HCW Biologics Reports Revenue Decline to $5,065 in Q1 2025, Net Loss Reduces to $2.2 Million

HCW Biologics Inc. reported a significant decline in revenue for the first quarter of 2025, generating only $5,065 compared to $1.1 million in the same period of the previous year. This drop is attributed to a decrease in sales from its licensing agreement with Wugen, which has not yet resulted in any commercial product sales. The company's net loss for the quarter was $2.2 million, a reduction from a loss of $7.5 million in the first quarter of 2024, reflecting a decrease in operating expenses primarily due to lower research and development costs.

The company's total operating expenses for the first quarter of 2025 were approximately $2 million, down from $8.1 million in the prior year. This reduction was largely driven by a significant decrease in legal expenses, which fell from $4.4 million to a net gain of $1.7 million due to the resolution of a legal dispute with ImmunityBio. Research and development expenses also decreased by 30% to $1.5 million, as the company wound down certain preclinical activities and reduced costs associated with manufacturing and materials.

In terms of strategic developments, HCW Biologics has made notable progress in its financing efforts. The company completed a reverse stock split on April 11, 2025, which helped it regain compliance with Nasdaq's minimum bid price rule. Additionally, HCW Biologics secured a $5 million equity offering on May 15, 2025, and entered into an Equity Purchase Agreement that could provide up to $40 million in funding over the next three years. The company also amended its license agreement with WY Biotech, which is expected to yield a $7 million upfront license fee in June 2025, contingent on the acceptance of a technology transfer report.

Operationally, HCW Biologics has faced challenges, including ongoing legal disputes related to construction liens on its new manufacturing facility. The company is currently engaged in litigation with BE&K Building Group and other subcontractors, which may impact its financial position. As of March 31, 2025, HCW Biologics reported a cash balance of $1.1 million, raising concerns about its liquidity and ability to sustain operations without additional funding. The company has indicated that it may need to revise its business plan and reduce costs if it cannot secure further financing.

Looking ahead, HCW Biologics remains focused on advancing its clinical development pipeline, particularly its lead product candidates targeting age-related diseases and cancer. The company anticipates continued operating losses as it progresses through clinical trials and seeks regulatory approvals. Management has expressed confidence in its strategic initiatives to enhance its financial position and operational capabilities, but acknowledges the inherent risks and uncertainties associated with its business model.