Protara Therapeutics Inc
For the period ended Dec 31, 2024. Filed Mar 5, 2025.
View on SEC.govAbout this filing
A company's yearly report to the SEC, with audited financial statements. It is the fullest account a company gives of its business, its finances and the risks it sees.
FY2024 · Filed Mar 5, 2025
TARA$2.30+8.0%Stored close · as of Nov 6, 2026
What changed in Management’s Discussion and Analysis?
Read the current filingPrevious report: 10-K
Period ended 2023-12-31; filed 2024-03-13.
0001213900-24-021982
Item 7. Management’s Discussion and Analysis of Financial Condition and Results of OperationsCurrent report: 10-K
Period ended 2024-12-31; filed 2025-03-05.
0001213900-25-020368
Item 7. Management’s Discussion and Analysis of Financial Condition and Results of OperationsThe baseline is this issuer’s latest earlier reporting period of the same form that was filed before the current report. A previous 10-Q is a different quarter, not a year-over-year comparison. Amendments are excluded.
Compared 68 previous paragraphs and 56 current paragraphs.
25 unchanged; 21 reworded; 10 added; 22 removed; 0 previous and 0 current paragraphs rearranged.
Tables are not compared: 2 previous and 3 current tables excluded. Dates, whitespace, punctuation and numbering changes are ignored; changes to financial figures remain significant.
A changed paragraph is not evidence that risk increased or decreased. An unchanged paragraph does not establish that risk stayed the same.
Added paragraphs (10)
Current report
We are also pursuing intravenous, or IV, Choline Chloride, an investigational phospholipid substrate replacement therapy, for patients receiving parenteral support, or PS, which includes both nutrition and fluids. Choline is a known important substrate for phospholipids that are critical for healthy liver function and also plays an important role in modulating gene expression, cell membrane signaling, brain development and neurotransmission, muscle function and bone health. PS patients are unable to synthesize choline from enteral nutrition sources, and there are currently no available PS formulations containing choline.
Current report
Research and Development Prepaid and Accrued Expenses
Current report
Research and development expenses
Current report
The following table summarizes our research and development expenses (in thousands):
Current report
Research and development expenses were $31.7 million for the year ended December 31, 2024, which represented an increase of approximately $6.7 million as compared to the year ended December 31, 2023. This increase was primarily due to a $6.1 million increase in direct expenses for our product candidates and a $0.6 million increase in indirect expenses. The increase in indirect expenses was primarily due to a $1.0 million increase in personnel-related expenses offset by a decrease of $0.3 million in indirect clinical manufacturing expenses.
Current report
General and administrative expenses
Current report
Other income (expense), net
Current report
In April 2024, the Company entered into a private placement transaction, or the April 2024 Private Placement, whereby the Company sold and issued common stock, warrants and in, in some circumstances, pre-funded warrants to certain purchasers. At the close of the April 2024 Private Placement, the Company received net proceeds of approximately $42.0 million after deducting placement agent fees and offering expenses.
Current report
Net cash provided by (used in) investing activities was approximately $19.2 million for the year ended December 31, 2024 compared to approximately $53.1 million for the year ended December 31, 2023. The decrease of $34.0 million resulted primarily from an increase of $17.2 million of marketable debt securities purchased as well as a decrease of $16.7 million of proceeds from marketable debt securities matured.
Current report
Net cash provided by (used in) financing activities was $139.9 million for the year ended December 31, 2024 compared to $(0.1) million for the year ended December 31, 2023. The increase of approximately $140.0 million resulted primarily from the net proceeds of the December 2024 Public Offering of $94.0 million and the April 2024 Private Placement of $42.0 million, as well as proceeds from the exercise of common warrants of $3.8 million.
Removed paragraphs (22)
Previous report
Our lead oncology program is TARA-002 in NMIBC, which is cancer found in the tissue that lines the inner surface of the bladder that has not spread into the bladder muscle. Bladder cancer is the sixth most common cancer in the United States, with NMIBC representing approximately 80% of bladder cancer diagnoses. Approximately 65,000 patients are diagnosed with NMIBC in the United States each year. Very few new therapeutics have been approved for NMIBC since the 1990s and the current standard of care for NMIBC includes intravesical Bacillus Calmette–Guérin, or BCG. The mechanism of action of TARA-002 is similar in some ways to that of BCG. TARA-002 and BCG are both intravesically administered, elicit a Th1 type immune response and produce a locally-activated generally similar array of cytokines and immune cells.
Previous report
We are conducting a Phase 1 open-label clinical trial to evaluate TARA-002 in treatment-naïve and treatment-experienced NMIBC patients with carcinoma in situ, or CIS, and high-grade papillary tumors, or Ta, known as the ADVANCED-1 trial. In the initial dose escalation phase of the trial, patients received six weekly intravesical doses of TARA-002, evaluating the 10KE, 20KE and 40KE doses (Klinische Einheit, or KE, is a German term indicating a specified weight of dried cells in vial). The primary objective of the trial is to evaluate the safety, tolerability and preliminary signs of anti-tumor activity of TARA-002, with the goal of establishing a recommended Phase 2 dose. In April 2023, we announced positive preliminary data from the Phase 1a dose escalation component of the ongoing ADVANCED-1 trial through the 40KE dose, in which TARA-002 indicated favorable tolerability and anti-tumor activity in NMIBC patients. A maximum tolerated dose was not determined, and dose escalation remains ongoing in exploratory cohorts.
Previous report
Preliminary data from the ADVANCED-1 trial suggested that intravesical TARA-002 was generally well tolerated at the three dose levels evaluated in the initial phase of the trial, and no dose limiting toxicities were observed. The Company has selected the 40KE dose for use in subsequent clinical trials. The majority of reported adverse events were Grades 1 and 2 across all dose levels, and treatment-related adverse events, as assessed by study investigators, were in line with typical responses to bacterial immunopotentiation and included fatigue, headache, fever and chills. The most common urinary symptoms were urinary urgency, urinary frequency, urinary tract pain/burning, incomplete emptying, and bladder spasm. Most bladder irritations resolved soon after administration, or in a few hours to a few days. A total of nine patients were enrolled in the dose escalation portion of the study through the 40KE dose. Of those, three patients with CIS, one of whom was a heavily pre-treated BCG-unresponsive patient, achieved a complete response at the 20KE dose, and tumor regression was observed in the other two patients. Results from six patients with high-grade, non-invasive papillary, or HGTa, tumors showed five of six patients with high-grade recurrence free survival, or HGRFS, at week 12. The patient who did not achieve HGRFS was dosed at 10KE, the lowest dose of TARA-002 offered in the trial.
Previous report
The ongoing open-label expansion trial, or ADVANCED-1EXP, is evaluating intravesical TARA-002 at the 40KE dose in up to 12 CIS patients, including BCG-naïve, BCG-unresponsive, and BCG-inadequately treated patients. Dosing is progressing in the trial, and we anticipate having preliminary data from this trial in the first half of 2024.
Previous report
Based on the preliminary results of ADVANCED-1, we are proceeding with the clinical development of TARA-002 for the treatment of NMIBC. In September 2023, we initiated ADVANCED-2, a Phase 2 open-label trial evaluating intravesical TARA-002 in at least 102 patients with high-grade CIS. Cohort A of the Phase 2 trial is expected to enroll 27 patients with CIS (± Ta/T1), BCG-Naïve or BCG-experienced, who have not received intravesical BCG for at least 24 months prior to CIS diagnosis. Cohort B of the Phase 2 trial is expected to enroll 75-100 patients with BCG-unresponsive CIS (± Ta/T1). The Company expects to share preliminary results from a pre-planned risk-benefit analysis of the ongoing Phase 2 open-label ADVANCED-2 trial in the second half of 2024. The analysis is expected to include approximately 10 patients who are six-month evaluable.
Previous report
In addition, we continue to conduct pre-clinical studies on TARA-002 to better characterize the mechanism of action to help us understand how TARA-002 may perform in potential combinations with other agents used to treat NMIBC. We use pre-clinical data to help us define other cancer targets for TARA-002, both within urothelial cancer and other types of cancer affecting different parts of the body.
Previous report
We are also pursuing TARA-002 in LMs, which are rare, non-malignant cysts of the lymphatic vascular system that primarily form in the head and neck region of children before the age of two. In July 2020, the FDA granted Rare Pediatric Disease designation for TARA-002 for the treatment of LMs and in May 2022 the European Medicines Agency granted orphan drug designation to TARA-002 for the treatment of LMs. In addition to the clinical experience in Japan, we have secured the rights to a dataset from one of the largest ever conducted Phase 2 trials in LMs, in which OK-432 was administered via a compassionate use program led by the University of Iowa to over 500 pediatric and adult patients. We have an investigational new drug application for LMs with the Vaccines and Related Products Division of the FDA, or Vaccines Division.
Previous report
In October 2023, we initiated STARBORN-1 is a Phase 2 single-arm, open-label, prospective clinical trial to evaluate the safety and efficacy of intracystic injection of TARA-002 for the treatment of macrocystic and mixed-cystic LMs (≥ 50% macrocystic disease) in participants six months to less than 18 years of age. Including an age de-escalation safety lead-in, the trial will enroll approximately 30 patients who will receive up to four injections of TARA-002 spaced approximately six weeks apart.
Previous report
The primary endpoint of the trial is the proportion of participants with macrocystic LMs and mixed-cystic LMs who demonstrated clinical success, defined as having either a complete response (90% to 100% reduction from baseline in total LM volume) or substantial response (60% to less than 90% reduction in total LM volume) as measured by axial imaging.
Previous report
The third development program in our portfolio is intravenous, or IV, Choline Chloride, an investigational phospholipid substrate replacement therapy, for patients receiving parenteral nutrition, or PN. The FDA has granted IV Choline Chloride Orphan Drug Designation for the prevention of choline deficiency in PN patients. We have conducted a two-part prevalence study to enhance our understanding of the PN patient population. The first, or retrospective, part of the prevalence study was completed in September 2021, when we reported results that supported that there was a significant unmet medical need in patients dependent on PN. We have concluded the second, or prospective part, of the prevalence study, which is a multi-center, cross-sectional observational study that assessed the prevalence of choline deficiency in patients dependent on PN. We shared these results with the FDA to inform our discussion on next steps for the IV Choline Chloride program. There are currently no IV formulations of choline available or in development for PN patients.
Previous report
Research and Development Accruals
Previous report
Goodwill
Previous report
Goodwill represents the excess of purchase price over the fair value of identifiable net assets acquired in a business combination. Goodwill has an indefinite useful life. Goodwill is assessed annually for impairment as of December 31, or more frequently if an event occurs or circumstances change that would indicate that it is more likely than not that the fair value of a reporting unit or the fair value of an indefinite-lived intangible asset has declined below its carrying value. In performing its annual goodwill impairment assessment, we have the option under GAAP to qualitatively assess whether it is more likely than not that the fair value of a reporting unit is less than its carrying value; if the conclusion of the qualitative assessment is that there are no indicators of impairment, then we would not perform a quantitative assessment. Otherwise, a quantitative assessment is performed and the fair value of the reporting unit is determined.
Previous report
Goodwill was evaluated for impairment at the reporting unit level, which is defined as an operating segment, or one level below an operating segment. We have determined that we operate as one reporting unit and had selected December 31 as the date to perform our annual impairment test. As of December 31, 2022, we elected to forego the qualitative screen and performed a quantitative annual goodwill impairment test for our single reporting unit.
Previous report
As of December 31, 2022, our stock price and market capitalization declined approximately 60% from December 31, 2021. Although we believed this decline reflects the overall performance of similar life science companies with less than $250 million in market capitalizations, or microcap companies, we do not believe it reflects the progress made in advancing our product candidate pipeline. The life sciences sector, which includes pre-commercialization and therefore net operating loss generating companies, relies heavily on the capital markets to finance their operations and fund pre-clinical and clinical trials for their existing development programs. As a result of a shift in risk appetite in the overall financial markets, the availability of capital for life science companies decreased significantly in 2022. Industry reports highlighted a decline of more than 50 percent in both the number of healthcare follow-on financings as well as the amount of capital raised in 2022 compared to 2021. These challenging financing conditions had a significantly negative impact on stock prices and respective market capitalizations, particularly for microcap companies. We considered the heightened financing risk that impacted the life sciences sector during 2022 to be one of the key macroeconomic factors that led to a sustained decrease in our stock price and market capitalization leading up to our annual goodwill impairment assessment date in late 2022.
Previous report
The fair value of our reporting unit was determined using an income approach based on discounted cash flows, or DCF, as we elected to forgo the qualitative screen. Determining fair value using a DCF analysis required the exercise of significant judgment with respect to several assumptions and estimates, including the amount and timing of expected future cash flows and appropriate discount rate to be applied. The expected cash flows used in the DCF analyses are based on our most recent internal long-range forecast and budget and, for years beyond the budget, our estimates, which are based, in part, on industry benchmarks and forecasted growth rates.
Previous report
The discount rate used in the DCF analysis was intended to reflect the risks inherent in the expected future cash flows of the respective programs within our portfolio. Assumptions used in the DCF analysis, including the discount rate, were assessed based on our current results and forecasted future performance, as well as macroeconomic and industry specific factors, including the aforementioned market factors influenced by financing risk discussed above.
Previous report
We determined the estimated fair value of our single reporting unit by utilizing a discount rate of 36%, which reflects these market factors. Based upon this discount rate, the fair value of our single reporting unit was below its carrying value by an amount greater than the carrying value of goodwill, and we recorded an impairment charge of $29.5 million in the fourth quarter of 2022 to fully write off the goodwill.
Previous report
Research and development expenses. During the year ended December 31, 2023, our research and development expenses were approximately $25.0 million, which represented an increase of approximately $8.2 million as compared to the year ended December 31, 2022. This was primarily due to an increase in expenses related to clinical trial and non-clinical activities for TARA-002 of $7.3 million as well as an increase of $0.8 million in personnel-related expenses.
Previous report
Loss on impairment of goodwill. During the year ended December 31, 2022, we recorded a non-cash impairment charge of $29.5 million to fully impair goodwill. There was no impairment charge during the year ended December 31, 2023.
Previous report
Net cash provided by investing activities was approximately $53.1 million for the year ended December 31, 2023 compared to net cash provided by investing activities of approximately $15.0 million for the year ended December 31, 2022. The increase of $38.2 million resulted primarily from maturities and redemptions of marketable debt securities of $65.3 million for the year ended December 31, 2023 as compared to $58.6 million for the year ended December 31, 2022 and the purchase of marketable debt securities of $12.2 million for the year ended December 31, 2023 as compared to $43.6 million for the year ended December 31, 2022.
Previous report
Net cash used in financing activities was approximately $0.1 million for the years ended December 31, 2023 and 2022.
Reworded paragraphs (21)
Previous wording
Our portfolio includes two development programs utilizing TARA-002, an investigational cell therapy based on the broad immunopotentiator, OK-432, which was originally granted marketing approval by the Japanese Ministry of Health and Welfare as an immunopotentiating cancer therapeutic agent. This cell therapy is currently approved in Japan and Taiwan for LMs and multiple oncologic indications. We have secured worldwide rights to the asset excluding Japan and Taiwan and are exploring its use in oncology and rare disease indications. TARA-002 was developed from the same master cell bank of genetically distinct group A Streptococcus pyogenes as OK-432 (marketed as Picibanil® in Japan and Taiwan by Chugai Pharmaceutical Co., Ltd., or Chugai Pharmaceutical). We are currently developing TARA-002 in non-muscle invasive bladder cancer, or NMIBC, and in LMs.
Current wording
Our portfolio includes two development programs utilizing TARA-002, an investigational cell therapy based on the broad immunopotentiator, OK-432, which was originally granted marketing approval by the Japanese Ministry of Health and Welfare as an immunopotentiating cancer therapeutic agent. This cell therapy is currently approved in Japan and Taiwan for lymphatic malformations, or LMs, and multiple oncologic indications. We have secured worldwide rights to the asset excluding Japan and Taiwan and are exploring its use in oncology and rare disease indications. TARA-002 was developed from the same master cell bank of genetically distinct group A Streptococcus pyogenes as OK-432 (marketed as Picibanil® in Japan by Chugai Pharmaceutical Co., Ltd., or Chugai Pharmaceutical). We are currently developing TARA-002 in non-muscle invasive bladder cancer, or NMIBC, and in LMs.
Previous wording
We have devoted substantial efforts to the development of these programs and do not have any approved products and have not generated any revenue from product sales. Neither TARA-002 nor IV Choline Chloride have been approved for use for any indications. We do not expect to generate revenues in the near-term, and it is possible we may never generate revenues in the future. To finance our current strategic plans, including the conduct of ongoing and future clinical trials and further research and development costs, we will need to raise additional capital. See “—Liquidity and Capital Resources” for additional information about our liquidity and capital resource needs.
Current wording
For additional information regarding our various clinical trials and programs, see “Item 1. Business.” We have devoted substantial efforts to the development of these programs and do not have any approved products and have not generated any revenue from product sales. Neither TARA-002 nor IV Choline Chloride have been approved for use for any indications. We do not expect to generate revenues in the near-term, and it is possible we may never generate revenues in the future. To finance our current strategic plans, including the conduct of ongoing and future clinical trials and further research and development costs, we will need to raise additional capital. See “Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations—Liquidity and Capital Resources” for additional information about our liquidity and capital resource needs.
Previous wording
Since inception, we have incurred significant operating losses. As of December 31, 2023, we had an accumulated deficit of approximately $200.4 million. We expect to continue to incur significant expenses and increasing operating losses for at least the next few years as we continue our development of, and seek marketing approvals for, our product candidates, prepare for and begin the commercialization of any approved products, and add infrastructure and personnel to support our product development efforts and operations as a public company in the United States.
Current wording
Since inception, we have incurred significant operating losses. As of December 31, 2024, we had an accumulated deficit of approximately $245.0 million. We expect to continue to incur significant expenses and increasing operating losses for at least the next few years as we continue our development of, and seek marketing approvals for, our product candidates, prepare for and begin the commercialization of any approved products, and add infrastructure and personnel to support our product development efforts and operations as a public company in the United States.
Previous wording
As of December 31, 2023, we had approximately $65.6 million in cash, cash equivalents, and marketable debt securities.
Current wording
As of December 31, 2024, we had approximately $170.3 million in cash and cash equivalents, and marketable debt securities.
Previous wording
Research and development expenses consist primarily of costs incurred for the development of TARA-002 and IV Choline Chloride, which include personnel-related expenses, including salaries, benefits, travel and stock-based compensation expense, expenses incurred under agreements with clinical research organizations, or CROs, contract development and manufacturing organizations, or CDMOs, the cost of acquiring, developing and manufacturing clinical trial materials, clinical and non-clinical related costs, costs associated with regulatory operations and facilities, depreciation and other expenses, which include expenses for rent and maintenance of facilities and other supplies.
Current wording
Research and development expenses consist primarily of costs incurred for the development of TARA-002 and IV Choline Chloride, which include personnel-related expenses, including salaries, benefits, travel and stock-based compensation expense, external expenses incurred under agreements with contract research organizations, or CROs, contract development and manufacturing organizations, or CDMOs, the cost of acquiring, developing and manufacturing clinical trial materials, clinical and non-clinical related costs, costs associated with regulatory operations and facilities, depreciation and other expenses, which include expenses for rent and maintenance of facilities and other supplies.
Previous wording
General and administrative expenses consist principally of personnel-related expenses, including salaries, benefits, travel and stock-based compensation expense, in executive and other administrative functions. Other general and administrative expenses also include professional fees for legal, intellectual property matters, consulting and accounting services, facility related costs, as well as expenses related to audit, legal, regulatory and tax-related services associated with maintaining compliance with our Nasdaq listing and SEC requirements, director and officer liability insurance premiums and investor relations costs associated with being a public company.
Current wording
General and administrative expenses consist primarily of personnel-related expenses, including salaries, benefits, travel and stock-based compensation expense, in executive and other administrative functions. Other general and administrative expenses also include professional fees for business and market development, legal, intellectual property matters, consulting and accounting services, facility related costs, as well as expenses related to audit, legal, regulatory and tax-related services associated with maintaining compliance with our Nasdaq listing and Securities and Exchange Commission, or SEC, requirements, director and officer liability insurance premiums and investor relations costs associated with being a public company.
Previous wording
Interest and investment income consists of interest and dividend income on our cash, cash equivalents and marketable debt securities and amortization of premiums and/or accretion of discounts.
Current wording
Other Income (Expense), net consists of interest and investment income and other income. Interest and investment income consists of interest and dividend income on our cash and cash equivalents and marketable debt securities and amortization of premiums and/or accretion of discounts.
Previous wording
Our management’s discussion and analysis of our financial position and results of operations is based on our financial statements, which have been prepared in accordance with accounting principles generally accepted in the United States of America, or GAAP. The preparation of financial statements in conformity with GAAP requires us to make estimates and assumptions that affect the amounts reported in the financial statements and accompanying notes. We base our estimates on historical experience and other market-specific or other relevant assumptions that we believe to be reasonable under the circumstances. Actual results may differ materially from those estimates or assumptions.
Current wording
Our management’s discussion and analysis of our financial condition and results of operations is based on our consolidated financial statements, which have been prepared in accordance with accounting principles generally accepted in the United States of America, or GAAP. The preparation of consolidated financial statements in conformity with GAAP requires us to make estimates and assumptions that affect the amounts reported in the financial statements and accompanying notes. We base our estimates on historical experience and other market-specific or other relevant assumptions that we believe to be reasonable under the circumstances. Actual results may differ materially from those estimates or assumptions.
Previous wording
While our significant accounting policies are described in more detail in the notes to our consolidated financial statements and related notes appearing elsewhere in this Annual Report on 10-K, we believe the following accounting policies to be most critical to the judgments and estimates used in the preparation of our financial statements.
Current wording
While our significant accounting policies are described in more detail in the notes to our consolidated financial statements and related notes appearing elsewhere in this Annual Report on this Form 10-K, we believe the following accounting policies to be most critical to the judgments and estimates used in the preparation of our financial statements.
Previous wording
Our critical accounting policy is the accounting for accrued research and development expenses. During the year ended December 31, 2022, goodwill was also considered a critical accounting estimate.
Current wording
Our critical accounting policy is the accounting for prepaid and accrued research and development expenses.
Previous wording
We record accruals for estimated costs of research, preclinical, clinical and manufacturing development within accrued expenses which are significant components of research and development expenses. A substantial portion of our ongoing research and development activities are conducted by third-party service providers. We accrue costs incurred under these third-party arrangements based on estimates of actual work completed in accordance with the respective agreements. We determine the estimated costs to accrue through discussions with internal personnel and our external service providers as to the percentage of completion of the services and the agreed-upon fees to be paid for such services. Payments made to third parties under these arrangements in advance of performance of the related services are recorded as prepaid expenses until the services are rendered.
Current wording
We record accruals for estimated costs of research, preclinical, non-clinical, clinical and manufacturing development within accrued expenses which are significant components of research and development expenses. A substantial portion of our ongoing research and development activities are conducted by third-party service providers. We accrue costs incurred under these third-party arrangements based on estimates of actual work completed in accordance with the respective agreements. We determine the estimated costs to accrue through discussions with internal personnel and our external service providers as to the percentage of completion of the services and the agreed-upon fees to be paid for such services. Payments made to third parties under these arrangements in advance of performance of the related services are recorded as prepaid expenses until the services are rendered.
Previous wording
The following table summarizes our results of operations for the years ended December 31, 2023 and 2022 (in thousands):
Current wording
The following table summarizes our results of operations (in thousands):
Previous wording
General and administrative expenses. During the year ended December 31, 2023, our general and administrative expenses were approximately $18.6 million, which represented a decrease of approximately $2.1 million as compared to the year ended December 31, 2022. This decrease was primarily due to a reduction of $1.6 million in personnel-related expenses (inclusive of $0.7 million of stock-based compensation) and lower premiums of $1.2 million for directors and officers liability insurance. These cost reductions were partially offset by an increase of $0.8 related to legal and market development activities.
Current wording
General and administrative expenses were $17.5 million for the year ended December 31, 2024, which represented a decrease of approximately $1.2 million as compared to the year ended December 31, 2023. This decrease was primarily due to a net decrease of $1.2 million in personnel-related expenses.
Previous wording
Other income (expense), net. During the year ended December 31, 2023, our other income (expense), net was approximately $3.2 million, which represented an increase of approximately $2.1 million as compared to the year ended December 31, 2022, due primarily to higher market interest rates obtained from money market funds and corporate debt securities held as marketable securities.
Current wording
Other income (expense), net was $4.6 million for the year ended December 31, 2024, which represented an increase of approximately $1.4 million as compared to the year ended December 31, 2023, due primarily to higher investment returns on a higher invested balance as well as a $0.4 million increase in other income.
Previous wording
As of December 31, 2023 and 2022, our cash, cash equivalents, and marketable debt securities were $65.6 million and $102.3 million, respectively. We have not generated revenues since our inception and have incurred net losses of approximately $40.4 million and $66.0 million for the years ended December 31, 2023 and 2022, respectively. As of December 31, 2023, we had working capital of approximately $62.6 million and stockholder’s equity of approximately $68.3 million. During the year ended December 31, 2023, cash flows used in operating activities were approximately $37.6 million, consisting primarily of a net loss of approximately $40.4 million, which includes non-cash activities of approximately $7.0 million, inclusive of $6.1 million in stock-based compensation charges, as well as working capital adjustments of $4.1 million. Since inception, we have met our liquidity requirements principally through the sale of our common stock and preferred stock in private placements and underwritten offerings.
Current wording
As of December 31, 2024 and 2023, our cash and cash equivalents, and marketable debt securities were $170.3 million and $65.6 million, respectively. We have not generated revenues since our inception and have incurred net losses of approximately $44.6 million and $40.4 million for the years ended December 31, 2024 and 2023, respectively. As of December 31, 2024, we had working capital of approximately $161.2 million and stockholder’s equity of approximately $167.1 million. During the year ended December 31, 2024, cash flows used in operating activities were approximately $35.8 million, consisting primarily of a net loss of approximately $44.6 million, which includes non-cash activities of approximately $4.8 million, inclusive of $4.1 million in stock-based compensation expense, as well as working capital adjustments of $4.0 million. Since inception, we have met our liquidity requirements principally through the sale of our common stock, preferred stock and pre-funded warrants in private placements and public offerings. In addition, we may receive proceeds upon the exercise of the common warrants issued in the April 2024 private placement described below.
Previous wording
On November 3, 2023, we filed a shelf registration statement on Form S-3, or the Shelf Registration Statement, which became effective in November 2023. The Shelf Registration Statement permits the offering, issuance and sale by us of up to a maximum aggregate offering price of $300 million of common stock, preferred stock, debt securities and warrants in one or more offerings and in any combination. No securities have been sold to date under the Shelf Registration Statement. For so long as the public float of our common stock held by non-affiliates is below $75 million, our ability to use the Shelf Registration Statement will be limited by “baby shelf” rules, which limit us to sales in an amount not to exceed one-third of such public float. Such amounts may not be adequate for meeting our capital needs.
Current wording
On November 3, 2023, we filed a shelf registration statement on Form S-3, or the Shelf Registration Statement, which became effective in November 2023. The Shelf Registration Statement permits the offering, issuance and sale by us of up to a maximum aggregate offering price of $300.0 million of common stock, preferred stock, debt securities and warrants in one or more offerings and in any combination. In December 2024, we sold and issued approximately $100.1 million in gross proceeds of common stock and pre-funded warrants in a public offering, or the December 2024 Public Offering, under the Shelf Registration Statement. The net proceeds were approximately $93.4 million. In January 2025, the underwriters partially exercised their option, or the Underwriters’ Option, to purchase a portion of the additional shares of common stock pursuant to the underwriting agreement, or the Underwriting Agreement, which resulted in gross proceeds of approximately $2.7 million and net proceeds of approximately $2.5 million.
Previous wording
We believe that our current financial resources, as of the date of the issuance of our consolidated financial statements included elsewhere in this Annual Report on Form 10-K, are sufficient to satisfy our estimated liquidity needs for at least 12 months.
Current wording
We believe that our current financial resources, as of the date of the issuance of our consolidated financial statements included elsewhere in this Annual Report on this Form 10-K, are sufficient to satisfy our estimated liquidity needs for at least 12 months.
Previous wording
As a result of volatility in the capital markets, economic conditions, general global economic uncertainty, political change, global pandemics, and other factors, we do not know whether additional capital will be available when needed, or that, if available, we will be able to obtain additional capital on reasonable terms. If we are unable to raise additional capital due to volatile global financial markets, general economic uncertainty or other factors, we may need to curtail planned development activities. The sustained elevated interest rates in recent years have had, and may continue to have, a negative effect on market prices for common stock of public companies, especially those in the pharmaceutical industry and those that have no current or near-term revenue. Further, a recession or market correction, supply chain disruptions and/or continued inflation could materially affect our business and the value of our common stock.
Current wording
As a result of volatility in the capital markets, economic conditions, general global economic uncertainty, political change, global pandemics, and other factors, we do not know whether additional capital will be available when needed, or that, if available, we will be able to obtain additional capital on reasonable terms. If we are unable to raise additional capital due to volatile global financial markets, general economic uncertainty or other factors, we may need to curtail planned development activities. Despite recent moderation, the sustained elevated interest rates in recent years have had, and may continue to have, a negative effect on market prices for common stock of public companies, especially those in the biotech industry and those that have no current or near-term revenue. Further, a recession or market correction, supply chain disruptions and/or continued inflation could materially affect our business and the value of our common stock.
Previous wording
The following table summarizes our sources and uses of cash for the years ended December 31, 2023 and 2022 (in thousands):
Current wording
The following table summarizes our sources and uses of cash (in thousands):
Previous wording
Net cash used in operating activities was approximately $37.6 million for the year ended December 31, 2023 compared to approximately $26.5 million for the year ended December 31, 2022. The increase of approximately $11.1 million in cash used in operating activities was primarily driven by a decrease in net loss of $25.5 million which includes a $32.0 million decrease in non-cash items including goodwill, stock-based compensation, operating lease right-of-use asset, depreciation, and amortization of premium on marketable debt securities and a $4.7 million increase in working capital adjustments, primarily related to changes in prepaid expenses and other current assets, accounts payable, and accrued expenses resulting from the timing of payments to our service providers.
Current wording
Net cash provided by (used in) operating activities was approximately $(35.8) million for the year ended December 31, 2024 compared to approximately $(37.6) million for the year ended December 31, 2023. The decrease of approximately $1.7 million in cash used in operating activities was primarily driven by a decrease in working capital adjustments, primarily related to changes in prepaid expenses and other current assets, accounts payable, and accrued expenses resulting from the timing of payments to our service providers of $8.1 million, offset in part by an increase in net loss of $4.2 million and by a $2.2 million decrease in non-cash items, consisting principally of stock-based compensation expense.
Previous wording
Our operating lease obligations primarily consist of lease payments on our corporate headquarters in New York, New York, as well as lease payments for our development laboratory, a manufacturing facility and an additional manufacturing space, all located in North America which are described in further detail in Note 9 of our consolidated financial statements included in this Annual Report on Form 10-K. Future contractual payments on operating lease obligations due within one year of December 31, 2023 are $1.3 million, and future contractual payments on operating lease obligations due greater than one year from December 31, 2023 are $5.1 million.
Current wording
Our operating lease obligations primarily consist of lease payments on our corporate headquarters in New York, New York, as well as lease payments for our development laboratory, a manufacturing facility and an additional manufacturing space, all located in North America which are described in further detail in Note 9 of our consolidated financial statements included in this Annual Report on Form 10-K. Future contractual payments on operating lease obligations due within one year of December 31, 2024 are $1.4 million, and future contractual payments on operating lease obligations due greater than one year from December 31, 2024 are $3.7 million.