Carisma Therapeutics Reports Financial Decline and Strategic Shift Amid Merger Plans

Carisma Therapeutics Inc. reported significant financial challenges in its latest 10-Q filing for the quarter ending June 30, 2025. The company recorded no collaboration revenues for the three months ended June 30, 2025, a stark decline from $9.2 million in the same period last year. For the six months, collaboration revenues totaled $3.7 million, down from $12.6 million in 2024. The operating loss for the second quarter was $5.8 million, compared to a loss of $11.7 million in the prior year, while the total operating expenses decreased to $5.8 million from $20.9 million year-over-year. The net loss for the quarter was $9.8 million, a reduction from $11.2 million in the previous year.

The company’s financial position has deteriorated, with total assets dropping to $5.0 million as of June 30, 2025, down from $30.5 million at the end of 2024. Cash and cash equivalents plummeted to $2.0 million from $17.9 million, reflecting a cash preservation strategy that included a significant workforce reduction. Carisma terminated approximately 84% of its employees, resulting in severance costs of approximately $4.2 million during the first half of 2025. The company has indicated that it does not have sufficient cash to support operations for more than one year, raising substantial doubt about its ability to continue as a going concern.

Strategically, Carisma has shifted its focus following a comprehensive review of its operations. The company ceased development of its lead product candidates, CT-0508 and CT-0525, and is now concentrating on exploring strategic alternatives, including a merger with OrthoCellix, Inc. This merger, announced on June 22, 2025, is intended to create a combined entity that will continue OrthoCellix's business. The merger is subject to various conditions, including stockholder approval and compliance with Nasdaq listing requirements, as Carisma has faced multiple notifications of non-compliance with Nasdaq standards.

Operationally, Carisma has halted all research and development activities and is focusing on monetizing legacy assets. The company has also entered into a reverse stock split to comply with Nasdaq's bid price rule, which requires a minimum closing bid price of $1.00 per share. The anticipated merger with OrthoCellix is critical for Carisma's future, as failure to complete the merger could lead to liquidation or bankruptcy proceedings. The company is currently evaluating its options and preparing for potential outcomes based on the merger's success or failure.

Looking ahead, Carisma's future hinges on the successful completion of the OrthoCellix merger and the ability to secure additional funding. The company has indicated that it will continue to incur significant expenses related to the merger process and the exploration of strategic alternatives. Without a successful merger or additional financing, Carisma may face severe operational constraints and potential dissolution.