RAPT Therapeutics Reports Third Quarter 2024 Financial Results

Rhea-AI Summary

RAPT Therapeutics (Nasdaq: RAPT), a clinical-stage, immunology-based therapeutics company, reported its third quarter 2024 financial results. Net loss for Q3 2024 was $18.4 million, a significant improvement from the $31.4 million loss in Q3 2023. Research and development expenses decreased to $13.3 million from $27.0 million in Q3 2023, mainly due to lower development costs for zelnecirnon, tivumecirnon, and early-stage programs, as well as reduced personnel and lab supply expenses. General and administrative expenses also saw a slight reduction to $6.4 million from $6.9 million. The company implemented a workforce reduction in July 2024, affecting 47 employees (40% of the workforce), incurring $0.9 million in restructuring charges. For the nine months ended September 30, 2024, net loss was $76.6 million, down from $85.9 million in the same period of 2023. As of September 30, 2024, RAPT held $97.9 million in cash and marketable securities.

Positive

• Net loss decreased to $18.4 million in Q3 2024 from $31.4 million in Q3 2023.
• Research and development expenses reduced to $13.3 million from $27.0 million.
• General and administrative expenses decreased to $6.4 million from $6.9 million.
• Net loss for the nine months ended September 30, 2024, decreased to $76.6 million from $85.9 million.

Negative

• Workforce reduction affected 47 employees, incurring $0.9 million in restructuring charges.
• General and administrative expenses for the nine months increased to $20.9 million from $19.6 million.

Insights

Financial Analyst

The Q3 financial report reveals concerning trends for RAPT Therapeutics. The company's $97.9 million cash position, while significant, must be viewed against a substantial quarterly burn rate of $18.4 million. The 40% workforce reduction, affecting 47 employees, signals serious cost-cutting measures that could impact development timelines.

While R&D expenses decreased by $13.7 million year-over-year to $13.3 million, this reduction primarily stems from scaled-back development activities across key programs including zelnecirnon and tivumecirnon. The narrowing net loss to $18.4 million from $31.4 million comes at the cost of reduced operational capacity.

At the current burn rate, without additional financing, the cash runway extends approximately 5-6 quarters. The restructuring suggests a strategic pivot to preserve capital, but may limit the company's ability to advance its pipeline effectively.

SOUTH SAN FRANCISCO, Calif., Nov. 12, 2024 (GLOBE NEWSWIRE) -- RAPT Therapeutics, Inc. (Nasdaq: RAPT), a clinical-stage, immunology-based therapeutics company focused on discovering, developing and commercializing oral small molecule therapies for patients with significant unmet needs in inflammatory diseases and oncology, today reported financial results for the third quarter and nine months ended September 30, 2024.

Financial Results for the Third Quarter and Nine Months Ended September 30, 2024

Third Quarter Ended September 30, 2024

Net loss for the third quarter of 2024 was $18.4 million, compared to $31.4 million for the third quarter of 2023.

Research and development expenses for the third quarter of 2024 were $13.3 million, compared to $27.0 million for the same period in 2023. The decrease in research and development expenses was primarily due to lower development costs related to zelnecirnon, tivumecirnon and early stage programs, as well as decreased expenses for personnel, consultants and lab supplies.

General and administrative expenses for the third quarter of 2024 were $6.4 million, compared to $6.9 million for the same period in 2023. The decrease in general and administrative expenses was primarily due to decreased expenses for personnel, consultants and insurance premiums, partially offset by increases in expenses for non-cash stock-based compensation and facilities.

On July 16, 2024, the Company’s board of directors approved a reduction of the Company’s workforce to conserve cash resources. The workforce reduction affected 47 people, or approximately 40% of the Company’s headcount. The Company incurred $0.9 million in restructuring charges in connection with the workforce reduction, consisting of cash-based expenses related to employee severance payments, benefits and related costs. The Company completed the workforce reduction plan and all the related cash payments during the third quarter ended September 30, 2024.

Nine Months Ended September 30, 2024

Net loss for the nine months ended September 30, 2024 was $76.6 million, compared to $85.9 million for the same period in 2023.

Research and development expenses for the nine months ended September 30, 2024 were $60.8 million, compared to $74.2 million for the same period in 2023. The decrease in research and development expenses was primarily due to decreases in development costs related to zelnecirnon, tivumecirnon and early-stage programs, as well as lab supplies, partially offset by increased expenses for personnel, consultants, facilities and non-cash stock-based compensation.

General and administrative expenses for the nine months ended September 30, 2024 were $20.9 million, compared to $19.6 million for the same period in 2023. The increase in general and administrative expenses was primarily due to increased expenses for personnel, non-cash stock-based compensation and facilities, partially offset by decreases in expenses for consultants and insurance premiums.

As of September 30, 2024, the Company had cash and cash equivalents and marketable securities of $97.9 million.

About RAPT Therapeutics, Inc.

RAPT Therapeutics is a clinical-stage, immunology-based therapeutics company focused on discovering, developing and commercializing oral small molecule therapies for patients with significant unmet needs in inflammatory diseases and oncology. Utilizing its proprietary discovery and development engine, the Company is developing highly selective small molecules designed to modulate the critical immune drivers underlying these diseases. RAPT has discovered and advanced two unique drug candidates, zelnecirnon (RPT193) and tivumecirnon (FLX475), each targeting C-C motif chemokine receptor 4 (CCR4), for the treatment of inflammation and cancer, respectively. The Company is also pursuing a range of targets that are in the discovery stage of development.

Forward-Looking Statements

This press release contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Words such as “anticipate,” “estimates,” “expects,” “will” and similar expressions (as well as other words or expressions referencing future events, conditions or circumstances) are intended to identify forward-looking statements. These statements relate to future events and involve known and unknown risks, uncertainties and other factors that may cause our actual results, performance or achievements to be materially different from any future performances or achievements expressed or implied by the forward-looking statements. Each of these statements is based only on current information, assumptions and expectations that are inherently subject to change and involve a number of risks and uncertainties. Detailed information regarding risk factors that may cause actual results to differ materially from the results expressed or implied by statements in this press release may be found in RAPT’s Quarterly Report on Form 10-Q filed with the Securities and Exchange Commission on November 12, 2024 and subsequent filings made by RAPT with the Securities and Exchange Commission. These forward-looking statements speak only as of the date hereof. RAPT disclaims any obligation to update these forward-looking statements, except as required by law.

RAPT Media Contact:
Aljanae Reynolds
areynolds@wheelhouselsa.com

RAPT Investor Contact:
Sylvia Wheeler
swheeler@wheelhouselsa.com

RAPT THERAPEUTICS INC. CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE LOSS (In thousands, except share per share data) (Unaudited)
		Three Months Ended September 30,				Three Months Ended September 30,				Nine Months Ended September 30,				Nine Months Ended September 30,
		2024				2023				2024				2023
Operating expenses:
Research and development			13,340				27,022				60,761				74,238
General and administrative			6,448				6,897				20,875				19,607
Total operating expenses			19,788				33,919				81,636				93,845
Loss from operations			(19,788	)			(33,919	)			(81,636	)			(93,845	)
Other income, net			1,356				2,548				5,020				7,923
Net loss		$	(18,432	)		$	(31,371	)		$	(76,616	)		$	(85,922	)
Other comprehensive income (loss):
Foreign currency translation loss			—				—				—				(655	)
Unrealized gain on marketable securities			154				59				4				560
Total comprehensive loss		$	(18,278	)		$	(31,312	)		$	(76,612	)		$	(86,017	)
Net loss per share, basic and diluted		$	(0.47	)		$	(0.82	)		$	(1.97	)		$	(2.24	)
Weighted average number of shares used in computing net loss per share, basic and diluted			38,903,476				38,358,032				38,800,528				38,322,773

RAPT THERAPEUTICS, INC. CONSOLIDATED BALANCE SHEETS (In thousands)
		September 30, 2024				December 31, 2023
Assets		(Unaudited)				(1)
Current assets:
Cash and cash equivalents		$	37,900			$	47,478
Marketable securities			60,005				111,384
Prepaid expenses and other current assets			4,693				2,920
Total current assets			102,598				161,782
Property and equipment, net			1,653				2,448
Operating lease right-of-use assets			3,825				5,228
Other assets			389				3,871
Total assets		$	108,465			$	173,329
Liabilities and stockholders’ equity
Current liabilities:
Accounts payable		$	1,380			$	5,176
Accrued expenses			6,398				14,103
Operating lease liabilities, current			2,523				2,448
Other current liabilities			61				109
Total current liabilities			10,362				21,836
Operating lease liabilities, non-current			2,597				4,458
Total liabilities			12,959				26,294
Commitments
Stockholders’ equity:
Preferred stock			—				—
Common stock			3				3
Additional paid-in capital			656,694				631,611
Accumulated other comprehensive gain			107				103
Accumulated deficit			(561,298	)			(484,682	)
Total stockholders’ equity			95,506				147,035
Total liabilities and stockholders’ equity		$	108,465			$	173,329

(1)

The consolidated balance sheet for December 31, 2023 has been derived from audited consolidated financial statements included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2023.

FAQ

What were RAPT Therapeutics' net losses for Q3 2024?

RAPT Therapeutics reported a net loss of $18.4 million for Q3 2024.

How much did RAPT Therapeutics spend on research and development in Q3 2024?

RAPT Therapeutics spent $13.3 million on research and development in Q3 2024.

What were the general and administrative expenses for RAPT Therapeutics in Q3 2024?

General and administrative expenses for Q3 2024 were $6.4 million.

How much did RAPT Therapeutics reduce its workforce by in July 2024?

RAPT Therapeutics reduced its workforce by 40%, affecting 47 employees.

What were RAPT Therapeutics' net losses for the nine months ended September 30, 2024?

RAPT Therapeutics reported a net loss of $76.6 million for the nine months ended September 30, 2024.

What was the cash and marketable securities position of RAPT Therapeutics as of September 30, 2024?

As of September 30, 2024, RAPT Therapeutics had $97.9 million in cash and marketable securities.