Sutro Biopharma Reports Full Year 2024 Financial Results and Business Highlights

Rhea-AI Summary

Sutro Biopharma (NASDAQ: STRO) has reported its full year 2024 financial results, announcing a strategic portfolio review that prioritizes wholly-owned next-generation ADC programs. The company's financial position shows $316.9 million in cash, cash equivalents, and marketable securities as of December 31, 2024, projecting a cash runway into at least Q4 2026.

Key financial metrics include:

• Revenue decreased to $62.0 million in 2024 from $153.7 million in 2023
• Total operating expenses increased to $300.5 million in 2024 from $243.0 million in 2023
• Research and development expenses were $252.0 million
• General and administrative expenses totaled $48.5 million

The restructuring plan is expected to require $40 to $45 million in cash payments, but subsequent cost reductions and refocused clinical development priorities are anticipated to support the company's operations through Q4 2026.

Positive

• Strong cash position of $316.9 million provides extended runway into Q4 2026
• Strategic portfolio review to focus on wholly-owned next-generation ADC programs
• Cost reduction initiatives implemented through restructuring

Negative

• Significant revenue decline from $153.7M in 2023 to $62.0M in 2024
• Operating expenses increased 23.7% to $300.5M in 2024
• Restructuring costs of $40-45M will impact cash reserves

Insights

Financial Analyst

Sutro Biopharma's full year 2024 financial results reveal a company in strategic transition, with mixed financial signals that demand careful analysis. The company reported $62.0 million in revenue for 2024, marking a substantial 60% decrease from the $153.7 million recorded in 2023. This significant revenue decline primarily stems from collaboration-based income fluctuations, which are inherently variable in biotech business models focused on partnership-driven development.

Simultaneously, operating expenses increased to $300.5 million, up 24% from 2023, with R&D accounting for $252.0 million of that total. This growing expense profile coupled with declining revenue creates an unfavorable financial trajectory that requires addressing, which appears to be precisely what management is doing through its announced strategic portfolio review.

The most significant positive factor in Sutro's financial position is its substantial liquidity - $316.9 million in cash, cash equivalents, and marketable securities as of December 31, 2024. This provides a projected runway into at least Q4 2026, even without factoring in potential milestone payments from existing collaborations. This strong cash position gives Sutro considerable breathing room to execute its strategic pivot despite current financial pressures.

The announced portfolio reprioritization toward wholly-owned next-generation ADC programs represents a strategic shift aimed at capturing higher-margin opportunities where Sutro retains full economics. The associated $40-45 million in restructuring expenditures indicates meaningful organizational changes that, while costly in the short term, are designed to extend runway and focus resources on programs with the highest potential ROI.

The confluence of portfolio reprioritization, management changes, and restructuring expenditures suggests the company is taking decisive action to address financial challenges while positioning itself for future growth in the competitive ADC landscape. The strong cash position provides the essential foundation for this transition, buying valuable time for their refocused pipeline to advance toward value-inflection milestones.

– Sutro announced a strategic portfolio review resulting in prioritization of wholly-owned next-generation ADC programs; Key management changes announced as part of transition –

– Cash, cash equivalents and marketable securities as of December 31, 2024 of $316.9 million, with cash runway expected into at least Q4 2026, excluding anticipated milestones from existing collaborations –

– Conference call today at 2:00 p.m. PT / 5:00 p.m. ET –

SOUTH SAN FRANCISCO, Calif., March 13, 2025 (GLOBE NEWSWIRE) -- Sutro Biopharma, Inc. (Sutro or the Company) (NASDAQ: STRO), an oncology company pioneering site-specific and novel-format antibody drug conjugates (ADCs), today reported its financial results for the full year 2024 and recent business highlights. The Company also announced the completion of a strategic portfolio review resulting in the prioritization of its next-generation ADC pipeline. A conference call will be held today at 2:00 p.m. PT / 5:00 p.m. ET to discuss the pipeline reprioritization, team restructuring and next steps.

Full Year 2024 Financial Highlights

Cash, Cash Equivalents and Marketable Securities
As of December 31, 2024, Sutro had cash, cash equivalents and marketable securities of $316.9 million, as compared to $388.3 million as of September 30, 2024. Cash runway is expected into at least Q4 2026, excluding anticipated milestones from existing collaborations.

Revenue
Revenue was $62.0 million for the year ended December 31, 2024, as compared to $153.7 million for the year ended December 31, 2023, with the 2024 amount related principally to the Astellas collaboration and the Tasly agreement. Future collaboration and license revenue under existing agreements, and from any additional collaboration and license partners, will fluctuate as a result of the amount and timing of revenue recognition of upfront, milestones, and other agreement payments.

Operating Expenses
Total operating expenses for the year ended December 31, 2024 were $300.5 million, as compared to $243.0 million for year ended December 31, 2023. The year 2024 includes non-cash expenses for stock-based compensation of $24.7 million and depreciation and amortization of $7.2 million, as compared to $24.9 million and $6.8 million, respectively, in the year 2023. Total operating expenses for the year ended December 31, 2024 were comprised of research and development expenses of $252.0 million and general and administrative expenses of $48.5 million.

Restructuring Expenditures 
Cash payments resulting from the strategic portfolio review and related restructuring are estimated to be $40 to $45 million. Cost reductions subsequently realized from the restructuring, combined with refocused clinical development priorities give the Company an expected cash runway into at least the fourth quarter of 2026, excluding anticipated milestones from existing collaborations.

Conference Call Details
The Company will host a conference call and webcast today at 2:00 p.m. PT/ 5:00 p.m. ET. The webcast information will also be available through the News & Events section of the Investors portion of the Company’s website at www.sutrobio.com. An archived replay will be available for at least 30 days after the event.

About Sutro Biopharma
Sutro Biopharma, Inc., is relentlessly focused on the discovery and development of precisely designed cancer therapeutics to transform what science can do for patients. Sutro’s fit-for-purpose technology, including cell-free XpressCF^®, provides the opportunity for broader patient benefit and an improved patient experience. Sutro is advancing a robust early-stage pipeline of novel exatecan and dual-payload antibody drug conjugates (ADCs), coupled with high-value collaborations and industry partnerships, which validate its continuous product innovation. Sutro is headquartered in South San Francisco. For more information, follow Sutro on social media @Sutrobio, or visit www.sutrobio.com.

Forward-Looking Statements
This press release contains forward-looking statements within the meaning of the “safe harbor” provisions of the Private Securities Litigation Reform Act of 1995, including, but not limited to, anticipated preclinical and clinical development activities, including enrollment and site activation; timing of announcements of clinical results, trial initiation, and regulatory filings; outcome of discussions with regulatory authorities; potential benefits of the Company’s product candidates and platform; potential business development and partnering transactions; potential market opportunities for the Company’s product candidates; the timing of exiting the manufacturing facility in San Carlos; the timing and receipt of anticipated future milestone payments; the Company’s expected cash runway; and the expected costs and cost reductions associated with the restructuring. All statements other than statements of historical fact are statements that could be deemed forward-looking statements. Although the Company believes that the expectations reflected in such forward-looking statements are reasonable, the Company cannot guarantee future events, results, actions, levels of activity, performance or achievements, and the timing and results of biotechnology development and potential regulatory approval is inherently uncertain. Forward-looking statements are subject to risks and uncertainties that may cause the Company’s actual activities or results to differ significantly from those expressed in any forward-looking statement, including risks and uncertainties related to the Company’s ability to advance its product candidates, the receipt and timing of potential regulatory designations, approvals and commercialization of product candidates, the market size for the Company’s product candidates to be smaller than anticipated, clinical trial sites, supply chain and manufacturing facilities, the Company’s ability to maintain and recognize the benefits of certain designations received by product candidates, the timing and results of preclinical and clinical trials, the Company’s ability to fund development activities and achieve development goals, the Company’s ability to protect intellectual property, and the Company’s commercial collaborations with third parties and other risks and uncertainties described under the heading “Risk Factors” in documents the Company files from time to time with the Securities and Exchange Commission. These forward-looking statements speak only as of the date of this press release, and the Company undertakes no obligation to revise or update any forward-looking statements to reflect events or circumstances after the date hereof.

Investor Contact
Emily White
Sutro Biopharma
(650) 823-7681
ewhite@sutrobio.com

Media Contact
Amy Bonanno
Lyra Strategic Advisory
abonanno@lyraadvisory.com

Sutro Biopharma, Inc. Selected Statements of Operations Financial Data (Unaudited) (In thousands, except share and per share amounts)
		For the year ended December 31
		2024				2023				2022
Revenues		$	62,043			$	153,731			$	67,772
Operating expenses
Research and development			252,043				180,425				137,171
General and administrative			48,453				62,584				59,544
Total operating expenses			300,496				243,009				196,715
Loss from operations			(238,453	)			(89,278	)			(128,943	)
Interest income			18,643				14,510				3,455
Unrealized gain on equity securities			-				9,917				12,130
Non-cash interest expense related to the sale of future royalties			(31,070	)			(12,570	)			-
Interest and other income (expense), net			25,782				(11,180	)			(3,346	)
Loss before provision for income taxes			(225,098	)			(88,601	)			(116,704	)
Provision for income taxes			2,363				18,192				2,500
Net loss		$	(227,461	)		$	(106,793	)		$	(119,204	)
Net loss per share, basic and diluted		$	(2.96	)		$	(1.78	)		$	(2.35	)
Weighted-average shares used in     computing basic and diluted net loss     per share			76,829,198				60,163,542				50,739,185

Sutro Biopharma, Inc. Selected Balance Sheets Financial Data (Unaudited) (In thousands)
		December 31,
		2024(1)				2023(2)
Assets
Cash, cash equivalents and marketable securities		$	316,895			$	333,681
Investment in equity securities			-				41,937
Accounts receivable			8,616				36,078
Property and equipment, net			18,190				21,940
Operating lease right-of-use assets			17,677				22,815
Other assets			25,829				14,285
Total Assets		$	387,207			$	470,736
Liabilities and Stockholders’ Equity
Accounts payable, accrued expenses and other liabilities		$	56,324			$	64,293
Deferred revenue			82,319				74,045
Operating lease liability			23,154				29,574
Debt			-				4,061
Deferred royalty obligation related to the sale of future royalties			180,809				149,114
Total liabilities			342,606				321,087
Total stockholders’ equity			44,601				149,649
Total Liabilities and Stockholders’ Equity		$	387,207			$	470,736

(1)		The condensed balance sheet as of December 31, 2024 was derived from the unaudited financial statements included in the Company's Annual Report on Form 10-K for the year ended December 31, 2024, filed with the Securities and Exchange Commission on March 13, 2025.
(2)		The condensed balance sheet as of December 31, 2023 was derived from the audited financial statements included in the Company's Annual Report on Form 10-K for the year ended December 31, 2023, filed with the Securities and Exchange Commission on March 25, 2024.

FAQ

What is Sutro Biopharma's (STRO) current cash position as of December 2024?

Sutro Biopharma had $316.9 million in cash, cash equivalents and marketable securities as of December 31, 2024.

How much did STRO's revenue decline in 2024 compared to 2023?

Revenue decreased from $153.7 million in 2023 to $62.0 million in 2024, primarily from Astellas collaboration and Tasly agreement.

What is the expected cost of Sutro's (STRO) restructuring plan?

The restructuring plan is estimated to require cash payments of $40 to $45 million.

How long will Sutro's (STRO) current cash runway last?

The cash runway is expected to last into at least Q4 2026, excluding anticipated milestones from existing collaborations.

What were STRO's operating expenses for 2024?

Total operating expenses were $300.5 million, including $252.0 million in R&D and $48.5 million in general and administrative expenses.