Century Therapeutics, Inc. — FY 2023 Form 10-K
Reporting period: Fiscal year ended December 31, 2023; comparative figures are for FY 2022. Century is a clinical-stage biotechnology company developing iPSC-derived, off-the-shelf cell therapies. It has no approved products and has generated no product-sales revenue.
Financial performance and position
| Metric | FY 2023 / Dec. 31, 2023 | FY 2022 / Dec. 31, 2022 |
|---|---|---|
| Collaboration revenue | $2.2 million | $5.2 million |
| Research and development expense | $92.7 million | $97.2 million |
| General and administrative expense | $34.7 million | $31.9 million |
| Impairment of long-lived assets | $16.4 million | None |
| Operating loss | $146.5 million | $133.8 million |
| Net loss | $136.7 million | $130.9 million |
| Basic and diluted loss per share | $2.30 | $2.27 |
| Operating cash flow | $(88.3) million | $14.1 million |
| Cash, cash equivalents and investments | $261.8 million | $367.4 million |
| Debt | None | $10.2 million, net |
Revenue came from the Bristol-Myers Squibb (BMS) collaboration; no royalties had been received. No product gross margin is reported. Year-end current assets were $177.0 million versus current liabilities of $17.8 million. Total liabilities were $175.9 million, including $115.8 million of deferred revenue and $48.2 million of operating lease liabilities. Undiscounted operating lease payments totaled $85.6 million.
Material changes versus FY 2022
- Collaboration revenue declined by $3.0 million, primarily reflecting the timing and amount of costs incurred under the BMS agreement.
- Net loss increased by $5.7 million. Operating expenses rose by $9.8 million, including a new $16.4 million impairment charge related to facility consolidation; higher interest income partially offset the increased operating loss.
- R&D expense fell by $4.5 million, mainly due to program reprioritization and reduced research, collaboration and consulting costs, partly offset by higher facility costs. G&A expense increased by $2.8 million, principally due to restructuring-related charges.
- Operating cash flow moved from positive $14.1 million to negative $88.3 million. The prior-year inflow benefited substantially from the BMS collaboration’s deferred revenue; FY 2023 cash flow reflected operating costs and a $2.2 million reduction in deferred revenue.
- Century repaid its Hercules loan in full in May 2023, paying $10.6 million including principal, interest and fees.
Programs, outlook and risks
- Lead program: CNTY-101 is in Phase 1 testing for relapsed or refractory CD19-positive B-cell lymphoma. In preliminary data for seven patients through November 13, 2023, the company reported no dose-limiting toxicities, Grade 1–2 cytokine release syndrome in two patients, transient Grade 3 neutropenia in two, and two complete responses. One response lasted six months before progression. These early, small-cohort results are preliminary, not evidence of established efficacy.
- The FDA permitted the Phase 1 CALiPSO-1 trial of CNTY-101 in moderate-to-severe systemic lupus erythematosus (SLE) to proceed. The company planned to start in the first half of 2024 and expected initial data by year-end 2024.
- Other pipeline priorities include CNTY-102 (CD19/CD22 B-cell malignancies) and CNTY-107 (Nectin-4 solid tumors). CNTY-104 and CNTY-106 are collaboration programs with BMS for AML and multiple myeloma. CNTY-103 and a discovery program were deprioritized in January 2023.
- Management estimated year-end cash, cash equivalents and investments would fund operations and capital expenditures into 2026, based on current plans and assumptions. The financial statements also state that resources are adequate for at least 12 months from issuance and that additional capital will be needed to fully implement the business plan. Management cautions that actual cash needs may exceed estimates.
- In the first quarter of 2024, Century sold 4,084,502 shares through its at-the-market facility at a weighted-average $4.50 per share, generating approximately $18.4 million gross. This was subsequent to year-end and diluted shareholders.
- A January 2023 restructuring reduced the workforce by approximately 25% and consolidated research activity in Philadelphia. The company recorded $16.4 million of asset impairment associated with exiting or consolidating leased facilities.
- Key risks include clinical and regulatory uncertainty, dependence on CNTY-101 and the iPSC platform, manufacturing and cryopreservation challenges, reliance on FCDI for licensed technology and clinical supply, potential financing needs, competition, intellectual-property disputes, and potential adverse effects associated with cell therapies. The company also cited the FDA’s investigation of T-cell malignancies reported with certain autologous CAR-T therapies; the filing does not report such a finding for CNTY-101.
- BMS collaboration payments beyond the upfront consideration depend on options, development and regulatory milestones, sales milestones and royalties; these are not assured. FCDI licenses may involve future milestone and royalty obligations. Century reported no material legal proceedings.
Most important facts for investors to verify
- Current cash, investments, cash burn and whether the stated runway into 2026 remains achievable; include the impact of the 2024 ATM issuance.
- Updated ELiPSE-1 patient numbers, response duration, safety, dosing schedule and evidence for repeat dosing without continued lymphodepletion.
- Whether CALiPSO-1 began on schedule and what its safety and clinical-response data show.
- Progress, timelines and funding requirements for CNTY-102, CNTY-107 and BMS-partnered programs, alongside any further portfolio changes.
- Manufacturing readiness, cryopreserved product stability, FCDI supply dependence and the costs and utilization of the Branchburg facility.
- Potential dilution, unrecognized collaboration milestones, lease commitments and other future financing or contractual obligations.
The financial statements received an unqualified audit opinion from Ernst & Young LLP. Management reported effective disclosure controls and internal control over financial reporting; the auditor was not engaged to attest to internal control effectiveness.