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What changed in Cartesian Therapeutics, Inc.'s 10-K — 2024 vs 2025

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Paragraph-level year-over-year comparison of Cartesian Therapeutics, Inc.'s 2024 and 2025 10-K annual filings, covering the Business, Risk Factors, Legal Proceedings, Cybersecurity, MD&A and Market Risk sections. Every new, removed and edited paragraph is highlighted side-by-side so you can see exactly what management changed in the 2025 report.

+382 added−378 removedSource: 10-K (2026-03-09) vs 10-K (2025-03-13)

Top changes in Cartesian Therapeutics, Inc.'s 2025 10-K

382 paragraphs added · 378 removed · 292 edited across 6 sections

Item 1. Business

Business — how the company describes what it does

104 edited+49 added−42 removed178 unchanged
Biggest changeKey provisions of the IRA include the following, among others: • The IRA requires manufacturers to pay rebates for Medicare Part B and Part D drugs whose price increases exceed inflation. • The IRA eliminates the so-called “donut hole” under Medicare Part D beginning in 2025 by significantly lowering the beneficiary maximum out-of-pocket cost and requiring manufacturers to subsidize, through a newly established manufacturer discount program, 10% of Part D enrollees’ prescription costs for brand drugs below the out-of-pocket maximum and 20% once the out-of-pocket maximum has been reached. • The IRA delays the rebate rule that would require pass through of pharmacy benefit manager rebates to beneficiaries • The IRA directs the Centers for Medicare and Medicaid Services, or CMS, to engage in price-capped negotiation for certain Medicare Part B and Part D products.
Biggest changeKey provisions of the IRA include the following, among others: • The IRA requires manufacturers to pay rebates for Medicare Part B and Part D drugs whose price increases exceed inflation. • The IRA eliminated the so-called “donut hole” under Medicare Part D by requiring manufacturers to subsidize, through a newly established manufacturer discount program, 10% of Part D enrollees’ prescription costs for brand drugs below the out-of-pocket maximum and 20% once the out-of-pocket maximum has been reached.
Clinical Development To date, we have completed the Phase 1/2 trial of Descartes-08 in MG, which consisted of a Phase 1b portion, a Phase 2a portion, and a Phase 2b portion. The primary objective of the Phase 1b portion of the trial was to determine the maximum tolerated dose of Descartes-08 for patients with MG.
Clinical Development To date, we have completed a Phase 1/2 trial of Descartes-08 in MG, which consisted of a Phase 1b portion, a Phase 2a portion, and a Phase 2b portion. The primary objective of the Phase 1b portion of the trial was to determine the maximum tolerated dose of Descartes-08 for patients with MG.
In addition, under the provisions of The Food and Drug Safety and Innovation Act, or FDASIA, the FDA established a Breakthrough Therapy Designation which is intended to expedite the development and review of products that treat serious or life-threatening diseases or conditions.
In addition, under the provisions of The Food and Drug Safety and Innovation Act, or FDASIA, Congress and the FDA established a Breakthrough Therapy Designation which is intended to expedite the development and review of products that treat serious or life-threatening diseases or conditions.
For more information regarding the risks related to our intellectual property, see the section titled “Risk factors—Risks Related to Our Intellectual Property.” 15 Table of Contents Key Agreements Biogen License Agreement On September 8, 2023, we entered into a non-exclusive, sublicensable, worldwide, perpetual license agreement, or the Biogen Agreement, with Biogen MA, Inc., or Biogen, to research, develop, make, use, offer, sell and import products or processes containing or using an engineering T-cell modified with an mRNA comprising, or encoding a protein comprising, certain sequences licensed under the Biogen Agreement for the prevention, treatment, palliation and management of autoimmune diseases and disorders, excluding cancers, neoplastic disorders, and paraneoplastic disorders.
For more information regarding the risks related to our intellectual property, see the section titled “Risk factors—Risks Related to Our Intellectual Property.” Key Agreements Biogen License Agreement On September 8, 2023, we entered into a non-exclusive, sublicensable, worldwide, perpetual license agreement, or the Biogen Agreement, with Biogen MA, Inc., or Biogen, to research, develop, make, use, offer, sell and import products or processes containing or using an engineering T-cell modified with an mRNA comprising, or encoding a protein comprising, certain sequences licensed under the Biogen Agreement for the prevention, treatment, palliation and management of autoimmune diseases and disorders, excluding cancers, neoplastic disorders, and paraneoplastic disorders.
Follow-on results of the Phase 2b portion of the trial were presented in December 2024. The trial reached its primary endpoint to assess the proportion of patients achieving a five-point or greater reduction in their MGC score at day 85. Patients received six weekly infusions at the dose established in Phase 1b (52.5 x106 cells/kg).
Follow-on results of the Phase 2b portion of the trial were presented in December 2024. The trial achieved its primary endpoint to assess the proportion of patients achieving a five-point or greater reduction in their MGC score at day 85. Patients received six weekly infusions at the dose established in Phase 1b (52.5 x106 cells/kg).
The hyperlink to our website is included as an inactive textual reference only, and the information on our website is not incorporated by reference in this Annual Report on Form 10-K or in any other filings we make with the SEC. 26 Table of Contents RISK FACTORS SUMMARY Investing in our common stock involves various risks.
The hyperlink to our website is included as an inactive textual reference only, and the information on our website is not incorporated by reference in this Annual Report on Form 10-K or in any other filings we make with the SEC. 28 Table of Contents RISK FACTORS SUMMARY Investing in our common stock involves various risks.
In connection with the Merger and pursuant to the Merger Agreement, the Company (which was known as Selecta Biosciences, Inc. until immediately prior to the Merger) changed its corporate name to Cartesian Therapeutics, Inc. Overview We are a clinical-stage biotechnology company pioneering mRNA cell therapy for the treatment of autoimmune diseases.
In connection with the Merger and pursuant to the Merger Agreement, the Company (which was known as Selecta Biosciences, Inc. until immediately prior to the Merger) changed its corporate name to Cartesian Therapeutics, Inc. Overview We are a late clinical-stage biotechnology company pioneering cell therapy for the treatment of autoimmune diseases.
The negotiated prices will be capped at a statutorily determined ceiling price. There are certain statutory exemptions from the IRA’s Price Negotiation Program, such as for a drug that has only a single orphan drug designation and is approved only for an indication or indications within the scope of such designation.
The negotiated prices will be capped at a statutorily determined ceiling price. There are certain statutory exemptions from the IRA’s Price Negotiation Program, such as for a drug that has only orphan drug designations and is approved only for an indication or indications within the scope of such designation.
To our knowledge, the definition of “biosimilar” with regard to an mRNA-modified cell therapy has not been expressly stated in statute, regulation, or guidance, and has not been reviewed by a court. The regulatory pathway for a biosimilar to one of our products thus remains somewhat uncertain.
To our knowledge, how the definition of “biosimilar” applies with regard to an mRNA-modified cell therapy has not been expressly stated in statute, regulation, or guidance, and has not been reviewed by a court. The regulatory pathway for a biosimilar to one of our products thus remains somewhat uncertain.
The key competitive factors affecting the success of any other cell therapy product candidates that we develop, if approved, are likely to be their efficacy, safety, convenience, price, the level of generic competition and the availability of reimbursement from government and other third-party payors.
The key competitive factors affecting the success of any other cell therapy product candidates that we develop, if approved, are likely to be their efficacy, durability of response, safety, convenience, price, the level of generic competition and the availability of reimbursement from government and other third-party payors.
Secondary endpoints will assess safety and tolerability and the proportion of participants with a reduction of four points or more in MGC score, as well as improvements in other validated MG severity scales, including Quantitative MG, QMG, and MG Quality of Life Revised Scale, or MG-QoL-15R.
Secondary endpoints will assess safety and tolerability and the proportion of participants with a reduction of four points or more in MG Composite, or MGC, score, as well as improvements in other validated MG severity scales, including QMG, and MG Quality of Life Revised Scale, or MG-QoL-15R.
Our patents are focused on several key technologies, including the use of our mRNA CAR-T technology and other developments in our mRNA cell therapy pipeline. As of December 31, 2024, we had seven issued patents worldwide, including three patents issued in the United States (U.S.
Our patents are focused on several key technologies, including the use of our mRNA CAR-T technology and other developments in our mRNA cell therapy pipeline. As of December 31, 2025, we had seven issued patents worldwide, including three patents issued in the United States (U.S.
Available Information We file electronically with the SEC our annual reports on Form 10-K, quarterly reports on Form 10-Q, current reports on Form 8-K, proxy statements and other information. Our SEC filings are available to the public over the Internet at the SEC’s website at http://www.sec.gov.
Available Information We file electronically with the SEC our annual reports on Form 10-K, quarterly reports on Form 10-Q, current reports on Form 8-K, proxy statements and other information. Our SEC filings are available to the public at the SEC’s website at http://www.sec.gov.
An SPA agreement documents the FDA’s concurrence with the adequacy and acceptability of specific critical elements of the protocol design, and the FDA may not change an SPA agreement once the trial is underway unless the sponsor or applicant agrees in writing or the FDA identifies a 18 Table of Contents substantial scientific issue essential to determining the safety or effectiveness of the drug after the testing has begun.
An SPA agreement documents the FDA’s concurrence with the adequacy and acceptability of specific critical elements of the protocol design, and the FDA may not change an SPA agreement once the trial is underway unless the sponsor or applicant agrees in writing or the FDA identifies a substantial scientific issue essential to determining the safety or effectiveness of the drug after the testing has begun.
Patent Nos. 10,934,337, 11,220,535, and 11,999,773) and four patents issued outside the United States (Japanese Patent No. 7,379,654, Canadian Patent No. 3,158,025, Israeli Patent No. 285909, and Korean Patent No. 102588292. Our issued patents and any patents issuing from our pending applications are set to expire on various dates in 2040 through 2044.
Patent Nos. 10,934,337, 11,220,535, and 11,999,773) and four patents issued outside the United States (Japanese Patent No. 7,379,654, Canadian Patent No. 3,158,025, Israeli Patent No. 285909, and Korean Patent No. 102588292). Our issued patents and any patents issuing from our pending applications are set to expire on various dates ranging from 2040 to 2044.
The IRA’s Price Negotiation Program is currently the subject of legal challenges. Manufacturers that fail to comply with the IRA may be subject to various penalties, including civil monetary penalties or a potential excise tax.
The IRA’s Price Negotiation Program is currently the subject of legal challenges. Manufacturers that fail to comply with the IRA may be subject to various penalties, including civil monetary penalties and a potential excise tax.
Pursuant to the Sobi License, Sobi agreed to make milestone payments totaling up to $630.0 million to us upon the achievement of various development and regulatory milestones and, if commercialized, sales thresholds for annual net sales of SEL-212, and tiered royalty payments ranging from the low double digits on the lowest sales tier to the high teens on the highest sales tier.
Pursuant to the Sobi License, Sobi agreed to make milestone payments totaling up to $630.0 million to us upon the achievement of various development and regulatory milestones and, if commercialized, sales thresholds for annual net sales of NASP, and tiered royalty payments ranging from the low double digits on the lowest sales tier to the high teens on the highest sales tier.
It remains unclear how any new legislation or regulation might affect the prices we may obtain for any of our product candidates for which regulatory approval is obtained. Employees and Human Capital Resources At Cartesian Therapeutics, we consider human capital to be an essential driver of our business and successful strategy creation and execution.
It remains unclear how any new legislation or regulation might affect the prices we may obtain for any of our product candidates for which regulatory approval is obtained. Employees and Human Capital Resources We consider human capital to be an essential driver of our business and successful strategy creation and execution.
We chose MG as our lead indication because the pathogenesis for MG is common to many autoimmune diseases. Background Information About MG MG is a rare autoimmune disease that causes debilitating muscle weakness and fatigue. It is estimated to affect over 120,000 patients in the U.S. and Europe.
We chose MG as our lead indication because the pathogenesis for MG is common to many autoimmune diseases. Background Information About MG MG is a rare autoimmune disease that causes debilitating muscle weakness and fatigue. It is estimated to affect over 106,000 patients in the U.S.
NCI has the right to 16 Table of Contents terminate this agreement, after giving written notice and providing a cure period in accordance with its terms, if we are in default of a material obligation. We have the unilateral right to terminate the agreement in any country or territory by giving NCI 60 days’ written notice.
NCI has the right to terminate this agreement, after giving written notice and providing a cure period in accordance with its terms, if we are in default of a material obligation. We have the unilateral right to terminate the agreement in any country or territory by giving NCI 60 days’ written notice.
Violation of the federal Anti-Kickback Statute may also constitute a false or fraudulent claim for purposes of the federal civil False Claims Act. Actions under the civil False Claims Act may be brought by the Department of Justice or as a qui tam action 23 Table of Contents by a private individual in the name of the government.
Violation of the federal Anti-Kickback Statute may also constitute a false or fraudulent claim for purposes of the federal civil False Claims Act. Actions under the civil False Claims Act may be brought by the Department of Justice or as a qui tam action by a private individual in the name of the government.
In addition, if Sobi were to terminate the Sobi License, we have the option to obtain a license to all patents and know-how necessary to exploit SEL-212 in existence as of the termination date from Sobi in return for making an equitable royalty payment to Sobi.
In addition, if Sobi were to terminate the Sobi License, we have the option to obtain a license to all patents and know-how necessary to exploit NASP in existence as of the termination date from Sobi in return for making an equitable royalty payment to Sobi.
Descartes-08 has been granted Orphan Drug Designation for the treatment of MG.. Expedited Development and Review Programs The FDA offers various programs, including the Fast Track program, Breakthrough Therapy designation, and the RMAT designation that are intended to expedite or facilitate the process for reviewing new biological products that meet certain criteria.
Descartes-08 has been granted Orphan Drug Designation for the treatment of MG. Expedited Development and Review Programs The FDA offers various programs, including the Fast Track program, Breakthrough Therapy designation, RMAT designation and the National Priority Voucher, or CNPV, program that are intended to expedite or facilitate the process for reviewing new biological products that meet certain criteria.
The Food and Drug Omnibus Reform Act of 2022, or FDORA, added the failure to conduct post-approval studies with due diligence or to submit timely progress reports on such studies to the list of prohibited acts under the FD&C Act, which means that any such failures, whether they result from a sponsor’s actions or the actions of third-parties, could provide the basis for enforcement actions.
The Food and Drug Omnibus Reform Act of 2022, or FDORA, added the failure to conduct post-approval studies with due diligence or to submit timely progress reports on such studies to the list of prohibited acts under the FD&C Act, which means that any such failures, whether they result from a sponsor’s actions or the actions of third-parties, could provide the basis for withdrawal of the product on an expedited basis or other enforcement actions.
However, the EMA may grant a deferral of the studies in order not to delay the approval of the product in adults and the EMA may waive the requirement to conduct studies in certain circumstances, such as if the relevant condition does not occur in 22 Table of Contents children.
However, the EMA may grant a deferral of the studies in order not to delay the approval of the product in adults and the EMA may waive the requirement to conduct studies in certain circumstances, such as if the relevant condition does not occur in children.
The Trump Administration has discussed several changes to the reach and oversight of the FDA, which could affect its relationship with the biotechnology and pharmaceutical industries, transparency in decision making and ultimately the cost and 25 Table of Contents availability of prescription drugs.
The Trump Administration has discussed several changes to the reach and oversight of the FDA, which could affect its relationship with the biotechnology and pharmaceutical industries, transparency in decision making and ultimately the cost and availability of prescription drugs.
Prior to the first commercial sale, upon NCI’s request, we are obligated to provide NCI with commercially reasonable quantities of licensed products made through licensed processes to be used for in vitro research.
Prior 17 Table of Contents to the first commercial sale, upon NCI’s request, we are obligated to provide NCI with commercially reasonable quantities of licensed products made through licensed processes to be used for in vitro research.
Further, each clinical study must be reviewed and approved by an institutional review board, or IRB, at or servicing each institution at which the clinical study will be conducted. Human clinical trials are typically conducted in three sequential phases that may overlap or be combined: Phase 1.
Further, each clinical study must be reviewed and approved by an institutional review board, or IRB, at or servicing each institution at which the clinical study will be conducted. Human clinical trials are typically conducted in three sequential phases that may overlap or be combined: 19 Table of Contents • Phase 1.
The primary endpoint will assess the proportion of Descartes-08 participants with an improvement in MG-ADL score of three points or more at Month 4 compared to placebo.
The primary endpoint will assess the proportion of Descartes-08 participants with an improvement in MG-ADL score of 11 Table of Contents three points or more at Month 4 compared to placebo.
We observed Descartes-08 to be well-tolerated by the three patients who participated in this portion of the trial with no CRS or other serious product-related adverse events.
We observed Descartes-08 to be well-tolerated by the three patients who participated in this portion of the trial with no CRS or other serious product-related AEs observed.
Other companies developing CAR-T therapies include large, fully integrated pharmaceutical companies such as Novartis AG, Gilead Sciences, Inc., through its Kite Pharma, Inc. subsidiary, Bristol-Myers Squibb Company, AstraZeneca PLC and Janssen Pharmaceuticals, Inc. and biopharmaceutical companies such as Kyverna Therapeutics, Inc. and Cabaletta Bio, Inc.
Other companies developing CAR-T therapies include large, fully integrated pharmaceutical companies such as Novartis AG, Gilead Sciences, Inc., through its Kite Pharma, Inc. subsidiary, Bristol-Myers Squibb Company, and biopharmaceutical companies such as Kyverna Therapeutics, Inc. and Cabaletta Bio, Inc.
Intellectual Property Our success depends in part on our ability to obtain, maintain, protect, defend and enforce proprietary protection for our drug candidates and other discoveries, inventions, trade secrets and know-how that are critical to our business operations.
Intellectual Property Our success depends in part on our ability to obtain, maintain, protect, defend and enforce proprietary rights for our product candidates and other discoveries, inventions, trade secrets and know-how that are critical to our business operations.
Our commercial opportunity could be reduced or eliminated if our competitors develop and commercialize products that are more effective, have fewer or less severe side effects, are more convenient or are less expensive than any products that we may develop.
Our commercial opportunity could be reduced or eliminated if our competitors develop and commercialize products that are more effective, have fewer or less severe side effects, are more convenient or are less expensive than any products that we 18 Table of Contents may develop.
In all cases, again, the clinical studies are conducted in accordance with GCP and the applicable regulatory requirements and the ethical principles that have their origin in the Declaration of Helsinki. When conducting clinical trials in the EU, we must adhere to the provisions of the EU Clinical Trials Regulation (EU) No 536/2014.
In all 24 Table of Contents cases, again, the clinical studies must be conducted in accordance with GCP and the applicable regulatory requirements and the ethical principles that have their origin in the Declaration of Helsinki. When conducting clinical trials in the EU, we must adhere to the provisions of the EU Clinical Trials Regulation (EU) No 536/2014.
Descartes-08 has been granted Orphan Drug Designation and Regenerative Medicine Advanced Therapy, or RMAT, Designation by the FDA for the treatment of MG as well as a Rare Pediatric Disease Designation for the treatment of juvenile dermatomyositis.
Descartes-08 has been granted Orphan Drug Designation and Regenerative Medicine Advanced Therapy, or RMAT, Designation by the FDA for the treatment of MG, and Rare Pediatric Disease Designation for the treatment of juvenile dermatomyositis, or JDM.
There are two types of MAs. The EU MA, which is issued by the European Commission through the Centralized Procedure, is based on the opinion of the Committee for Medicinal Products for Human Use, or CHMP, of the European Medicines Agency, or EMA, and is valid throughout the entire territory of the EEA.
The EU MA, which is issued by the European Commission through the Centralized Procedure, is based on the opinion of the Committee for Medicinal Products for Human Use, or CHMP, of the European Medicines Agency, or EMA, and is valid throughout the entire territory of the EEA.
This included aggregate reductions of Medicare payments to providers of 2% per fiscal year, which went into effect on April 1, 2013, and, due to subsequent legislative amendments, will stay in effect through 2027 unless additional Congressional action is taken.
These include aggregate reductions of Medicare payments to providers of 2% per fiscal year, which went into effect on April 1, 2013, and, due to subsequent legislative amendments, will stay in effect through 2032 unless additional Congressional action is taken.
Pursuant to the Sobi License, we granted Sobi an exclusive, worldwide (except as to Greater China) license to develop, manufacture and commercialize a drug candidate known as SEL-212, which is currently in development for the treatment of chronic refractory gout.
Pursuant to the Sobi License, we granted Sobi an exclusive, worldwide (except as to Greater China) license to develop, manufacture and commercialize a drug candidate Nanoecapsulated Sirolimus plus Pegadricase, or NASP, formerly known as SEL-212, which is currently in development for the treatment of chronic refractory gout.
We may incur additional costs or experience delays in completing, or ultimately be unable to complete, the development and commercialization of our product candidates. • We expect to continue to grow our manufacturing capabilities and resources and we must incur significant costs to develop this expertise and/or rely on third-parties to manufacture our products. • We rely, and expect to continue to rely, on third-parties, including CROs, to conduct our clinical trials, and those third-parties may not perform satisfactorily, including by failing to meet deadlines for the completion of such trials. • If we or our licensors are unable to adequately protect our proprietary technology, or obtain and maintain issued patents that are sufficient to protect our product candidates, others could compete against us more directly, which would negatively impact our business. • We have been in the past and may in the future be subject to stockholder litigation.
We have, and may in the future, record impairment charges, which would adversely impact our financial position and results of operations. • We expect to continue to grow our manufacturing capabilities and resources and we must incur significant costs to develop this expertise and/or rely on third-parties to manufacture our products. • We rely, and expect to continue to rely, on third-parties, including CROs, to conduct our clinical trials, and those third-parties may not perform satisfactorily, including by failing to meet deadlines for the completion of such trials. • If we or our licensors are unable to adequately protect our proprietary technology, or obtain and maintain issued patents that are sufficient to protect our product candidates, others could compete against us more directly, which would negatively impact our business. • We have been in the past and may in the future be subject to stockholder litigation.
At Month 4, particularly deep responses were observed in participants without prior exposure to biologic therapies (n=7), including complement or neonatal fragment crystallizable receptor inhibitors, with an average MG-ADL reduction of 6.6 (±1.5).
At Month 4, particularly deep responses were observed in participants without prior exposure to biologic therapies (n=7), including complement or neonatal fragment crystallizable receptor inhibitors, with an average MG-ADL reduction of 6.6 (±1.5). Responses amongst this patient population without prior exposure to biologic therapies were observed to deepen through Month 12 with an average MG-ADL reduction of 7.1 (±1.9).
As of December 31, 2024, we have administered Descartes-08 to over 100 patients suffering from one of MG, multiple myeloma, and other diseases in open-label trials on an outpatient basis, many at community clinics. We have not observed product-related CRS, neurotoxicity or infection of any grade.
As of December 31, 2025, we have administered Descartes-08 to over 100 patients suffering from one of MG, multiple myeloma, and other diseases in open-label and randomized placebo-controlled trials on an outpatient basis. We have not observed product-related CRS, neurotoxicity or infection of any grade.
The FDA has also granted Descartes-08 Rare Pediatric Disease Designation for the treatment of JDM. The FDA grants Rare Pediatric Disease Designation for serious and life-threatening diseases that primarily affect children ages 18 years or younger and fewer than 200,000 people in the United States.
The initiation of the Phase 2 pediatric basket trial was announced in January 2026. The FDA has also granted Descartes-08 Rare Pediatric Disease Designation for the treatment of JDM. The FDA grants Rare Pediatric Disease Designation for serious and life-threatening diseases that primarily affect children ages 18 years or younger and fewer than 200,000 people in the United States.
As of December 31, 2024, we had 66 full-time employees, 54 of whom are primarily engaged in research and development activities and 12 of whom are primarily engaged in corporate functions. 58% of our employees have at least one of a Masters, PhD, or MD degree.
As of December 31, 2025, we had 75 full-time employees, 62 of whom are primarily engaged in research and development activities and 13 of whom are primarily engaged in corporate functions. 60% of our employees have at least one of a Masters, PhD, or MD degree.
Descartes-08 may compete with products of other companies in the MG market, including Argenx SE, UCB S.A., Johnson & Johnson, Alexion Pharmaceuticals, Inc. and Cabaletta Bio, Inc.
Descartes-08 may compete with products of other companies in the MG market, including Amgen, Argenx SE, UCB S.A., Johnson & Johnson through its Janssen Pharmaceuticals, Inc. subsidiary, AstraZeneca PLC through its Alexion Pharmaceuticals, Inc. subsidiary, Kyverna Therapeutics, Inc. and Cabaletta Bio, Inc.
The FDA may refuse to file any BLA that it deems incomplete or otherwise not reviewable and may request additional information.
The FDA may request additional information before deciding whether to accept a BLA for filing. The FDA may refuse to file any BLA that it deems incomplete or otherwise not reviewable and may request additional information.
Under the FDA’s Rare Pediatric Disease Designation and priority review voucher programs, if Decartes-08 is approved for marketing in JDM, Cartesian may qualify for a priority review voucher that can be redeemed to receive priority review of a subsequent marketing application for a different product candidate. Descartes-15 Descartes-15 is our next-generation autologous anti-BCMA mRNA CAR-T.
Under the FDA’s recently renewed Rare Pediatric Disease Designation and priority review voucher programs, if Descartes-08 is approved for marketing in JDM, Cartesian may qualify for a priority review voucher that can be redeemed to receive priority review of a subsequent marketing application for a different product candidate.
The federal Health Insurance Portability and Accountability Act of 1996, or HIPAA, prohibits, among other actions, knowingly and willfully executing, or attempting to execute, a scheme to defraud any healthcare benefit program, including private third-party payors, knowingly and willfully embezzling or stealing from a healthcare benefit program, willfully obstructing a criminal investigation of a healthcare offense, and knowingly and willfully falsifying, concealing or covering up a material fact or making any materially false, fictitious or fraudulent statement in connection with the delivery of or payment for healthcare benefits, items or services.
Many states also have similar fraud and abuse statutes or regulations that apply to items and services reimbursed under Medicaid and other state programs, or, in several states, apply regardless of the payor. 25 Table of Contents The federal Health Insurance Portability and Accountability Act of 1996, or HIPAA, prohibits, among other actions, knowingly and willfully executing, or attempting to execute, a scheme to defraud any healthcare benefit program, including private third-party payors, knowingly and willfully embezzling or stealing from a healthcare benefit program, willfully obstructing a criminal investigation of a healthcare offense, and knowingly and willfully falsifying, concealing or covering up a material fact or making any materially false, fictitious or fraudulent statement in connection with the delivery of or payment for healthcare benefits, items or services.
Notably, in the one participant who completed their 12-month retreatment follow-up visit, the duration of response was observed to be longer than that patient’s initial response, and this patient had maintained minimum symptom expression at Month 12.
The time course and magnitude of treatment response upon retreatment were similar to those seen when the participants were first treated. Notably, in the one participant who completed their 12-month retreatment follow-up visit, the duration of response was observed to be longer than that patient’s initial response, and this patient had maintained minimum symptom expression at Month 12.
Descartes-08 has been granted RMAT designation for the treatment of MG. Post-approval Requirements Rigorous and extensive FDA regulation of biological products continues after approval, particularly with respect to cGMP requirements. Manufacturers of our products are required to comply with applicable requirements in the cGMP regulations, including quality control and quality assurance and maintenance of records and documentation.
Post-approval Requirements Rigorous and extensive FDA regulation of biological products continues after approval. Manufacturers of our products are required to comply with applicable requirements in the cGMP regulations, including quality control and quality assurance and maintenance of records and documentation.
We plan to commence our Phase 3 AURORA trial of Descartes-08 in patients with MG in the first half of 2025. The randomized, double-blind, placebo-controlled Phase 3 AURORA trial is designed to assess Descartes-08 versus placebo (1:1 randomization) administered as six weekly outpatient infusions without preconditioning chemotherapy in approximately 100 participants with acetylcholine receptor autoantibody positive, or AChR Ab+, MG.
The randomized, double-blind, placebo-controlled Phase 3 AURORA trial is designed to assess Descartes-08 versus placebo (1:1 randomization) administered as six weekly outpatient infusions without preconditioning chemotherapy in approximately 100 participants with AChR Ab+, MG.
In contrast to conventional DNA-based CAR T-cell therapies, mRNA CAR-T administration is designed to not require preconditioning chemotherapy, can be administered in the outpatient setting, and does not carry the risk of genomic integration associated with cancerous transformation.
In contrast to conventional DNA-based CAR T-cell therapies, our CAR-T administration has been observed to provide deep and durable benefits through 12 months, is designed to not require preconditioning chemotherapy, to be administered in the outpatient setting and does not carry the risk of genomic integration associated with cancerous transformation.
In December 2024, we reported updated results from this trial. Deepening of responses was observed over time with participants included in the primary efficacy dataset who continued follow-up (n=12) experiencing an average MG-ADL reduction of 5.5 (±1.1) at Month 4.
Deepening of responses was observed over time with participants included in the primary efficacy dataset who continued follow-up (n=12) experiencing an average MG-ADL reduction of 5.5 (±1.1) at Month 4 which was maintained through Month 12 (4.8±1.4).
The SPA agreement indicates that the FDA has determined that the proposed trial design is acceptable to support a future Biologics License Application, or BLA, for Descartes-08 in MG, subject to the ultimate outcome of the trial. Descartes-08 for the Treatment of Other Autoimmune Diseases We are also developing Descartes-08 for the treatment of other autoimmune diseases.
The SPA agreement indicates that the FDA has determined that the proposed trial design is acceptable to support a future Biologics License Application, or BLA, for Descartes-08 in MG, subject to the ultimate outcome of the trial. The complete trial design for AURORA is set forth below.
This chemotherapy is toxic, suppressing the immune system and increasing the risk of infection, anemia, and neurotoxicity. Given these risks and requirements, conventional DNA cell therapies are administered under close monitoring in an inpatient setting, increasing their cost and limiting their reach to only the sickest patients.
Given these risks and requirements, conventional DNA cell therapies are administered under close monitoring in an inpatient setting, increasing their cost and limiting their reach to only the sickest patients.
The effect of the IRA is anticipated to have significant effects on the pharmaceutical industry and may reduce the prices pharmaceutical manufacturers can charge and reimbursement pharmaceutical manufacturers can receive for approved products, among other effects. In addition, other legislative changes have been proposed and adopted in the United States.
The IRA is anticipated to have significant effects on the pharmaceutical industry and may reduce the prices pharmaceutical manufacturers can charge and reimbursement pharmaceutical manufacturers can receive for approved products, among other effects.
Responses were observed to be durable through Month 12, with 80% (4/5) of evaluable participants from the primary efficacy dataset maintaining a clinically meaningful response, defined as a reduction in MG-ADL score of at least 2 points.
Responses were observed to be durable through Month 12, with 83% (10/12) of evaluable participants from the primary efficacy dataset maintaining a clinically meaningful response, defined as a reduction in MG-ADL score of at least 2 points. Of the seven participants with no prior exposure to biologic therapy that reached Month 12, 100% maintained at least a clinically meaningful response.
There were no other new adverse events, or AEs, reported, including no hypogammaglobulinemia and other infections and no difference in vaccine titers between Descartes-08 and placebo. 12 Table of Contents We previously reported that there were three participants in the Phase 2a portion of the trial who were observed to have a response to Descartes-08, but then reverted to baseline, two patients one year after treatment and the other 1.5 years after treatment.
We previously reported that there were three participants in the Phase 2a portion of the trial who were observed to have a response to Descartes-08, but then reverted to baseline, two patients one year after treatment and the other 1.5 years after treatment.
Recently, many countries in the EU have increased the amount of discounts required on pharmaceuticals and these efforts could continue as countries attempt to manage healthcare expenditures, especially in light of the severe fiscal and debt crises experienced by many countries in the EU. The downward pressure on health care costs in general, particularly prescription products, has become intense.
Recently, many countries in the EU have increased the amount of discounts required on pharmaceuticals and these efforts could continue as countries attempt to manage healthcare expenditures, especially 26 Table of Contents in light of the severe fiscal and debt crises experienced by many countries in the EU.
Our main manufacturing facility is located in Frederick, Maryland, and operates under current good manufacturing practice, or cGMP. This facility has sufficient capacity to support current clinical needs and can potentially transition to support commercial manufacturing of our maturing pipeline of innovative mRNA cell therapies for the treatment of autoimmune diseases.
This facility has sufficient capacity to support current clinical needs and can potentially transition to support commercial manufacturing of our maturing pipeline of innovative cell therapies for the treatment of autoimmune diseases.
As a result, the ultimate impact, implementation and meaning of the BPCIA is subject to significant uncertainty. 21 Table of Contents Government Regulation Outside of the United States Whether or not we obtain FDA approval for a product, we must obtain the requisite approvals from regulatory authorities in countries outside the United States prior to the commencement of clinical studies or marketing of the product in those countries.
Government Regulation Outside of the United States Whether or not we obtain FDA approval for a product, we must obtain the requisite approvals from regulatory authorities in countries outside the United States prior to the commencement of clinical studies or marketing of the product in those countries.
With respect to the legacy Selecta assets, as of December 31, 2024, we had (i) 102 issued patents worldwide, including 11 patents issued in the United States and 91 issued outside the United States, set to expire on various dates in 2032 through 2043, (ii) 65 patent applications pending worldwide, including 12 U.S. applications and 53 applications outside the United States and (iii) two registered marks.
With respect to the legacy Selecta assets, as of December 31, 2025, we had (i) 294 issued patents worldwide, including 14 patents issued in the United States and 280 issued outside the United 16 Table of Contents States, set to expire on various dates in 2032 through 2040, (ii) 75 patent applications pending worldwide, including 13 U.S. applications and 62 applications outside the United States and (iii) two registered marks.
Additionally, as of December 31, 2024, we had 13 patent applications pending worldwide, including three U.S. applications, eight applications in ex-U.S. jurisdictions, and 2 International (PCT) applications. A patent granted on U.S. Patent Application No. 18/654,279 will expire on March 13, 2040, a patent granted on U.S.
Additionally, as of December 31, 2025, we had 24 patent applications pending worldwide, including seven U.S. applications and seventeen applications in ex-U.S. jurisdictions. A patent granted from U.S. Patent Application No. 18/654,279 will expire on March 13, 2040, a patent granted from U.S. Patent Application No. 17/919,092 will expire on April 15, 2041, a patent granted from U.S.
Responses were observed to further deepen at Month 6, with 33% (4/12) of participants in the primary efficacy dataset and 57% (4/7) of participants with no prior exposure to biologic therapy observed to have minimum symptom expression, defined as an MG-ADL score of 0 or 1.
The deepest responses were observed as minimal symptom expression, or MSE, defined as an MG-ADL score of 0 or 1. 9 Table of Contents The tables below set forth the results observed. 33% (4/12) of participants in the primary efficacy dataset and 57% (4/7) of participants with no prior exposure to biologic therapy were observed to achieve MSE by Month 6 and maintained it through Month 12.
The acute toxicities are from exponential amplification of the modified cell, and the pre-treatment chemotherapy administered to enable cell amplification. Conventional DNA-engineered CAR-T cells are in clinical development for several autoimmune diseases. DNA CAR-T cells are typically administered to patients in a subtherapeutic dose, which means that the cells must proliferate to reach therapeutic numbers in the body.
The acute toxicities are from exponential amplification of the modified cell and the pre-treatment chemotherapy administered to enable cell amplification. Conventional DNA-engineered chimeric antigen receptor, or CAR, T-cells are in clinical development for several autoimmune diseases.
Limitations of Current Biologic Treatments in Autoimmune Disease Currently approved biologic therapies for MG, such as complement inhibitors and FcRn inhibitors have significantly improved treatment options, but they come with limitations such as incomplete response, immunosuppression risks, high treatment burden, lack of disease modification and potential for emerging resistance.
Limitations of Current Biologic Treatments in Autoimmune Disease Currently approved biologic therapies for MG, such as complement inhibitors and FcRn inhibitors have improved treatment options. However, these therapies are still limited by incomplete response, chronic dosing required to mitigate symptoms, immunosuppression risks, high treatment burden and lack of disease modification.
Government Regulation Government authorities in the United States, at the federal, state and local level, and in other countries extensively regulate, among other things, the research, development, testing, manufacturing, quality control, approval, labeling, packaging, storage, record-keeping, promotion, advertising, distribution, post-approval monitoring and reporting, marketing and export and import of products such as those we are developing. 17 Table of Contents We believe our cell therapy product candidates are subject to regulation in the United States as “biologics” or “biological products.” We expect to seek approval of Descartes-08 through a single BLA reviewed by FDA’s Center for Biologics Evaluation and Research, or CBER.
Government Regulation Government authorities in the United States, at the federal, state and local level, and in other countries, extensively regulate, among other things, the research, development, testing, manufacturing, quality control, approval, labeling, packaging, storage, record-keeping, promotion, advertising, distribution, post-approval monitoring and reporting, marketing and export and import of products such as those we are developing.
This portion of the trial evaluated 11 patients with particularly advanced disease as assessed by both patient and clinician-reported outcomes. 79% of the 14 patients included in the Phase 1b and Phase 2a portions of the trial were classified at screening to have Class III or IV disease, as defined by the Myasthenia Gravis Foundation of America, indicating they had moderate-to-severe weakness affecting their muscles. 10 Table of Contents The results of the Phase 2a portion of the trial, published in the Lancet Neurology in July 2023, indicated that after six weekly infusions of Descartes-08, the average improvement in all disease severity scores was three-to-five-fold greater than what is considered clinically meaningful by expert consensus.
This portion of the trial evaluated 11 patients with particularly advanced disease 8 Table of Contents as assessed by both patient and clinician-reported outcomes. 11 of the 14 patients included in the Phase 1b and Phase 2a portions of the trial were classified at screening to have Class III or IV disease, as defined by the Myasthenia Gravis Foundation of America, indicating they had moderate-to-severe weakness affecting their muscles.
The most common manifestations of SLE are cutaneous and musculoskeletal symptoms, although neurological, gastrointestinal, hematological, and renal symptoms are regularly observed as well. Patients with SLE are at a substantially increased risk of infection and cardiovascular disease, contributing to estimated 10- and 15-year mortality rates of 9% and 15%, respectively.
Patients with SLE are at a substantially increased risk of infection and cardiovascular disease, contributing to estimated 10- and 15-year mortality rates of 9% and 15%, respectively.
We believe the Frederick facility will allow us to scale our wholly-owned, in-house cGMP manufacturing capabilities for late-stage clinical and commercial supply of our mRNA cell therapy product candidates, while continuing to maintain control over product quality and production. We also maintain additional manufacturing space located in Gaithersburg, Maryland.
We believe the Frederick facility has the potential to allow us to scale our wholly-owned, in-house cGMP manufacturing capabilities for late-stage clinical and commercial supply of our cell therapy product candidates, while continuing to maintain control over product quality and production. We manufacture Descartes-08 in-house and are typically able to process and release lots for infusion within approximately three weeks.
Acceptance of any medicinal product for reimbursement may come with cost, use and often volume restrictions, which again can vary by country. In addition, results-based rules of reimbursement may apply.
Inclusion of orphan drugs in reimbursement systems tend to focus on the medical usefulness, need, quality and economic benefits to patients and the healthcare system as for any product. Acceptance of any medicinal product for reimbursement may come with cost, use and often volume restrictions, which again can vary by country. In addition, results-based rules of reimbursement may apply.
As previously reported, there were two participants who were retreated and experienced rapid improvements in clinical scores and maintained minimum symptom expression for up to one year after receiving a second treatment cycle. The time course and magnitude of treatment response upon retreatment were similar to those seen when the participants were first treated.
As previously reported, there were two participants who were retreated and experienced rapid improvements in clinical scores and maintained minimum symptom expression for up to one year after receiving a second treatment cycle. The tables below set forth key findings from these patients.
In addition, a patent granted on any of European patent application 20773688.5, AU 2020241428, CA 3199205, CN 202080020956.1, IN 202117036675, KR 2023-7034215, or MX/a/2021/011196 will expire March 2040 and a patent granted on European patent application 21789568.9 will expire April 2041. All of these patent applications are composition-of-matter applications.
In addition, a patent granted on any of foreign patent applications EP 20773688.5, AU 2020241428, CA 3199205, CN 202080020956.1, IN 202117036675, KR 2023-7034215, and MX/a/2021/011196 will expire March 2040, a patent granted on European patent application 21789568.9 will expire April 2041, and a patent granted on any of foreign patent application EP 24775468.2, AU 2024240255, BR112025019788-6, CA 3286127, CN 202480031788.4, JP 2025-554182, KR 10-2025-7034765, MX/a/2025/010878, and SG 11202506142T will expire March 2044.
We leverage our proprietary technology and manufacturing platform to introduce one or more mRNA molecules into cells to enhance their function. Unlike DNA, mRNA degrades naturally over time without integrating into the cell’s genetic material.
We leverage our proprietary technology and manufacturing platform to introduce mRNA into cells to provide a therapeutic effect to patients suffering from a variety of autoimmune conditions. Unlike DNA, mRNA degrades naturally over time without integrating into the cell’s genetic material.
While ravulizumab reduces the frequency of infusions compared to eculizumab, both of these treatments require ongoing maintenance, which may impact patient quality of life. Access to infusion centers or home infusion services further adds to the logistical challenges. All existing biologic therapies for MG manage symptoms rather than addressing the root cause of the disease.
While ravulizumab and inebilizumab-cdon each reduce the frequency of infusions compared to eculizumab, both of these 6 Table of Contents treatments require ongoing maintenance, which may impact patient quality of life. Access to infusion centers or home infusion services further adds to the logistical challenges.
We manufacture Descartes-08 in-house and are typically able to process and release lots for infusion within approximately three weeks. Our autologous cell therapy product candidates, including Descartes-08, are manufactured on a patient-by-patient basis. We have optimized our manufacturing processes through over 200 cGMP runs.
Our autologous cell therapy product candidates, including Descartes-08, are manufactured on a patient-by-patient basis. We have optimized our manufacturing processes through over 200 cGMP runs across all of our current and prior programs.
However, this proliferation is not controlled in magnitude or duration, varies from patient to patient, and can be unpredictable. This proliferation occurs because the CAR gene is irreversibly integrated into the T-cell’s genome, causing a cascade in which every daughter cell carries the same CAR as the parent cells.
This proliferation occurs because the CAR gene is irreversibly integrated into the T-cell’s genome, causing a cascade in which every daughter cell carries the same CAR as the parent cells. The resulting unconstrained proliferation frequently exceeds the toxicity threshold, leading to serious adverse events, or SAEs.
Fast Track, priority review, accelerated approval, and breakthrough therapy designations do not change the standards for approval and may not necessarily expedite the development or approval process. 20 Table of Contents In 2016, the 21st Century Cures Act established what the FDA describes as RMAT designation.
The designation includes all of the features of Fast Track designation, as well as more intensive FDA interaction and guidance. Fast Track, priority review, accelerated approval, and breakthrough therapy designations do not change the standards for approval and may not necessarily expedite the development or approval process.
In July 2024, the first patient was dosed in our Phase 2 trial of Descartes-08 for the treatment of systemic lupus erythematosus, or SLE, a chronic autoimmune disease that causes systemic inflammation affecting multiple organ systems. A data readout of this trial is expected in the second half of 2025.
Descartes-08 for the Treatment of Systemic Lupus Erythematosus Overview In November 2025, we announced topline data from our Phase 2 trial in SLE, a chronic autoimmune disease that causes systemic inflammation which affects multiple organ systems.
As a result, increasingly high barriers are being erected to the entry of new products in the marketplace. Political, economic and regulatory developments may further complicate pricing negotiations, and pricing negotiations may continue after reimbursement has been obtained. Reference pricing used by various EU Member States and parallel trade (arbitrage between low-priced and high-priced member states) can further reduce prices.
The downward pressure on health care costs in general, particularly prescription products, has become intense. As a result, increasingly high barriers are being erected to the entry of new products in the marketplace. Political, economic and regulatory developments may further complicate pricing negotiations, and pricing negotiations may continue after reimbursement has been obtained.
The trial also involved a crossover component, in which any patient originally assigned to placebo was given the opportunity to receive Descartes-08 after completing trial treatment. In the Phase 2b trial, we observed a deepening of responses after Month 3 in the primary efficacy data set.
The trial also involved a crossover component in which any patient originally assigned to placebo was given the opportunity to receive Descartes-08 after completing trial treatment. In April, 2025, we reported updated, 12-month data from this trial and published this data in Nature Medicine in January 2026.

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Item 1A. Risk Factors

Risk Factors — what could go wrong, per management

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Biggest changeA finding of infringement could prevent us from commercializing our product candidates or force us to cease some of our business operations, which could materially harm our business. 45 Table of Contents Claims that we have misappropriated the confidential information or trade secrets of third-parties could have a similar negative impact on our business.
Biggest changeClaims that we have misappropriated the confidential information or trade secrets of third parties could have a similar negative impact on our business. Even if we are successful in such proceedings, we may incur substantial costs and divert management time and attention in pursuing these proceedings, which could have a material adverse effect on us.
Moreover, other parties may have developed technologies that may be related or competitive to our approach, and may have filed or may file patent applications, and may have received or may receive patents that may overlap or conflict with our patent applications, either by claiming similar methods or by claiming subject matter that could dominate our patent position.
Moreover, other parties may have developed technologies that may be related or competitive to our approach, and may have filed or may file patent applications, and may have received or may receive patents that may overlap or conflict with our patent applications or patents, either by claiming similar methods or by claiming subject matter that could dominate our patent position.
Although our agreements require all of our employees to assign their inventions to us, and we require all of our employees, consultants, advisors and any other third-parties who have access to our trade secrets, proprietary know-how and other confidential information and technology to enter into appropriate confidentiality agreements, we cannot be certain that our trade secrets, proprietary know-how, and other confidential information and technology will not be subject to unauthorized disclosure or that our competitors will not otherwise gain access to or independently develop substantially equivalent trade secrets, proprietary know-how, and other information and technology.
Although we require all of our employees to assign their inventions to us, and we require all of our employees, consultants, advisors and any other third parties who have access to our trade secrets, proprietary know-how and other confidential information and technology to enter into appropriate confidentiality agreements, we cannot be certain that our trade secrets, proprietary know-how, and other confidential information and technology will not be subject to unauthorized disclosure or that our competitors will not otherwise gain access to or independently develop substantially equivalent trade secrets, proprietary know-how, and other information and technology.
We may experience numerous unforeseen events during, or as a result of, clinical trials that could delay or prevent our ability to receive marketing approval for, or commercialize, our product candidates, including: • clinical trials of our product candidates may produce unfavorable, incomplete or inconclusive results; • we may be unable to manufacture our product candidates, which in some cases such as mRNA CAR-T, are manufactured on a patient-by-patient basis; • regulators or institutional review boards may not authorize us or our investigators to commence a clinical trial or conduct a clinical trial at a prospective trial site or may place a clinical hold on existing clinical trials; • we may experience delays in reaching, or fail to reach, agreement on acceptable terms with CROs or clinical trial sites; • we may be unable to recruit suitable patients to participate in a clinical trial, the number of patients required for clinical trials of our product candidates may be larger than we expect, enrollment in these clinical trials may be slower than we expect or participants may drop out of these clinical trials at a higher rate than we expect, or enrollment could be affected by unforeseen geopolitical conflict; • the number of clinical trial sites required for clinical trials of our product candidates may be larger than we expect; • our third-party contractors may fail to comply with regulatory requirements or meet their contractual obligations to us in a timely manner, or at all; • we may have to suspend or terminate clinical trials of our product candidates for various reasons, including a finding that the participants are being exposed to unacceptable health risks; • investigators, regulators, data safety monitoring boards or institutional review boards may require that we or our investigators suspend or terminate clinical research, or we may decide to do so ourselves; • investigators may deviate from the trial protocol, fail to conduct the trial in accordance with regulatory requirements or misreport study data; • the cost of clinical trials of our product candidates may be greater than we expect or we may have insufficient resources to pursue or complete certain aspects of our clinical trial programs or to do so within the timeframe we planned; • the supply or quality of raw materials or manufactured product candidates (whether provided by us or third-parties) or other materials necessary to conduct clinical trials of our product candidates may be insufficient, inadequate or not available at an acceptable cost, or in a timely manner, or we may experience interruptions in supply; • laboratories that we rely upon to perform certain quality control tests may become unavailable, or their services could be delayed; • regulators may revise the requirements for approving our product candidates, or such requirements may not be as we expect; • the FDA or comparable foreign regulatory authorities may disagree with our clinical trial design or our interpretation of data from preclinical studies and clinical trials, or may change the requirements for approval even after it has reviewed and commented on the design of our clinical trials; • regarding trials managed by our existing or any future collaborators, our collaborators may face any of the above issues, and may conduct clinical trials in ways they view as advantageous to them but potentially suboptimal for us; and • geopolitical events may affect international and overseas trial sites in ways beyond our control.
We may experience numerous unforeseen events during, or as a result of, clinical trials that could delay or prevent our ability to receive marketing approval for, or commercialize, our product candidates, including: • clinical trials of our product candidates may produce unfavorable, incomplete or inconclusive results; • we may be unable to manufacture our product candidates, which in some cases such as mRNA CAR-T, are manufactured on a patient-by-patient basis; • regulators or institutional review boards may not authorize us or our investigators to commence a clinical trial or conduct a clinical trial at a prospective trial site or may place a clinical hold on existing clinical trials; • we may experience delays in reaching, or fail to reach, agreement on acceptable terms with CROs or clinical trial sites; • we may be unable to recruit suitable patients to participate in a clinical trial, the number of patients required for clinical trials of our product candidates may be larger than we expect, enrollment in these clinical trials may be slower than we expect or participants may drop out of these clinical trials at a higher rate than we expect, or enrollment could be affected by unforeseen geopolitical conflict; • the number of clinical trial sites required for clinical trials of our product candidates may be larger than we expect; • our third-party contractors may fail to comply with regulatory requirements or meet their contractual obligations to us in a timely manner, or at all; • we may have to suspend or terminate clinical trials of our product candidates for various reasons, including a finding that the participants are being exposed to unacceptable health risks; • investigators, regulators, data safety monitoring boards or institutional review boards may require that we or our investigators suspend or terminate clinical research, or we may decide to do so ourselves; • investigators may deviate from the trial protocol, fail to conduct the trial in accordance with regulatory requirements or misreport study data; • the cost of clinical trials of our product candidates may be greater than we expect or we may have insufficient resources to pursue or complete certain aspects of our clinical trial programs or to do so within the timeframe we planned; • the supply or quality of raw materials or manufactured product candidates (whether provided by us or third-parties) or other materials necessary to conduct clinical trials of our product candidates may be insufficient, inadequate or not available at an acceptable cost, or in a timely manner, or we may experience interruptions in supply; • laboratories that we rely upon to perform certain quality control tests may become unavailable, or their services could be delayed; 31 Table of Contents • regulators may revise the requirements for approving our product candidates, or such requirements may not be as we expect; • the FDA or comparable foreign regulatory authorities may disagree with our clinical trial design or our interpretation of data from preclinical studies and clinical trials, or may change the requirements for approval even after it has reviewed and commented on the design of our clinical trials; • regarding trials managed by our existing or any future collaborators, our collaborators may face any of the above issues, and may conduct clinical trials in ways they view as advantageous to them but potentially suboptimal for us; and • geopolitical events may affect international and overseas trial sites in ways beyond our control.
Doing business internationally involves a number of risks, including but not limited to: • multiple, conflicting and changing laws and regulations, such as privacy regulations, tax laws, export and import restrictions, employment laws, regulatory requirements and other governmental approvals, permits and licenses; • failure by us to obtain and maintain regulatory approvals for the use of our product candidates in various countries; • additional potentially relevant third-party patent rights; • complexities and difficulties in obtaining protection of and enforcing our intellectual property rights; • difficulties in staffing and managing foreign operations; • complexities associated with managing multiple-payor reimbursement regimes, government payors or patient self-pay systems; • limits on our ability to penetrate international markets; • financial risks, such as longer payment cycles, difficulty collecting accounts receivable, the impact of local and regional financial crises on demand and payment for our product candidates and exposure to foreign currency exchange rate fluctuations, which could result in increased operating expenses and reduced revenues; • natural disasters, political and economic instability, including wars, events of terrorism and political unrest, outbreak of disease, including pandemics, boycotts, curtailment of trade and other business restrictions, economic sanctions, and economic weakness, including inflation; • changes in diplomatic and trade relationships; • challenges in enforcing our contractual and intellectual property rights, especially in those foreign countries that do not respect and protect intellectual property rights to the same extent as the United States; • restriction on cross-border investment, including enhanced oversight by the Committee on Foreign Investment in the United States and substantial restrictions on investment from China; • certain expenses including, among others, expenses for travel, translation and insurance; • legal risks, including use of the legal system by the government to benefit itself or affiliated entities at our expense, including expropriation of property; • regulatory and compliance risks that relate to maintaining accurate information and control over sales and activities that may fall within the purview of the FCPA its books and records provisions, or its anti-bribery provisions; and • risks that we may suffer reputational harm as a result of our operations in Russia.
Doing business internationally involves a number of risks, including but not limited to: • multiple, conflicting and changing laws and regulations, such as privacy regulations, tax laws, export and import restrictions, employment laws, regulatory requirements and other governmental approvals, permits and licenses; • failure by us to obtain and maintain regulatory approvals for the use of our product candidates in various countries; • additional potentially relevant third-party patent rights; • complexities and difficulties in obtaining protection of and enforcing our intellectual property rights; • difficulties in staffing and managing foreign operations; • complexities associated with managing multiple-payor reimbursement regimes, government payors or patient self-pay systems; • limits on our ability to penetrate international markets; • financial risks, such as longer payment cycles, difficulty collecting accounts receivable, the impact of local and regional financial crises on demand and payment for our product candidates and exposure to foreign currency exchange rate fluctuations, which could result in increased operating expenses and reduced revenues; 52 Table of Contents • natural disasters, political and economic instability, including wars, events of terrorism and political unrest, outbreak of disease, including pandemics, boycotts, curtailment of trade and other business restrictions, economic sanctions, and economic weakness, including inflation; • changes in diplomatic and trade relationships; • challenges in enforcing our contractual and intellectual property rights, especially in those foreign countries that do not respect and protect intellectual property rights to the same extent as the United States; • restriction on cross-border investment, including enhanced oversight by the Committee on Foreign Investment in the United States and substantial restrictions on investment from China; • certain expenses including, among others, expenses for travel, translation and insurance; • legal risks, including use of the legal system by the government to benefit itself or affiliated entities at our expense, including expropriation of property; • regulatory and compliance risks that relate to maintaining accurate information and control over sales and activities that may fall within the purview of the FCPA its books and records provisions, or its anti-bribery provisions; and • risks that we may suffer reputational harm as a result of our operations in Russia.
A person or entity does not need to have actual knowledge of the statute or specific intent to violate it to have committed a violation; • HIPAA, as amended by HITECH, and their respective implementing regulations, which also impose obligations, including mandatory contractual terms, on certain types of people and entities with respect to safeguarding the privacy, security and transmission of individually identifiable health information; • the federal Physician Payments Sunshine Act, or the Sunshine Act, which requires applicable manufacturers of certain products for which payment is available under a federal healthcare program to report annually to the government information related to certain payments or other “transfers of value” made to physicians (defined to include doctors, dentists, optometrists, podiatrists and chiropractors), certain other health care professionals beginning in 2022, and teaching hospitals, as well as ownership and investment interests held by the physicians and their immediate family members; 37 Table of Contents • analogous state laws and regulations, such as state anti-kickback and false claims laws, which may apply to sales or marketing arrangements and claims involving healthcare items or services reimbursed by third-party payors, including private insurers; and requirements to comply with federal and pharmaceutical industry compliance guidelines; • state data privacy and price transparency laws, many of which differ from each other in significant ways and often are broader than and not preempted by HIPAA or the Sunshine Act, thus complicating compliance efforts; by way of example, the California Consumer Privacy Act, or CCPA, which went into effect January 1, 2020, among other things, creates new data privacy obligations for covered companies and provides new privacy rights to California residents, including the right to opt out of certain disclosures of their information.
A person or entity does not need to have actual knowledge of the statute or specific intent to violate it to have committed a violation; • HIPAA, as amended by HITECH, and their respective implementing regulations, which also impose obligations, including mandatory contractual terms, on certain types of people and entities with respect to safeguarding the privacy, security and transmission of individually identifiable health information; • the federal Physician Payments Sunshine Act, or the Sunshine Act, which requires applicable manufacturers of certain products for which payment is available under a federal healthcare program to report annually to the government information related to certain payments or other “transfers of value” made to physicians (defined to include doctors, dentists, optometrists, podiatrists and chiropractors), certain other health care professionals beginning in 2022, and teaching hospitals, as well as ownership and investment interests held by the physicians and their immediate family members; • analogous state laws and regulations, such as state anti-kickback and false claims laws, which may apply to sales or marketing arrangements and claims involving healthcare items or services reimbursed by third-party payors, including private insurers; and requirements to comply with federal and pharmaceutical industry compliance guidelines; • state data privacy and price transparency laws, many of which differ from each other in significant ways and often are broader than and not preempted by HIPAA or the Sunshine Act, thus complicating compliance efforts; by way of example, the California Consumer Privacy Act, or CCPA, which went into effect January 1, 2020, among other things, creates new data privacy obligations for covered companies and provides new privacy rights to California residents, including the right to opt out of certain disclosures of their information.
In addition, recent patent reform legislation could further increase the uncertainties and costs surrounding the prosecution of our patent applications and the enforcement or defense of our issued patents. The Leahy-Smith Act America Invents Act, or the Leahy-Smith Act, included provisions that affect the way patent applications are prosecuted and may also affect patent litigation, including first-to-file provisions.
In addition, patent reform legislation could further increase the uncertainties and costs surrounding the prosecution of our patent applications and the enforcement or defense of our issued patents. The Leahy-Smith Act America Invents Act, or the Leahy-Smith Act, included provisions that affect the way patent applications are prosecuted and may also affect patent litigation, including first-to-file provisions.
Descartes-08 also received Rare Pediatric Disease Designation by the FDA for the treatment of JDM. We expect to seek one or more of these designations for our other current and future product candidates. There can be no assurance that any of our other product candidates will qualify for any of these designations.
Descartes-08 received Rare Pediatric Disease Designation by the FDA for the treatment of JDM. We expect to seek one or more of these designations for our other current and future product candidates. There can be no assurance that any of our other product candidates will qualify for any of these designations.
These designations include but are not limited to orphan drug designation, breakthrough therapy designation, accelerated approval, fast track status and priority review for our product candidates. For example, Descartes-08 has been granted Orphan Drug Designation and RMAT Designation by the FDA for the treatment of MG.
These designations include but are not limited to orphan drug designation, breakthrough therapy designation, accelerated approval, CNPV, fast track status and priority review for our product candidates. For example, Descartes-08 has been granted Orphan Drug Designation and RMAT Designation by the FDA for the treatment of MG.
From time to time, we may publish interim, top-line or preliminary data from our clinical studies, which is based on a preliminary analysis of then-available data, and the results and related findings and conclusions are subject to change following a full analyses of all data related to the particular trial.
From time to time, we may publish interim, top-line or preliminary data from our clinical studies, which is based on a preliminary analysis of then-available data, and the results and related findings and conclusions are subject to change following a full analysis of all data related to the particular trial.
The success of our product candidates will depend on several factors, including the following: • design, initiation and completion of preclinical studies and clinical trials with positive results; • reliance on third-parties, including but not limited to collaborators, licensees, clinical research organizations and contract manufacturing organizations; 27 Table of Contents • receipt of marketing approvals from applicable regulatory authorities; • obtaining and maintaining patent and trade secret protection and regulatory exclusivity for our product candidates and not infringing or violating patents or other intellectual property of third-parties; • manufacturability, manufacturing, logistics, and stability of our cell therapies, including autologous cell therapies; • growing our internal cGMP manufacturing capabilities to support commercial manufacturing or making arrangements with third-party manufacturers; • launching commercial sales of our products, if and when approved, whether alone or in collaboration with others; • acceptance of our products, if and when approved, by patients and the medical community; • effectively competing with other therapies; • obtaining and maintaining coverage and adequate reimbursement by third-party payors, including government payors, for our products, if approved; • maintaining an acceptable safety profile of our products following approval; and • maintaining and growing an organization of scientists and businesspeople who can develop and commercialize our product candidates and technology.
The success of our product candidates will depend on several factors, including the following: • design, initiation and completion of preclinical studies and clinical trials with positive results; • reliance on third-parties, including but not limited to collaborators, licensees, clinical research organizations and contract manufacturing organizations; • receipt of marketing approvals from applicable regulatory authorities; • obtaining and maintaining patent and trade secret protection and regulatory exclusivity for our product candidates and not infringing or violating patents or other intellectual property of third-parties; • manufacturability, manufacturing, logistics, and stability of our cell therapies, including autologous cell therapies; • growing our internal cGMP manufacturing capabilities to support commercial manufacturing or making arrangements with third-party manufacturers; • launching commercial sales of our products, if and when approved, whether alone or in collaboration with others; • acceptance of our products, if and when approved, by patients and the medical community; • effectively competing with other therapies; • obtaining and maintaining coverage and adequate reimbursement by third-party payors, including government payors, for our products, if approved; • maintaining an acceptable safety profile of our products following approval; and • maintaining and growing an organization of scientists and businesspeople who can develop and commercialize our product candidates and technology.
We rely, and expect to continue to rely, on third-parties, such as CROs, clinical data management organizations, medical institutions and clinical investigators, to conduct and manage our clinical trials, including our planned Phase 3 clinical trials of Descartes-08. We also expect to rely on other third-parties to store and distribute drug supplies for our clinical trials.
We rely, and expect to continue to rely, on third-parties, such as CROs, clinical data management organizations, medical institutions and clinical investigators, to conduct and manage our clinical trials, including our current and planned Phase 3 clinical trials of Descartes-08. We also expect to rely on other third-parties to store and distribute drug supplies for our clinical trials.
We may not prevail in any lawsuits that we initiate and the damages or other remedies awarded if we were to prevail may not be commercially meaningful. Even if we are successful, domestic or foreign litigation, or USPTO or foreign patent office proceedings, may result in substantial costs and distraction to our management.
We may not prevail in any lawsuits we initiate, and the damages or other remedies awarded if we were to prevail may not be commercially meaningful. Even if we are successful, domestic or foreign litigation, or USPTO or foreign patent office proceedings, may result in substantial costs and distraction to our management.
We have recorded a material amount of goodwill and indefinite-lived intangible assets in connection with the Merger. We may record impairment charges, which would adversely impact our financial position and results of operations. We have recorded a material amount of goodwill and indefinite-lived intangible assets on our balance sheet in connection with the Merger.
We have recorded a material amount of goodwill and indefinite-lived intangible assets in connection with the Merger. We have, and may in the future, record impairment charges, which would adversely impact our financial position and results of operations. We have recorded a material amount of goodwill and indefinite-lived intangible assets on our balance sheet in connection with the Merger.
Additionally, if one or more of our product candidates receives marketing approval, and we or others later identify undesirable side effects caused by such products, a number of potentially significant negative consequences could result, including: • regulatory authorities may withdraw approvals of such product; • regulatory authorities may require the addition of labeling statements, such as a boxed warning or a contraindication; • regulatory authorities may impose additional restrictions on the marketing of, or the manufacturing processes for, the particular product; • we may be required to create a medication guide outlining the risks of such side effects for distribution to patients; • we could be sued and held liable for harm caused to patients, or become subject to fines, injunctions or the imposition of civil or criminal penalties; • our reputation may suffer; and • we could be required to develop a risk evaluation and mitigation strategies, or REMS, plan to prevent, monitor and/or manage a specific serious risk by informing, educating and/or reinforcing actions to reduce the frequency and/or severity of the event.
Additionally, if one or more of our product candidates receives marketing approval, and we or others later identify undesirable side effects caused by such products, a number of potentially significant negative consequences could result, including: 34 Table of Contents • regulatory authorities may withdraw approvals of such product; • regulatory authorities may require the addition of labeling statements, such as a boxed warning or a contraindication; • regulatory authorities may impose additional restrictions on the marketing of, or the manufacturing processes for, the particular product; • we may be required to create a medication guide outlining the risks of such side effects for distribution to patients; • we could be sued and held liable for harm caused to patients, or become subject to fines, injunctions or the imposition of civil or criminal penalties; • our reputation may suffer; and • we could be required to develop a risk evaluation and mitigation strategies, or REMS, plan to prevent, monitor and/or manage a specific serious risk by informing, educating and/or reinforcing actions to reduce the frequency and/or severity of the event.
The failure of any CMO to perform its obligations as expected, or, to the extent we manufacture all or a portion of our product candidates ourselves, our failure to execute on our manufacturing requirements, could adversely affect our business in a number of ways, including: • we or our current or future collaborators may not be able to initiate or continue clinical trials of product candidates that are under development; • we or our current or future collaborators may be delayed in submitting regulatory applications, or receiving regulatory approvals, for our product candidates; • we may lose the cooperation of our collaborators; • our facilities and those of our CMOs, and our products could be the subject of inspections by regulatory authorities that could have a negative outcome and result in delays in supply; 33 Table of Contents • we may be required to cease distribution or recall some or all batches of our products or take action to recover clinical trial material from clinical trial sites; and • ultimately, we may not be able to meet the clinical and commercial demands for our products.
The failure of any CMO to perform its obligations as expected, or, to the extent we manufacture all or a portion of our product candidates ourselves, our failure to execute on our manufacturing requirements, could adversely affect our business in a number of ways, including: • we or our current or future collaborators may not be able to initiate or continue clinical trials of product candidates that are under development; • we or our current or future collaborators may be delayed in submitting regulatory applications, or receiving regulatory approvals, for our product candidates; • we may lose the cooperation of our collaborators; • our facilities and those of our CMOs, and our products could be the subject of inspections by regulatory authorities that could have a negative outcome and result in delays in supply; • we may be required to cease distribution or recall some or all batches of our products or take action to recover clinical trial material from clinical trial sites; and • ultimately, we may not be able to meet the clinical and commercial demands for our products.
Additional risks inherent in conducting international clinical trials include: • foreign regulatory requirements that could burden or limit our ability to conduct our clinical trials; • increased costs and heightened supply constraints associated with the acquisition of standard of care drugs and/or combination or comparator agents for which we may bear responsibility in certain jurisdictions; • administrative burdens of conducting clinical trials under multiple foreign regulatory schema; • foreign exchange fluctuations; • more burdensome manufacturing, customs, shipment and storage requirements; • cultural differences in medical practice and clinical research; • lack of consistency in standard of care from country to country; 30 Table of Contents • diminished protection of intellectual property in some countries; • changes in country or regional regulatory requirements; and • geopolitical instability or wars in regions outside of the United States where we conduct clinical trials may impact ongoing clinical trials.
Additional risks inherent in conducting international clinical trials include: • foreign regulatory requirements that could burden or limit our ability to conduct our clinical trials; • increased costs and heightened supply constraints associated with the acquisition of standard of care drugs and/or combination or comparator agents for which we may bear responsibility in certain jurisdictions; • administrative burdens of conducting clinical trials under multiple foreign regulatory schema; • foreign exchange fluctuations; • more burdensome manufacturing, customs, shipment and storage requirements; • cultural differences in medical practice and clinical research; • lack of consistency in standard of care from country to country; • diminished protection of intellectual property in some countries; • changes in country or regional regulatory requirements; and • geopolitical instability or wars in regions outside of the United States where we conduct clinical trials may impact ongoing clinical trials.
If we are required to conduct additional clinical trials or other testing of our product candidates beyond those that we currently contemplate, if we are unable to successfully complete clinical trials of our product candidates or other testing, if the results of these trials or tests are not positive or are only modestly positive or if there are safety concerns, or if we are forced to delay or abandon certain clinical trials or other testing in order to conserve capital resources, we may: • be delayed in obtaining marketing approval for our product candidates, if at all; • obtain marketing approval in some countries and not in others; • obtain approval for indications or patient populations that are not as broad as intended or desired; 29 Table of Contents • obtain approval with labeling that includes significant use or distribution restrictions or safety warnings; • be subject to additional post-marketing testing requirements; or • have a product removed from the market after obtaining marketing approval.
If we are required to conduct additional clinical trials or other testing of our product candidates beyond those that we currently contemplate, if we are unable to successfully complete clinical trials of our product candidates or other testing, if the results of these trials or tests are not positive or are only modestly positive or if there are safety concerns, or if we are forced to delay or abandon certain clinical trials or other testing in order to conserve capital resources, we may: • be delayed in obtaining marketing approval for our product candidates, if at all; • obtain marketing approval in some countries and not in others; • obtain approval for indications or patient populations that are not as broad as intended or desired; • obtain approval with labeling that includes significant use or distribution restrictions or safety warnings; • be subject to additional post-marketing testing requirements; or • have a product removed from the market after obtaining marketing approval.
Although the law includes limited exceptions, including for “protected health information” maintained by a covered entity or business associate, it may regulate or impact our processing of personal information depending on the context; and ◦ similar healthcare laws and regulations in the EU and other jurisdictions, including reporting requirements detailing interactions with and payments to healthcare providers and laws governing the privacy and security of certain protected information, such as the GDPR, which imposes obligations and restrictions on the collection and use of personal data relating to individuals located in the EU (including health data); in addition, the United Kingdom leaving the EU could also lead to further legislative and regulatory changes.
Although the law includes limited exceptions, including for “protected health information” maintained by a covered entity or business associate, it may regulate or impact our processing of personal information depending on the context; and • similar healthcare laws and regulations in the EU and other jurisdictions, including reporting requirements detailing interactions with and payments to healthcare providers and laws governing the privacy and security of certain protected information, such as the GDPR, which imposes obligations and restrictions on the collection and use of 43 Table of Contents personal data relating to individuals located in the EU (including health data); in addition, the United Kingdom leaving the EU could also lead to further legislative and regulatory changes.
Any of these transactions could be material to our financial condition and operating results and expose us to many risks, including: • disruption in our relationships with future customers or with current or future distributors or suppliers as a result of such a transaction; • unexpected liabilities related to acquired companies; • difficulties integrating acquired personnel, technologies and operations into our existing business; • diversion of management time and focus from operating our business to acquisition integration challenges; • increases in our expenses and reductions in our cash available for operations and other uses; • possible write-offs or impairment charges relating to acquired businesses; and 50 Table of Contents • inability to develop a sales force for any additional product candidates.
Any of these transactions could be material to our financial condition and operating results and expose us to many risks, including: • disruption in our relationships with future customers or with current or future distributors or suppliers as a result of such a transaction; • unexpected liabilities related to acquired companies; • difficulties integrating acquired personnel, technologies and operations into our existing business; • diversion of management time and focus from operating our business to acquisition integration challenges; • increases in our expenses and reductions in our cash available for operations and other uses; • possible write-offs or impairment charges relating to acquired businesses; and • inability to develop a sales force for any additional product candidates.
Regardless of merit or eventual outcome, liability claims may result in: 36 Table of Contents • regulatory investigations, product recalls or withdrawals, or labeling, marketing or promotional restrictions; • decreased demand for any product candidates or products that we may develop; • injury to our reputation and significant negative media attention; • loss of clinical trial participants or increased difficulty in enrolling future participants; • significant costs to defend the related litigation or to reach a settlement; • substantial payments to trial participants or patients; • loss of revenue; • reduced resources of our management to pursue our business strategy; • the inability to commercialize any products that we may develop; • distraction of management’s attention from our primary business; and • substantial monetary awards to patients or other claimants.
Regardless of merit or eventual outcome, liability claims may result in: • regulatory investigations, product recalls or withdrawals, or labeling, marketing or promotional restrictions; • decreased demand for any product candidates or products that we may develop; • injury to our reputation and significant negative media attention; • loss of clinical trial participants or increased difficulty in enrolling future participants; • significant costs to defend the related litigation or to reach a settlement; • substantial payments to trial participants or patients; • loss of revenue; • reduced resources of our management to pursue our business strategy; • the inability to commercialize any products that we may develop; • distraction of management’s attention from our primary business; and • substantial monetary awards to patients or other claimants.
The complaint seeks a temporary injunction against the stockholder vote on the Series A Conversion Proposal, compensatory damages, pre-and post-judgment interest, and attorneys’ fees and costs. At a telephonic hearing on February 28, 2024, the Court denied the Plaintiff’s motion to expedite the proceedings, rejecting Plaintiff’s argument that the lawsuit raised colorable disclosure claims warranting expedited treatment.
The complaint sought a temporary injunction against the stockholder vote on the Series A Conversion Proposal, compensatory damages, pre-and post-judgment interest, and attorneys’ fees and costs. At a telephonic hearing on February 28, 2024, the Court denied the Plaintiff’s motion to expedite the proceedings, rejecting Plaintiff’s argument that the lawsuit raised colorable disclosure claims warranting expedited treatment.
Were we to receive a designation that promised a period of market exclusivity, such as orphan drug exclusivity, such exclusivity may not effectively protect the product from competition because different drugs can be approved for the same condition. In particular, the scope of exclusivity afforded for mRNA-modified cell therapy products may not be well defined.
Were we to receive a designation that promised a period of market exclusivity, such as orphan drug exclusivity, such exclusivity may not effectively protect the product from competition because different drugs can be approved for the same condition. In particular, the scope of exclusivity afforded for mRNA-modified cell therapy products may not be well defined and may change.
Depending on these and other decisions by the U.S. Congress, the federal courts and the USPTO, the laws and regulations governing patents could change or be interpreted in unpredictable ways that would weaken our ability to obtain new patents or to enforce any patents that may issue to us in the future.
Depending on these and other decisions by the U.S. Congress, the federal courts and the USPTO, the laws and regulations governing patents could change or be interpreted in unpredictable ways that would weaken our ability to obtain new patents or to enforce any patents that have issued or may issue to us in the future.
Therefore, we cannot know with certainty whether we were the first to make the inventions claimed in any owned patents or pending patent applications, or that we were the first to file for patent protection of such inventions, nor can we know whether those from whom we may license patents were the first to make the inventions claimed or were the first to file.
Therefore, we cannot know with certainty whether we were the first to make the inventions claimed in any owned patents or pending patent applications, or that we were the first to file for patent protection of such inventions, nor can we know whether those from whom we have licensed or may license patents were the first to make the inventions claimed or were the first to file.
Such proceedings could result in revocation or amendment of our patents in such a way that they no longer cover our product candidates or competitive products. The outcome following legal assertions of invalidity and unenforceability is unpredictable.
Such proceedings could result in revocation or amendment of our patents including claimes in such a way that they no longer cover our product candidates or competitive products. The outcome following legal assertions of invalidity and unenforceability is unpredictable.
It is also possible that unauthorized access to data may be obtained through inadequate use of security controls by our suppliers or other vendors. Although we have general liability insurance coverage, our insurance may not cover all claims, continue to be available on reasonable terms or be sufficient in amount to cover one or more large claims.
It is also possible that unauthorized access to data may be obtained through inadequate use of security controls by our suppliers or other vendors. 53 Table of Contents Although we have general liability insurance coverage, our insurance may not cover all claims, continue to be available on reasonable terms or be sufficient in amount to cover one or more large claims.
The complaint alleged that the 52 Table of Contents individual defendants breached their fiduciary duties by failing to disclose purportedly material information to our Company’s stockholders in our Preliminary Proxy Statement filed on January 31, 2024 in connection with the solicitation of stockholder approval of the Series A Conversion Proposal.
The complaint alleged that the individual defendants breached their fiduciary duties by failing to disclose purportedly material information to our Company’s stockholders in our Preliminary Proxy Statement filed on January 31, 2024 in connection with the solicitation of stockholder approval of the Series A Conversion Proposal.
As a result, we may not be able to use a material portion of the NOLs reflected on our balance sheet, even if we attain profitability. Under current law, NOLs that arose before January 1, 2018 may be carried forward up to 20 years.
As a result, we may not be able to use a material portion of the NOLs reflected on our balance sheet, even if we attain profitability. 37 Table of Contents Under current law, NOLs that arose before January 1, 2018 may be carried forward up to 20 years.
Due to legal standards relating to patentability, validity, enforceability and claim scope of patents covering biotechnological and pharmaceutical inventions, our ability to obtain, maintain and enforce patents is uncertain and involves complex legal and factual questions. Even if issued, a patent’s validity, inventorship, ownership or enforceability is not conclusive.
Due to legal standards relating to patentability, validity, enforceability and claim scope of patents covering biotechnological and pharmaceutical inventions, our ability to 46 Table of Contents obtain, maintain and enforce patents is uncertain and involves complex legal and factual questions. Even if issued, a patent’s validity, inventorship, ownership or enforceability is not conclusive.
Furthermore, replacing executive officers and key employees may be difficult and may take an extended period of time because of the limited number of individuals in our industry with the breadth of skills and experience required to successfully develop, gain regulatory approval of and commercialize product candidates.
Furthermore, replacing executive officers and key employees may be difficult and may take an 51 Table of Contents extended period of time because of the limited number of individuals in our industry with the breadth of skills and experience required to successfully develop, gain regulatory approval of and commercialize product candidates.
Although we have no knowledge of any such claims being alleged to date, if such claims were to arise, litigation may be necessary to defend against any such claims. If we fail in prosecuting or defending any such claims, in addition to paying monetary damages, we may lose valuable intellectual property rights or personnel.
Although we have no knowledge of any such claims being alleged to date, if such claims were to arise, litigation may be necessary to defend against any such claims. 50 Table of Contents If we fail in prosecuting or defending any such claims, in addition to paying monetary damages, we may lose valuable intellectual property rights or personnel.
The degree of market acceptance of our product candidates, if approved for commercial sale, will depend on several factors, including: • the efficacy, safety and potential advantages compared to alternative treatments; • our ability to manufacture and distribute cell therapies in a timely and secure manner; • our ability to offer our products for sale at competitive prices; • the convenience and ease of administration compared to alternative treatments; • product labeling or product insert requirements of the FDA or foreign regulatory authorities, including any limitations or warnings contained in a product’s approved labeling, including any black box warning or REMS; • the willingness of the target patient population to try new treatments and of physicians to prescribe these treatments; • our ability to hire and retain a sales force; • the strength of marketing and distribution support; • the availability of third-party coverage and adequate reimbursement for our product candidates, once approved; • the prevalence and severity of any side effects; and • any restrictions on the use of our products together with other medications. 34 Table of Contents We currently have no sales organization.
The degree of market acceptance of our product candidates, if approved for commercial sale, will depend on several factors, including: • the efficacy, safety and potential advantages compared to alternative treatments; • our ability to manufacture and distribute cell therapies in a timely and secure manner; • our ability to offer our products for sale at competitive prices; • the convenience and ease of administration compared to alternative treatments; • product labeling or product insert requirements of the FDA or foreign regulatory authorities, including any limitations or warnings contained in a product’s approved labeling, including any black box warning or REMS; • the willingness of the target patient population to try new treatments and of physicians to prescribe these treatments; • our ability to hire and retain a sales force; • the strength of marketing and distribution support; • the availability of third-party coverage and adequate reimbursement for our product candidates, once approved; • the prevalence and severity of any side effects; and • any restrictions on the use of our products together with other medications.
A third-party that files a patent application in the USPTO before us could therefore be awarded a patent covering an invention of ours even if we had made the invention before it was made by the third-party. This requires us to be cognizant of the time from invention to filing of a patent application.
A third party that files a patent application in the USPTO before us could therefore be awarded a patent covering an invention of ours even if we had made the invention before it was made by the third party. This requires us to be cognizant of 47 Table of Contents the time from invention to filing of a patent application.
Third-parties may assert infringement claims against us based on existing intellectual property rights and intellectual property rights that may be granted in the future. Patent and other types of intellectual property litigation can involve complex factual and legal questions, and their outcome is uncertain.
Third parties may assert infringement claims against us based on existing intellectual property rights and intellectual property rights that may be granted in the future. 48 Table of Contents Patent and other types of intellectual property litigation can involve complex factual and legal questions, and their outcome is uncertain.
We maintain general liability, product liability and umbrella liability insurance. Our existing insurance coverage may not fully cover potential liabilities that we may incur. We may need to increase our insurance coverage as we expand our clinical trials or if we commence commercialization of our product candidates. Insurance coverage is increasingly expensive.
We maintain general liability, product liability and umbrella liability insurance. Our existing insurance coverage may not fully cover potential liabilities that we may incur. We may need to increase our insurance coverage as we expand our clinical 42 Table of Contents trials or if we commence commercialization of our product candidates. Insurance coverage is increasingly expensive.
If the IRS, challenges our analysis that existing NOLs will not expire before 41 Table of Contents utilization due to previous ownership changes, or if we undergo an ownership change, our ability to use our NOLs could be limited by Section 382 of the Code.
If the IRS, challenges our analysis that existing NOLs will not expire before utilization due to previous ownership changes, or if we undergo an ownership change, our ability to use our NOLs could be limited by Section 382 of the Code.
Any such action or other negative results caused by our inability to meet our reporting requirements or comply with legal and regulatory requirements or by disclosure of an accounting, reporting or control 48 Table of Contents issue could adversely affect the trading price of our securities and our business.
Any such action or other negative results caused by our inability to meet our reporting requirements or comply with legal and regulatory requirements or by disclosure of an accounting, reporting or control issue could adversely affect the trading price of our securities and our business.
As we reach the statutory deadlines for deciding whether and where to initiate prosecution in specific foreign jurisdictions by filing national stage applications based on our Patent Cooperation Treaty, or PCT, applications, we will have to decide whether and where to pursue patent protection for the various inventions claimed in our patent portfolio, and we will only have the opportunity to obtain patents in those jurisdictions where we pursue protection.
As we reach the statutory deadlines for deciding whether and where to initiate prosecution in specific foreign jurisdictions by filing national stage applications based on our Patent Cooperation Treaty, or PCT, applications, we will have to decide whether and where to pursue patent protection for the various inventions claimed in our patent portfolio, and we will only have the opportunity to 45 Table of Contents obtain patents in those jurisdictions where we pursue protection.
In addition, these provisions may frustrate or prevent any attempts by our stockholders to replace or remove then current management by making it more difficult for stockholders to replace members of the Board of Directors, which is responsible for appointing the members of management.
In addition, these provisions may frustrate or prevent any attempts by our stockholders to replace or remove 55 Table of Contents then current management by making it more difficult for stockholders to replace members of the Board of Directors, which is responsible for appointing the members of management.
Consequently, for our existing patent rights outside the United States and any foreign patent rights we may decide to pursue in the future, we may not be able to obtain relevant claims and/or we may not be able to prevent third-parties from practicing our inventions in all countries 47 Table of Contents outside the United States, or from selling or importing products made using our inventions in and into the United States or other jurisdictions.
Consequently, for our existing patent rights outside the United States and any foreign patent rights we may decide to pursue in the future, we may not be able to obtain relevant claims and/or we may not be able to prevent third parties from practicing our inventions in all countries outside the United States, or from selling or importing products made using our inventions in and into the United States or other jurisdictions.
Failure to do so can result in fines, adverse publicity, and civil and criminal sanctions. Furthermore, these third-parties may also have relationships with other entities, some of which may be our competitors.
Failure to do so can result in fines, adverse publicity, and civil and criminal sanctions. 39 Table of Contents Furthermore, these third-parties may also have relationships with other entities, some of which may be our competitors.
Any litigation to enforce or defend our patent rights, even if we were to prevail, could be costly and time-consuming and would divert the attention of our management and key personnel from our business operations.
Any litigation to enforce or defend our patent rights or other intellectual property rights, even if we were to prevail, could be costly and time-consuming and would divert the attention of our management and key personnel from our business operations.
Our and their assignment agreements may not be self-executing or may be breached, and we may be forced to bring claims against third-parties, or defend claims they may bring against us, to determine the ownership of what we regard as our intellectual property.
Our or other relevant assignment agreements may not be self-executing or may be breached, and we may be forced to bring claims against third-parties, or defend claims they may bring against us, to determine the ownership of what we regard as our intellectual property.
We have not demonstrated the ability to successfully complete any Phase 3 or other pivotal clinical trials, obtain regulatory approvals, manufacture a commercial product, or arrange for a third-party to do so on our behalf, or conduct other sales and marketing activities necessary for successful product commercialization.
We have not demonstrated the ability to successfully complete any Phase 3 or other pivotal clinical trials, obtain regulatory approvals, manufacture a commercial product, or arrange for a third-party to do so on our behalf, or conduct other sales and marketing activities necessary for 29 Table of Contents successful product commercialization.
Accordingly, we will need to obtain substantial additional funding to continue operations. If we are unable to raise capital when 40 Table of Contents needed or on attractive terms, we could be forced to delay, reduce or eliminate our clinical trials, our other research and development programs or any future commercialization efforts.
Accordingly, we will need to obtain substantial additional funding to continue operations. If we are unable to raise capital when needed or on attractive terms, we could be forced to delay, reduce or eliminate our clinical trials, our other research and development programs or any future commercialization efforts.
In such an event, our competitors might be able to enter the market, which would have an adverse effect on our business. 46 Table of Contents We may not be successful in obtaining or maintaining necessary rights to our product candidates through acquisitions and in-licenses.
In such an event, our competitors might be able to enter the market, which would have an adverse effect on our business. We may not be successful in obtaining or maintaining necessary rights to our product candidates through acquisitions and in-licenses.
However, there is no guarantee that any of these strategic or financing opportunities will be executed on favorable terms, and some could be dilutive to existing stockholders.
However, there is no 36 Table of Contents guarantee that any of these strategic or financing opportunities will be executed on favorable terms, and some could be dilutive to existing stockholders.
It is possible that defects of form in the 42 Table of Contents preparation or filing of our patents or patent applications may exist, or may arise in the future, such as, with respect to proper priority claims, inventorship, claim scope or patent term adjustments.
It is possible that defects of form in the preparation, filing or prosecution of our patents or patent applications may exist, or may arise in the future, such as, with respect to proper priority claims, inventorship, claim scope or patent term adjustments.
Many companies in the pharmaceutical and biotechnology industries have suffered significant setbacks in clinical trials after achieving positive results in preclinical development or early-stage clinical trials, and we cannot be certain that we will not face similar setbacks.
Many companies in the pharmaceutical and biotechnology industries have suffered significant setbacks in clinical trials after achieving positive results in preclinical development or early-stage clinical trials, and we cannot be certain that we will not 30 Table of Contents face similar setbacks.
Similarly, we may be subject to claims that an employee, advisor or consultant performed work for us that conflicts with that person’s obligations to a third-party, such as an employer, and thus, that the third-party has an ownership interest in the intellectual property arising out of work performed for us. Litigation may be necessary to defend against these claims.
Similarly, we may be subject to claims that an employee, advisor or consultant performed work for us that conflicts with that person’s obligations to a third-party, such as an employer, and thus, that the third-party has an ownership interest in the intellectual property arising out of work performed for us.
Although the FDA may accept data from clinical trials conducted outside the United States, acceptance of these data is subject to certain conditions imposed by the FDA.
Although the FDA may accept data from clinical trials conducted outside the United 32 Table of Contents States, acceptance of these data is subject to certain conditions imposed by the FDA.
There exist several designations that we can apply for from the FDA and other regulators that would provide us with various combinations of the potential for expedited regulatory review, certain financial incentives as well as the potential for post-approval exclusivity for a period of time.
There exist several designations that we can apply for from the FDA and other regulators that would provide us with various combinations of the potential for expedited regulatory review, certain financial incentives, aid in our obtaining marketing approval as well as the potential for post-approval exclusivity for a period of time.
We face competition with respect to our current product candidates and will face competition with respect to any product candidates that we may seek to develop or commercialize in the future, from major pharmaceutical companies, specialty pharmaceutical companies and biotechnology companies worldwide.
We face competition with respect to our current product candidates and will face competition with respect to 40 Table of Contents any product candidates that we may seek to develop or commercialize in the future, from major pharmaceutical companies, specialty pharmaceutical companies and biotechnology companies worldwide.
The market price for our common stock may be influenced by many factors, including: • the success of competitive products or technologies; • results or progress, or changes in approach or timelines, of clinical trials of our product candidates or those of our competitors; • failure or discontinuation of any of our development programs; • commencement of, termination of, or any development related to any collaboration or licensing arrangement; • regulatory or legal developments in the United States and other countries; • development of new product candidates that may address our markets and make our product candidates less attractive; • changes in physician, hospital or healthcare provider practices that may make our product candidates less useful; • announcements by us, our collaborators or our competitors of significant acquisitions, strategic partnerships, joint ventures, collaborations or capital commitments; • announcement or market expectation of additional financing efforts; • developments or disputes concerning patent applications, issued patents or other proprietary rights; • the recruitment or departure of key personnel; • the level of expenses related to any of our product candidates or clinical development programs; • failure to meet or exceed financial estimates, projections or development timelines of the investment community or that we provide to the public; • the results of our efforts to discover, develop, acquire or in-license additional product candidates or products; • actual or expected changes in estimates as to financial results, development timelines or recommendations by securities analysts; • variations in our financial results or those of companies that are perceived to be similar to us; • changes in the structure of healthcare payment systems; • sale of common stock by us or our stockholders in the future as well as the overall trading volume of our common stock; • changes in the composition of our stockholder base; • activity in the options market for shares of our common stock; • market conditions in the pharmaceutical and biotechnology sectors; • general economic, industry and market conditions; and • the other factors described in this “Risk Factors ” section. 51 Table of Contents Our executive officers, directors, and principal stockholders, if they choose to act together, will continue to have the ability to control or significantly influence all matters submitted to stockholders for approval.
The market price for our common stock may be influenced by many factors, including: • the success of competitive products or technologies; • results or progress, or changes in approach or timelines, of clinical trials of our product candidates or those of our competitors; • failure or discontinuation of any of our development programs; • commencement of, termination of, or any development related to any collaboration or licensing arrangement; • regulatory or legal developments in the United States and other countries; • development of new product candidates that may address our markets and make our product candidates less attractive; • changes in physician, hospital or healthcare provider practices that may make our product candidates less useful; 54 Table of Contents • announcements by us, our collaborators or our competitors of significant acquisitions, strategic partnerships, joint ventures, collaborations or capital commitments; • announcement or market expectation of additional financing efforts; • developments or disputes concerning patent applications, issued patents or other proprietary rights; • the recruitment or departure of key personnel; • the level of expenses related to any of our product candidates or clinical development programs; • failure to meet or exceed financial estimates, projections or development timelines of the investment community or that we provide to the public; • the results of our efforts to discover, develop, acquire or in-license additional product candidates or products; • actual or expected changes in estimates as to financial results, development timelines or recommendations by securities analysts; • variations in our financial results or those of companies that are perceived to be similar to us; • changes in the structure of healthcare payment systems; • sale of common stock by us or our stockholders in the future as well as the overall trading volume of our common stock; • changes in the composition of our stockholder base; • activity in the options market for shares of our common stock; • market conditions in the pharmaceutical and biotechnology sectors; • general economic, industry and market conditions; and • the other factors described in this “Risk Factors” section.
As is the case with other biotechnology companies, our success is heavily dependent on intellectual property, particularly patents. Obtaining and enforcing patents in the biotechnology industry involves both technological and legal complexity, and is therefore costly, time-consuming and inherently uncertain.
As is the case with other biotechnology and pharmaceutical companies, our success is heavily dependent on intellectual property, particularly patents. Obtaining and enforcing patents in the biotechnology and pharmaceutical industries involve both technological and legal complexity, and is therefore costly, time-consuming and inherently uncertain.
While we believe our mRNA-based CAR-T product candidates may have a differentiated toxicity profile than currently approved DNA-based CAR-T therapies, there can be no assurance that the FDA would not treat Descartes-08 or any of our other product candidates similar to approved DNA-based CAR-T therapies.
While we believe our mRNA-based CAR-T product candidates may have a differentiated toxicity profile than currently approved DNA-based CAR-T therapies, there can be no assurance that the FDA would not treat Descartes-08 or any of our other product candidates similar to approved DNA-based CAR-T therapies, or decide a REMS is necessary to assure safe use.
In addition, it may be some time before we understand how the patent office reacts to our patent claims and whether they identify prior art of relevance that we have not already considered.
In addition, it may be some time before we understand how patent offices react to our patent claims and whether they identify prior art of relevance that we have not already considered.
Our executive officers, directors and stockholders who own more than 5% of our outstanding common stock and their respective affiliates, in the aggregate, hold shares representing approximately 64.5% of our outstanding voting stock as of December 31, 2024 , assuming the conversion of all shares of all outstanding shares of Series A Non-Voting Convertible Preferred Stock, par value $0.0001 per share, or Series A Preferred Stock, and Series B Non-Voting Convertible Preferred Stock, par value $0.0001 per share, or Series B Preferred Stock, into common stock, or 68.4%, assuming no conversion of outstanding shares of Series A Preferred Stock and Series B Preferred Stock into common stock .
Our executive officers, directors and stockholders who own more than 5% of our outstanding common stock and their respective affiliates, in the aggregate, hold shares representing approximately 67.1% of our outstanding voting stock as of December 31, 2025, assuming the conversion of all shares of all outstanding shares of Series A Non-Voting Convertible Preferred Stock, par value $0.0001 per share, or Series A Preferred Stock, and Series B Non-Voting Convertible Preferred Stock, par value $0.0001 per share, or Series B Preferred Stock, into common stock, or 59.7%, assuming no conversion of outstanding shares of Series A Preferred Stock and Series B Preferred Stock into common stock.
Additionally, over the last several years, the U.S. government has shut down multiple times and certain regulatory agencies, such as the FDA, have had to furlough critical FDA and other government employees 32 Table of Contents and stop critical activities.
Additionally, over the last several years, the U.S. government has shut down multiple times and certain regulatory agencies, such as the FDA, have had to furlough or reduce the number of critical FDA and other government employees and stop critical activities.
It takes at least six months to obtain approval of the application for patent term extension. We may not be granted an extension because of, for example, failing to apply within applicable deadlines, failing to apply prior to expiration of relevant patents or otherwise failing to satisfy applicable requirements.
It may take at least several months to a few years to obtain approval of the application for patent term extension. We may not be granted an extension because of, for example, failing to apply within applicable deadlines, failing to apply prior to expiration of relevant patents or otherwise failing to satisfy applicable requirements.
Our autologous cell therapy product candidates, including Descartes-08, are made on a patient-by-patient basis, rendering their manufacture less predictable and requiring more demanding logistics. We rely on one or more third-party laboratories to perform certain quality control tests. These laboratories could become unavailable, or provision of their services could be delayed.
Our autologous cell therapy product candidates, including Descartes-08, are made on a patient-by-patient basis, rendering their manufacture less predictable and requiring more demanding logistics. We rely on one or more third-party laboratories to perform certain quality control tests.
Additionally, as we scale up our manufacturing, we may encounter further challenges. Furthermore, competition for supply from our manufacturers from other companies, a breach or violation by such manufacturers of their contractual or regulatory obligations or a dispute with such manufacturers would cause delays in our discovery and development efforts, as well as additional expense to us.
Furthermore, competition for supply from our manufacturers from other companies, a breach or violation by such manufacturers of their contractual or regulatory obligations or a dispute with such manufacturers would cause delays in our discovery and development efforts, as well as additional expense to us.
Moreover, some of the patent applications in our portfolio will be subject to examination under the pre-Leahy-Smith Act law and regulations, while other patents applications in our portfolio will be subject to examination under the law and regulations, as amended by the Leahy-Smith Act.
Moreover, some of the patent applications in our portfolio will be subject to examination under the pre-Leahy-Smith Act law and regulations, while other patents applications in our portfolio will be subject to examination under the law and regulations, as amended by the Leahy-Smith Act. This introduces additional complexities into the prosecution and management of our portfolio.
On August 1, 2022, the Court entered an Order and Final Judgment which dismissed the action, and all claims contained therein, with prejudice. We could receive other demands or be subject to other litigation. We intend to vigorously defend against any demands which we believe to be without merit.
On August 1, 2022, the Court entered an Order and Final Judgment which dismissed the action, and all claims contained therein, with prejudice. We could receive other demands or be subject to other litigation.
A variety of risks associated with maintaining our subsidiary in Russia or expanding operations internationally could adversely affect our business. In addition to our U.S. operations, we maintain a wholly owned subsidiary in Russia, Selecta (RUS). However, we are in the process of winding down all remaining operations of this subsidiary.
A variety of risks associated with winding down operations of our subsidiary in Russia or expanding operations internationally could adversely affect our business. In addition to our U.S. operations, we maintain a wholly owned subsidiary in Russia, Selecta (RUS).
This introduces additional complexities into the prosecution and management of our portfolio. 44 Table of Contents In addition, the Leahy-Smith Act limits where a patentee may file a patent infringement suit and provides opportunities for third-parties to challenge any issued patent in the USPTO. These provisions apply to all of our U.S. patents, even those issued before March 16, 2013.
In addition, the Leahy-Smith Act limits where a patentee may file a patent infringement suit and provides opportunities for third parties to challenge any issued patent in the USPTO. These provisions apply to all of our U.S. patents, even those issued before March 16, 2013.
We expect to continue to incur significant expenses and operating losses for the foreseeable future.
We expect to 35 Table of Contents continue to incur significant expenses and operating losses for the foreseeable future.
If we are unable to establish effective sales, marketing and distribution capabilities, or enter into agreements with third-parties with such capabilities, we may not be successful in commercializing our product candidates if and when they are approved. We do not have a sales or marketing infrastructure and have no experience in the sale, marketing or distribution of pharmaceutical products.
We currently have no sales organization. If we are unable to establish effective sales, marketing and distribution capabilities, or enter into agreements with third-parties with such capabilities, we may not be successful in commercializing our product candidates if and when they are approved.
Treasury Department’s Office of Foreign Assets Control or the U.S. Department of State, the U.S. Foreign Corrupt Practices Act of 1977, as amended, or the FCPA, the U.S. domestic bribery statute contained in 18 U.S.C. § 201, the U.S.
Foreign Corrupt Practices Act of 1977, as amended, or the FCPA, the U.S. domestic bribery statute contained in 18 U.S.C. § 201, the U.S.
Any of these factors could significantly harm our future international expansion and operations and, consequently, our results of operations. 49 Table of Contents Our business and operations, including our development programs, could be materially disrupted in the event of system failures, security breaches, violations of data protection laws or data loss or damage by us or third-parties on which we rely, including our CROs or other contractors or consultants.
Our business and operations, including our development programs, could be materially disrupted in the event of system failures, security breaches, violations of data protection laws or data loss or damage by us or third-parties on which we rely, including our CROs or other contractors or consultants.
There can be no assurance as to the outcome of any stockholder litigation. Unfavorable outcomes in class action litigation could require us to pay extensive damages, which could delay or prevent our ability to develop our product candidates and harm our operations. Item 1B. Unresolved Staff Comments Not applicable.
Unfavorable outcomes in class action litigation could require us to pay extensive damages, which could delay or prevent our ability to develop our product candidates and harm our operations. Item 1B. Unresolved Staff Comments Not applicable.
We are subject to U.S. and certain foreign export and import controls, sanctions, embargoes, anti-corruption laws, and anti-money laundering laws and regulations. Compliance with these legal standards could impair our ability to compete in domestic and international markets. We can face criminal liability and other serious consequences for violations, which can have a material adverse effect on our business.
Compliance with these legal standards could impair our ability to compete in domestic and international markets. We can face criminal liability and other serious consequences for violations, which can have a material adverse effect on our business. We are subject to export control and import laws and regulations, including the U.S. Export Administration Regulations administered by the U.S.
We may face risks associated with winding down the operations of our subsidiary in Russia, or with any international operations, including possible unfavorable regulatory, pricing and reimbursement, legal, political, tax and labor conditions, and risks associated with our compliance with evolving international sanctions, which could harm our business.
We are in the process of winding down the operations of our subsidiary in Russia, but until that process is complete, we remain subject to risks associated with this subsidiary, or with any international operations, including possible unfavorable regulatory, pricing and reimbursement, legal, political, tax and labor conditions, and risks associated with our compliance with evolving international sanctions, which could harm our business.
In such an event, our 31 Table of Contents trials could be suspended or terminated, and the FDA or comparable foreign regulatory authorities could order us to cease further development of or deny approval of our product candidates for any or all targeted indications.
Results of our clinical trials could reveal a high and unacceptable severity and prevalence of side effects. In such an event, our trials could be suspended or terminated, and the FDA or comparable foreign regulatory authorities could order us to cease further development of or deny approval of our product candidates for any or all targeted indications.
The implementation of cost containment measures or other healthcare reforms may prevent us from being able to generate revenue, attain profitability or commercialize our products. 38 Table of Contents Disruptions at the FDA and other government agencies caused by funding shortages or global health concerns could hinder their ability to hire, retain or deploy key leadership and other personnel, or otherwise prevent new or modified products from being developed, approved or commercialized in a timely manner or at all, which could negatively impact our business.
Disruptions at the FDA and other government agencies caused by funding shortages or global health concerns could hinder their ability to hire, retain or deploy key leadership and other personnel, or otherwise prevent new or modified products from being developed, approved or commercialized in a timely manner or at all, which could negatively impact our business.
Risks Related to the Development of our Product Candidates We develop our mRNA-based product candidates by leveraging our proprietary technology and our manufacturing platform, which is an unproven approach to the treatment of autoimmune disease.
Risks Related to the Development of our Product Candidates We develop our mRNA-based product candidates by leveraging our proprietary technology and our manufacturing platform, which is an unproven approach to the treatment of autoimmune disease. We may not be successful in our efforts to build a pipeline of product candidates and develop marketable drugs.
If a prolonged government shutdown occurs, or if global health concerns were to again prevent the FDA or other regulatory authorities from conducting their regular inspections, reviews, or other regulatory activities, it could significantly impact the ability of the FDA or other regulatory authorities to timely review and process our regulatory submissions, which could have a material adverse effect on our business.
If a prolonged government shutdown occurs, or if global health concerns were to again prevent the FDA or other regulatory authorities from conducting their regular inspections, reviews, or other regulatory activities, it could significantly impact the ability of the FDA or other regulatory authorities to timely review and process our regulatory submissions, which could have a material adverse effect on our business. 44 Table of Contents We are subject to U.S. and certain foreign export and import controls, sanctions, embargoes, anti-corruption laws, and anti-money laundering laws and regulations.
If we fail to produce positive results in clinical trials of our product candidates, the development timeline and regulatory approval and commercialization prospects for our product candidates, and, correspondingly, our business and financial prospects, would be negatively impacted. 28 Table of Contents In addition, we cannot be certain as to what type and how many clinical trials the FDA will require us to conduct before we may gain regulatory approval to market any of our product candidates in the United States or other countries, if any.
In addition, we cannot be certain as to what type and how many clinical trials the FDA will require us to conduct before we may gain regulatory approval to market any of our product candidates in the United States or other countries, if any.
Furthermore, an adverse decision in an interference proceeding can result in a third-party receiving the patent right sought by us, which in turn could affect our ability to develop, market or otherwise commercialize our product candidates. The issuance, scope, validity, enforceability and commercial value of our patents are subject to a level of uncertainty.
Furthermore, an adverse decision in an interference or a derivation proceeding can result in our inability to receive, or a a third party receiving, the patent right sought by us, which in turn could affect our ability to develop, market or otherwise commercialize our product candidates.

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Item 1C. Cybersecurity

Cybersecurity — threats and controls disclosure

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Biggest changeWe have implemented processes when evaluating third-party service providers, for example by reviewing available audit reports including the System and 53 Table of Contents Organization Controls (SOC 2) reports and requesting disclosure of any previous cybersecurity events. We also perform quality audits of certain regulated vendors, which includes an assessment of the vendor’s information technology system and associated controls.
Biggest changeWe are leveraging these insights to strengthen our key defenses and continuously mature our security posture. We have implemented processes when evaluating third-party service providers, for example by reviewing available audit reports including the System and Organization Controls (SOC 2) reports and requesting disclosure of any previous cybersecurity events.
We partner with external cybersecurity vendors to enact a layered defense approach with controls deployed that seek to meet the requirements of the NIST Cybersecurity Framework. Our Chief Financial Officer has served as a biotechnology executive for 20 years, whose responsibilities have included direct oversight of his companies’ cybersecurity risks.
We partner with external cybersecurity vendors to enact a layered defense approach with controls deployed that seek to meet the requirements of the NIST Cybersecurity Framework. Our Chief Financial Officer has served as a biotechnology executive for over 20 years, whose responsibilities have included direct oversight of his companies’ cybersecurity risks.
Our Senior Director, Head of IT has served as an Information Technology professional for over ten years and has held senior IT positions across several companies including a large pharmaceutical company. We have established policies and processes for assessing, identifying, and managing material risk from cybersecurity threats, and have integrated these processes into our overall risk management systems and processes.
Our Senior Director, Head of IT has served as an Information Technology professional for over fifteen years and has held senior IT positions across several companies including a large pharmaceutical company. We have established policies and processes for assessing, identifying, and managing material risk from cybersecurity threats, and have integrated these processes into our overall risk management systems and processes.
Our Chief Financial Officer and Senior Director, Head of IT provide periodic briefings to the Audit Committee regarding our Company’s cybersecurity risks and activities, including any recent cybersecurity incidents and related responses, cybersecurity systems testing, activities of third-parties, and related matters. The Audit Committee provides regular updates to the full Board of Directors on such reports.
Our Chief Financial Officer and Senior Director, Head of IT provide periodic briefings to the Audit Committee regarding our Company’s cybersecurity risks and activities, including any recent cybersecurity incidents and related responses, cybersecurity systems testing, activities of third-parties, and related matters.
In the event of a major security incident, we have established an escalation path for stakeholder notification and remediation efforts, and major incidents are immediately escalated to the Head of IT, Chief Financial Officer, and Chief Operations Officer.
In the event of a major security incident, we have established an escalation path for stakeholder notification and remediation efforts, and major incidents are immediately escalated to the Head of IT, Chief Financial Officer, and Chief Operations Officer. In 2024, an external partner conducted a robust cybersecurity assessment to evaluate our risk profile.
We have not encountered cybersecurity challenges that have materially impaired our operations or financial standing. For additional information regarding risks from cybersecurity threats, please refer to Item 1A, “Risk Factors,” in this Annual Report on Form 10-K.
The Audit Committee provides regular updates to the full Board of Directors on such reports. 57 Table of Contents We have not encountered cybersecurity challenges that have materially impaired our operations or financial standing. For additional information regarding risks from cybersecurity threats, please refer to Item 1A, “Risk Factors,” in this Annual Report on Form 10-K.
Additionally, we conduct periodic risk assessments to identify and monitor against potential cybersecurity threats and incidents, as well as assess for any changes in our business practices that may affect our cybersecurity position.
We also perform quality audits of our regulated vendors, which includes an assessment of the vendor’s information technology system and associated controls. Additionally, we conduct periodic risk assessments to identify and monitor against potential cybersecurity threats and incidents, as well as assess for any changes in our business practices that may affect our cybersecurity position.
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In 2024, we proactively conducted a thorough and robust cybersecurity assessment, performed by an external cybersecurity partner, to evaluate our risks and identify key areas to improve our cybersecurity posture.

Item 2. Properties

Properties — owned and leased real estate

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Biggest changeItem 2. Properties Our corporate headquarters are currently located at 7495 New Horizon Way, Frederick, Maryland and consists of 29,050 total square feet of integrated manufacturing and office space under a lease that expires in June 2031.
Biggest changeItem 2. Properties Our corporate headquarters are currently located at 7495 New Horizon Way, Frederick, Maryland and consists of over 35,000 total square feet of integrated manufacturing and office space under a lease that expires in June 2031.
Mine Safety Disclosures Not applicable. 54 Table of Contents PART II
Mine Safety Disclosures Not applicable. 58 Table of Contents PART II

Item 5. Market for Registrant's Common Equity

Market for Common Equity — stock, dividends, buybacks

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Biggest changeItem 5. Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities Market Information Our common stock is publicly traded on The Nasdaq Stock Market under the symbol “RNAC.” Holders As of February 28, 2025, there were approximately 25,907,101 shares of our common stock outstanding held by approximately 107 holders of record.
Biggest changeItem 5. Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities Market Information Our common stock is publicly traded on The Nasdaq Stock Market under the symbol “RNAC”. Holders As of February 28, 2026, there were 26,509,024 shares of our common stock outstanding held by approximately 102 holders of record.
Investors should not purchase our common stock with the expectation of receiving cash dividends. Purchases of Equity Securities by the Issuer or Affiliated Purchasers We did not repurchase any of our equity securities during the quarter ended December 31, 2024. Recent Sales of Unregistered Securities and Use of Proceeds from Registered Securities Not applicable. Item 6. [Reserved]
Investors should not purchase our common stock with the expectation of receiving cash dividends. Purchases of Equity Securities by the Issuer or Affiliated Purchasers We did not repurchase any of our equity securities during the quarter ended December 31, 2025. Recent Sales of Unregistered Securities and Use of Proceeds from Registered Securities Not applicable. Item 6. [Reserved]
Any future determination to pay dividends will be made at the discretion of our Board of Directors and will depend 55 Table of Contents on various factors, including applicable laws, our results of operations, financial condition, future prospects, then applicable contractual restrictions and any other factors deemed relevant by our Board of Directors.
Any future determination to pay dividends will be made at the discretion of our Board of Directors and will depend on various factors, including applicable laws, our results of operations, financial condition, future prospects, then applicable contractual restrictions and any other factors deemed relevant by our Board of Directors.
Removed
Stock Performance Graph The graph set forth below compares the cumulative total stockholder return on our common stock between December 31, 2019 and December 31, 2024, with the cumulative total return of (a) the Nasdaq Composite Index and (b) the Nasdaq Biotechnology Index, over the same period.
Removed
This graph assumes the investment of $100 at the market close on December 31, 2019 in our common stock, the Nasdaq Composite Index and the Nasdaq Biotechnology Index and assumes the reinvestment of dividends, if any. The stock price performance of the following graph is not necessarily indicative of future stock price performance.
Removed
Comparison Of Cumulative Total Return Cartesian Therapeutics, Inc., Nasdaq Composite Index and Nasdaq Biotechnology Index This performance graph shall not be deemed “soliciting material” or to be “filed” with the SEC for purposes of Section 18 of the Exchange Act, or otherwise subject to the liabilities under that Section, and shall not be deemed to be incorporated by reference into any of our filings under the Securities or the Exchange Act.

Item 7. Management's Discussion & Analysis

Management's Discussion & Analysis (MD&A) — revenue / margin commentary

75 edited+27 added−37 removed80 unchanged
Biggest changeChange in fair value of forward contract liabilities The forward contract liabilities associated with the delayed issuance of the Series A Preferred Stock related to the Merger and 2023 Private Placement are remeasured quarterly and upon settlement at fair value with the change in fair value recognized as a component of earnings. 58 Table of Contents Results of Operations Comparison of the Years Ended December 31, 2024 and 2023 Year Ended December 31, Increase (Decrease) 2024 2023 (in thousands, except percentages) Revenue: Collaboration and license revenue $ 38,275 $ 26,004 $ 12,271 47 % Grant revenue 638 — 638 100 % Total revenue 38,913 26,004 12,909 50 % Operating expenses: Research and development 45,105 71,260 (26,155) (37) % General and administrative 30,126 40,450 (10,324) (26) % Impairment of long-lived assets 7,579 710 6,869 967 % Total operating expenses 82,810 112,420 (29,610) (26) % Operating loss (43,897) (86,416) 42,519 (49) % Interest income 7,386 4,964 2,422 49 % Foreign currency transaction, net — 38 (38) (100) % Interest expense — (2,833) 2,833 (100) % Change in fair value of warrant liabilities 2,558 12,746 (10,188) (80) % Change in fair value of contingent value right liability (36,900) (18,300) (18,600) 102 % Change in fair value of forward contract liabilities (6,890) (149,600) 142,710 (95) % Other income, net 606 691 (85) (12) % Loss before income taxes (77,137) (238,710) 161,573 (68) % Income tax (expense) benefit (287) 19,000 (19,287) (102) % Net loss $ (77,424) $ (219,710) $ 142,286 (65) % Collaboration and license revenue During the year ended December 31, 2024, we recognized $38.3 million of collaboration and license revenue, compared to $26.0 million for the year ended December 31, 2023, an increase of $12.3 million.
Biggest changeTo date,we have not incurred interest and penalties related to uncertain tax positions. 62 Table of Contents Results of Operations Comparison of the Years Ended December 31, 2025 and 2024 Year Ended December 31, Increase (Decrease) 2025 2024 (in thousands, except percentages) Revenues: Collaboration and license $ 400 $ 38,275 $ (37,875) (99) % Grant 2,397 638 1,759 NM Total revenues 2,797 38,913 (36,116) (93) % Operating expenses: Research and development 58,034 45,105 12,929 29 % General and administrative 31,468 30,126 1,342 4 % Impairment of indefinite-lived intangible and long-lived assets 56,700 7,579 49,121 NM Total operating expenses 146,202 82,810 63,392 77 % Operating loss (143,405) (43,897) (99,508) NM Other income (expense): Interest income 6,579 7,386 (807) (11) % Gain on change in fair value of warrant liabilities 3,695 2,558 1,137 44 % Loss on change in fair value of contingent value right liability (4,354) (36,900) 32,546 (88) % Loss on change in fair value of forward contract liabilities — (6,890) 6,890 (100) % Other (expense) income, net (2,010) 606 (2,616) NM Total other income (expense), net 3,910 (33,240) 37,150 (112) % Loss before income taxes (139,495) (77,137) (62,358) 81 % Income tax benefit (expense) 9,193 (287) 9,480 NM Net loss $ (130,302) $ (77,424) $ (52,878) 68 % NM - Not meaningful Collaboration and license revenue During the year ended December 31, 2025, we recognized $0.4 million of collaboration and license revenue, compared to $38.3 million for the year ended December 31, 2024, a decrease of $37.9 million.
Research and development Our research and development expenses consist of internal and external research and development costs, which primarily include fees paid to contract research organizations, internal manufacturing- and quality-related expenses, process development costs, internal research and development expenses, as well as fees paid to contract manufacturing organizations.
Research and development expenses Our research and development expenses consist of internal and external research and development costs, which primarily include fees paid to contract research organizations, internal manufacturing- and quality-related expenses, process development costs, internal research and development expenses, as well as fees paid to contract manufacturing organizations.
General and administrative General and administrative expenses consist primarily of salaries and related benefits, including stock-based compensation, related to our executive, finance, business development and support functions.
General and administrative expenses General and administrative expenses consist primarily of salaries and related benefits, including stock-based compensation, related to our executive, finance, business development and support functions.
The preparation of these consolidated financial statements requires us to make estimates and judgements that affect the reported amounts of assets, liabilities, revenues and expenses, and disclosure of contingent assets and liabilities in our consolidated financial statements. Actual results may differ from these estimates under different assumptions or conditions and could have a material impact on our reported results.
The preparation of these consolidated financial statements requires us to make estimates and judgments that affect the reported amounts of assets, liabilities, revenues and expenses, and disclosure of contingent assets and liabilities in our consolidated financial statements. Actual results may differ from these estimates under different assumptions or conditions and could have a material impact on our reported results.
Under the NCI Agreement, we were granted a license under certain NCI patents and patent applications designated in the agreement, to make, use, sell, offer and import products and processes within the scope of the patents and applications licensed under the NCI Agreement when developing and manufacturing anti-BCMA CAR-T cell products for the treatment of MG, pemphigus vulgaris, and immune thrombocytopenic purpura according to methods designated in the NCI Agreement.
Under the NCI Agreement, we were granted a license under certain NCI patents and patent applications designated in the agreement, to make, use, sell, offer and import products and processes within the scope of the patents and applications licensed under the NCI Agreement when developing and manufacturing anti-BCMA CAR-T cell products for the treatment of MG, pemphigus vulgaris, and immune 65 Table of Contents thrombocytopenic purpura according to methods designated in the NCI Agreement.
We analyze collaboration arrangements by first assessing whether they are within the scope of ASC Topic 808, Collaborative Arrangements (ASC 808 ), and evaluate whether such arrangements involve joint operating activities performed by parties that are both active participants in the activities and exposed to significant risks and rewards that are dependent on the commercial success of such activities.
We analyze collaboration arrangements by first assessing whether they are within the scope of ASC Topic 808, Collaborative Arrangements (ASC 808), and evaluate whether such arrangements involve joint operating activities performed by parties that are both active participants in the activities and exposed to significant risks and 69 Table of Contents rewards that are dependent on the commercial success of such activities.
We evaluate the measure of progress each reporting period and, if necessary, adjust the measure of performance and related revenue recognition. Optional licenses are evaluated to determine if 66 Table of Contents they are issued at a discount, and therefore, represent material rights and should be accounted for as separate performance obligations.
We evaluate the measure of progress each reporting period and, if necessary, adjust the measure of performance and related revenue recognition. Optional licenses are evaluated to determine if they are issued at a discount, and therefore, represent material rights and should be accounted for as separate performance obligations.
We are eligible to receive $630.0 million in milestone payments upon the achievement of various development and regulatory milestones and sales thresholds for annual net sales of SEL-212, and tiered royalty payments ranging from the low double digits on the lowest sales tier to the high teens on the highest sales tier.
We are eligible to receive $630.0 million in milestone payments upon the achievement of various development and regulatory milestones and sales thresholds for annual net sales of NASP, and tiered royalty payments ranging from the low double digits on the lowest sales tier to the high teens on the highest sales tier.
We recorded the fair value of the 2019 Warrants and 2022 Warrants upon issuance using the Black-Scholes valuation model, and are required to revalue the common warrants at each reporting date and upon exercise or expiration with any changes in fair value recorded on our statement of operations.
We recorded the fair value of the 2019 Warrants and 2022 Warrants upon issuance using the Black-Scholes valuation model, and are required to revalue the common warrants at each reporting date and upon exercise or expiration with any 71 Table of Contents changes in fair value recorded on our statement of operations.
We expect that any revenue we generate will fluctuate from quarter to quarter because of the timing and amounts of fees, research and development reimbursements and other payments from collaborators. We do not expect to generate revenue from product sales for at least the next several years.
We expect that any revenue we generate will fluctuate from quarter to quarter 60 Table of Contents because of the timing and amounts of fees, research and development reimbursements and other payments from collaborators. We do not expect to generate revenue from product sales for at least the next several years.
Payments made and remaining obligations on the license agreement with 3SBio are subject to potential reimbursement through deductions to CVR distributions as described in Note 6 to our consolidated financial statements included elsewhere in this Annual Report.
Payments made and remaining obligations on the license agreement with 3SBio are subject to potential reimbursement through deductions to CVR distributions as described in Note 6, “Fair Value Measurements” to our consolidated financial statements included elsewhere in this Annual Report.
Change in fair value of warrant liabilities Common warrants classified as liabilities are remeasured quarterly at fair value with the change in fair value recognized as a component of earnings.
Gain on change in fair value of warrant liabilities Common warrants classified as liabilities are remeasured quarterly at fair value with the change in fair value recognized as a component of earnings.
We expect to continue to incur significant expenses and operating losses for the foreseeable future as we: • advance Descartes-08 for MG into Phase 3 development; 56 Table of Contents • continue to develop our preclinical and clinical-stage product candidates; • seek regulatory approvals for any product candidates that successfully complete clinical trials; • maintain, expand and protect our intellectual property portfolio, including through licensing arrangements; • hire additional staff, including clinical, scientific and management personnel; and • incur additional costs associated with continuing to operate as a public company.
We expect to continue to incur significant expenses and operating losses for the foreseeable future as we: • continue to advance Descartes-08 for MG through Phase 3 development; • advance Descartes-08 for myositis into Phase 2 development; • continue to develop our preclinical and clinical-stage product candidates; • seek regulatory approvals for any product candidates that successfully complete clinical trials; • maintain, expand and protect our intellectual property portfolio, including through licensing arrangements; • hire additional staff, including clinical, scientific and management personnel; and • incur additional costs associated with continuing to operate as a public company.
As a result of the sublicense of Xork to Astellas, we made a $4.0 million payment to Genovis in February 2023. The Astellas Agreement was terminated effective June 6, 2024. For further description of the Astellas Agreement, see Note 14 to our consolidated financial statements included elsewhere in this Annual Report.
As a result of the sublicense of Xork to Astellas, we made a $4.0 million payment to Genovis in February 2023. The Astellas Agreement was terminated effective June 6, 2024. For further description of the Astellas Agreement, see Note 13, “Revenue Arrangements” to our consolidated financial statements included elsewhere in this Annual Report.
Sobi has agreed to fund the Phase 3 clinical program of SEL-212, which commenced in September 2020. In July 2022, we received $10.0 million for the completion of the enrollment of the DISSOLVE II trial.
Sobi has agreed to fund the Phase 3 clinical program of NASP, which commenced in September 2020. In July 2022, we received $10.0 million for the completion of the enrollment of the DISSOLVE II trial.
In July 2024, we received $30.0 million for the milestone associated with the initiation of a rolling biologics license application to the FDA for SEL-212 for the potential treatment of chronic refractory gout by Sobi.
In July 2024, we received $30.0 million for the milestone associated with the initiation of a rolling biologics license application to the FDA for NASP for the potential treatment of chronic refractory gout by Sobi.
Change in fair value of contingent value right liability The contingent value right liability is remeasured quarterly at fair value with the change in fair value recognized as a component of earnings.
Loss on change in fair value of contingent value right liability The contingent value right liability is remeasured quarterly at fair value with the change in fair value recognized as a component of earnings.
Under the fair value option election, 65 Table of Contents the CVRs are initially measured at the aggregate estimated fair value of the CVRs and will be subsequently remeasured at estimated fair value on a recurring basis at each reporting period date.
Under the fair value option election, the CVRs are initially measured at the aggregate estimated fair value of the CVRs and will be subsequently remeasured at estimated fair value on a recurring basis at each reporting period date.
Clinical Trial Costs Clinical trial expenses are a significant component of research and development expenses, and we outsource a significant portion of these costs to third-parties. Third-party clinical trial expenses include patient costs, clinical research organization costs and costs for data management.
Clinical Trial Costs Clinical trial expenses are a significant component of research and development expenses, and we outsource a significant portion of these costs to third-parties. Third-party clinical trial expenses include patient costs, clinical research organization 70 Table of Contents costs and costs for data management.
In December 2022, we amended the terms of the outstanding 2019 Warrants held by certain members of our Board of Directors to remove the cash settlement provision (as so amended, the 67 Table of Contents Amended 2019 Warrants).
In December 2022, we amended the terms of the outstanding 2019 Warrants held by certain members of our Board of Directors to remove the cash settlement provision (as so amended, the Amended 2019 Warrants).
Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations The following discussion and analysis of our financial condition and results of operations should be read in conjunction with our consolidated financial statements and related notes thereto and other financial information included elsewhere in this Annual Report on Form 10-K.
Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations The following discussion and analysis of our financial condition and results of operations should be read in conjunction with our consolidated financial statements and related notes thereto and other financial information included elsewhere in this Annual Report.
The increase was primarily due to an increase in revenue recognized under the Sobi License resulting from the $30.0 million unconstrained development milestone recognized during the year ended December 31, 2024 and recognition of the remaining deferred revenue under the License and Development Agreement, or the Astellas Agreement, with Audentes Therapeutics, Inc., or Astellas, upon notice of termination during the year ended December 31, 2024.
The decrease was primarily due to revenue recognized under the Sobi License in the prior year, resulting from the $30.0 million unconstrained development milestone, coupled with recognition of the remaining deferred revenue under the License and Development Agreement, or the Astellas Agreement, with Audentes Therapeutics, Inc., or Astellas, upon notice of termination during the year ended December 31, 2024.
The estimated fair value of the CVR liability was determined using a discounted cash flow methodology as of December 31, 2023 and a Monte Carlo simulation model as of December 31, 2024 to estimate future cash flows associated with the legacy assets, including the expected milestone and royalty payments under the Sobi License, net of deductions.
The estimated fair value of the CVR liability was determined using a Monte Carlo simulation model as of December 31, 2025 and 2024 to estimate future cash flows associated with the legacy assets, including the expected milestone and royalty payments under the Sobi License, net of deductions.
During the year ended December 31, 2024, we recorded a full impairment charge of $7.6 million after evaluating the right-of-use assets and related furniture and fixtures upon our decision to cease use of our office and laboratory space at 65 Grove Street, Watertown, Massachusetts.
During the year ended December 31, 2024, we recorded an impairment charge to our long-lived assets of $7.6 million after evaluating the right-of-use assets and related furniture and fixtures upon our decision to cease use of our office and laboratory space at 65 Grove Street, Watertown, Massachusetts.
In connection with our entry into the NCI 61 Table of Contents Agreement, we paid to NCI a one-time $0.1 million license royalty payment. Under the NCI Agreement, we are further required to pay NCI a low five-digit annual royalty.
In connection with our entry into the NCI Agreement, we paid to NCI a one-time $0.1 million license royalty payment. Under the NCI Agreement, we are further required to pay NCI a low five-digit annual royalty.
We are subject to risks in the development of our products, and we may encounter unforeseen expenses, difficulties, complications, delays and other unknown factors that may adversely affect our business. We expect that we will need substantial additional funding to support our continuing operations. As of December 31, 2024, we had an accumulated deficit of $692.1 million.
We are subject to risks in the development of our products, and we may encounter unforeseen expenses, difficulties, complications, delays and other unknown factors that may adversely affect our business. We expect that we will need substantial additional funding to support our continuing operations. As of December 31, 2025, we had an accumulated deficit of $822.4 million.
Our cash, cash equivalents, and restricted cash were $214.3 million as of December 31, 2024, of which $1.7 million was restricted cash related to lease commitments. In addition to our existing cash equivalents, we from time to time have received and may receive in the future research and development funding pursuant to our collaboration and license agreements.
Our cash, cash equivalents, and restricted cash were $126.9 million as of December 31, 2025, of which $1.7 million was restricted cash related to lease commitments. In addition to our existing cash equivalents, we from time to time have received and may receive in the future research and development funding pursuant to our collaboration and license agreements.
We are not obligated to pay Biogen any expenses, fees, or royalties. For further description of the Biogen Agreement, see Note 16 to our consolidated financial statements included elsewhere in this Annual Report. Effective September 2019, we entered into the NCI Agreement with NCI.
We are not obligated to pay Biogen any expenses, fees, or royalties. For further description of the Biogen Agreement, see Note 15, “Collaboration and License Agreements” to our consolidated financial statements included elsewhere in this Annual Report. Effective September 2019, we entered into the NCI Agreement with NCI.
Recent Accounting Pronouncements For a discussion of recently adopted or issued accounting pronouncements refer to Note 3 to our consolidated financial statements included elsewhere in this Annual Report. Off-Balance Sheet Arrangements As of December 31, 2024, we did not have any off-balance sheet arrangements as defined in the rules and regulations of the SEC.
Recent Accounting Pronouncements For a discussion of recently adopted or issued accounting pronouncements refer to Note 2, “Summary of Significant Accounting Policies” to our consolidated financial statements included elsewhere in this Annual Report. Off-Balance Sheet Arrangements As of December 31, 2025, we did not have any off-balance sheet arrangements as defined in the rules and regulations of the SEC.
We do not know when, or if, we will generate revenue from product sales. We will not generate significant revenue from product sales unless and until we obtain regulatory approval and commercialize one of our current or future product candidates.
We will not generate significant revenue from product sales unless and until we obtain regulatory approval and commercialize one of our current or future product candidates.
Proceeds from milestone payments and royalties on sales of SEL-212, if any, are required to be distributed, net of certain agreed deductions, to holders of the CVRs. For further description of the Sobi License, see Note 14 to our consolidated financial statements included elsewhere in this Annual Report.
Proceeds from milestone payments and royalties on sales of NASP, if any, are required to be distributed, net of certain agreed deductions, to holders of the CVRs. For further description of the Sobi License, see Note 13, “Revenue Arrangements” to our consolidated financial statements included elsewhere in this Annual Report.
Under this agreement, Astellas obtained the sole and exclusive right to commercialize Xork for use in Pompe disease in combination with an Astellas gene therapy investigational or authorized product, with a current focus on AT845.
Out-licenses In January 2023, we entered into the Astellas Agreement with Astellas. Under this agreement, Astellas obtained the sole and exclusive right to commercialize Xork for use in Pompe disease in combination with an Astellas gene therapy investigational or authorized product, with a current focus on AT845.
As of December 31, 2024, we were unable to estimate the timing or likelihood of achieving these milestones or 64 Table of Contents generating future product sales.
As of December 31, 2025, we were unable to estimate the timing or likelihood of achieving these milestones or generating future product sales.
Amounts paid and remaining obligations with regard to the Xork product candidate not reimbursed by Astellas through the Astellas Agreement were subject to potential reimbursement through deductions to CVR distributions as described in Note 6 to our consolidated financial statements included elsewhere in this Annual Report.
Amounts paid and remaining obligations with regard to the Xork product candidate not reimbursed by Astellas through the Astellas Agreement were subject to potential reimbursement through deductions to CVR distributions as described in Note 6, “Fair Value Measurements” to our consolidated financial statements included elsewhere in this Annual Report. In June 2020, we entered into the Sobi License.
Other general and administrative expenses include facility-related costs not otherwise allocated to research and development expenses, travel expenses for our general and administrative personnel and professional fees for auditing, tax and corporate legal services, including intellectual property-related legal services. Impairment of long-lived assets Impairment of long-lived assets consists of impairment charges on our long-lived assets.
Other general and administrative expenses include facility-related costs not otherwise allocated to research and development expenses, travel expenses for our general and administrative personnel and professional fees for auditing, tax and corporate legal services, including intellectual property-related legal services.
Our future capital requirements will depend on many factors, including: • the scope, progress, results and costs of our clinical trials, preclinical development, manufacturing, laboratory testing and logistics; • the number of product candidates that we pursue and the speed with which we pursue development; • our headcount growth and associated costs; • the costs, timing and outcome of regulatory review of our product candidates; • the costs and timing of future commercialization activities, including manufacturing, marketing, sales and distribution, for any of our product candidates for which we receive marketing approval; • the revenue, if any, from commercial sales of our product candidates for which we receive marketing approval; • the costs and timing of preparing, filing and prosecuting patent applications, maintaining and enforcing our intellectual property rights and defending any intellectual property-related claims; • the effect of competing technological and market developments; and • the extent to which we acquire or invest in businesses, products and technologies, including entering into licensing or collaboration arrangements for product candidates.
Our future capital requirements will depend on many factors, including: • the scope, progress, results and costs of our clinical trials, preclinical development, manufacturing, laboratory testing and logistics; • the number of product candidates that we pursue and the speed with which we pursue development; • our headcount growth and associated costs; • the costs, timing and outcome of regulatory review of our product candidates; • the costs and timing of future commercialization activities, including manufacturing, marketing, sales and distribution, for any of our product candidates for which we receive marketing approval; • the revenue, if any, from commercial sales of our product candidates for which we receive marketing approval; • the costs and timing of preparing, filing and prosecuting patent applications, maintaining and enforcing our intellectual property rights and defending any intellectual property-related claims; • the effect of competing technological and market developments; and • the extent to which we acquire or invest in businesses, products and technologies, including entering into licensing or collaboration arrangements for product candidates. 67 Table of Contents Cash Requirements due to Contractual Obligations and Other Commitments We are under agreement to lease approximately 32,294 square feet of laboratory and office space in Watertown, Massachusetts through May 2028.
Annualized base rent under the leases is approximately $1.2 million and is subject to annual increases in accordance with the terms of the lease agreement. The leases provide for a tenant improvement allowance of $0.8 million. Remaining lease payments from December 31, 2024 through the end of the lease term total approximately $8.1 million.
Annualized base rent under the leases is approximately $1.4 million and is subject to annual increases in accordance with the terms of the lease agreement. Remaining lease payments from December 31, 2025 through the end of the lease term total approximately $8.8 million.
The 2024 Private Placement resulted in gross proceeds of approximately $130.0 million before deducting placement agent fees and other offering expenses. We granted customary registration rights to investors in connection with the 2024 Private Placement.
The 2024 Private Placement resulted in gross proceeds of approximately $130.0 million before deducting placement agent fees and other offering expenses. We granted customary registration rights to investors in connection with the 2024 Private Placement. On December 13, 2024, we and Leerink Partners entered into a Sales Agreement, or the Sales Agreement.
For further descriptions of the agreements underlying our collaboration and license revenue, see Notes 3 and 14 to our consolidated financial statements included elsewhere in this Annual Report. 57 Table of Contents Grant revenue Additionally, we generate grant revenue which consists of funding received to perform specific research and development services under grant arrangements.
For further descriptions of the agreements underlying our collaboration and license revenue, see Notes 2, “Summary of Significant Accounting Policies” and 15, “Collaboration and License Agreements” to our consolidated financial statements included elsewhere in this Annual Report. Grant revenue We generate grant revenue, which consists of funding received to perform specific research and development services under grant arrangements.
Overview We are a clinical-stage biotechnology company pioneering mRNA cell therapy for the treatment of autoimmune diseases. We leverage our proprietary technology and manufacturing platform to introduce one or more mRNA molecules into cells to enhance their function. Unlike DNA, mRNA degrades naturally over time without integrating into the cell’s genetic material.
Overview We are a late clinical-stage biotechnology company pioneering cell therapy for the treatment of autoimmune diseases. We leverage our proprietary technology and manufacturing platform to introduce mRNA into cells to provide a therapeutic effect to patients suffering from a variety of autoimmune conditions. Unlike DNA, mRNA degrades naturally over time without integrating into the cell’s genetic material.
The decrease in net cash used in operating activities of $27.5 million was primarily due to $17.9 million of net loss, adjusted for non-cash items, and $5.8 million of cash used in changes in operating assets and liabilities, in each case during the year ended December 31, 2024 compared to $56.1 million of net loss, adjusted for non-cash items, and $4.9 million of cash provided by changes in operating assets and liabilities during the year ended December 31, 2023.
The increase in net cash used in operating activities of $50.2 million was primarily due to $65.9 million of net loss, adjusted for non-cash items, and $8.0 million of cash used in changes in operating assets and liabilities during the year ended December 31, 2025 compared to $17.9 million of net loss, adjusted for non-cash items, and $5.8 million of cash provided by changes in operating assets and liabilities during the year ended December 31, 2024.
Change in fair value of warrant liabilities For the year ended December 31, 2024, we recognized $2.6 million of income from the decrease in the fair value of warrant liabilities, compared to $12.7 million for the year ended December 31, 2023, a decrease of $10.1 million. Fair value of warrant liabilities was determined utilizing the Black-Scholes valuation methodology.
Gain on change in fair value of warrant liabilities For the year ended December 31, 2025, we recognized $3.7 million gain on the change in the fair value of warrant liabilities, compared to $2.6 million gain for the year ended December 31, 2024, an increase of $1.1 million. Fair value of warrant liabilities was determined utilizing the Black-Scholes valuation methodology.
Investing activities Net cash used in investing activities for the year ended December 31, 2024 was $8.7 million compared to net cash provided by investing activities of $34.6 million in the same period in 2023, a decrease of $43.3 million.
Investing activities Net cash used in investing activities for the year ended December 31, 2025 was $5.5 million compared to net cash used in investing activities of $8.7 million for the year ended December 31, 2024, a decrease of $3.2 million.
Murat Kalayoglu, a co-founder and the former chief executive officer of Old Cartesian, who joined our Board of Directors effective immediately after the effective time of the Merger, providing for the 2023 Private Placement.
Springer, and (iii) Seven One Eight Three Four Irrevocable Trust, a trust associated with Murat Kalayoglu, M.D., Ph.D., a co-founder and the former chief executive officer of Old Cartesian, who joined our Board of Directors effective immediately after the effective time of the Merger, providing for the 2023 Private Placement.
For further description of the NCI Agreement, see Note 16 to our consolidated financial statements included elsewhere in this Annual Report. In October 2021, we and Ginkgo Bioworks Holdings, Inc., or Ginkgo, entered into a Collaboration and License Agreement, or the First Ginkgo Agreement, and paid Ginkgo a $0.5 million one-time upfront payment.
For further description of the NCI Agreement, see Note 15, “Collaboration and License Agreements” to our consolidated financial statements included elsewhere in this Annual Report. In October 2021, we entered into an Exclusive License Agreement with Genovis AB (publ.), or Genovis, or the Genovis Agreement, and paid Genovis a $4.0 million one-time upfront payment.
Under the 2024 Sales Agreement, we may issue and sell shares of our common stock, from time to time, through Leerink Partners for aggregate gross sales proceeds of up to $100.0 million. On November 13, 2023, we entered into the 2023 Securities Purchase Agreement with (i) Dr. Timothy A.
Under the Sales Agreement, we may issue and sell shares of our common stock, from time to time, through Leerink Partners for aggregate gross sales proceeds of up to $100.0 million.
Financing activities Net cash provided by financing activities for the year ended December 31, 2024 was $168.4 million compared to net cash used in financing activities of $13.1 million in the same period in 2023, an increase of $181.5 million.
Financing activities Net cash used in financing activities for the year ended December 31, 2025 was $8.1 million compared to net cash provided by financing activities of $168.4 million for the year ended December 31, 2024, a change of $176.5 million.
We believe that our existing cash, cash equivalents, and restricted cash as of December 31, 2024 will enable us to fund our operating expenses and capital expenditure requirements into mid-2027.
We believe that our existing cash, cash equivalents, and restricted cash as of December 31, 2025 will enable us to fund our operating expenses and capital expenditure requirements for at least the next 12 months.
Summary of Cash Flows Year Ended December 31, (In thousands) 2024 2023 Cash provided by and (used in): Operating activities $ (23,674) $ (51,161) Investing activities (8,742) 34,609 Financing activities 168,428 (13,145) Effect of exchange rate changes on cash (21) (53) Net change in cash, cash equivalents, and restricted cash $ 135,991 $ (29,750) Operating activities Net cash used in operating activities for the year ended December 31, 2024 was $23.7 million compared to $51.2 million in the same period in 2023.
Summary of Cash Flows Year Ended December 31, (In thousands) 2025 2024 Cash (used in) provided by: Operating activities $ (73,941) $ (23,674) Investing activities (5,454) (8,742) Financing activities (8,055) 168,428 Effect of exchange rate changes on cash 45 (21) Net change in cash, cash equivalents, and restricted cash $ (87,405) $ 135,991 Operating activities Net cash used in operating activities for the year ended December 31, 2025 was $73.9 million compared to $23.7 million for the year ended December 31, 2024.
We will require substantial additional financing to fund our operations and to continue to execute our strategy, and we will pursue a range of options to secure additional capital. 63 Table of Contents We regularly evaluate various potential sources of additional funding such as strategic collaborations, license agreements, debt issuance, potential royalty and/or milestone monetization transactions and the issuance of equity instruments to fund our operations.
We regularly evaluate various potential sources of additional funding such as strategic collaborations, license agreements, debt issuance, potential royalty and/or milestone monetization transactions and the issuance of equity instruments to fund our operations.
In May 2024, we entered into an amendment to lease an additional approximately 7,842 square feet at the same site. In August 2024, we entered into a second amendment to lease an additional approximately 2,009 square feet at the same site. The lease, as amended, expires in June 2031.
In August 2024, we entered into a second amendment to lease an additional approximately 2,009 square feet at the same site. In March 2025, we entered into a third amendment to lease an additional approximately 6,439 square feet at the same site. The leases expire coterminously in June 2031.
The liability value is based on significant inputs not observable in the market such as estimated cash flows, estimated probabilities of success, expected volatility of future revenues (Monte Carlo simulation model) and risk-adjustment discount rates (discounted cash flow methodology), which represent a Level 3 measurement within the fair value hierarchy.
Changes in fair value of the CVR liability are presented in the consolidated statements of operations and comprehensive loss. The liability value is based on significant inputs not observable in the market such as estimated cash flows, estimated probabilities of success, expected volatility of future revenues, which represent a Level 3 measurement within the fair value hierarchy.
Income taxes During the year ended December 31, 2024, we recognized a deferred tax expense of $0.3 million relating to a change in state tax rate applied to the indefinite deferred tax liability.
During the year ended December 31, 2024, we recognized a deferred tax expense of $0.3 million relating to a change in state tax rate applied to the indefinite deferred tax liability. Liquidity and Capital Resources Except for net income for the year ended December 31, 2022, we have incurred recurring net losses since our inception.
The net cash provided by financing activities for the year ended December 31, 2024 was primarily the result of proceeds of the 2024 Private Placement and the 2023 Private Placement.
The net cash used in financing activities for the year ended December 31, 2025 was primarily due to payment on the contingent value 68 Table of Contents right liability. The net cash provided by financing activities for the year ended December 31, 2024 was primarily the result of proceeds of the 2024 Private Placement and the 2023 Private Placement.
In connection with the Second Merger, Old Cartesian changed its name to Cartesian Bio, LLC. In connection with the Merger and pursuant to the Merger Agreement, the Company changed its corporate name to Cartesian Therapeutics, Inc. See Note 4 of the accompanying notes to the consolidated financial statements appearing elsewhere in this Annual Report.
In connection with the Second Merger, Old Cartesian changed its name to Cartesian Bio, LLC. In connection with the Merger and pursuant to the Merger Agreement, the Company changed its corporate name to Cartesian Therapeutics, Inc.
Grant revenue During the year ended December 31, 2024, we recognized $0.6 million of grant revenue.
Grant revenue During the year ended December 31, 2025, we recognized $2.4 million of grant revenue, compared to $0.6 million for the year ended December 31, 2024, an increase of $1.8 million.
Change in fair value of forward contract liabilities For the year ended December 31, 2024, we recognized $6.9 million of expense associated with the increase in the fair value of Series A Preferred Stock forward contract liabilities, compared to $149.6 million of expense for the year ended December 31, 2023, a decrease of $142.7 million.
Loss on change in fair value of forward contract liabilities For the year ended December 31, 2024, we recognized $6.9 million loss on the change in fair value of Series A Preferred Stock forward contract liabilities. The Series A Preferred Stock forward contract liability was settled during the year ended December 31, 2024.
Merger On November 13, 2023, the Company (formerly known as Selecta) merged with the private Delaware corporation which, immediately prior to the Merger, was known as Cartesian Therapeutics, Inc., in accordance with the terms of the Merger Agreement, by and among Selecta, First Merger Sub, Second Merger Sub, and Old Cartesian.
Our cell therapies are designed to be dosed repeatedly like conventional drugs, administered in an outpatient setting, and given without pre-treatment chemotherapy, which is required with many conventional cell therapies. 59 Table of Contents Merger On November 13, 2023, the Company (formerly known as Selecta) merged with the private Delaware corporation which, immediately prior to the Merger, was known as Cartesian Therapeutics, Inc., in accordance with the terms of the Merger Agreement, by and among Selecta, First Merger Sub, Second Merger Sub, and Old Cartesian.
We may be unable to raise capital when needed or on reasonable terms, if at all, which would force us to delay, limit, reduce or terminate our product development or future commercialization efforts. We will need to generate significant revenues to achieve profitability, and we may never do so.
Until we can generate substantial product revenues, we expect to finance our cash needs through a combination of equity offerings, debt financings, and license and collaboration agreements. We may be unable to raise capital when needed or on reasonable terms, if at all, which would force us to delay, limit, reduce or terminate our product development or future commercialization efforts.
The net cash used in investing activities for the year ended December 31, 2024 consisted primarily of purchases of property and equipment. The net cash provided by investing activities for the year ended December 31, 2023 was primarily proceeds from the maturities of marketable securities and cash assumed in the Merger offset by purchases of property and equipment.
The net cash used in investing activities for the years ended December 31, 2025 and 2024 consisted primarily of purchases of property and equipment.
Except for the year ended December 31, 2022, we have incurred significant operating losses since our inception. We incurred a net loss of $77.4 million and $219.7 million for the years ended December 31, 2024 and 2023, respectively. As of December 31, 2024, we had an accumulated deficit of $692.1 million.
We incurred a net loss of $130.3 million and $77.4 million for the years ended December 31, 2025 and 2024, respectively. As of December 31, 2025, we had an accumulated deficit of $822.4 million.
We received funding approval from the National Institute of Neurological Disorders and Stroke of the National Institutes of Health, or NINDS, during the year ended December 31, 2024, and there was no grant revenue during the year ended December 31, 2023. 59 Table of Contents Research and development expenses The following is a comparison of research and development expenses for the years ended December 31, 2024 and 2023 (in thousands, except percentages): Year Ended December 31, Increase (Decrease) 2024 2023 Legacy Selecta programs $ 6,150 $ 31,826 $ (25,676) (81) % Descartes-08 for MG 12,142 343 11,799 3440 % Early stage programs 1,028 595 433 73 % Research and development employee expenses 11,952 18,363 (6,411) (35) % Research and development stock-based compensation expense 3,217 12,985 (9,768) (75) % Research and development facilities and other expenses 10,616 7,148 3,468 49 % Total research and development expenses $ 45,105 $ 71,260 $ (26,155) (37) % For the year ended December 31, 2024, our research and development expenses were $45.1 million, compared to $71.3 million for the year ended December 31, 2023, a decrease of $26.2 million.
The increase was primarily due to increased expenses reimbursable under the grant from the National Institute of Neurological Disorders and Stroke of the National Institutes of Health incurred during the year ended December 31, 2025, for which we received funding approval during the year ended December 31, 2024. 63 Table of Contents Research and development expenses The following is a comparison of research and development expenses for the years ended December 31, 2025 and 2024 (in thousands, except percentages): Year Ended December 31, Increase (Decrease) 2025 2024 Legacy Selecta programs $ — $ 6,150 $ (6,150) (100) % Descartes-08 for MG 22,893 12,142 10,751 89 % Early stage programs 5,795 1,028 4,767 NM Research and development employee expenses 16,826 11,952 4,874 41 % Research and development stock-based compensation expense 4,772 3,217 1,555 48 % Research and development facilities and other expenses 7,748 10,616 (2,868) (27) % Total research and development expenses $ 58,034 $ 45,105 $ 12,929 29 % NM - Not meaningful For the year ended December 31, 2025, our research and development expenses were $58.0 million, compared to $45.1 million for the year ended December 31, 2024, an increase of $12.9 million.
The Genovis Agreement was terminated effective September 13, 2024. For further description of the Genovis Agreement, see Note 16 to our consolidated financial statements included elsewhere in this Annual Report.
In February 2023, as a result of the sublicense of Xork, a bacterial IgG protease, to Astellas, we made a $4.0 million payment to Genovis. The Genovis Agreement was terminated effective September 13, 2024. For further description of the Genovis Agreement, see Note 15, “Collaboration and License Agreements” to our consolidated financial statements included elsewhere in this Annual Report.
Other income, net During the year ended December 31, 2024, we recognized other income, net of $0.6 million, compared to $0.7 million for the year ended December 31, 2023, a decrease of $0.1 million. The decrease was primarily driven by a decrease in sublease income. The terms of our subleases expired during the year ended December 31, 2024.
Other (expense) income, net During the year ended December 31, 2025, we recognized other expense, net of $2.0 million, compared to $0.6 million of other income, net for the year ended December 31, 2024, a change of $2.6 million.
Payments made and remaining obligations on this lease liability are subject to potential reimbursement through deductions to CVR distributions as described in Note 6 to our consolidated financial statements included elsewhere in this Annual Report. In November 2023, in connection with the Merger, we acquired two leases for office and laboratory space in Gaithersburg, Maryland, which expire in January 2027.
Payments made and remaining obligations on this lease liability were subject to potential reimbursement through deductions to CVR distributions as described in Note 6 “Fair Value Measurements” to our consolidated financial statements included elsewhere in this Annual Report and were reimbursed in the March 2025 CVR distribution.
We believe that our existing cash, cash equivalents, and restricted cash as of December 31, 2024 will enable us to fund our operating expenses and capital expenditure requirements into mid-2027. We have based this estimate on assumptions that may prove to be wrong, and we could use our capital resources sooner than we currently expect.
We have based this estimate on assumptions that may prove to be wrong, and we could use our capital resources sooner than we currently expect.
Annualized rent is approximately $0.3 million and remaining lease payments from December 31, 2024 through the end of the lease term total approximately $0.7 million. In February 2024, we entered into an agreement to lease approximately 19,199 square feet of integrated manufacturing and office space in Fredericksburg, Maryland.
In February 2024, we entered into an agreement to lease approximately 19,199 square feet of integrated manufacturing and office space in Frederick, Maryland. In May 2024, we entered into an amendment to lease an additional approximately 7,842 square feet at the same site.
General and administrative expenses For the year ended December 31, 2024, our general and administrative expenses were $30.1 million, compared to $40.5 million for the year ended December 31, 2023, a decrease of $10.4 million. The decrease in costs was primarily the result of reductions in expenses incurred for stock compensation and professional fees in connection with the Merger.
General and administrative expenses For the year ended December 31, 2025, our general and administrative expenses were $31.5 million, compared to $30.1 million for the year ended December 31, 2024, an increase of $1.4 million.
The increase in the fair value of CVR liability was primarily due to changes in the amount and timing of anticipated payments and the passage of time.
The fair values of the contingent value right liability as of December 31, 2025 and 2024 were determined utilizing a Monte Carlo simulation model. The increase in the fair value of the contingent value right liability was primarily due to the passage of time, partially offset by changes in the anticipated amount and timing of future payments.
The decrease in warrant value was primarily driven by a decrease in the per-share price of our common stock and the expiration of the warrants we issued in 2019, or the 2019 Warrants, during the year ended December 31, 2024.
The decrease in warrant value was primarily driven by a decrease in the per-share price of our common stock and the passage of time. 64 Table of Contents Loss on change in fair value of contingent value right liability For the year ended December 31, 2025, we recognized a $4.4 million loss on the change in the fair value of contingent value right liability, compared to a loss of $36.9 million for the year ended December 31, 2024, a decrease of $32.5 million.
The increase in expenses for Descartes-08 for MG was primarily related to the expenses for the ongoing Phase 2b trial and the preparations for the Phase 3 AURORA trial that were incurred following the Merger.
The increase was primarily due to an increase in expenses for the development of Descartes-08 for MG, primarily related to the expenses for the ongoing Phase 3 AURORA trial, an increase in our research and development employee expenses and stock-based compensation expense due to headcount growth and manufacturing operations expenses.
Impairment of long-lived assets During the year ended December 31, 2024, our impairment of long-lived assets was $7.6 million, compared to $0.7 million for the year ended December 31, 2023, an increase of $6.9 million.
Interest income Interest income for the year ended December 31, 2025 was $6.6 million, compared to $7.4 million for the year ended December 31, 2024, a decrease of $0.8 million. The decrease in interest income was due to lower investment balances and lower interest rates.
Interest income Interest income consists primarily of income earned on our cash, cash equivalents and marketable securities. Interest expense Interest expense consists of interest expense on amounts borrowed under our credit facilities and loss on extinguishment of debt. Other income, net Other income, net consists of non-operating income and non-operating expenses.
Impairment of indefinite-lived intangible and long-lived assets Impairment of indefinite-lived intangible and long-lived assets consists of impairment charges on our intangible and long-lived assets. Interest income Interest income consists primarily of income earned on our cash, cash equivalents and marketable securities.
Springer, a member of our Board of Directors; (ii) TAS Partners LLC, an affiliate of Dr. Springer, and (iii) Seven One Eight Three Four Irrevocable Trust, a trust associated with Dr.
Financings On November 13, 2023, we entered into the 2023 Securities Purchase Agreement with (i) Timothy A. Springer, Ph.D., a member of our Board of Directors; (ii) TAS Partners LLC, an affiliate of Dr.
A portion of the forward contract liability was settled during the year ended December 31, 2023 and there was no such forward contract liability prior to the Merger.
The Series A Preferred Stock forward contract liability was settled during the year ended December 31, 2024 Other (expense) income, net Other (expense) income, net consists of non-operating income and non-operating expenses, including impairment charge on investment.
Removed
Therefore, our mRNA cell therapies are distinguished by their capacity to be dosed repeatedly like conventional drugs, administered in an outpatient setting, and given without pre-treatment chemotherapy required with many conventional cell therapies.
Added
See Note 4, “Merger” to the consolidated financial statements included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2024 for more information regarding the Merger.
Removed
In a placebo-controlled Phase 2b clinical trial in patients with myasthenia gravis, or MG, a chronic autoimmune disease that causes disabling muscle weakness and fatigue, we observed that our lead product candidate, Descartes-08, generated a deep and durable clinical benefit where we observed an average MG-ADL reduction of 5.5 points at Month 4 with a third of patients achieving minimal symptom expression at Month 6 and 80% of participants reaching Month 12 maintained a clinically meaningful response.
Added
We will need to generate significant revenues to achieve profitability, and we may never do so.
Removed
Durability of response in MG is commonly measured over a period of 26 to 52 weeks, and maintenance of response over that period is considered durable.

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Other RNAC 10-K year-over-year comparisons