Sonnet BioTherapeutics Reports $1M Collaboration Revenue and $3.2M Net Loss for December 2024 Quarter

Sonnet BioTherapeutics Holdings, Inc. reported a significant increase in collaboration revenue for the three months ended December 31, 2024, totaling $1 million, compared to just $18,626 in the same period of the previous year. This revenue surge is attributed to the transfer of the Alkem License and Supply under a new agreement with Alkem Laboratories Limited, which was executed in October 2024. However, the company also experienced a substantial rise in operating expenses, which reached $3.8 million, up from $1.3 million in the prior year, primarily driven by increased research and development costs and general administrative expenses.

The company's net loss for the quarter was $3.2 million, a notable increase from the $1.2 million loss reported in the same quarter of 2023. This loss was influenced by higher operating expenses, including a $1.2 million increase in research and development expenses, which rose to $1.9 million, and a $1.3 million increase in general and administrative expenses, totaling $2 million. The increase in expenses was partly due to the cancellation of accrued bonuses from previous fiscal years, which had inflated the prior year's figures.

In terms of strategic developments, Sonnet BioTherapeutics has made significant strides in its clinical programs. The company is advancing its lead asset, SON-1010, in clinical trials for solid tumors, including a recent expansion of its Phase 1 study to evaluate the drug in combination with trabectedin. Additionally, the company has entered into a collaboration agreement with Roche to evaluate SON-1010 in combination with atezolizumab for platinum-resistant ovarian cancer. The company also announced a new licensing agreement with Alkem for the development and commercialization of SON-080 in India, which is aimed at treating diabetic peripheral neuropathy and chemotherapy-induced peripheral neuropathy.

Operationally, Sonnet BioTherapeutics has seen an increase in its cash position, ending the quarter with $4.9 million, a significant rise from $149,456 at the end of the previous quarter. This increase was primarily due to net cash provided by financing activities, which amounted to $7.6 million, reflecting successful public offerings and warrant exercises. The company’s employee headcount has also likely increased as it continues to expand its clinical and administrative capabilities to support ongoing and future trials.

Looking ahead, Sonnet BioTherapeutics anticipates continued operational losses as it invests heavily in research and development. The company expects that its current cash reserves will fund operations into July 2025, but it acknowledges the need for substantial additional financing to support its growth strategy. The company plans to pursue various funding avenues, including equity sales and potential collaborations, to ensure it can continue its clinical development efforts and navigate the challenges of bringing its product candidates to market.