROs, CMOs, research/testing laboratories and outside consultants in connection with our preclinical development, process development, manufacturing and clinical development activities. We do not allocate these costs to specific product candidates because many of them are deployed across several of our development programs and, as such, are not separately classified. We use internal resources primarily to conduct research and manage our preclinical development, process development, manufacturing and clinical development activities. These employees work across multiple development programs and, therefore, we do not track their costs by program and, as such, are not separately classified. Research and development activities are central to our business model. Product candidates in later stages of clinical development generally have higher development costs than those in earlier stages of clinical development, primarily due to the increased size and duration of later-stage clinical trials. We expect our research and development expenses to increase significantly over the next several years as we increase personnel costs, including stock-based compensation, conduct our preclinical studies and clinical trials, and prepare regulatory filings for our product candidates.

Current wording

Our direct external research and development expenses consist primarily of external costs, such as fees paid to CROs, CMOs, research/testing laboratories and outside consultants in connection with our preclinical development, process development, manufacturing and clinical development activities. We do not allocate these costs to specific product candidates because many of them are deployed across several of our development programs and, as such, are not separately classified. We use internal resources primarily to conduct research and manage our preclinical development, process development, manufacturing and clinical development activities. These employees work across multiple development programs and, therefore, we do not track their costs by program and, as such, are not separately classified. Research and development activities are central to our business model. Product candidates in later stages of clinical development generally have higher development costs than those in earlier stages of clinical development, primarily due to the increased size and duration of later-stage clinical trials. We expect our research and development expenses to increase over the next several years as we conduct our clinical trials, prepare regulatory filings for our product candidates and have increased costs associated with manufacturing.

Previous wording

Our expenditures are subject to additional uncertainties, including the terms and timing of regulatory approvals, and the expense of filing, prosecuting, defending and enforcing any patent claims or other intellectual property rights. We may never succeed in achieving regulatory approval for any of our product candidates. We may obtain unexpected results from our clinical trials. We may elect to discontinue, delay or modify clinical trials of some product candidates or focus on others. A change in the outcome of any of these variables with respect to the development of a product candidate could mean a significant change in the costs and timing associated with the development of that product candidate. For example, if the FDA or other regulatory authorities were to require us to conduct clinical trials beyond those that we currently anticipate, or if we experience significant delays in enrollment in any of our clinical trials, we could be required to expend significant additional financial resources and time on the completion of clinical development. Product commercialization will take several years and significant additional development costs.

Current wording

Our expenditures are subject to additional uncertainties, including the terms and timing of regulatory approvals. We may never succeed in achieving regulatory approval for any of our product candidates. We may obtain unexpected results from our clinical trials. We may elect to discontinue, delay or modify clinical trials of some product candidates or focus on others. A change in the outcome of any of these variables with respect to the development of a product candidate could mean a significant change in the costs and timing associated with the development of that product candidate. For example, if the FDA or other regulatory authorities were to require us to conduct clinical trials beyond those that we currently anticipate, or if we experience significant delays in enrollment in any of our clinical trials, we could be required to expend significant additional financial resources and time on the completion of clinical development. Product commercialization will take several years and significant additional development costs.

Previous wording

General and administrative expenses consist principally of salaries and related costs for personnel in executive, administrative, finance and legal functions, including stock-based compensation, travel expenses and recruiting expenses. Other general and administrative expenses include facility related costs, patent filing and prosecution costs and professional fees for legal, auditing and tax services, and insurance costs.

Current wording

General and administrative expenses consist principally of salaries and related costs for personnel in executive, administrative, finance and legal functions, including stock-based compensation, travel and recruiting expenses. Other general and administrative expenses include facility related costs, patent filing and prosecution costs and professional fees for legal, auditing and tax services, and insurance costs.

Previous wording

Our other income (expense) consists of realized gain or loss on short-term investments, litigation expense, gain on debt extinguishments, accretion expense on short-term investments and interest expense.

Current wording

Our other income (expense) consists of accretion on short-term investments, litigation expense, interest expense and gain or loss on fixed asset disposals.

Previous wording

Research and development expenses were $18.3 million for the year ended December 31, 2023, compared to $30.4 million for the year ended December 31, 2022. The decrease of $12.1 million was primarily attributable to $5.5 million of lower manufacturing related expense, $4.4 million of decreased personnel costs, including stock-based compensation and incentives, $2.3 million less expense relating to relating to lab supply purchases, $1.2 million of lower facilities expense, $1.1 million of less costs for preclinical research, $0.8 million of lower restructuring costs, $0.4 million of lower licensing fees and $0.3 million of lower outside research fees, primarily offset by $3.2 million of higher expense associated with clinical trials and $0.7 million of increased consulting costs.

Current wording

Research and development expenses were $18.6 million for the year ended December 31, 2024, compared to $18.3 million for the year ended December 31, 2023. The increase of $0.3 million was primarily attributable to $3.1 million of higher expense associated with clinical trials and $0.8 million of expense related to restructuring costs partially offset by $1.3 million of lower preclinical research expense, $0.9 million less for consulting fees, $0.6 million of lower outside research fees, $0.5 million of lower facilities expense, $0.2 million less expense relating to relating to lab supply purchases and $0.1 million of decreased personnel costs, including stock-based compensation and incentives.

Previous wording

General and administrative expenses were $18.8 million for the year ended December 31, 2023, compared to $19.8 million for the year ended December 31, 2022. The decrease of $1.0 million was primarily attributable to $1.0 million less expense for directors and officers insurance, $0.6 million of lower personnel costs, including stock-based compensation and incentives, $0.6 million of lower recruiting expense, $0.5 million of lower franchise, net worth, and other non-income tax expense, $0.4 million of lower expense for outside services, $0.2 million of decreased legal fees, $0.1 million of less external communications expense and $0.1 million of lower restructuring costs, primarily offset by $1.1 million of higher external professional services associated with stockholder activism, $0.9 million of higher facilities expense and $0.5 million increase related to consulting fees.

Current wording

General and administrative expenses were $13.0 million for the year ended December 31, 2024, compared to $18.8 million for the year ended December 31, 2023. The decrease of $5.7 million was primarily attributable to $3.0 million of lower costs for external professional services associated with stockholder activism, $1.1 million of lower personnel costs, including stock-based compensation and incentives, $0.9 million less expense for directors and officers insurance, $0.4 million of less external communications expense, $0.3 million of less external administrative fees, $0.2 million decrease related to consulting fees and $0.1 million of lower restructuring costs, partially offset by $0.3 million of higher facilities expense.

Previous wording

Other income was $3.0 million for the year ended December 31, 2023, compared to $1.6 million for the year ended December 31, 2022. The increase of $1.4 million was primarily attributable to a $1.9 million higher gain on investments relating to interest and accretion partially offset by other expense of $0.5 million primarily relating to $0.3 million loss on asset disposals and $0.2 million for to a legal matter unrelated to core business operations.

Current wording

Other income was $3.0 million for the year ended December 31, 2023 primarily attributable to a $3.5 million gain on investments relating to interest and accretion partially offset by a $0.3 million loss on asset disposals and $0.2 million for a legal matter unrelated to core business operations.

Previous wording

We have not generated any product revenue and have incurred net losses and negative cash flows from our operations. As of December 31, 2023, we had cash, cash equivalents and marketable securities of $65.8 million. We have financed our operations through sales of our common stock, convertible preferred stock and convertible debt. Through the date of this Report, we have raised an aggregate of $123.4 million of gross proceeds from private placements of our equity and convertible debt securities and net proceeds of $138.5 million from our IPO in February 2021. Our net loss was $34.1 million and $48.6 million for the years ended December 31, 2023 and 2022, respectively. As of December 31, 2023, we had an accumulated deficit of $231.9 million. Our primary use of cash is to fund operating expenses, which consist primarily of research and development expenditures, and to a lesser extent, general and administrative expenditures.

Current wording

Since our inception, we have not generated any product revenue and have incurred net losses and negative cash flows from our operations. As of December 31, 2024, we had cash, cash equivalents and marketable securities of $41.3 million. We have financed our operations through sales of our common stock, convertible preferred stock and convertible debt. Through the date of this Report, we have raised an aggregate of $123.4 million of gross proceeds from private placements of our equity and convertible debt securities and net proceeds of $138.5 million from our IPO in February 2021. Our net loss was $30.2 million and $34.1 million for the years ended December 31, 2024 and 2023, respectively. As of December 31, 2024, we had an accumulated deficit of $262.1 million. Our primary use of cash is to fund operating expenses, which consist primarily of research and development expenditures, and to a lesser extent, general and administrative expenditures.

Previous wording

During the year ended December 31, 2023, our operating activities used $32.0 million of cash, resulting from our $34.1 million net loss and a $4.3 million decrease in our operating assets and liabilities partially offset by increases in non-cash charges of $6.4 million, primarily related to $4.5 million of stock compensation expense, $1.4 million of non-cash lease expense, $0.8 million of amortization of financing lease right-of-use assets, $0.6 million of depreciation and $0.3 million of loss on fixed asset disposals, partially offset by $1.1 million of accretion on marketable securities. During the year ended December 31, 2022, operating activities used $39.0 million of cash, resulting from our $48.6 million net loss, partially offset by increases in non-cash charges of $8.6 million primarily related to $5.8 million of stock compensation expense, $1.2 million of non-cash lease expense, $0.7 million of amortization of financing lease right-of-use assets, $0.6 million of depreciation and $0.2 million for amortization of marketable securities, as well as a $1.0 million increase in our operating assets and liabilities.

Current wording

During the year ended December 31, 2024, our operating activities used $24.7 million of cash, resulting from our $30.2 million net loss and a $0.5 million decrease related to changes in our operating assets and liabilities partially offset by increases in non-cash charges of $6.0 million, primarily related to $3.1 million of stock compensation expense, $1.6 million of non-cash lease expense, $0.8 million of amortization of financing lease right-of-use assets, $0.6 million for financing right-of-use asset impairments, $0.6 million of depreciation and $0.3 million of loss on fixed asset impairments, partially offset by $1.0 million of accretion on marketable securities. During the year ended December 31, 2023, our operating activities used $32.0 million of cash, resulting from our $34.1 million net loss and a $4.3 million decrease related to changes in our operating assets and liabilities partially offset by increases in non-cash charges of $6.4 million primarily related to $4.5 million of stock compensation expense, $1.4 million of non-cash lease expense, $0.8 million of amortization of financing lease right-of-use assets, $0.6 million of depreciation and $0.3 million of loss on fixed asset disposals, partially offset by $1.1 million of accretion on marketable securities.

Previous wording

During the year ended December 31, 2023, net cash provided by investing activities was $38.4 million, primarily due to $59.6 million in sales and maturities of short-term investments and $0.2 million in proceeds from the sale of property and equipment, partially offset by $21.2 million in purchases of short-term investments and $0.2 million in purchases of property and equipment. During the year ended December 31, 2022, net cash used in investing activities was $49.9 million primarily due to $97.1 million in sales and maturities of short-term investments, partially offset by $46.9 million in purchases of short-term investments and $0.3 million in purchases of property and equipment.

Current wording

During the year ended December 31, 2024, net cash provided by investing activities was $22.4 million, primarily due to $67.2 million in maturities of short-term investments partially offset by $44.6 million in purchases of short-term investments and $0.2 million in purchases of property and equipment. During the year ended December 31, 2023, net cash used in investing activities was $38.4 million primarily due to $59.6 million in sales and maturities of short-term investments and $0.2 million in proceeds from the sale of property and equipment, partially offset by $21.2 million in purchases of short-term investments and $0.2 million in purchases of property and equipment.

Previous wording

During the year ended December 31, 2023, net cash used in financing activities was $11.2 million, primarily from $10.4 million of payments for the repurchase of common stock and $0.8 million of principal payments under our financing leases. During the year ended December 31, 2022, net cash used in financing activities was $0.3 million, primarily from $0.6 million of principal payments under our financing leases, partially offset by $0.2 million of proceeds from the exercise of stock options and $0.1 million relating to ESPP purchases.

Current wording

During the year ended December 31, 2024, net cash used in financing activities was $0.8 million, primarily from $0.8 million of principal payments under our financing leases. During the year ended December 31, 2023, net cash used in financing activities was $11.2 million, primarily from $10.4 million of payments for the repurchase of common stock and $0.8 million of principal payments under our financing leases.

Previous wording

Our material cash requirements will have an impact on our future liquidity. Our material cash requirements represent material expected or contractually committed future payment obligations. We believe that we will be able to fund these obligations through cash from our existing balances of cash, cash equivalents and marketable securities.

Current wording

Our material cash requirements will have an impact on our future liquidity. Our material cash requirements represent material expected or contractually committed future payment obligations.

Previous wording

We have operating lease arrangements for our corporate offices, lab facilities and an executive residence. As part of our adoption of Accounting Standards Codification (“ASC”) 842, we recorded operating right-of-use assets and operating lease liabilities for these agreements. As of December 31, 2023, we had operating lease payment obligations of $5.1 million, with $1.9 million payable within twelve months. See Note 6 in our annual financial statements included elsewhere in this Report for additional information.

Current wording

We have operating lease arrangements for our corporate offices, lab facilities and an executive residence. As part of our adoption of Accounting Standards Codification (“ASC”) 842, we recorded operating right-of-use assets and operating lease liabilities for these agreements. As of December 31, 2024, we had operating lease payment obligations of $3.2 million, with $1.7 million payable within twelve months. See Note 6 in our annual financial statements included elsewhere in this Report for additional information.

Previous wording

We lease research equipment, furniture and a vehicle under finance leases. As part of our adoption of ASC 842, we recorded financing right-of-use assets and financing lease liabilities for these leases as of January 1, 2022. As of December 31, 2023, we had finance lease payment obligations of $1.8 million, with $0.9 million payable within 12 months. See Note 6 in our annual financial statements included elsewhere in this Report for additional information.

Current wording

We lease research equipment, furniture and a vehicle under finance leases. As part of our adoption of ASC 842, we recorded financing right-of-use assets and financing lease liabilities for these leases as of January 1, 2022. As of December 31, 2024, we had finance lease payment obligations of $0.9 million, with $0.8 million payable within 12 months. See Note 6 in our annual financial statements included elsewhere in this Report for additional information.

Previous wording

We expect our existing cash and cash equivalents will enable us to fund our operating expenses and capital expenditure requirements at least into the fourth quarter of 2025. We have based this estimate on assumptions that may prove to be wrong, and we may use our available capital resources sooner than we currently expect. Our future capital requirements will depend on many factors, including:

Current wording

We expect our existing cash and cash equivalents will enable us to fund our operating expenses and capital expenditure requirements into the second quarter of 2026. We have based this estimate on assumptions that may prove to be wrong, and we may use our available capital resources sooner than we currently expect. Our future capital requirements will depend on many factors, including: