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Transcode Therapeutics, Inc. (RNAZ)·Q1 2024 Earnings Summary

Executive Summary

  • Q1 2024 was a pre-revenue quarter; operating expenses fell 33% year over year to $3.29M, improving net loss to $(3.33)M vs $(4.82)M in Q1 2023 .
  • Cash ended at $4.91M; January 2024 financing added ~$7.25M gross to extend runway, but management still flags going-concern risk and expects cash sufficiency only into Q3 2024 .
  • Clinical execution advanced: FDA “Study May Proceed” for a Phase I/II with lead candidate TTX‑MC138; Phase 1 intended to begin mid-2024 subject to authorization .
  • Listing risk remains a catalyst: after a 1‑for‑40 reverse split, the company appealed Nasdaq’s minimum bid price noncompliance; a hearing was scheduled and delisting action stayed pending panel decision .

What Went Well and What Went Wrong

What Went Well

  • Operating discipline: total opex decreased to $3.29M in Q1 (R&D $1.76M; G&A $1.53M) from $4.89M a year ago, reducing quarterly net loss to $(3.33)M .
  • Pipeline momentum: FDA cleared an IND to conduct a Phase I/II with TTX‑MC138; company targets Phase 1 initiation mid-2024 (“planned to begin in mid‑2024”) .
  • Strategic partnerships expanded: announced a research collaboration with Debiopharm to combine TTX delivery with targeted mRNA constructs for cancer cells .

Quote: “We now look forward to our Phase 1 clinical trial of TTX‑MC138 which…is planned to begin in mid‑2024.” — Tom Fitzgerald, Interim CEO/CFO .

What Went Wrong

  • Going concern: management concludes substantial doubt without additional capital; runway only into Q3 2024 .
  • Listing uncertainty: received Nasdaq notice of noncompliance with the $1.00 bid rule; shares subject to delisting absent successful appeal .
  • FX and grant income headwinds: recorded $(55)k currency loss; grant income fell to $27k as the prior NIH award ended in March 2024 .

Financial Results

Year-over-year (Q1 2023 vs Q1 2024)

MetricQ1 2023Q1 2024
Revenues ($USD)$0 $0
R&D Expense ($USD)$2,591,350 $1,759,020
G&A Expense ($USD)$2,296,334 $1,529,962
Total Operating Expenses ($USD)$4,887,684 $3,288,982
Operating Loss ($USD)$(4,887,684) $(3,288,982)
Net Loss ($USD)$(4,816,934) $(3,326,812)
Diluted EPS ($USD)$(259.07) $(0.65)
Weighted Avg Shares18,593 5,142,398
Cash and Equivalents ($USD)$1,622,657 $4,913,676

Sequential trend (last available quarter vs current)

MetricQ3 2023Q1 2024
R&D Expense ($USD)~$3,300,000 $1,759,020
G&A Expense ($USD)~$2,000,000 $1,529,962
Operating Loss ($USD)~$5,300,000 $3,288,982
Cash and Equivalents ($USD)~$7,500,000 (as of 9/30/23) $4,913,676 (as of 3/31/24)

Notes:

  • No revenue was reported in any period .
  • The company did not disclose a standalone Q4 2023 quarterly P&L; April 3, 2024 release provides annual 2023 figures only .

Guidance Changes

MetricPeriodPrevious GuidanceCurrent GuidanceChange
Cash Runway2024Cash ~$2.8M at 12/31/23 + ~$6.2M net January proceeds; sufficient into late Q3 or early Q4 2024 Cash ~$4.9M at 3/31/24; sufficient into Q3 2024 Clarified/tightened timing
Nasdaq Listing Status2024Reverse split (1‑for‑40) to address bid price Delisting stayed pending June 25, 2024 panel hearing; outcome uncertain Status update

No product revenue, margin, tax, or OpEx guidance ranges were provided; guidance relates to runway and listing status .

Earnings Call Themes & Trends

(No Q1 2024 earnings call transcript was found.)

TopicPrevious Mentions (Q3 2023, Q4 2023)Current Period (Q1 2024)Trend
TTX‑MC138 clinical pathPhase 0 first patient dosed; IND for Phase 1 planned FDA “Study May Proceed” for Phase I/II; Phase 1 targeted mid‑2024 Progressing
Financing/liquiditySept 2023 offering ~$8.5M gross; cash ~$7.5M at 9/30/23 Jan 2024 public offering ~$7.25M gross; cash $4.91M at 3/31/24; runway into Q3 2024 Ongoing need
Nasdaq complianceEquity rule exception granted Oct 2023 1‑for‑40 reverse split; bid price noncompliance appeal; delisting stayed Uncertain
PartnershipsR&D partnerships highlighted Debiopharm collaboration to test targeted mRNA delivery constructs Expanding
GrantsNIH SBIR funding previously supporting programs Prior SBIR ended Mar 2024; new SBIRs submitted (Direct‑to‑Phase II TTX‑MC138; Fast‑Track TTX‑siPDL1) Transitioning

Management Commentary

  • “We now look forward to our Phase 1 clinical trial of TTX‑MC138 which, subject to FDA authorization, is planned to begin in mid‑2024.” — Tom Fitzgerald, Interim CEO/CFO .
  • 2024 objectives include initiating the Phase 1 TTX‑MC138 trial, reporting preliminary results later in the year, and publishing multiple preclinical studies (subject to capital) .

Q&A Highlights

No Q1 2024 earnings call transcript was available; hence, there were no publishable Q&A themes or clarifications identified [ListDocuments returned none].

Estimates Context

  • Wall Street consensus estimates for Q1 2024 revenue/EPS via S&P Global were unavailable at time of query due to data access limits; management did not provide quantitative guidance beyond cash runway and clinical timelines .
  • Given no revenue and negative EPS, estimate revisions will hinge on clinical milestones (Phase 1 initiation/early readouts) and financing/Listing outcomes rather than near-term fundamentals .

Key Takeaways for Investors

  • Operating expense reduction drove a smaller net loss; the business remains pre‑revenue and highly dependent on capital markets and grants .
  • Near-term catalysts: Phase 1 initiation for TTX‑MC138 (mid‑2024 targeted) and initial readouts later in 2024 if timelines hold .
  • Liquidity: Jan 2024 financing and current cash fund operations only into Q3 2024; additional capital will likely be required to sustain trials and corporate runway .
  • Listing risk persists despite the reverse split; Nasdaq panel outcome could impact liquidity access and trading dynamics .
  • Partnership optionality (Debiopharm) and pending SBIR submissions could provide non‑dilutive support and technical validation if awarded .
  • Expect stock volatility around regulatory and listing decisions; trading strategy should account for binary outcomes tied to hearing results and trial initiation .