FORTE BIOSCIENCES, INC., 10-K filed on 3/28/2025
Annual Report
v3.25.1
Document and Entity Information - USD ($)
$ in Millions
 12 Months Ended
Dec. 31, 2024
Mar. 24, 2025
Jun. 30, 2024
Cover [Abstract]      
Document Type 10-K    
Amendment Flag false    
Document Period End Date Dec. 31, 2024    
Document Fiscal Year Focus 2024    
Document Fiscal Period Focus FY    
Entity Interactive Data Current Yes    
Trading Symbol FBRX    
Entity Current Reporting Status Yes    
Entity Registrant Name FORTE BIOSCIENCES, INC.    
Entity Central Index Key 0001419041    
Current Fiscal Year End Date --12-31    
Entity Filer Category Non-accelerated Filer    
Entity Well-known Seasoned Issuer No    
Entity Voluntary Filers No    
Entity Shell Company false    
ICFR Auditor Attestation Flag false    
Document Financial Statement Error Correction [Flag] false    
Entity Small Business true    
Entity Emerging Growth Company false    
Title of 12(b) Security Common Stock    
Security Exchange Name NASDAQ    
Entity File Number 001-38052    
Entity Incorporation, State or Country Code DE    
Entity Tax Identification Number 26-1243872    
Entity Address, Address Line One 3060 Pegasus Park Drive, Building 6    
Entity Address, City or Town Dallas    
Entity Address, State or Province TX    
Entity Address, Postal Zip Code 75247    
City Area Code 310    
Local Phone Number 618-6994    
Document Annual Report true    
Document Transition Report false    
Entity Public Float     $ 18.3
Entity Common Stock, Shares Outstanding   6,581,667  
Auditor Name KPMG LLP    
Auditor Firm ID 185    
Auditor Location San Diego, California    
Auditor Opinion

Opinion on the Consolidated Financial Statements

 

We have audited the accompanying consolidated balance sheets of Forte Biosciences, Inc. and subsidiaries (the Company) as of December 31, 2024 and 2023, the related consolidated statements of operations and comprehensive loss, stockholders’ equity, and cash flows for the years then ended, and the related notes (collectively, the consolidated financial statements). In our opinion, the consolidated financial statements present fairly, in all material respects, the financial position of the Company as of December 31, 2024 and 2023, and the results of its operations and its cash flows for the years then ended, in conformity with U.S. generally accepted accounting principles.

    
Documents Incorporated by Reference

Portions of the Registrant’s definitive proxy statement to be filed with the Securities and Exchange Commission, or SEC, subsequent to the date hereof pursuant to Regulation 14A in connection with the Registrant’s 2025 Annual Meeting of Stockholders will be incorporated by reference into Part III of this Annual Report on Form 10-K assuming such proxy statement is filed with the SEC not later than 120 days after the conclusion of the registrant’s fiscal year ended December 31, 2024. If such proxy statement is not filed on or before such date, the information called for by Part III will be filed as part of an amendment to this Annual Report on Form 10-K on or before such date.

    
v3.25.1
Consolidated Balance Sheets - USD ($)
$ in Thousands
Dec. 31, 2024
Dec. 31, 2023
Current assets:    
Cash and cash equivalents $ 22,244 $ 37,125
Short-term investments 36,121  
Prepaid expenses and other current assets 2,981 1,202
Total current assets 61,346 38,327
Property and equipment, net 77 109
Other assets 138 544
Total assets 61,561 38,980
Current liabilities:    
Accounts payable 4,879 1,424
Accrued liabilities 4,202 2,242
Total current liabilities 9,081 3,666
Commitments and contingencies (Note 5)
Stockholders’ equity    
Common stock, $0.001 par value: 200,000,000 shares authorized as of December 31, 2024 and December 31, 2023; 6,393,323 and 1,453,402 shares issued and outstanding at December 31, 2024 and December 31, 2023, respectively 6 1
Additional paid-in capital 206,461 153,829
Accumulated other comprehensive income 11 4
Accumulated deficit (153,998) (118,520)
Total stockholders’ equity 52,480 35,314
Total liabilities and stockholders' equity $ 61,561 $ 38,980
v3.25.1
Consolidated Balance Sheets (Parenthetical) - $ / shares
Dec. 31, 2024
Dec. 31, 2023
Common stock, par value $ 0.001 $ 0.001
Common stock, shares authorized 200,000,000 200,000,000
Common stock, shares issued 6,393,323 1,453,402
Common stock, shares outstanding 6,393,323 1,453,402
v3.25.1
Consolidated Statements of Operations and Comprehensive Loss - USD ($)
$ in Thousands
 12 Months Ended
Dec. 31, 2024
Dec. 31, 2023
Operating expenses:    
Research and development $ 20,714 $ 21,862
Research and development - related party 479  
General and administrative 15,409 10,624
Total operating expenses 36,602 32,486
Loss from operations (36,602) (32,486)
Interest income 1,314 1,124
Other expense, net (190) (114)
Net loss $ (35,478) $ (31,476)
Net loss per share - basic $ (12.17) $ (24.92)
Net loss per share - diluted $ (12.17) $ (24.92)
Weighted average shares and pre-funded warrants outstanding, basic 2,915,894 1,262,840
Weighted average shares and pre-funded warrants outstanding, diluted 2,915,894 1,262,840
Comprehensive Loss:    
Net loss $ (35,478) $ (31,476)
Unrealized gain on available-for-sale securities 7 4
Comprehensive loss $ (35,471) $ (31,472)
v3.25.1
Consolidated Statements of Stockholders' Equity - USD ($)
$ in Thousands
Total
Common Stock
Additional Paid-in Capital
Accumulated Other Comprehensive Income
Accumulated Deficit
Beginning balance at Dec. 31, 2022 $ 38,818 $ 1 $ 125,861   $ (87,044)
Beginning balance, shares at Dec. 31, 2022   840,002      
Issuance of common stock under ESPP 16   16    
Issuance of common stock under ESPP, shares   700      
Issuance of common stock and pre-funded warrants in PIPE financing, net of issuance costs 24,728   24,728    
Issuance of common stock and pre-funded warrants in PIPE financing, net of issuance costs, shares   606,678      
Issuance of common stock upon vesting of restricted stock units, value (60)   (60)    
Issuance of common stock upon vesting of restricted stock units, net, shares   6,022      
Stock-based compensation 3,284   3,284    
Unrealized gain on available-for-sale securities 4     $ 4  
Net loss (31,476)       (31,476)
Ending Balance at Dec. 31, 2023 35,314 $ 1 153,829 4 (118,520)
Ending balance, shares at Dec. 31, 2023   1,453,402      
Issuance of common stock under ESPP 14   14    
Issuance of common stock under ESPP, shares   958      
Issuance of common stock and pre-funded warrants in PIPE financing, net of issuance costs 49,564 $ 5 49,559    
Issuance of common stock and pre-funded warrants in PIPE financing, net of issuance costs, shares   4,931,389      
Issuance of common stock upon vesting of restricted stock units, value (35)   (35)    
Issuance of common stock upon vesting of restricted stock units, net, shares   7,721      
Stock-based compensation 3,095   3,095    
Unrealized gain on available-for-sale securities 7     7  
Settlement of fractional shares paid in cash (1)   (1)    
Settlement of fractional shares paid in cash, shares   (147)      
Net loss (35,478)       (35,478)
Ending Balance at Dec. 31, 2024 $ 52,480 $ 6 $ 206,461 $ 11 $ (153,998)
Ending balance, shares at Dec. 31, 2024   6,393,323      
v3.25.1
Consolidated Statements of Stockholders' Equity (Parenthetical) - USD ($)
$ in Thousands
 12 Months Ended
Dec. 31, 2024
Dec. 31, 2023
Statement of Stockholders' Equity [Abstract]    
Issuance costs $ 3,436 $ 272
v3.25.1
Consolidated Statements of Cash Flows - USD ($)
$ in Thousands
 12 Months Ended
Dec. 31, 2024
Dec. 31, 2023
Cash flows from operating activities:    
Net loss $ (35,478) $ (31,476)
Adjustments to reconcile net loss to net cash used in operating activities:    
Depreciation expense 39 9
Accretion of discount on available-for-sale securities (158) (131)
Stock based compensation expense 3,095 3,284
Changes in operating assets and liabilities:    
Prepaid expenses and other assets (1,373) (849)
Accounts payable 3,021 271
Accrued liabilities 109 186
Net cash used in operating activities (30,745) (28,706)
Cash flows from investing activities:    
Purchase of available-for-sale securities (35,956) (9,965)
Proceeds from maturity of available-for-sale securities   10,100
Purchase of property and equipment (37) (88)
Net cash (used in) provided by investing activities (35,993) 47
Cash flows from financing activities:    
Proceeds from issuance of common stock and pre-funded warrants 53,000 25,000
Payment of issuance costs associated with financing (1,121) (272)
Proceeds from exercise of employee stock options and issuance of common stock under ESPP 14 16
Taxes paid related to net share settlement of equity awards (35) (60)
Settlement of fractional shares paid in cash (1)  
Net cash provided by financing activities 51,857 24,684
Net decrease in cash and cash equivalents (14,881) (3,975)
Cash and cash equivalents - beginning of year 37,125 41,100
Cash and cash equivalents - end of year 22,244 37,125
Supplemental disclosure of non-cash investing and financing activities    
Unpaid issuance costs recorded in accounts payable and accrued liabilities $ 2,316  
Purchase of property and equipment recorded in accrued liabilities   $ 30
v3.25.1
Pay vs Performance Disclosure - USD ($)
$ in Thousands
 12 Months Ended
Dec. 31, 2024
Dec. 31, 2023
Pay vs Performance Disclosure    
Net Income (Loss) $ (35,478) $ (31,476)
v3.25.1
Insider Trading Arrangements
 3 Months Ended
Dec. 31, 2024
Trading Arrangements, by Individual  
Rule 10b5-1 Arrangement Adopted false
Non-Rule 10b5-1 Arrangement Adopted false
Rule 10b5-1 Arrangement Terminated false
Non-Rule 10b5-1 Arrangement Terminated false
v3.25.1
Cybersecurity Risk Management, Strategy and Governance
 12 Months Ended
Dec. 31, 2024
Cybersecurity Risk Management, Strategy, and Governance [Line Items]  
Cybersecurity Risk Management Processes for Assessing, Identifying, and Managing Threats [Text Block]

Item 1C. Cybersecurity.

 

We have implemented and maintain processes designed to identify, assess and manage material risks from cybersecurity threats to our computer networks, third party hosted services, communications systems, hardware and software, and our data, including intellectual property, confidential information that is proprietary, strategic or competitive in nature, and personal information of employees and others (“Information Systems and Data”).

Our information technology consultants help identify, assess and manage the Company’s cybersecurity threats and risks. Our information technology consultants identify and assess risks from cybersecurity threats by monitoring and evaluating our threat environment using various methods including, for example: manual and automated cybersecurity tools such as malware scans and; vulnerability testing.

Depending on the environment, we implement and maintain technical, physical, and organizational measures, processes, standards and policies designed to manage and mitigate risks from cybersecurity threats to our Information Systems and Data, including,

for example: employee training; access controls; data encryption; systems monitoring; regular patching of operating systems and software; and a password policy.

Our assessment and management of material risks from cybersecurity threats are integrated into the Company’s overall risk management processes. For example, our information technology consultants work with management to prioritize our risk management processes and mitigate cybersecurity threats that are more likely to lead to a material impact to our business.

We use third-party service providers to perform a variety of functions throughout our business, such as electronic communications service providers, cloud-based file storage service providers, and contract manufacturing and research organizations. We evaluate the cybersecurity posture of such third-party service providers, including whether such providers maintain appropriate security measures and, where appropriate, require them to implement and maintain reasonable security measures in connection with their work with us. Our Board, as a whole and at the committee level, has oversight for the most significant risks facing us and for our processes to identify, prioritize, assess, manage, and mitigate those risks. The Audit Committee, which is comprised solely of independent directors, has been designated by our Board to oversee cybersecurity risks. The Audit Committee receives updates, as needed, on cybersecurity and information technology matters and related risk exposures from our Chief Financial Officer as well as other members of the senior leadership team. The Board also receives updates from management and the Audit Committee on cybersecurity risks. For additional information regarding whether any risks from cybersecurity threats are reasonably likely to materially affect our company, including our business strategy, results of operations, or financial condition, please refer to Item 1A, “Risk Factors” in this Annual Report on Form 10-K.
Cybersecurity Risk Management Processes Integrated [Flag] true
Cybersecurity Risk Management Processes Integrated [Text Block] Our assessment and management of material risks from cybersecurity threats are integrated into the Company’s overall risk management processes. For example, our information technology consultants work with management to prioritize our risk management processes and mitigate cybersecurity threats that are more likely to lead to a material impact to our business.
Cybersecurity Risk Management Third Party Engaged [Flag] true
Cybersecurity Risk Third Party Oversight and Identification Processes [Flag] true
Cybersecurity Risk Materially Affected or Reasonably Likely to Materially Affect Registrant [Flag] true
Cybersecurity Risk Materially Affected or Reasonably Likely to Materially Affect Registrant [Text Block] For additional information regarding whether any risks from cybersecurity threats are reasonably likely to materially affect our company, including our business strategy, results of operations, or financial condition, please refer to Item 1A, “Risk Factors” in this Annual Report on Form 10-K.
Cybersecurity Risk Board of Directors Oversight [Text Block] Our Board, as a whole and at the committee level, has oversight for the most significant risks facing us and for our processes to identify, prioritize, assess, manage, and mitigate those risks. The Audit Committee, which is comprised solely of independent directors, has been designated by our Board to oversee cybersecurity risks. The Audit Committee receives updates, as needed, on cybersecurity and information technology matters and related risk exposures from our Chief Financial Officer as well as other members of the senior leadership team. The Board also receives updates from management and the Audit Committee on cybersecurity risks. For additional information regarding whether any risks from cybersecurity threats are reasonably likely to materially affect our company, including our business strategy, results of operations, or financial condition, please refer to Item 1A, “Risk Factors” in this Annual Report on Form 10-K.
Cybersecurity Risk Board Committee or Subcommittee Responsible for Oversight [Text Block] The Board also receives updates from management and the Audit Committee on cybersecurity risks.
Cybersecurity Risk Process for Informing Board Committee or Subcommittee Responsible for Oversight [Text Block] The Audit Committee receives updates, as needed, on cybersecurity and information technology matters and related risk exposures from our Chief Financial Officer as well as other members of the senior leadership team.
Cybersecurity Risk Role of Management [Text Block] Our information technology consultants help identify, assess and manage the Company’s cybersecurity threats and risks. Our information technology consultants identify and assess risks from cybersecurity threats by monitoring and evaluating our threat environment using various methods including, for example: manual and automated cybersecurity tools such as malware scans and; vulnerability testing.

Depending on the environment, we implement and maintain technical, physical, and organizational measures, processes, standards and policies designed to manage and mitigate risks from cybersecurity threats to our Information Systems and Data, including,

for example: employee training; access controls; data encryption; systems monitoring; regular patching of operating systems and software; and a password policy.
Cybersecurity Risk Management Positions or Committees Responsible [Flag] true
Cybersecurity Risk Management Positions or Committees Responsible [Text Block] The Audit Committee receives updates, as needed, on cybersecurity and information technology matters and related risk exposures from our Chief Financial Officer as well as other members of the senior leadership team.
Cybersecurity Risk Process for Informing Management or Committees Responsible [Text Block]

Depending on the environment, we implement and maintain technical, physical, and organizational measures, processes, standards and policies designed to manage and mitigate risks from cybersecurity threats to our Information Systems and Data, including,

for example: employee training; access controls; data encryption; systems monitoring; regular patching of operating systems and software; and a password policy.
Cybersecurity Risk Management Positions or Committees Responsible Report to Board [Flag] true
v3.25.1
Organization and Description of Business
 12 Months Ended
Dec. 31, 2024
Organization, Consolidation and Presentation of Financial Statements [Abstract]  
Organization and Description of Business

1. Organization and Description of Business

 

Forte Biosciences, Inc. (www.fortebiorx.com) and its subsidiaries, referred to herein as the “Company” or "Forte", is a clinical- stage biopharmaceutical company focused on developing FB102, which is a proprietary anti-CD122 monoclonal antibody therapeutic candidate with potentially broad autoimmune and autoimmune-related indications. The phase 1 healthy volunteer single and multiple ascending dose cohorts have completed. Forte is currently advancing clinical development of FB102 into patient-based trials for celiac disease and non-segmental vitiligo.

 

The Company merged with Tocagen, Inc. ("Merger"), a publicly traded biotechnology company, on June 15, 2020. Prior to the Merger, Forte was a privately held company incorporated in Delaware on May 3, 2017. The Company's headquarters is in Dallas, Texas. The Company’s common stock is traded on the Nasdaq stock exchange under the ticker symbol “FBRX”‌.

 

Reverse Stock Split

On August 20, 2024, the Company's stockholders approved effecting a reverse stock split of the issued common stock of the Company (the “Common Stock”) at a ratio in the range between 1:5 and 1:30, with the final ratio to be approved by the Company's board of directors (the "Board"). The Board approved a final ratio of 1 for 25 for the reverse stock split.

On August 27, 2024, the Company filed a certificate of amendment to the Company's Amended and Restated Certificate of Incorporation with the Secretary of State of the State of Delaware, to effect a 1 for 25 reverse stock split of the Common Stock, effective as of 8:00 a.m., Eastern Time, on August 28, 2024. The par value and authorized shares were not adjusted as a result of the reverse split. The Reverse Stock Split also affected the Company’s outstanding common stock options and pre-funded warrants, and resulted in the shares underlying such instruments being reduced and the exercise price being increased proportionately. All issued and outstanding shares of common stock and per share amounts contained in the consolidated financial statements have been retroactively adjusted to reflect this reverse stock split for all periods presented.

Liquidity and Risks

The accompanying consolidated financial statements have been prepared assuming that the Company will continue as a going concern, which contemplates the realization of assets and the settlement of liabilities and commitments in the normal course of business. The consolidated financial statements do not reflect any adjustments relating to the recoverability and reclassification of assets and liabilities that might be necessary if the Company is unable to continue as a going concern. Since inception, the Company has incurred losses and negative cash flows from operations. As of December 31, 2024, the Company had an accumulated deficit of $154.0 million and used $30.7 million of cash and cash equivalents in operating activities during the year ended December 31, 2024. Management expects to continue to incur additional losses in the foreseeable future as the Company focuses its development efforts on advancing FB102 through clinical trials.

The Company had cash, cash equivalents and short-term investments of approximately $58.4 million as of December 31, 2024. The Company’s cash, cash equivalents and short-term investments are held at financial institutions that exceed federally insured limits. The Company believes that its existing cash, cash equivalents and short-term investments will be sufficient to allow the Company to fund its operations for at least 12 months from the filing date of this Form 10-K.

The Company will continue to need to raise additional capital or obtain financing from other sources. Management may fund future operations through the sale of equity and debt financings and may also seek additional capital through arrangements with strategic partners or other sources. There can be no assurance that additional funding will be available on terms acceptable to the Company, if at all. If the Company is unable to raise additional funding to meet its working capital needs in the future, it may be forced to delay or reduce the scope of its research and development programs and/or limit or cease its operations. The Company's ability to raise additional funds may be adversely impacted by potential worsening global economic conditions and the recent disruptions to, and volatility in, the credit and financial markets in the United States and worldwide resulting from the military conflicts in Eastern Europe, the Middle East, and otherwise.

There are numerous risks and uncertainties associated with pharmaceutical development and the Company is unable to predict the timing or amount of increased expenses on the development of future product candidates or when or if it will start to generate revenues. Even if the Company does generate revenues, it may not be able to achieve or maintain profitability. If the Company fails to

become profitable or is unable to sustain profitability on a continuing basis, then it may be unable to continue its operations at planned levels and may be forced to reduce its operations.

Businesses throughout our industry have been and will continue to be impacted by a number of challenging and unexpected global and national events and circumstances that continue to evolve, including without limitation the military conflicts in Eastern Europe and the Middle East, increased economic uncertainty, inflation, rising interest rates, recent and any potential future financial institution failures, and other geopolitical tensions. The extent of the impact of these events and circumstances on our business, operations, development timelines and plans remains uncertain, and will depend on certain developments, including the duration and scope of the events and their impact on the Company's development activities, third parties with whom it does business, as well as its impact on regulatory authorities and its key scientific and management personnel. The Company has been and continues to actively monitor the potential impacts that these various events and circumstances may have on its business and the Company takes steps, where warranted, to minimize any potential negative impacts on its business resulting from these events and circumstances.
v3.25.1
Summary of Significant Accounting Policies
 12 Months Ended
Dec. 31, 2024
Accounting Policies [Abstract]  
Summary of Significant Accounting Policies

2. Summary of Significant Accounting Policies

Basis of Presentation

The Company prepares its consolidated financial statements in accordance with accounting principles generally accepted in the United States of America (“GAAP”), as found in the Accounting Standards Codification (“ASC”), the Accounting Standards Update (“ASU”), of the Financial Accounting Standards Board (“FASB”), and the rules and regulations of the US Securities and Exchange Commission (“SEC”).

Principles of Consolidation

The consolidated financial statements include the accounts of the Company and its wholly-owned subsidiaries, Forte Subsidiary, Inc. and Forte Biosciences Australia Proprietary Limited. All intercompany accounts and transactions have been eliminated in the preparation of the consolidated financial statements.

Use of Estimates

The preparation of the Company’s consolidated financial statements requires management to make estimates and assumptions that impact the reported amounts of assets, liabilities, expenses and the disclosure of contingent assets and liabilities in the Company’s consolidated financial statements and accompanying notes. Significant management estimates that affect the reported amounts of assets, liabilities and expenses include stock-based compensation expense and accruals for clinical trials and drug manufacturing. Although these estimates are based on the Company’s knowledge of current events and actions it may undertake in the future, actual results may ultimately materially differ from these estimates and assumptions.

Cash and cash equivalents

Cash and cash equivalents include cash in readily available operating accounts, U.S. treasury bills, money market funds and deposits with commercial banks. Cash equivalents are defined as short-term, highly liquid investments with maturities of 90 days or less from the date of purchase.

 

Available-for-Sale Securities

The Company’s available-for-sale securities consist of U.S. treasury bills. Securities with maturities from the date of purchase of 90 days or less are included in cash equivalents. The Company classifies its marketable securities as available-for-sale and records such assets at estimated fair value in the consolidated balance sheets, with unrealized gains and losses, if any, reported as a component of other comprehensive loss within the consolidated statements of operations and comprehensive loss and as a separate component of stockholders’ equity. Realized gains and losses are calculated on the specific identification method and recorded as interest income (loss).

Any premium arising at purchase is amortized to the earliest call date and any discount arising at purchase is accreted to maturity. Accretion of discounts are recorded in interest income in the consolidated statements of operations and comprehensive loss.

 

 

 

Fair Value of Financial Instruments

Fair value is defined as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. There is a three-level hierarchy that prioritizes the inputs used in determining fair value by their reliability and preferred use as follows:

•
Level 1 - Valuations based on quoted prices in active markets for identical assets or liabilities.
•
Level 2 – Valuations based on quoted prices in active markets for similar assets and liabilities, quoted prices for identical or similar assets or liabilities in inactive markets, or other inputs that are observable or can be corroborated by observable market data.
•
Level 3 – Valuations based on inputs that are both significant to the fair value measurements and are unobservable.

To the extent that a valuation is based on models or inputs that are less observable, or unobservable in the market, the determination of fair value requires more judgment. Accordingly, the degree of judgment exercised by the Company in determining fair value is greatest for instruments categorized within Level 3. A financial instrument’s level within the fair value hierarchy is based on the lowest level of any input that is significant to the fair value measurement.

There have been no significant changes to the valuation methods utilized by the Company during the periods presented. There have been no transfers between Level 1, Level 2, and Level 3 in any periods presented.

The carrying amounts of financial instruments consisting of cash and cash equivalents, accounts payable and accrued liabilities included in the Company’s financial statements are reasonable estimates of fair value, primarily due to their short maturities. Short-term investments are recorded at fair value, with any unrealized gains or losses reported as accumulated other comprehensive income or loss.

Property and Equipment, Net

Property and equipment are stated at cost less accumulated depreciation, subject to review for impairment. Property and equipment, net are depreciated over the estimated useful lives of the assets, generally three to five years, using the straight-line method.

Impairment of Property and Equipment

The Company reviews its property and equipment for impairment when events or changes in circumstances indicate the carrying value of the assets may not be recoverable. Recoverability is measured by comparing the book values of the assets to future net undiscounted cash flows that the assets or the asset groups are expected to generate. If such assets are considered impaired, the impairment to be recognized is measured by the amount the book value of the assets exceed their fair value, which is measured based on the estimated discounted future net cash flows arising from the assets or asset groups. No impairment losses on property and equipment have been recorded for the years ended December 31, 2024 or 2023.

Pre-Funded Warrants

Pre-funded warrants are accounted for as either derivative liabilities or as equity instruments depending on the specific terms of the agreement. The pre-funded warrants are equity-classified instruments that were recorded in additional paid-in capital at issuance and are not subject to remeasurement. The Company periodically evaluates changes in facts and circumstances that could impact the classification of warrants.

Research and Development Costs

Research and development costs are expensed as incurred. Research and development costs consist primarily of salaries and benefits of research and development personnel, costs related to research activities, preclinical studies, clinical trials and drug manufacturing. Non-refundable advance payments for goods or services that will be used in future research and development activities are deferred and capitalized and are only expensed when the goods have been received or when the service has been performed rather than when the payment is made.

Drug manufacturing and clinical trial costs are a component of research and development expenses. The Company expenses costs for its drug manufacturing activities performed by Contract Manufacturing Organizations (“CMOs”), preclinical and clinical trial costs performed by Contract Research Organizations (“CROs”) and other service providers, as they are incurred, based upon estimates

of the work completed over the life of the individual task in accordance with associated agreements. The Company uses information it receives from internal personnel and outside service providers to estimate the percentage of completion and therefore the expense to be recognized.

Research and Development Tax Incentive

The Company is eligible to receive a cash refund from the Australian Taxation Office for eligible research and development (“R&D”) expenditures under the Australian R&D Tax Incentive Program (the “Australian Tax Incentive”). The Australian Tax Incentive is recognized as a reduction to R&D expense when the relevant expenditure has been incurred, the amount can be reliably measured and it is probable that the Australian Tax Incentive will be received. The Company has not recorded any reductions to R&D expense under the Australian tax incentive as it is not reasonably assured that the criteria have been met. The Company has not received any cash refunds under this program.

Patent Costs

Costs related to filing and pursuing patent applications, including direct application fees and the legal and consulting expenses related to making such applications, are expensed as incurred, as recoverability of such expenditures is uncertain. These costs are included in general and administrative expenses within the consolidated statements of operations and comprehensive loss.

Comprehensive Loss

Comprehensive loss is defined as the change in equity during a period from transactions from non-owner sources. Other comprehensive loss includes unrealized gains on available-for-sale securities, which was the only difference between net loss and comprehensive loss for the applicable periods.

Net Loss Per Share

The Company’s net loss is equivalent to net loss attributable to common stockholders for all periods presented. Basic net loss per share is computed by dividing net loss applicable to common stockholders by the weighted average number of common shares, without consideration for common stock equivalents. The weighted average number of shares of common stock used in the basic and diluted net loss per share calculation include the pre-funded warrants outstanding during the period as they are exercisable at any time and their exercise requires only nominal consideration for the delivery of shares. As of December 31, 2024, no pre-funded warrants have been exercised and pre-funded warrants to purchase an aggregate of 5,003,121 shares of common stock were outstanding.

Diluted net loss per share is computed by dividing net loss by the weighted-average number of shares of common stock and common stock equivalents outstanding during the period in accordance with the treasury stock method. The following number of unexercised stock options, restricted stock units, warrants, and shares expected to be purchased under the ESPP, which are common stock equivalents, have been excluded from the diluted net loss calculation as their effect would have been anti-dilutive for the periods presented.

 

 

 

 

 

 

 

 

 

Year Ended December 31,

 

 

 

 

2024

 

 

2023

 

Options

 

 

 

212,501

 

 

 

105,791

 

Restricted stock units

 

 

 

28,537

 

 

 

42,237

 

Warrants

 

 

 

176

 

 

 

176

 

ESPP

 

 

 

66

 

 

 

73

 

Total

 

 

 

241,280

 

 

 

148,277

 

 

Stock-Based Compensation

The Company issues stock-based awards to employees, directors and non-employees, generally in the form of stock options, restricted stock units or rights granted to employees under the Employee Stock Purchase Plan (“ESPP”). The Company accounts for stock-based compensation awards in accordance with ASC Topic 718, Compensation—Stock Compensation.

The Company measures compensation cost for all equity awards for employees, directors and non-employees at their grant-date fair value and recognizes compensation expense for service-based awards on a straight-line basis over the requisite service period,

which is generally the vesting period. The grant-date fair value of stock options is estimated using the Black-Scholes option pricing model. The grant-date fair value of restricted stock units is determined using the Company’s closing stock price on the date of grant. Forfeitures are recognized as they occur.

Stock-based compensation expense for an award with a performance condition is recognized when the achievement of the performance condition has been determined to be probable. If the outcome of such performance condition has not been determined to be probable, or has not been met, no compensation expense is recognized and any previously recognized compensation expense is reversed. For rights granted under the ESPP, the fair value of each purchase is estimated at the beginning of the offering period using the Black-Scholes option pricing model.

The Company classifies stock-based compensation expense in its statement of operations in the same manner in which the award recipient’s salary and related costs are classified in the case of employees, or in which the award recipient’s service payments are classified in the case of directors and non-employees.

Foreign Currency Transactions

Transaction gains and losses that arise from exchange rate fluctuations on transactions denominated in currencies other than the US dollar are recorded to other expenses, net in the consolidated statements of operations and comprehensive loss and were not material for the periods presented. The Company's subsidiaries use the U.S. dollar as their functional currency.

Income Taxes

The Company uses an asset and liability approach to account for income taxes. The Company recognizes deferred tax assets and liabilities for the expected future tax consequences of temporary differences between the financial reporting and tax bases of assets and liabilities. These differences are measured using the enacted statutory tax rates that are expected to be in effect for the years in which differences are expected to reverse.

Valuation allowances are provided when the expected realization of deferred tax assets does not meet a “more likely than not” criterion. The Company makes estimates and judgments about its future taxable income that are based on assumptions that are consistent with its plans and estimates. Should the actual amounts differ from those estimates, the amount of the valuation allowance could be materially impacted. Changes in these estimates may result in significant increases or decreases to the Company’s tax provision in a period in which such estimates are changed, which in turn would affect net income or loss.

The Company recognizes tax benefits from uncertain tax positions if it believes the position is more likely than not to be sustained on examination by the taxing authorities based on the technical merits of the position. The Company makes adjustments to these reserves when facts and circumstances change, such as the closing of a tax audit or the refinement of an estimate. The provision for income taxes includes the effects of any reserves for tax positions that are not more likely than not to be sustained, as well as the related net interest and penalties.

Recently Adopted Accounting Standards

In November 2023, the FASB issued ASU No. 2023-07, Segment Reporting (Topic 280): Improvements to Reportable Segment Disclosures. The new standard is intended to improve annual and interim reportable segment disclosure requirements regardless of number of reporting units, primarily through enhanced disclosures of significant expenses. The amendment requires public entities to disclose significant segment expenses that are regularly provided to the CODM and included within each reported measure of segment profit and loss. The Company adopted this new standard for the annual period ended December 31, 2024 on a retrospective basis, and the adoption did not have a material impact on its consolidated financial statements and related disclosures. See Note 12, Segment Information, for the updated segment disclosures as a result of adopting this ASU.

In August 2020, the FASB issued ​ASU 2020-06​, ​Debt - Debt with Conversion and Other Options (Subtopic 470-20) and Derivatives and Hedging - Contracts in an Entity’s Own Equity (Subtopic 815-40)​. ​ASU 2020-06 eliminates the beneficial conversion and cash conversion accounting models for convertible instruments. It also amends the accounting for certain contracts in an entity’s own equity that are currently accounted for as derivatives because of specific settlement provisions. In addition, ASU 2020-06 modifies how particular convertible instruments and certain contracts that may be settled in cash or shares impact the diluted earnings per share computation. The amendments in ASU 2020-06 are effective for smaller reporting companies as defined by the SEC for fiscal years beginning after December 15, 2023, including interim periods within those fiscal years. The Company adopted ASU 2020-06 as of January 1, 2024, which did not have a material impact on the Company’s consolidated financial statements.

Recently Issued Accounting Standards Not Yet Adopted

From time to time, new accounting pronouncements are issued by the FASB or other standard-setting bodies and adopted by us as of a specified effective date. Unless otherwise discussed, the Company believes that the impact of recently issued standards that are not yet effective will not have a material impact on the Company’s financial position or results of operations.

In December 2023, the FASB issued ASU No. 2023-09 Income Taxes (Topic 740): Improvements to Income Tax Disclosure. This ASU includes amendments that further enhance income tax disclosures, primarily through standardization and disaggregation of rate reconciliation categories and income taxes paid by jurisdiction. The ASU is effective for years beginning after December 15, 2024, but early adoption is permitted. This ASU should be applied on a prospective basis, although retrospective application is permitted. Management is currently evaluating the impact of the changes required by the new standard on the Company's consolidated financial statements and related disclosures.

In November 2024, the FASB issued ASU 2024-03, Income Statement—Reporting Comprehensive Income—Expense Disaggregation Disclosures, which requires disclosure of additional information about specific expense categories in the notes to the financial statements on an interim and annual basis. The standard is effective for fiscal years beginning after December 15, 2026, and for interim periods beginning after December 15, 2027, with early adoption permitted. The Company is currently evaluating the disclosure requirements related to this new standard.
v3.25.1
Balance Sheet Components
 12 Months Ended
Dec. 31, 2024
Balance Sheet Related Disclosures [Abstract]  
Balance Sheet Components

3. Balance Sheet Components

Prepaid Expenses and Other Current Assets

Prepaid expenses and other current assets as of December 31, 2024 and 2023 consist of the following (in thousands):

 

 

 

December 31, 2024

 

 

December 31, 2023

 

Prepaid professional fees

 

$

377

 

 

$

413

 

Prepaid insurance

 

 

286

 

 

 

318

 

Prepaid manufacturing and research expense

 

 

1,982

 

 

 

306

 

Other

 

 

336

 

 

 

165

 

Total Prepaid Expenses and Other Current Assets

 

$

2,981

 

 

$

1,202

 

 

Property and Equipment, Net

Property and equipment, net as of December 31, 2024 and 2023 consist of the following (in thousands):

 

 

 

December 31, 2024

 

 

December 31, 2023

 

 Equipment

 

$

107

 

 

$

100

 

 Furniture and Fixtures

 

 

18

 

 

 

18

 

 Property and equipment, at cost

 

 

125

 

 

 

118

 

 Less accumulated depreciation

 

 

(48

)

 

 

(9

)

Total Property and Equipment, net

 

$

77

 

 

$

109

 

 

Other Assets

Other assets as of December 31, 2024 and 2023 consist of the following (in thousands):

 

 

 

December 31, 2024

 

 

December 31, 2023

 

Prepaid insurance

 

$

87

 

 

$

280

 

Prepaid professional fees

 

 

-

 

 

 

211

 

Other

 

 

51

 

 

 

53

 

Total Other Assets

 

$

138

 

 

$

544

 

 

Accrued Liabilities

Accrued liabilities as of December 31, 2024 and 2023 consist of the following (in thousands):

 

 

 

December 31, 2024

 

 

December 31, 2023

 

 Accrued issuance costs

 

$

1,881

 

 

$

—

 

 Accrued manufacturing and clinical expenses

 

 

541

 

 

 

1,016

 

 Accrued compensation

 

 

1,551

 

 

 

947

 

 Accrued legal and professional fees

 

 

97

 

 

 

276

 

 Accrued other expenses

 

 

132

 

 

 

3

 

Total Accrued Liabilities

 

$

4,202

 

 

$

2,242

 
v3.25.1
Fair Value
 12 Months Ended
Dec. 31, 2024
Fair Value Disclosures [Abstract]  
Fair Value

4. Fair Value

The following tables provide a summary of the assets that are measured at fair value on a recurring basis as of December 31, 2024 and December 31, 2023 (in thousands):

 

 

 

Fair Value Measurements as of
December 31, 2024

 

Cash, cash equivalents and short-term investments

 

Level 1

 

 

Level 2

 

 

Level 3

 

 

Total

 

Cash

 

$

1,464

 

 

$

—

 

 

$

—

 

 

$

1,464

 

Money Market Funds

 

 

20,780

 

 

 

-

 

 

 

-

 

 

 

20,780

 

U.S. Treasury Bills

 

 

-

 

 

 

36,121

 

 

 

-

 

 

 

36,121

 

Total

 

$

22,244

 

 

$

36,121

 

 

$

—

 

 

$

58,365

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Fair Value Measurements as of
December 31, 2023

 

Cash and cash equivalents

 

Level 1

 

 

Level 2

 

 

Level 3

 

 

Total

 

Cash

 

$

6,275

 

 

$

—

 

 

$

—

 

 

$

6,275

 

Money Market Funds

 

 

5,686

 

 

 

-

 

 

 

-

 

 

 

5,686

 

U.S. Treasury Bills

 

 

-

 

 

 

25,164

 

 

 

-

 

 

 

25,164

 

Total

 

$

11,961

 

 

$

25,164

 

 

$

—

 

 

$

37,125

 

 

Money market funds are valued at the closing price reported by the fund sponsor from an actively traded exchange. Money market funds and U.S. Treasury bills were included as cash and cash equivalents in the consolidated balance sheet as of December 31, 2023. The Company's U.S Treasury Bills are included in short-term investments as of December 31, 2024, due to an original maturity greater than 90 days. The Company obtains the fair value of its Level 2 cash equivalents from third-party pricing services. The pricing services utilize industry standard valuation models whereby all significant inputs, including benchmark yields, reported trades, broker/dealer quotes, issuer spreads, bids, offers, or other market-related data, are observable.

v3.25.1
Available-for-Sale Securities
 12 Months Ended
Dec. 31, 2024
Investments, Debt and Equity Securities [Abstract]  
Available-for-Sale Securities

5. Available-for-Sale Securities

The following table summarizes the Company's available-for-sale securities as of December 31, 2024 and December 31, 2023 (in thousands).

 

 

 

December 31, 2024

 

 

 

 

 

 

Unrealized

 

 

 

 

Short-term investments

 

Amortized Cost

 

 

Gains

 

 

Losses

 

 

Estimated Fair Value

 

U.S. Treasury Bills

 

$

36,110

 

 

$

11

 

 

$

—

 

 

$

36,121

 

Total available-for-sale securities

 

$

36,110

 

 

$

11

 

 

$

—

 

 

$

36,121

 

 

 

 

 

December 31, 2023

 

 

 

 

 

 

Unrealized

 

 

 

 

Cash equivalents

 

Amortized Cost

 

 

Gains

 

 

Losses

 

 

Estimated Fair Value

 

U.S. Treasury Bills

 

$

25,160

 

 

$

4

 

 

$

—

 

 

$

25,164

 

Total available-for-sale securities

 

$

25,160

 

 

$

4

 

 

$

—

 

 

$

25,164

 

 
v3.25.1
Commitments and Contingencies
 12 Months Ended
Dec. 31, 2024
Commitments and Contingencies Disclosure [Abstract]  
Commitments and Contingencies

6. Commitments and Contingencies

Concentrations of Credit Risk

The Company limits its credit risk associated with its cash and cash equivalents by placing them with financial institutions it believes are highly creditworthy. Bank accounts in the United States are insured by the Federal Deposit Insurance Corporation (“FDIC”) up to $250 thousand. The Company’s cash accounts significantly exceed the FDIC limits.

Indemnifications

As permitted under Delaware law, the Company indemnifies its officers, directors, and employees for certain events and occurrences while the officer, employee or director is, or was, serving at the Company’s request in such capacity. As of December 31, 2024, the Company did not have any material indemnification claims that were probable or reasonably possible and consequently has not recorded any related liabilities.

Lease Agreements

The Company has entered into month-to-month lease agreements for certain office and laboratory space. The lease agreements are cancellable by the Company at any time with a 30-day notice. Total rent expense was $300 thousand and $129 thousand for the years ended December 31, 2024 and 2023, respectively.

 

Clinical and Preclinical Services

 

The Company has entered into various agreements with third-party vendors for preclinical and clinical services. The estimated remaining commitments as of December 31, 2024 under these agreements were approximately $7.2 million. The Company entered into agreements with a clinical research organization ("CRO") for clinical trials of FB102, its product candidate. The Company has agreed to pay third-party costs associated with those agreements. The CRO agreements are subject to termination at any time, with or without cause, by the Company, in which case only costs earned or non-cancellable to the date of termination would remain subject to reimbursement.

 

Legal Proceedings

 

Camac Fund L.P. v. Forte Biosciences Inc., C.A. No. 2022-1075-NAC (Del. Ch.)

In November 2022, a stockholder of the Company, Camac Fund LP, filed a complaint in the Delaware Court of Chancery seeking to access certain books and records of the Company pursuant to Section 220 of the Delaware General Corporation Law, as well as to seek attorney fees (the “Books and Records Action”). The Books and Records Action, which is captioned Camac Fund L.P. v. Forte Biosciences Inc., C.A. No. 2022-1075-NAC, was dismissed with prejudice on July 29, 2024.

Camac Fund, LP v. Paul A. Wagner, et al., C.A. No. 2023-0817-MTZ (Del. Ch.)

On August 10, 2023, Camac Fund LP filed a complaint (the “Complaint”), captioned Camac Fund, LP v. Paul A. Wagner, et al., C.A. No. 2023-0817-MTZ, in the Delaware Court of Chancery, against the members of the Company's Board of Directors (the "Directors") and entities affiliated with certain of the Company’s investors (the “Investors”) and naming the Company as nominal defendant. The Complaint alleged that the Directors breached their fiduciary duties by causing the Company to enter into a July 31, 2023 private placement (the “ 2023 Private Placement”), which raised approximately $25 million for the Company from the Investors and certain of the Company’s executives and directors, and by scheduling the Company’s 2023 annual meeting of stockholders (the “Annual Meeting”) for more than thirteen months after its 2022 annual meeting. The Complaint also alleged the Investors aided and abetted the alleged breaches of fiduciary duty by the Directors. Plaintiff also filed a motion for preliminary injunction and motion to

expedite seeking a hearing on its preliminary injunction motion on an expedited basis. The Complaint and motions sought declarations that the Directors breached their fiduciary duties and that the Investors aided and abetted them, to enjoin defendants from counting votes cast by the Investors’ shares obtained through the private placement at the Annual Meeting or any subsequent director election, and money damages in an unspecified amount.

 

On August 15, 2023, the Company, the Directors, and certain Investors filed oppositions to Plaintiff’s motion to expedite. On August 16, 2023, the Company, the Directors, and certain Investors filed motions to dismiss the Complaint. On August 17, 2023, the Court held a hearing at which it granted the motion to expedite in part but declined to schedule a preliminary injunction hearing prior to the Annual Meeting and determined that Defendants could brief their motions to dismiss and be heard on an expedited schedule. The Court determined that discovery could proceed while the motions to dismiss are pending and directed the parties to confer regarding a schedule for further proceedings.

 

On September 1, 2023, Plaintiff voluntarily dismissed its claims against the Investors. On September 7, 2023, the parties agreed to a schedule for briefing the motion to dismiss filed by the Directors and the Company (together, hereinafter, “Defendants”), with the understanding that the schedule would change if Plaintiff amended its Complaint rather than file a brief in opposition to Defendants’ motion to dismiss, and the parties also agreed to stay discovery pending resolution of the motion to dismiss. On September 19, 2023, the Company held its Annual Meeting at which, among other things, the Company’s two director nominees were re-elected and Plaintiff’s two director nominees were not elected. On September 21, 2023, Defendants filed their opening brief in support of their motion to dismiss.

 

On October 20, 2023, Plaintiff filed an amended class action and derivative complaint (the “Amended Complaint”) against the Directors and naming the Company as a nominal defendant. The Amended Complaint makes many of the same allegations as the original Complaint. The Amended Complaint also purports to bring a claim on behalf of a class of holders of the Company’s common stock as of August 10, 2023, the record date for the Annual Meeting. The class claim alleges the Directors breached their fiduciary duties by causing the Company to enter into the Private Placement, setting the Annual Meeting record date for a date after the Private Placement closed, and holding the Annual Meeting more than thirteen months after the 2022 annual meeting. The Amended Complaint purports to bring a second claim for “wrongful dilution” derivatively on behalf of the Company. The derivative claim alleges the Directors “wrongfully diluted” Plaintiff and other stockholders by causing the Company to enter into the Private Placement in bad faith and for the purpose of entrenchment and not permitting Plaintiff and other stockholders to participate. The Amended Complaint seeks declarations that the Directors breached their fiduciary duties, that the votes cast at the Annual Meeting by the shares acquired in the Private Placement should be excluded from the final voting results, that Plaintiff’s two director nominees at the Annual Meeting were elected and that the Company’s nominees were not elected, as well as an order requiring the Company’s board of directors to recognize Plaintiff’s nominees as validly elected and remove the Company’s nominees from their positions on the board of directors. The Amended Complaint also sought an order that the Company hold an annual meeting of stockholders in 2024 within thirteen months of the 2023 Annual Meeting, that the shares acquired in the Private Placement are enjoined from voting at the 2024 annual meeting, and awarding money damages in an unspecified amount.

 

On November 3, 2023, Defendants moved to dismiss the Amended Complaint, which was fully briefed in advance of a hearing before the Court on the motion on February 14, 2024. On April 15, 2024, the Court issued an oral ruling denying Defendants’ motion to dismiss. Expedited discovery ensued. On June 4, 2024, the parties reached an agreement-in-principle to settle the action. On June 11, 2024, the parties entered into a Stipulation and Agreement of Settlement, Compromise, and Release, which was filed with the Court the next day. Also on June 11, 2024, the Company entered into a Standstill and Voting Agreement with Camac Fund LP and related entities and persons. On July 2, 2024, Plaintiff filed its Opening Brief in Support of (A) Approval of Settlement; (B) Certification of the Settlement Class; and (C) Award of Attorneys’ Fees, Litigation Expenses and Incentive Award. In accordance with the terms of the Stipulation and Agreement of Settlement, Compromise, and Release the Company paid $364 thousand and accrued $1.7 million for Camac’s estimated legal fees which does not include any potential insurance recoveries. The accrual reflected the Company’s best estimate based on currently available information at the time. On July 30, 2024, the Court held a settlement hearing and declined to approve the settlement.

 

The Company subsequently took certain actions to moot Camac’s claims in the action, as described more fully in the Company’s Form 8-K filed with the SEC on September 20, 2024, which is incorporated by reference. Camac acknowledged that the actions taken by the Company mooted all claims in the action and provided substantial benefits to all stockholders. Camac also repaid to the Company the $364 thousand that the Company had paid for Camac’s expenses. In order to fully resolve Camac’s claim for an award of attorneys’ fees, the Company, on behalf of all named defendants in the action, made a payment to Plaintiff’s counsel for its fees and expenses in the amount of $1.5 million. On September 18, 2024, the parties filed a Stipulation and Proposed Order Dismissing the Action as Moot (the “Mootness Order”), pursuant to which the action would be dismissed with prejudice as to Camac only. On September 20, 2024, the Court entered the Mootness Order. On October 8, 2024, Forte filed an affidavit notifying the Court that, as required by the Mootness Order, it had filed the September 20, 2024 Form 8-K. In accordance with the Mootness Order, the Court subsequently closed the case.

 

Forte Biosciences, Inc. v. Camac Fund, LP, et al., Case No. 3:23-cv-02399-N (N.D. Tex.)

 

On October 28, 2023, the Company filed a complaint (the “Texas Complaint”), captioned Forte Biosciences, Inc. v. Camac Fund, LP, et al., Case No. 3:23-cv-02399-N, in the U.S. District Court for the Northern District of Texas, against Camac Fund, LP, Camac Partners, LLC, Camac Capital, LLC, and Eric Shahinian (collectively, “Camac”), as well as against Michael G. Hacke, Chris McIntyre, McIntyre Partnerships, LP, McIntyre Capital GP, LLC, McIntyre Capital Management, LP, McIntyre Capital Management GP, LLC, ATG Fund II LLC, ATG Capital Management, LLC, Gabriel Gliksberg, Funicular Funds, LP, The Funicular Fund, LP, Cable Car Capital LLC, Jacob Ma-Weaver, BML Investment Partners, L.P., BML Capital Management, LLC, and Braden M. Leonard (collectively with Camac, the “Texas Defendants”). The Texas Complaint alleged that the Texas Defendants issued false and misleading disclosures in connection with their efforts to elect two directors to Forte’s board of directors at the 2023 annual meeting. The Texas Defendants moved to dismiss and on June 11, 2024, the Complaint was dismissed with prejudice.

 

In October 2024, to resolve all claims and potential claims asserted by the parties, the Texas Defendants entered into a settlement agreement and release with Forte, and all Texas Defendants other than Camac entered into standstill and voting agreements that are similar to the agreement Camac entered into in June 2024. The Company paid $650 thousand related to these agreements which does not include any potential insurance recoveries. The Company expenses legal fees as they are incurred.

 

Forte Biosciences, Inc. v. Wesco Insurance Co., et al., Case No. N24C-10-015 VLM CCLD (Del. Super. Ct.)

 

On October 1, 2024, the Company filed a complaint (the “Wesco Complaint”), captioned Forte Biosciences, Inc. v. Wesco Insurance Co., et al., Case No. N24C-10-015 VLM CCLD, in the Superior Court of the State of Delaware, against its current and former carriers of Directors & Officers liability insurance, Wesco Insurance Company, Beazley Insurance Company, and Palms Insurance Company, Limited (collectively, “Insurance Defendants”). The Wesco Complaint brings claims for declaratory relief, breach of contract, and bad faith, alleging that the Insurance Defendants breached their contractual and legal obligations by refusing to acknowledge and perform their obligation to provide insurance coverage to the Company in connection with: (i) the action captioned Camac Fund, LP v. Paul A. Wagner, et al., C.A. No. 2023-0817-MTZ (Del. Ch.), described above; (ii) a books and records action brought by Camac in November 2022, which was captioned Camac Fund L.P. v. Forte Biosciences Inc., C.A. No. 2022-1075-NAC (Del. Ch.), described above; and (iii) two books demands for books and records under Delaware General Corporation Law Section 220, made by Camac on August 26, 2022 and August 23, 2023, respectively. The Complaint seeks a declaratory judgment that one or more of the Insurance Defendants have an obligation to provide insurance coverage to the Company and the named defendants in the referenced actions, reimbursement and compensatory damages from the Insurance Defendants for breach of contract, and consequential and punitive damages for the Insurance Defendants’ bad faith coverage positions.
v3.25.1
Equity
 12 Months Ended
Dec. 31, 2024
Equity [Abstract]  
Equity

7. Equity

Preferred Stock

The Company has 10 million authorized shares of Series A Preferred Stock, par value $0.001, with no shares outstanding as of December 31, 2024 and 2023.

Common Stock

On November 19, 2024, the Company issued 4,931,389 shares of the Company’s common stock at a purchase price of $5.552 per Share and 4,615,555 pre-funded warrants to purchase shares of common stock at a purchase price of $5.551 per pre-funded warrant ("2024 Private Placement") in connection with a Securities Purchase Agreement (the “ 2024 Purchase Agreement”). The pre-funded warrants have an exercise price of $0.001 per share of common stock, are immediately exercisable and remain exercisable until exercised in full. The holders of pre-funded warrants may not exercise a pre-funded warrant if the holder, together with its affiliates, would beneficially own more than 19.99% of the number of shares of common stock outstanding immediately after giving effect to such exercise. The holders of pre-funded warrants may increase or decrease such percentages not in excess of 19.99% by providing at least 61 days’ prior notice to the Company. In connection with the 2024 Private Placement, the Company filed a registration statement to register shares on Form S-3, which was declared effective on December 20, 2024. The gross proceeds of the 2024 Private Placement were $53.0 million and the Company incurred $3.4 million in issuance costs. Certain executive officers and senior management of the Company participated in this 2024 Private Placement, purchasing $475 thousand in shares of common stock at a purchase price of $5.552 per share.

In connection with, and as a condition to, the closing of the 2024 Private Placement, the Company has agreed to enter into letter agreements with two investors. Pursuant to the terms of the letter agreements, the Company has agreed that, during the period beginning ninety (90) days after the closing date of the 2024 Private Placement and ending on the three (3) year anniversary of the closing date of the 2024 Private Placement (or earlier upon investors failing to meet certain ownership thresholds), if the Company’s Common Stock trades within certain specified parameters for thirty (30) consecutive trading days, each of the investors shall be entitled to designate one individual to serve on the Board, in each case pursuant and subject to the terms of the applicable letter agreement and compliance with applicable Nasdaq and SEC regulations and the Board’s fiduciary duties under applicable law. In addition, for the duration of the applicable designation period, the Company shall also include such designee in the slate of nominees recommended by the Board for election at each annual or special meeting of the Company’s stockholders at which directors of such designee’s class are to be elected. The letter agreement also provides one investor a participation right in future offerings of the Company’s equity securities.

On July 31, 2023, the Company issued 606,678 shares of the Company’s common stock at a purchase price of $25.15 per Share and 387,566 pre-funded warrants to purchase shares of common stock at a purchase price of $25.13 per pre-funded warrant ("Private Placement") in connection with a Securities Purchase Agreement (the “Purchase Agreement”). The pre-funded warrants have an exercise price of $0.025 per share of common stock, are immediately exercisable and remain exercisable until exercised in full. The holders of pre-funded warrants may not exercise a pre-funded warrant if the holder, together with its affiliates, would beneficially own more than 9.99% of the number of shares of common stock outstanding immediately after giving effect to such exercise. The holders of pre-funded warrants may increase or decrease such percentages not in excess of 19.99% by providing at least 61 days’ prior notice to the Company. The Purchase Agreement also provides certain investors a participation right in future offerings of the Company’s equity securities. In connection with the Private Placement, the Company filed a registration statement to register shares on Form S-3 that was declared effective on September 8, 2023. The gross proceeds of the Private Placement were $25.0 million and the Company incurred $272 thousand in issuance costs. Certain executive officers, senior management, and board members of the Company participated in this Private Placement, purchasing $1.16 million in shares of common stock at a purchase price of $25.25 per share.

As of December 31, 2024, no pre-funded warrants were exercised and pre-funded warrants to purchase an aggregate of 5,003,121 shares of common stock remain outstanding. The 5,003,121 shares of common stock issuable upon the exercise of the pre-funded warrants is not included in the number of issued and outstanding shares of common stock as of December 31, 2024 and December 31, 2023.

In June 2021, the Company filed a shelf registration statement on Form S-3 that went effective in June 2021 to register the issuance of up to $300 million in securities. On March 31, 2022, the Company entered into an (“ATM Facility”) whereby the Company may from time to time offer and sell shares of its common stock up to an aggregate offering price of $25.0 million during the term of the ATM Facility. On April 1, 2022, the Company filed a prospectus supplement to the June 2021 Form S-3 relating to the offer and sale of the shares pursuant to the ATM Facility covering sales of up to $7.0 million of shares of common stock. On August 12, 2022, the Company filed an additional prospectus supplement relating to the offer and sale of shares pursuant to the ATM Facility covering sales of up to an additional $2.7 million of shares of common stock. However, this shelf registration statement on Form S-3 expired in June 2024, and the Company would need to file a new registration statement on Form S-3 to sell additional shares under the ATM Facility. The Company is not obligated to sell any shares under the ATM Facility. The ATM Facility may be terminated at any time upon ten days’ prior notice, or at any time in certain circumstances, including the occurrence of a material adverse effect on the Company. The Company has agreed to pay the sales agent a commission equal to 3.0% of the gross proceeds from the sales of shares under the ATM Facility and has agreed to provide the sales agent with customary indemnification and contribution rights. The Company issued 246 thousand shares of common stock for gross proceeds of approximately $7.7 million under the ATM Facility from July 1, 2022 through December 31, 2022 and incurred $595 thousand in issuance costs related to the ATM Facility and shelf registration statement. While the ATM Facility remains in place, the Company remains restricted in its ability to access additional funding from the sale of securities under Form S-3.

Warrants to purchase 176 shares of the Company’s common stock at an exercise price of $3,506.25 per share were issued pre-Merger and remain outstanding as of December 31, 2024 and December 31, 2023. These warrants have an expiration date of October 30, 2025. These warrants meet the criteria for equity classification and were recorded at fair value as of the grant date as a component of stockholders’ equity within additional paid-in capital.

Shares of common stock reserved for future issuance were as follows:

 

 

 

Shares

 

Pre-funded warrants outstanding

 

 

5,003,121

 

Stock options outstanding

 

 

212,501

 

Reserved for issuance under equity incentive plans

 

 

199,708

 

RSUs outstanding

 

 

28,537

 

Reserved for issuance under employee stock purchase plan

 

 

31,483

 

Warrants outstanding

 

 

176

 

Total

 

 

5,475,526

 

 

Rights Plan

On July 11, 2022, the Company authorized and declared a dividend distribution of one right (each, a “Right” and part of the "Rights Agreement") for each outstanding share of common stock of the Company to stockholders of record as of the close of business on July 21, 2022. Each Right entitled the registered holder to purchase from the Company four ten thousandths of a share of Series A Participating Preferred Stock, par value $0.001 per share (the “Preferred Stock”), of the Company at an exercise price of $400 per four ten thousandths of a share of Preferred Stock.

On June 26, 2023, the Company entered into Amendment No. 1 to the Rights Agreement which extended the expiration of the Rights to July 12, 2024.

On July 28, 2023, the Company entered into Amendment No. 2 to the Rights Agreement, which prevented the approval, execution, delivery or performance of the Purchase Agreement or the pre-funded warrants, or the consummation of any of the transactions contemplated by the Purchase Agreement or the pre-funded warrants, including any issuance of the Company's common stock pursuant to the terms of the Purchase Agreement or the pre-funded warrants, from, among other things, (i) causing or permitting the Rights to be exercised or exchanged, or (ii) causing any Purchaser or any of their respective affiliates to be deemed an Acquiring Person (as defined in the Rights Agreement) for any purpose under the Rights Agreement.

The Rights were determined to have no value upon issuance. The Rights expired on July 12, 2024.
v3.25.1
Stock-Based Compensation
 12 Months Ended
Dec. 31, 2024
Share-Based Payment Arrangement [Abstract]  
Stock-Based Compensation

8. Stock-Based Compensation

Equity Plans

The Company inherited the 2017 Equity Incentive Plan (the "2017 Plan") as part of its merger with Tocagen, Inc. in June 2020. The 2017 Plan was terminated in May 2021 and replaced by the 2021 Equity Incentive Plan (the “2021 Plan”). The 2017 Plan will continue to govern outstanding awards issued under the 2017 Plan. The 2021 Plan, as amended and restated most recently in August 2024, has an aggregate of 340,000 authorized shares.

The 2021 Plan provides for the grant of incentive stock options (“ISOs”), non-statutory stock options, stock appreciation rights, restricted stock awards, restricted stock unit awards, performance-based stock awards, other forms of equity compensation and performance cash awards. ISOs may be granted only to employees. All other awards may be granted to employees, including officers, and to non-employee directors and consultants of the Company and its affiliates. Service-based awards generally vested over a four-year period, with the first 25% of such awards vesting following twelve months of continued employment or service with the remaining awards vesting monthly in equal installments over the following thirty-six months. For certain service-based awards to the board of directors, vesting occurs in thirty-six equal monthly installments over a three-year period for initial grants and in twelve equal monthly installments over a twelve-month period for subsequent grants. As of December 31, 2024, there were 129,508 shares available for issuance under the 2021 Plan.

On July 26, 2020, the Company adopted the 2020 Inducement Equity Incentive Plan (the “2020 Inducement Plan”) and reserved 20,000 shares for future grant under the 2020 Inducement Plan. The 2020 Inducement Plan was amended on March 14, 2024 to increase the shares available for grant by an additional 60,000. As of December 31, 2024, there were 70,200 shares available for issuance under the 2020 Inducement Plan.

 

 

Stock Options

The risk-free interest rate assumption for stock options is based on the U.S. Treasury yield curve rate at the date of grant with a maturity approximating the expected term of the option.

All option awards generally expire ten years from the date of grant. The expected term assumption for options granted to employees is determined using the simplified method that represents the average of the contractual term of the option and the weighted average vesting period of the option. The Company uses the simplified method because it does not have sufficient historical option exercise data to provide a reasonable basis upon which to estimate expected term.

Due to the Company’s limited trading of its common stock, it does not have the relevant company-specific historical data to support its expected volatility. As such, the Company utilized a weighted approach by blending its own historical price data with the historical volatility of a group of similar companies in the life sciences industry whose shares are publicly traded. The Company selected the peer group based on comparable characteristics, including development stage, product pipeline, and market capitalization. The Company computes historical volatility data using the daily closing prices during the equivalent period of the calculated expected term of the stock-based awards.

The assumed dividend yield is based upon the Company’s expectation of not paying dividends in the foreseeable future. The fair value per share of common stock is the closing stock price on the option grant date.

The weighted average grant-date fair value of stock options granted in the years ended December 31, 2024 and 2023 was $14.25 and $16.41, respectively. The weighted-average assumptions used to value these stock options using the Black-Scholes option-pricing model were as follows.

 

 

 

Year ended
December 31, 2024

 

 

Year Ended December 31, 2023

 

Fair value of common stock

 

$

16.88

 

 

$

19.61

 

Risk-free interest rate

 

 

4.08

%

 

 

4.30

%

Dividend yield

 

 

0.00

%

 

 

0.00

%

Expected term of options (years)

 

 

5.98

 

 

 

5.62

 

Volatility

 

 

110.15

%

 

 

114.50

%

 

 

The table below summarizes the stock option activity during the year ended December 31, 2024:

 

 

 

Number of
Shares
Outstanding

 

 

Weighted-
Average
Exercise Price

 

 

Weighted-
Average
Remaining
Contractual
Term
(Years)

 

 

Aggregate
Intrinsic
Value (in thousands)

 

Balances at December 31, 2023

 

 

105,791

 

 

$

206.47

 

 

7.17

 

 

$

30

 

Granted

 

 

123,600

 

 

$

16.92

 

 

 

—

 

 

 

—

 

Exercised

 

 

—

 

 

 

—

 

 

 

—

 

 

 

—

 

Cancelled/Forfeited

 

 

(16,890

)

 

$

114.74

 

 

 

—

 

 

 

—

 

Balances at December 31, 2024

 

 

212,501

 

 

$

103.51

 

 

7.82

 

 

$

760

 

Vested and expected to vest at December 31, 2024

 

 

212,501

 

 

$

103.51

 

 

7.82

 

 

$

760

 

Exercisable at December 31, 2024

 

 

68,703

 

 

$

265.62

 

 

6.49

 

 

$

113

 

 

The aggregate intrinsic value of stock options as of December 31, 2024 is based on the Company’s closing stock price of $22.71 per share.

 

Restricted Stock Unit Awards

Restricted stock units vest over four years with one sixteenth of the restricted stock units vesting every quarter.

Restricted stock unit award transactions during the year ended December 31, 2024 were as follows:

 

 

 

 

 

 

Weighted Avg

 

 

 

 

 

 

Grant Date

 

 

 

Shares

 

 

Fair Value

 

Outstanding at December 31, 2023

 

 

42,237

 

 

$

 

34.22

 

Granted

 

 

—

 

 

$

 

—

 

Forfeited/Cancelled

 

 

(3,600

)

 

$

 

25.75

 

Issued as Common Stock

 

 

(10,100

)

 

$

 

25.13

 

Outstanding at December 31, 2024

 

 

28,537

 

 

$

 

38.50

 

The aggregate fair value of RSUs vested during the year ended December 31, 2024 was $146 thousand.

2017 Employee Stock Purchase Plan

In May 2021, the Company’s board of directors reactivated the Company’s 2017 Employee Stock Purchase Plan (“ESPP”) which had previously been suspended. The ESPP allows eligible employees to withhold up to 15% of their earnings to purchase shares of the Company’s common stock at a price per share equal to the lower of (i) 85% of the fair market value of a share of the Company’s common stock on the first date of an offering or (ii) 85% of the fair market value of a share of the Company’s common stock on the date of purchase. The Company had 31,483 shares available for future issuance under the ESPP as of December 31, 2024. The number of shares of common stock reserved for issuance will automatically increase on January 1 of each calendar year through January 1, 2027, by the lesser of (a) 1% of the total number of shares of the Company’s common stock outstanding on December 31 of the preceding calendar year, (b) 12,000 shares, or (c) a number determined by the Company’s board of directors that is less than (a) and (b). The Company issued 958 and 700 shares under the ESPP during the year ended December 31, 2024 and 2023, respectively. The ESPP is considered a compensatory plan. The Company recorded stock-based compensation expense related to its ESPP of $8 thousand and $12 thousand for the years ended December 31, 2024 and 2023, respectively.

 

 

The fair value of the rights granted to employees under the ESPP was estimated using a Black-Scholes option-pricing model with the following weighted-average valuation assumptions:

 

 

 

Year ended
December 31, 2024

 

 

Year Ended December 31, 2023

 

Fair value of common stock

 

$

16.34

 

 

$

26.17

 

Risk-free interest rate

 

 

5.32

%

 

 

5.20

%

Dividend yield

 

 

0.00

%

 

 

0.00

%

Expected term of options (years)

 

 

0.50

 

 

 

0.50

 

Volatility

 

 

72.58

%

 

 

119.32

%

 

Stock-Based Compensation Expense

Stock-based compensation expenses included in the Company’s consolidated statements of operations and comprehensive loss for the years ended December 31, 2024 and 2023 are as follows (in thousands):

 

 

 

 

 

 

 

Year Ended December 31,

 

 

 

2024

 

 

2023

 

Research and development

 

$

1,075

 

 

$

1,201

 

General and administrative

 

 

2,020

 

 

 

2,083

 

Total

 

$

3,095

 

 

$

3,284

 

 

As of December 31, 2024, there was unrecognized stock-based compensation expense of $2.6 million related to stock options and restricted stock units with service conditions, which is expected to be recognized over a weighted-average period of 2.72 years. Total unrecognized stock-based compensation as of December 31, 2024 was approximately $0.5 million related to restricted stock units with performance based vesting. The performance based conditions are tied to development milestones which have not been met.
v3.25.1
Income Taxes
 12 Months Ended
Dec. 31, 2024
Income Tax Disclosure [Abstract]  
Income Taxes

9. Income Taxes

The components of net loss before income taxes consisted of the following (in thousands):

 

 

Year Ended December 31,

 

 

2024

 

 

2023

 

United States

$

(30,905

)

 

$

(31,476

)

International

 

(4,573

)

 

 

-

 

Net loss before taxes

$

(35,478

)

 

$

(31,476

)

 

For the years ended December 31, 2024 and 2023, the Company did not record a current or deferred income tax expense or benefit due to a valuation allowance position.

The benefit for income taxes differs from the amount of income tax determined by applying the applicable U.S. statutory federal income tax rate to pretax income as a result of the following differences (in thousands):

 

 

 

Year Ended December 31,

 

 

 

2024

 

 

2023

 

Income tax expense (benefit) at federal statutory rate

 

$

(7,450

)

 

21.0

%

 

$

(6,610

)

 

21.0

%

Increase/(decrease) in tax resulting from:

 

 

 

 

 

 

 

 

 

 

State income taxes

 

 

—

 

 

0.0

%

 

 

—

 

 

0.0

%

Change in valuation allowance

 

 

6,441

 

 

-18.2

%

 

 

6,541

 

 

-20.8

%

Nondeductible R&D Expenses

 

 

921

 

 

-2.6

%

 

 

—

 

 

0.0

%

Stock-based compensation expense

 

 

90

 

 

-0.2

%

 

 

60

 

 

-0.2

%

Other

 

 

(2

)

 

0.0

%

 

 

9

 

 

0.0

%

Total

 

$

—

 

 

0.0

%

 

$

—

 

 

0.0

%

 

The primary components of temporary differences which give rise to the Company’s net deferred tax assets and liabilities as of December 31, 2024 and 2023 are as follows (in thousands):

 

 

Year Ended December 31,

 

 

2024

 

 

2023

 

Deferred tax assets:

 

 

 

 

 

Accrual to cash adjustment

$

499

 

 

$

433

 

Start-up costs

 

7,190

 

 

 

4,508

 

Patent costs

 

40

 

 

 

40

 

Stock-based compensation expense

 

1,432

 

 

 

1,627

 

Net operating loss

 

7,638

 

 

 

6,515

 

Capitalized R&D

 

6,813

 

 

 

4,940

 

Other deferred taxes

 

21

 

 

 

11

 

R&D credits

 

868

 

 

 

528

 

Total noncurrent deferred tax assets

 

24,501

 

 

 

18,602

 

Valuation Allowance

 

(24,501

)

 

 

(18,602

)

Net deferred tax assets after valuation allowance

$

—

 

 

$

—

 

 

Beginning January 1, 2022, the Tax Cuts and Jobs Act (the "Tax Act”) eliminated the option to deduct research and development expenditures in the current year and requires taxpayers to capitalize such expenses pursuant to Internal Revenue Code (“IRC”) Section 174. The capitalized expenses are amortized over a 5-year period for domestic expenses and a 15-year period for foreign expenses. As a result of this provision of the Tax Act, deferred tax assets related to capitalized research expenses increased by $1.9 million during the year ended December 31, 2024.

 

The Company has evaluated the positive and negative evidence bearing upon the realizability of its deferred tax assets. Based upon the Company’s history of operating losses, the Company has concluded that it is more likely than not that the benefit of its deferred tax assets will not be realized. Accordingly, the Company has provided a full valuation allowance for deferred tax assets as of

December 31, 2024 and 2023. During 2024 and 2023, the valuation allowance increased by $5.9 million and $6.4 million, respectively.

 

As of December 31, 2024, the Company has federal and California research and development tax credit carryforwards of $752 thousand and $617 thousand, respectively. The federal research and development tax credits begin to expire in 2041 unless previously utilized. The California credits do not expire.

 

Net operating losses and tax credit carryforwards as of December 31, 2024 are as follows (in thousands):

 

 

 

Amount

 

 

Expiration Years

Net operating losses, federal (Post December 31, 2017)

 

$

32,229

 

 

Do Not Expire

Net operating losses, federal (Pre January 1, 2018)

 

$

11

 

 

2037

Net operating losses, state

 

$

11,602

 

 

2037

Net operating losses, foreign

 

$

192

 

 

Indefinite

Tax credits, federal

 

$

752

 

 

2041

Tax credits, state

 

$

617

 

 

Indefinite

 

The Company is subject to taxation in the U.S. and California. As of December 31, 2024, Tocagen’s tax years beginning 2007 to date are subject to examination by federal and California taxing authorities due to the carry forward of unutilized net operating losses and research and development tax credits. To the extent the Company has tax attribute carryforwards, the tax years in which the attribute was generated may still be adjusted upon examination by the Internal Revenue Service or state tax authorities to the extent utilized in a future period.

 

Pursuant to Internal Revenue Code (IRC) Sections 382 and 383, annual use of a company’s net operating loss and tax credit carryforwards may be limited if there is a cumulative change in ownership of greater than 50% (by value) within a three-year period. The amount of the annual limitation is determined based on the value of the Company immediately prior to the ownership change. Subsequent ownership changes may further affect the limitation in future years. The Company has completed several equity offerings since its inception which may have resulted in a change in control as defined by Sections 382 and 383 of the IRC, or could result in a change in control in the future. The Company has not completed an IRC Section 382 and 383 analysis regarding the limitation of net operating loss and research and development credit carryforwards. Upon completion of such an analysis, there may be either increases or decreases to the reported amount of the deferred tax assets for net operating losses and federal and California research and development credits. Any change in the amount of the deferred tax assets would have a corresponding change in the valuation allowance, and therefore is not expected to impact the Company’s effective tax rate.

 

The Company recognizes a tax benefit from an uncertain tax position when it is more likely than not that the position will be sustained upon examination, including resolutions of any appeals or litigation processes. Income tax positions must meet a more likely than not recognition at the effective date to be recognized.

 

A reconciliation of the beginning and ending amount of unrecognized tax benefits for 2024 and 2023 is as following (in thousands):

 

 

Year Ended December 31,

 

 

2024

 

 

2023

 

Beginning Balance

$

251

 

 

$

157

 

Additions based on tax positions related to the current year

$

160

 

 

$

94

 

Ending Balance

$

411

 

 

$

251

 

 

The Company’s policy is to record interest and penalties relating to uncertain tax positions as a component of income tax expense should the Company believe there is an uncertain tax position liability. As of December 31, 2024, and 2023, there was no accrued interest or penalties for uncertain positions. Due to the existence of the valuation allowance, future changes in the Company’s unrecognized tax benefits will not impact the Company’s effective tax rate.
v3.25.1
Related Party Transactions
 12 Months Ended
Dec. 31, 2024
Related Party Transactions [Abstract]  
Related Party Transactions

10. Related Party Transactions

One of the Company’s board of directors received cash payments of $479 thousand for scientific consulting services during the year ended December 31, 2024. There was no consulting services provided in 2023.

On November 19, 2024, certain executive officers and senior management of the Company participated in the 2024 Private Placement, purchasing $475 thousand in shares of common stock at a purchase price of $5.552 per share.

On July 31, 2023, certain executive officers, senior management, and board members of the Company participated in the Private Placement, purchasing approximately $1.16 million in shares of common stock at a purchase price of $25.25 per share.
v3.25.1
Employee Benefit Plan
 12 Months Ended
Dec. 31, 2024
Retirement Benefits [Abstract]  
Employee Benefit Plan

11. Employee Benefit Plan

The Company has a defined-contribution 401(k) plan for employees. Under the terms of the plan, employees may make voluntary contributions as a percentage of compensation. The Company matches employee contributions as permitted by the plan. The Company's total cost related to the 401(k) plan was $138 thousand for the year ended December 31, 2024. The Company did not make contributions in 2023.
v3.25.1
Segment Information
 12 Months Ended
Dec. 31, 2024
Segment Reporting [Abstract]  
Segment Information

12. Segment Information

The Company operates in one operating segment, which includes all activities related to the discovery and development of FB102, for the purposes of assessing performance, making operating decisions, and allocating Company resources. The Company’s chief operating decision maker (CODM) is its chief executive officer, who considers net loss to evaluate overall expenses associated with conducting research and development activities, which includes evaluating the progress of ongoing clinical trials and the planning and execution of current and future research and development activities. Further, the CODM reviews and utilizes functional expenses (research and development and general and administrative) as reported in the statements of operations to manage the Company’s operations. Other segment items included in net loss are interest income and other expense, net. The measure of performance, significant expenses, and other items are each reflected in the statements of operations. In addition to the statements of operations, the CODM is regularly provided with forecasted expense information which is used to determine the Company’s liquidity needs. The CODM also monitors the cash, cash equivalents and short-term investments as reported on the Company’s consolidated balance sheets to determine funding for research and development activities. The measure of segment assets is reported on the consolidated balance sheets as total consolidated assets.
v3.25.1
Subsequent Events
 12 Months Ended
Dec. 31, 2024
Subsequent Events [Abstract]  
Subsequent Events

13. Subsequent Events

In January 2025, 185,732 of the pre-funded warrants issued in the 2023 Private Placement were exercised.
v3.25.1
Summary of Significant Accounting Policies (Policies)
 12 Months Ended
Dec. 31, 2024
Dec. 31, 2023
Accounting Policies [Abstract]    
Basis of Presentation

Basis of Presentation

The Company prepares its consolidated financial statements in accordance with accounting principles generally accepted in the United States of America (“GAAP”), as found in the Accounting Standards Codification (“ASC”), the Accounting Standards Update (“ASU”), of the Financial Accounting Standards Board (“FASB”), and the rules and regulations of the US Securities and Exchange Commission (“SEC”).

 
Principles of Consolidation

Principles of Consolidation

The consolidated financial statements include the accounts of the Company and its wholly-owned subsidiaries, Forte Subsidiary, Inc. and Forte Biosciences Australia Proprietary Limited. All intercompany accounts and transactions have been eliminated in the preparation of the consolidated financial statements.

  
Use of Estimates

Use of Estimates

The preparation of the Company’s consolidated financial statements requires management to make estimates and assumptions that impact the reported amounts of assets, liabilities, expenses and the disclosure of contingent assets and liabilities in the Company’s consolidated financial statements and accompanying notes. Significant management estimates that affect the reported amounts of assets, liabilities and expenses include stock-based compensation expense and accruals for clinical trials and drug manufacturing. Although these estimates are based on the Company’s knowledge of current events and actions it may undertake in the future, actual results may ultimately materially differ from these estimates and assumptions.

 
Cash and Cash Equivalents

Cash and cash equivalents

Cash and cash equivalents include cash in readily available operating accounts, U.S. treasury bills, money market funds and deposits with commercial banks. Cash equivalents are defined as short-term, highly liquid investments with maturities of 90 days or less from the date of purchase.

  
Available-for-Sale Securities

The Company’s available-for-sale securities consist of U.S. treasury bills. Securities with maturities from the date of purchase of 90 days or less are included in cash equivalents. The Company classifies its marketable securities as available-for-sale and records such assets at estimated fair value in the consolidated balance sheets, with unrealized gains and losses, if any, reported as a component of other comprehensive loss within the consolidated statements of operations and comprehensive loss and as a separate component of stockholders’ equity. Realized gains and losses are calculated on the specific identification method and recorded as interest income (loss).

Any premium arising at purchase is amortized to the earliest call date and any discount arising at purchase is accreted to maturity. Accretion of discounts are recorded in interest income in the consolidated statements of operations and comprehensive loss.

  
Fair Value of Financial Instruments

Fair Value of Financial Instruments

Fair value is defined as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. There is a three-level hierarchy that prioritizes the inputs used in determining fair value by their reliability and preferred use as follows:

•
Level 1 - Valuations based on quoted prices in active markets for identical assets or liabilities.
•
Level 2 – Valuations based on quoted prices in active markets for similar assets and liabilities, quoted prices for identical or similar assets or liabilities in inactive markets, or other inputs that are observable or can be corroborated by observable market data.
•
Level 3 – Valuations based on inputs that are both significant to the fair value measurements and are unobservable.

To the extent that a valuation is based on models or inputs that are less observable, or unobservable in the market, the determination of fair value requires more judgment. Accordingly, the degree of judgment exercised by the Company in determining fair value is greatest for instruments categorized within Level 3. A financial instrument’s level within the fair value hierarchy is based on the lowest level of any input that is significant to the fair value measurement.

There have been no significant changes to the valuation methods utilized by the Company during the periods presented. There have been no transfers between Level 1, Level 2, and Level 3 in any periods presented.

The carrying amounts of financial instruments consisting of cash and cash equivalents, accounts payable and accrued liabilities included in the Company’s financial statements are reasonable estimates of fair value, primarily due to their short maturities. Short-term investments are recorded at fair value, with any unrealized gains or losses reported as accumulated other comprehensive income or loss.

  
Property and Equipment

Property and Equipment, Net

Property and equipment are stated at cost less accumulated depreciation, subject to review for impairment. Property and equipment, net are depreciated over the estimated useful lives of the assets, generally three to five years, using the straight-line method.

 
Impairment of Property and Equipment  

Impairment of Property and Equipment

The Company reviews its property and equipment for impairment when events or changes in circumstances indicate the carrying value of the assets may not be recoverable. Recoverability is measured by comparing the book values of the assets to future net undiscounted cash flows that the assets or the asset groups are expected to generate. If such assets are considered impaired, the impairment to be recognized is measured by the amount the book value of the assets exceed their fair value, which is measured based on the estimated discounted future net cash flows arising from the assets or asset groups. No impairment losses on property and equipment have been recorded for the years ended December 31, 2024 or 2023.

Pre-Funded Warrants

Pre-Funded Warrants

Pre-funded warrants are accounted for as either derivative liabilities or as equity instruments depending on the specific terms of the agreement. The pre-funded warrants are equity-classified instruments that were recorded in additional paid-in capital at issuance and are not subject to remeasurement. The Company periodically evaluates changes in facts and circumstances that could impact the classification of warrants.

  
Research and Development Costs

Research and Development Costs

Research and development costs are expensed as incurred. Research and development costs consist primarily of salaries and benefits of research and development personnel, costs related to research activities, preclinical studies, clinical trials and drug manufacturing. Non-refundable advance payments for goods or services that will be used in future research and development activities are deferred and capitalized and are only expensed when the goods have been received or when the service has been performed rather than when the payment is made.

Drug manufacturing and clinical trial costs are a component of research and development expenses. The Company expenses costs for its drug manufacturing activities performed by Contract Manufacturing Organizations (“CMOs”), preclinical and clinical trial costs performed by Contract Research Organizations (“CROs”) and other service providers, as they are incurred, based upon estimates

of the work completed over the life of the individual task in accordance with associated agreements. The Company uses information it receives from internal personnel and outside service providers to estimate the percentage of completion and therefore the expense to be recognized.

Research and Development Tax Incentive

The Company is eligible to receive a cash refund from the Australian Taxation Office for eligible research and development (“R&D”) expenditures under the Australian R&D Tax Incentive Program (the “Australian Tax Incentive”). The Australian Tax Incentive is recognized as a reduction to R&D expense when the relevant expenditure has been incurred, the amount can be reliably measured and it is probable that the Australian Tax Incentive will be received. The Company has not recorded any reductions to R&D expense under the Australian tax incentive as it is not reasonably assured that the criteria have been met. The Company has not received any cash refunds under this program.

  
Patent Costs

Patent Costs

Costs related to filing and pursuing patent applications, including direct application fees and the legal and consulting expenses related to making such applications, are expensed as incurred, as recoverability of such expenditures is uncertain. These costs are included in general and administrative expenses within the consolidated statements of operations and comprehensive loss.

  
Comprehensive Loss

Comprehensive Loss

Comprehensive loss is defined as the change in equity during a period from transactions from non-owner sources. Other comprehensive loss includes unrealized gains on available-for-sale securities, which was the only difference between net loss and comprehensive loss for the applicable periods.

  
Net Loss Per Share

Net Loss Per Share

The Company’s net loss is equivalent to net loss attributable to common stockholders for all periods presented. Basic net loss per share is computed by dividing net loss applicable to common stockholders by the weighted average number of common shares, without consideration for common stock equivalents. The weighted average number of shares of common stock used in the basic and diluted net loss per share calculation include the pre-funded warrants outstanding during the period as they are exercisable at any time and their exercise requires only nominal consideration for the delivery of shares. As of December 31, 2024, no pre-funded warrants have been exercised and pre-funded warrants to purchase an aggregate of 5,003,121 shares of common stock were outstanding.

Diluted net loss per share is computed by dividing net loss by the weighted-average number of shares of common stock and common stock equivalents outstanding during the period in accordance with the treasury stock method. The following number of unexercised stock options, restricted stock units, warrants, and shares expected to be purchased under the ESPP, which are common stock equivalents, have been excluded from the diluted net loss calculation as their effect would have been anti-dilutive for the periods presented.

 

 

 

 

 

 

 

 

 

Year Ended December 31,

 

 

 

 

2024

 

 

2023

 

Options

 

 

 

212,501

 

 

 

105,791

 

Restricted stock units

 

 

 

28,537

 

 

 

42,237

 

Warrants

 

 

 

176

 

 

 

176

 

ESPP

 

 

 

66

 

 

 

73

 

Total

 

 

 

241,280

 

 

 

148,277

 
 
Stock-Based Compensation

Stock-Based Compensation

The Company issues stock-based awards to employees, directors and non-employees, generally in the form of stock options, restricted stock units or rights granted to employees under the Employee Stock Purchase Plan (“ESPP”). The Company accounts for stock-based compensation awards in accordance with ASC Topic 718, Compensation—Stock Compensation.

The Company measures compensation cost for all equity awards for employees, directors and non-employees at their grant-date fair value and recognizes compensation expense for service-based awards on a straight-line basis over the requisite service period,

which is generally the vesting period. The grant-date fair value of stock options is estimated using the Black-Scholes option pricing model. The grant-date fair value of restricted stock units is determined using the Company’s closing stock price on the date of grant. Forfeitures are recognized as they occur.

Stock-based compensation expense for an award with a performance condition is recognized when the achievement of the performance condition has been determined to be probable. If the outcome of such performance condition has not been determined to be probable, or has not been met, no compensation expense is recognized and any previously recognized compensation expense is reversed. For rights granted under the ESPP, the fair value of each purchase is estimated at the beginning of the offering period using the Black-Scholes option pricing model.

The Company classifies stock-based compensation expense in its statement of operations in the same manner in which the award recipient’s salary and related costs are classified in the case of employees, or in which the award recipient’s service payments are classified in the case of directors and non-employees.

  
Foreign Currency Transactions

Foreign Currency Transactions

Transaction gains and losses that arise from exchange rate fluctuations on transactions denominated in currencies other than the US dollar are recorded to other expenses, net in the consolidated statements of operations and comprehensive loss and were not material for the periods presented. The Company's subsidiaries use the U.S. dollar as their functional currency.

 
Income Taxes

Income Taxes

The Company uses an asset and liability approach to account for income taxes. The Company recognizes deferred tax assets and liabilities for the expected future tax consequences of temporary differences between the financial reporting and tax bases of assets and liabilities. These differences are measured using the enacted statutory tax rates that are expected to be in effect for the years in which differences are expected to reverse.

Valuation allowances are provided when the expected realization of deferred tax assets does not meet a “more likely than not” criterion. The Company makes estimates and judgments about its future taxable income that are based on assumptions that are consistent with its plans and estimates. Should the actual amounts differ from those estimates, the amount of the valuation allowance could be materially impacted. Changes in these estimates may result in significant increases or decreases to the Company’s tax provision in a period in which such estimates are changed, which in turn would affect net income or loss.

The Company recognizes tax benefits from uncertain tax positions if it believes the position is more likely than not to be sustained on examination by the taxing authorities based on the technical merits of the position. The Company makes adjustments to these reserves when facts and circumstances change, such as the closing of a tax audit or the refinement of an estimate. The provision for income taxes includes the effects of any reserves for tax positions that are not more likely than not to be sustained, as well as the related net interest and penalties.

Recently Adopted Accounting Standards

In November 2023, the FASB issued ASU No. 2023-07, Segment Reporting (Topic 280): Improvements to Reportable Segment Disclosures. The new standard is intended to improve annual and interim reportable segment disclosure requirements regardless of number of reporting units, primarily through enhanced disclosures of significant expenses. The amendment requires public entities to disclose significant segment expenses that are regularly provided to the CODM and included within each reported measure of segment profit and loss. The Company adopted this new standard for the annual period ended December 31, 2024 on a retrospective basis, and the adoption did not have a material impact on its consolidated financial statements and related disclosures. See Note 12, Segment Information, for the updated segment disclosures as a result of adopting this ASU.

In August 2020, the FASB issued ​ASU 2020-06​, ​Debt - Debt with Conversion and Other Options (Subtopic 470-20) and Derivatives and Hedging - Contracts in an Entity’s Own Equity (Subtopic 815-40)​. ​ASU 2020-06 eliminates the beneficial conversion and cash conversion accounting models for convertible instruments. It also amends the accounting for certain contracts in an entity’s own equity that are currently accounted for as derivatives because of specific settlement provisions. In addition, ASU 2020-06 modifies how particular convertible instruments and certain contracts that may be settled in cash or shares impact the diluted earnings per share computation. The amendments in ASU 2020-06 are effective for smaller reporting companies as defined by the SEC for fiscal years beginning after December 15, 2023, including interim periods within those fiscal years. The Company adopted ASU 2020-06 as of January 1, 2024, which did not have a material impact on the Company’s consolidated financial statements.

 
Recently Issued Accounting Standards Not Yet Adopted

Recently Issued Accounting Standards Not Yet Adopted

From time to time, new accounting pronouncements are issued by the FASB or other standard-setting bodies and adopted by us as of a specified effective date. Unless otherwise discussed, the Company believes that the impact of recently issued standards that are not yet effective will not have a material impact on the Company’s financial position or results of operations.

In December 2023, the FASB issued ASU No. 2023-09 Income Taxes (Topic 740): Improvements to Income Tax Disclosure. This ASU includes amendments that further enhance income tax disclosures, primarily through standardization and disaggregation of rate reconciliation categories and income taxes paid by jurisdiction. The ASU is effective for years beginning after December 15, 2024, but early adoption is permitted. This ASU should be applied on a prospective basis, although retrospective application is permitted. Management is currently evaluating the impact of the changes required by the new standard on the Company's consolidated financial statements and related disclosures.

In November 2024, the FASB issued ASU 2024-03, Income Statement—Reporting Comprehensive Income—Expense Disaggregation Disclosures, which requires disclosure of additional information about specific expense categories in the notes to the financial statements on an interim and annual basis. The standard is effective for fiscal years beginning after December 15, 2026, and for interim periods beginning after December 15, 2027, with early adoption permitted. The Company is currently evaluating the disclosure requirements related to this new standard.

  
v3.25.1
Summary of Significant Accounting Policies (Tables)
 12 Months Ended
Dec. 31, 2024
Accounting Policies [Abstract]  
Schedule of Common Stock Equivalents Excluded from Diluted Net Loss Calculation

 

 

 

 

 

 

 

 

 

Year Ended December 31,

 

 

 

 

2024

 

 

2023

 

Options

 

 

 

212,501

 

 

 

105,791

 

Restricted stock units

 

 

 

28,537

 

 

 

42,237

 

Warrants

 

 

 

176

 

 

 

176

 

ESPP

 

 

 

66

 

 

 

73

 

Total

 

 

 

241,280

 

 

 

148,277

 
v3.25.1
Balance Sheet Components (Tables)
 12 Months Ended
Dec. 31, 2024
Balance Sheet Related Disclosures [Abstract]  
Schedule of Prepaid Expenses and Other Current Assets

Prepaid expenses and other current assets as of December 31, 2024 and 2023 consist of the following (in thousands):

 

 

 

December 31, 2024

 

 

December 31, 2023

 

Prepaid professional fees

 

$

377

 

 

$

413

 

Prepaid insurance

 

 

286

 

 

 

318

 

Prepaid manufacturing and research expense

 

 

1,982

 

 

 

306

 

Other

 

 

336

 

 

 

165

 

Total Prepaid Expenses and Other Current Assets

 

$

2,981

 

 

$

1,202

 
Schedule of Property and Equipment

Property and equipment, net as of December 31, 2024 and 2023 consist of the following (in thousands):

 

 

December 31, 2024

 

 

December 31, 2023

 

 Equipment

 

$

107

 

 

$

100

 

 Furniture and Fixtures

 

 

18

 

 

 

18

 

 Property and equipment, at cost

 

 

125

 

 

 

118

 

 Less accumulated depreciation

 

 

(48

)

 

 

(9

)

Total Property and Equipment, net

 

$

77

 

 

$

109

 
Schedule of Other Assets

Other assets as of December 31, 2024 and 2023 consist of the following (in thousands):

 

 

 

December 31, 2024

 

 

December 31, 2023

 

Prepaid insurance

 

$

87

 

 

$

280

 

Prepaid professional fees

 

 

-

 

 

 

211

 

Other

 

 

51

 

 

 

53

 

Total Other Assets

 

$

138

 

 

$

544

 
Components of Accrued Liabilities

Accrued liabilities as of December 31, 2024 and 2023 consist of the following (in thousands):

 

 

 

December 31, 2024

 

 

December 31, 2023

 

 Accrued issuance costs

 

$

1,881

 

 

$

—

 

 Accrued manufacturing and clinical expenses

 

 

541

 

 

 

1,016

 

 Accrued compensation

 

 

1,551

 

 

 

947

 

 Accrued legal and professional fees

 

 

97

 

 

 

276

 

 Accrued other expenses

 

 

132

 

 

 

3

 

Total Accrued Liabilities

 

$

4,202

 

 

$

2,242

 
v3.25.1
Fair Value (Tables)
 12 Months Ended
Dec. 31, 2024
Fair Value Disclosures [Abstract]  
Schedule of Financial Assets Measured at Fair Value on a Recurring Basis

The following tables provide a summary of the assets that are measured at fair value on a recurring basis as of December 31, 2024 and December 31, 2023 (in thousands):

 

 

 

Fair Value Measurements as of
December 31, 2024

 

Cash, cash equivalents and short-term investments

 

Level 1

 

 

Level 2

 

 

Level 3

 

 

Total

 

Cash

 

$

1,464

 

 

$

—

 

 

$

—

 

 

$

1,464

 

Money Market Funds

 

 

20,780

 

 

 

-

 

 

 

-

 

 

 

20,780

 

U.S. Treasury Bills

 

 

-

 

 

 

36,121

 

 

 

-

 

 

 

36,121

 

Total

 

$

22,244

 

 

$

36,121

 

 

$

—

 

 

$

58,365

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Fair Value Measurements as of
December 31, 2023

 

Cash and cash equivalents

 

Level 1

 

 

Level 2

 

 

Level 3

 

 

Total

 

Cash

 

$

6,275

 

 

$

—

 

 

$

—

 

 

$

6,275

 

Money Market Funds

 

 

5,686

 

 

 

-

 

 

 

-

 

 

 

5,686

 

U.S. Treasury Bills

 

 

-

 

 

 

25,164

 

 

 

-

 

 

 

25,164

 

Total

 

$

11,961

 

 

$

25,164

 

 

$

—

 

 

$

37,125

 

 

Money market funds are valued at the closing price reported by the fund sponsor from an actively traded exchange. Money market funds and U.S. Treasury bills were included as cash and cash equivalents in the consolidated balance sheet as of December 31, 2023. The Company's U.S Treasury Bills are included in short-term investments as of December 31, 2024, due to an original maturity greater than 90 days. The Company obtains the fair value of its Level 2 cash equivalents from third-party pricing services. The pricing services utilize industry standard valuation models whereby all significant inputs, including benchmark yields, reported trades, broker/dealer quotes, issuer spreads, bids, offers, or other market-related data, are observable.

v3.25.1
Available-for-Sale Securities (Tables)
 12 Months Ended
Dec. 31, 2024
Investments, Debt and Equity Securities [Abstract]  
Summary of Available-for-Sale Securities

The following table summarizes the Company's available-for-sale securities as of December 31, 2024 and December 31, 2023 (in thousands).

 

 

 

December 31, 2024

 

 

 

 

 

 

Unrealized

 

 

 

 

Short-term investments

 

Amortized Cost

 

 

Gains

 

 

Losses

 

 

Estimated Fair Value

 

U.S. Treasury Bills

 

$

36,110

 

 

$

11

 

 

$

—

 

 

$

36,121

 

Total available-for-sale securities

 

$

36,110

 

 

$

11

 

 

$

—

 

 

$

36,121

 

 

 

 

 

December 31, 2023

 

 

 

 

 

 

Unrealized

 

 

 

 

Cash equivalents

 

Amortized Cost

 

 

Gains

 

 

Losses

 

 

Estimated Fair Value

 

U.S. Treasury Bills

 

$

25,160

 

 

$

4

 

 

$

—

 

 

$

25,164

 

Total available-for-sale securities

 

$

25,160

 

 

$

4

 

 

$

—

 

 

$

25,164

 
v3.25.1
Equity (Tables)
 12 Months Ended
Dec. 31, 2024
Equity [Abstract]  
Schedule of Common Stock Reserved for Future Issuance

Shares of common stock reserved for future issuance were as follows:

 

 

 

Shares

 

Pre-funded warrants outstanding

 

 

5,003,121

 

Stock options outstanding

 

 

212,501

 

Reserved for issuance under equity incentive plans

 

 

199,708

 

RSUs outstanding

 

 

28,537

 

Reserved for issuance under employee stock purchase plan

 

 

31,483

 

Warrants outstanding

 

 

176

 

Total

 

 

5,475,526

 
v3.25.1
Stock-Based Compensation (Tables)
 12 Months Ended
Dec. 31, 2024
Summary of Weighted-Average Assumptions Used to Value Stock Options The weighted-average assumptions used to value these stock options using the Black-Scholes option-pricing model were as follows.

 

 

 

Year ended
December 31, 2024

 

 

Year Ended December 31, 2023

 

Fair value of common stock

 

$

16.88

 

 

$

19.61

 

Risk-free interest rate

 

 

4.08

%

 

 

4.30

%

Dividend yield

 

 

0.00

%

 

 

0.00

%

Expected term of options (years)

 

 

5.98

 

 

 

5.62

 

Volatility

 

 

110.15

%

 

 

114.50

%
Summary of Stock Option Activity

The table below summarizes the stock option activity during the year ended December 31, 2024:

 

 

 

Number of
Shares
Outstanding

 

 

Weighted-
Average
Exercise Price

 

 

Weighted-
Average
Remaining
Contractual
Term
(Years)

 

 

Aggregate
Intrinsic
Value (in thousands)

 

Balances at December 31, 2023

 

 

105,791

 

 

$

206.47

 

 

7.17

 

 

$

30

 

Granted

 

 

123,600

 

 

$

16.92

 

 

 

—

 

 

 

—

 

Exercised

 

 

—

 

 

 

—

 

 

 

—

 

 

 

—

 

Cancelled/Forfeited

 

 

(16,890

)

 

$

114.74

 

 

 

—

 

 

 

—

 

Balances at December 31, 2024

 

 

212,501

 

 

$

103.51

 

 

7.82

 

 

$

760

 

Vested and expected to vest at December 31, 2024

 

 

212,501

 

 

$

103.51

 

 

7.82

 

 

$

760

 

Exercisable at December 31, 2024

 

 

68,703

 

 

$

265.62

 

 

6.49

 

 

$

113

 
Summary of Restricted Stock Unit Award Transactions

Restricted stock unit award transactions during the year ended December 31, 2024 were as follows:

 

 

 

 

 

 

Weighted Avg

 

 

 

 

 

 

Grant Date

 

 

 

Shares

 

 

Fair Value

 

Outstanding at December 31, 2023

 

 

42,237

 

 

$

 

34.22

 

Granted

 

 

—

 

 

$

 

—

 

Forfeited/Cancelled

 

 

(3,600

)

 

$

 

25.75

 

Issued as Common Stock

 

 

(10,100

)

 

$

 

25.13

 

Outstanding at December 31, 2024

 

 

28,537

 

 

$

 

38.50

 
Summary of Stock-Based Compensation Expenses

Stock-based compensation expenses included in the Company’s consolidated statements of operations and comprehensive loss for the years ended December 31, 2024 and 2023 are as follows (in thousands):

 

 

 

 

 

 

 

Year Ended December 31,

 

 

 

2024

 

 

2023

 

Research and development

 

$

1,075

 

 

$

1,201

 

General and administrative

 

 

2,020

 

 

 

2,083

 

Total

 

$

3,095

 

 

$

3,284

 
ESPP  
Summary of Weighted-Average Assumptions Used to Value Stock Options

The fair value of the rights granted to employees under the ESPP was estimated using a Black-Scholes option-pricing model with the following weighted-average valuation assumptions:

 

 

 

Year ended
December 31, 2024

 

 

Year Ended December 31, 2023

 

Fair value of common stock

 

$

16.34

 

 

$

26.17

 

Risk-free interest rate

 

 

5.32

%

 

 

5.20

%

Dividend yield

 

 

0.00

%

 

 

0.00

%

Expected term of options (years)

 

 

0.50

 

 

 

0.50

 

Volatility

 

 

72.58

%

 

 

119.32

%

 
v3.25.1
Income Taxes (Tables)
 12 Months Ended
Dec. 31, 2024
Income Tax Disclosure [Abstract]  
Components of Net Loss Before Income Taxes

The components of net loss before income taxes consisted of the following (in thousands):

 

 

Year Ended December 31,

 

 

2024

 

 

2023

 

United States

$

(30,905

)

 

$

(31,476

)

International

 

(4,573

)

 

 

-

 

Net loss before taxes

$

(35,478

)

 

$

(31,476

)
Summary of Reconciliations of Income Tax

The benefit for income taxes differs from the amount of income tax determined by applying the applicable U.S. statutory federal income tax rate to pretax income as a result of the following differences (in thousands):

 

 

 

Year Ended December 31,

 

 

 

2024

 

 

2023

 

Income tax expense (benefit) at federal statutory rate

 

$

(7,450

)

 

21.0

%

 

$

(6,610

)

 

21.0

%

Increase/(decrease) in tax resulting from:

 

 

 

 

 

 

 

 

 

 

State income taxes

 

 

—

 

 

0.0

%

 

 

—

 

 

0.0

%

Change in valuation allowance

 

 

6,441

 

 

-18.2

%

 

 

6,541

 

 

-20.8

%

Nondeductible R&D Expenses

 

 

921

 

 

-2.6

%

 

 

—

 

 

0.0

%

Stock-based compensation expense

 

 

90

 

 

-0.2

%

 

 

60

 

 

-0.2

%

Other

 

 

(2

)

 

0.0

%

 

 

9

 

 

0.0

%

Total

 

$

—

 

 

0.0

%

 

$

—

 

 

0.0

%
Components of Net Deferred Tax Assets and Liabilities

The primary components of temporary differences which give rise to the Company’s net deferred tax assets and liabilities as of December 31, 2024 and 2023 are as follows (in thousands):

 

 

Year Ended December 31,

 

 

2024

 

 

2023

 

Deferred tax assets:

 

 

 

 

 

Accrual to cash adjustment

$

499

 

 

$

433

 

Start-up costs

 

7,190

 

 

 

4,508

 

Patent costs

 

40

 

 

 

40

 

Stock-based compensation expense

 

1,432

 

 

 

1,627

 

Net operating loss

 

7,638

 

 

 

6,515

 

Capitalized R&D

 

6,813

 

 

 

4,940

 

Other deferred taxes

 

21

 

 

 

11

 

R&D credits

 

868

 

 

 

528

 

Total noncurrent deferred tax assets

 

24,501

 

 

 

18,602

 

Valuation Allowance

 

(24,501

)

 

 

(18,602

)

Net deferred tax assets after valuation allowance

$

—

 

 

$

—

 
Summary of Net Operating Losses and Tax Credit Carryforwards

Net operating losses and tax credit carryforwards as of December 31, 2024 are as follows (in thousands):

 

 

 

Amount

 

 

Expiration Years

Net operating losses, federal (Post December 31, 2017)

 

$

32,229

 

 

Do Not Expire

Net operating losses, federal (Pre January 1, 2018)

 

$

11

 

 

2037

Net operating losses, state

 

$

11,602

 

 

2037

Net operating losses, foreign

 

$

192

 

 

Indefinite

Tax credits, federal

 

$

752

 

 

2041

Tax credits, state

 

$

617

 

 

Indefinite
Summary of Reconciliation of Beginning and Ending Amount of Unrecognized Tax Benefits

A reconciliation of the beginning and ending amount of unrecognized tax benefits for 2024 and 2023 is as following (in thousands):

 

 

Year Ended December 31,

 

 

2024

 

 

2023

 

Beginning Balance

$

251

 

 

$

157

 

Additions based on tax positions related to the current year

$

160

 

 

$

94

 

Ending Balance

$

411

 

 

$

251

 
v3.25.1
Organization and Description of Business - Additional Information (Details)
$ in Thousands
 12 Months Ended
Aug. 27, 2024
Aug. 20, 2024
Dec. 31, 2024
USD ($)
Dec. 31, 2023
USD ($)
Collaborative Arrangement and Arrangement Other than Collaborative [Line Items]        
Accumulated deficit     $ 153,998 $ 118,520
Reverse stock split   reverse stock split of the issued common stock of the Company    
Reverse stock split ratio 0.04 0.04    
Cash and cash equivalents used in operating activities     (30,745) $ (28,706)
Cash, cash equivalents and short-term investments     $ 58,400  
Minimum        
Collaborative Arrangement and Arrangement Other than Collaborative [Line Items]        
Reverse stock split ratio   0.2    
Maximum        
Collaborative Arrangement and Arrangement Other than Collaborative [Line Items]        
Reverse stock split ratio   0.03    
v3.25.1
Summary of Significant Accounting Policies - Additional Information (Details) - USD ($)
 12 Months Ended
Dec. 31, 2024
Dec. 31, 2023
Schedule Of Significant Accounting Policies [Line Items]    
Transfers between fair value hierarchy levels $ 0  
Impairment losses on property and equipment $ 0 $ 0
Number of prefunded or common stock warrants exercised 0  
Accounting Standards, Adoption true  
Accounting Standards, Immaterial effect true  
Accounting Standards Update us-gaap:AccountingStandardsUpdate202006Member  
Accounting Standards, Adoption date Jan. 01, 2024  
Common Stock    
Schedule Of Significant Accounting Policies [Line Items]    
Warrants outstanding 5,003,121  
Minimum    
Schedule Of Significant Accounting Policies [Line Items]    
Estimated useful life of assets 3 years  
Maximum    
Schedule Of Significant Accounting Policies [Line Items]    
Estimated useful life of assets 5 years  
v3.25.1
Summary of Significant Accounting Policies - Schedule of Common Stock Equivalents Excluded from Diluted Net Loss Calculation (Details) - shares
 12 Months Ended
Dec. 31, 2024
Dec. 31, 2023
Dec. 31, 2022
Antidilutive Securities Excluded From Computation Of Earnings Per Share [Line Items]      
Anti-dilutive securities excluded from diluted net loss calculation   148,277 241,280
Options      
Antidilutive Securities Excluded From Computation Of Earnings Per Share [Line Items]      
Anti-dilutive securities excluded from diluted net loss calculation   105,791 212,501
Restricted Stock Units      
Antidilutive Securities Excluded From Computation Of Earnings Per Share [Line Items]      
Anti-dilutive securities excluded from diluted net loss calculation   42,237 28,537
Warrants      
Antidilutive Securities Excluded From Computation Of Earnings Per Share [Line Items]      
Anti-dilutive securities excluded from diluted net loss calculation   176 176
ESPP      
Antidilutive Securities Excluded From Computation Of Earnings Per Share [Line Items]      
Anti-dilutive securities excluded from diluted net loss calculation 66 73  
v3.25.1
Balance Sheet Components - Schedule of Prepaid Expenses and Other Current Assets (Details) - USD ($)
$ in Thousands
Dec. 31, 2024
Dec. 31, 2023
Balance Sheet Related Disclosures [Abstract]    
Prepaid professional fees $ 377 $ 413
Prepaid insurance 286 318
Prepaid manufacturing and research expense 1,982 306
Other 336 165
Total Prepaid Expenses and Other Current Assets $ 2,981 $ 1,202
v3.25.1
Balance Sheet Components - Schedule of Property and Equipment (Details) - USD ($)
$ in Thousands
Dec. 31, 2024
Dec. 31, 2023
Property, Plant and Equipment [Line Items]    
Property and equipment, at cost $ 125 $ 118
Less accumulated depreciation (48) (9)
Total Property and Equipment, net 77 109
Equipment    
Property, Plant and Equipment [Line Items]    
Property and equipment, at cost 107 100
Furniture and Fixtures    
Property, Plant and Equipment [Line Items]    
Property and equipment, at cost $ 18 $ 18
v3.25.1
Balance Sheet Components - Schedule of Other Assets (Details) - USD ($)
$ in Thousands
Dec. 31, 2024
Dec. 31, 2023
Balance Sheet Related Disclosures [Abstract]    
Prepaid insurance $ 87 $ 280
Prepaid professional fees 0 211
Other 51 53
Total Other Assets $ 138 $ 544
v3.25.1
Balance Sheet Components - Components of Accrued Liabilities (Details) - USD ($)
$ in Thousands
Dec. 31, 2024
Dec. 31, 2023
Balance Sheet Related Disclosures [Abstract]    
Accrued issuance costs $ 1,881  
Accrued manufacturing and clinical expenses 541 $ 1,016
Accrued compensation 1,551 947
Accrued legal and professional fees 97 276
Accrued other expenses 132 3
Total Accrued Liabilities $ 4,202 $ 2,242
v3.25.1
Fair Value - Schedule of Financial Assets Measured at Fair Value on a Recurring Basis (Details) - Recurring - USD ($)
$ in Thousands
Dec. 31, 2024
Dec. 31, 2023
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]    
Total $ 58,365 $ 37,125
U.S. Treasury Bills    
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]    
Total 36,121 25,164
Money Market Funds    
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]    
Total 20,780 5,686
Cash    
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]    
Total 1,464 6,275
Level 1    
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]    
Total 22,244 11,961
Level 1 | Money Market Funds    
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]    
Total 20,780 5,686
Level 1 | Cash    
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]    
Total 1,464 6,275
Level 2    
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]    
Total 36,121 25,164
Level 2 | U.S. Treasury Bills    
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]    
Total $ 36,121 $ 25,164
v3.25.1
Available-for-Sale Securities - Schedule of Available-for-Sale Securities (Details) - USD ($)
$ in Thousands
Dec. 31, 2024
Dec. 31, 2023
Debt Securities, Available-for-Sale [Line Items]    
Investment, Type [Extensible Enumeration] us-gaap:ShortTermInvestmentsMember us-gaap:CashEquivalentsMember
Available-for-sale securities, Amortized Cost $ 36,110 $ 25,160
Available-for-sale securities, Unrealized Gains 11 4
Available-for-sale securities, Estimated Fair Value $ 36,121 $ 25,164
U.S. Treasury Bills    
Debt Securities, Available-for-Sale [Line Items]    
Investment, Type [Extensible Enumeration] us-gaap:ShortTermInvestmentsMember us-gaap:CashEquivalentsMember
Available-for-sale securities, Amortized Cost $ 36,110 $ 25,160
Available-for-sale securities, Unrealized Gains 11 4
Available-for-sale securities, Estimated Fair Value $ 36,121 $ 25,164
v3.25.1
Commitments and Contingencies - Additional Information (Details) - USD ($)
$ in Thousands
 1 Months Ended 12 Months Ended
Oct. 01, 2024
Sep. 20, 2024
Oct. 28, 2023
Aug. 10, 2023
Jul. 31, 2023
Jun. 30, 2024
Dec. 31, 2024
Dec. 31, 2023
Commitments And Contingencies [Line Items]                
FDIC insured amount             $ 250  
Rent expenses             300 $ 129
Complaint filed, date Oct. 01, 2024   Oct. 28, 2023 Aug. 10, 2023        
Contractual obligation             7,200  
Payments for legal settlements   $ 364         364  
Claim payment           $ 650    
Accrued estimated legal fees             $ 1,700  
Loss contingency, damages sought, value   $ 1,500            
Name of plaintiff Forte Biosciences   Forte Biosciences Camac Fund LP        
Name of defendant Wesco Insurance Co.   Camac Fund, LP members of the Company's Board of Directors (the "Directors") and entities affiliated with certain of the Company’s investors (the “Investors”) and naming the Company as nominal defendant.        
Gross proceeds of private placement         $ 25,000      
v3.25.1
Equity - Additional Information (Details)
$ / shares in Units, $ in Thousands
 6 Months Ended
Nov. 19, 2024
USD ($)
Days
$ / shares
shares
Jul. 31, 2023
USD ($)
$ / shares
shares
Aug. 12, 2022
USD ($)
Jul. 11, 2022
Right
$ / shares
shares
Apr. 01, 2022
USD ($)
Mar. 31, 2022
USD ($)
Dec. 31, 2022
USD ($)
shares
Dec. 31, 2024
$ / shares
shares
Dec. 31, 2023
$ / shares
shares
Jun. 26, 2023
Jun. 30, 2021
USD ($)
Jun. 16, 2020
shares
Class Of Stock [Line Items]                        
Gross proceeds of private placement   $ 25,000                    
Warrants expiration date               Jul. 12, 2024   Jul. 12, 2024    
Number of prefunded warrants exercised | shares               0        
2024 Private Placement                        
Class Of Stock [Line Items]                        
Issuance of stock closing date 90 days                      
Issuance of stock threshold period 3 years                      
Common stock threshold consecutive trading day period | Days 30                      
At The Market Equity Offering Program                        
Class Of Stock [Line Items]                        
Gross proceeds from issuance of common stock           $ 25,000            
Percentage of sales commission           3.00%            
O 2022 Q2 Dividends [Member]                        
Class Of Stock [Line Items]                        
Dividend payable, date of record       Jul. 21, 2022                
Maximum | At The Market Equity Offering Program                        
Class Of Stock [Line Items]                        
Gross proceeds from issuance of common stock         $ 7,000              
New issuance of common stock     $ 2,700                  
Maximum | Shelf Registration                        
Class Of Stock [Line Items]                        
Issuance in securities                     $ 300,000  
Certain Executive Officers and Senior Management | 2024 Private Placement                        
Class Of Stock [Line Items]                        
Private placement purchasing amount $ 475                      
Shares price, per share | $ / shares $ 5.552                      
Certain Executive Officers, Senior Management and Board Members | Private Placement                        
Class Of Stock [Line Items]                        
Private placement purchasing amount   $ 1,160                    
Shares price, per share | $ / shares   $ 25.25                    
Common Stock                        
Class Of Stock [Line Items]                        
Common stock issued, shares | shares 4,931,389 606,678                    
Warrants to purchase common stock | shares                       176
Common stock exercise price | $ / shares               $ 3,506.25 $ 3,506.25      
Warrant ownership limit 19.99% 9.99%                    
Warrant ownership increase or decrease limit 19.99% 19.99%                    
Warrant notice limit 61 days 61 days                    
Warrants expiration date                       Oct. 30, 2025
Warrants outstanding | shares               5,003,121        
Dividend distribution, number of right for each share | Right       1                
Common Stock | 2024 Private Placement                        
Class Of Stock [Line Items]                        
Gross proceeds of private placement $ 53,000                      
Offering costs $ 3,400                      
Common Stock | Private Placement                        
Class Of Stock [Line Items]                        
Gross proceeds of private placement   $ 25,000                    
Offering costs   $ 272                    
Common Stock | At The Market Equity Offering Program                        
Class Of Stock [Line Items]                        
Common stock issued, shares | shares             246,000          
Gross proceeds from issuance of common stock             $ 7,700          
Offering costs             $ 595          
Common Stock | Certain Executive Officers and Senior Management | 2024 Private Placement                        
Class Of Stock [Line Items]                        
Shares price, per share | $ / shares $ 5.552                      
Common Stock | Certain Executive Officers, Senior Management and Board Members | Private Placement                        
Class Of Stock [Line Items]                        
Shares price, per share | $ / shares   $ 25.25                    
Common Stock | Pre funded warrants                        
Class Of Stock [Line Items]                        
Warrants to purchase common stock | shares               5,003,121 5,003,121      
Common stock exercise price | $ / shares 0.001 0.025                    
Shares price, per share | $ / shares $ 5.552 $ 25.15                    
Common Stock | Pre funded warrants | 2024 Private Placement                        
Class Of Stock [Line Items]                        
Warrants to purchase common stock | shares 4,615,555                      
Shares price, per share | $ / shares $ 5.551                      
Common Stock | Pre funded warrants | Private Placement                        
Class Of Stock [Line Items]                        
Warrants to purchase common stock | shares   387,566                    
Shares price, per share | $ / shares   $ 25.13                    
Series A Preferred Stock                        
Class Of Stock [Line Items]                        
Preferred stock authorized, shares | shares               10,000,000 10,000,000      
Preferred stock per share | $ / shares               $ 0.001 $ 0.001      
Preferred stock outstanding, shares | shares               0 0      
Series A Participating Preferred Stock                        
Class Of Stock [Line Items]                        
Preferred stock per share | $ / shares       $ 0.001                
Common stock exercise price | $ / shares       $ 400                
Dividend distribution, each right entitled to purchase shares | shares       0.004                
v3.25.1
Equity - Schedule of Common Stock Reserved for Future Issuance (Details)
Dec. 31, 2024
shares
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items]  
Total common stock reserved for future issuance 5,475,526
Stock Options Outstanding  
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items]  
Total common stock reserved for future issuance 212,501
Equity Incentive Plan  
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items]  
Total common stock reserved for future issuance 199,708
Restricted Stock Units (RSUs)  
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items]  
Total common stock reserved for future issuance 28,537
Employee Stock Purchase Plan  
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items]  
Total common stock reserved for future issuance 31,483
Pre funded warrants  
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items]  
Total common stock reserved for future issuance 5,003,121
Warrants Outstanding  
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items]  
Total common stock reserved for future issuance 176
v3.25.1
Stock-Based Compensation - Additional Information (Details) - USD ($)
$ / shares in Units, $ in Thousands
 1 Months Ended 12 Months Ended
May 31, 2021
Dec. 31, 2024
Dec. 31, 2023
Aug. 31, 2024
Mar. 14, 2024
Jul. 26, 2020
Share Based Compensation Arrangement by Share Based Payment Award [Line Items]            
Weighted average grant-date fair value of stock options granted   $ 14.25 $ 16.41      
Fair value of stock price   $ 22.71        
Stock-based compensation expense   $ 3,095 $ 3,284      
Shares available for future issuance   5,475,526        
Unrecognized compensation expense   $ 2,600        
Weighted-average period over which unrecognized compensation expense is expected to be recognized   2 years 8 months 19 days        
Options            
Share Based Compensation Arrangement by Share Based Payment Award [Line Items]            
Expiration years from the date of grant   10 years        
Restricted Stock Units (RSUs)            
Share Based Compensation Arrangement by Share Based Payment Award [Line Items]            
Aggregate fair value of restricted stock units vested   $ 146        
Shares available for future issuance   28,537        
Performance Stock Options and Restricted Stock Awards            
Share Based Compensation Arrangement by Share Based Payment Award [Line Items]            
Unrecognized compensation expense   $ 500        
2020 Inducement Equity Incentive Plan            
Share Based Compensation Arrangement by Share Based Payment Award [Line Items]            
Shares reserved for future grant           20,000
Shares available for issuance   70,200   340,000    
2021 Equity Incentive Plan            
Share Based Compensation Arrangement by Share Based Payment Award [Line Items]            
Service-based awards, vesting period 4 years          
Service-based awards vesting description   vested over a four-year period, with the first 25% of such awards vesting following twelve months of continued employment or service with the remaining awards vesting monthly in equal installments over the following thirty-six months.        
Shares available for issuance   129,508        
Additional shares available for grant         60,000  
2021 Equity Incentive Plan | Following Twelve Months of Service            
Share Based Compensation Arrangement by Share Based Payment Award [Line Items]            
Service-based awards vesting percentage 25.00%          
2021 Equity Incentive Plan | Board of Directors            
Share Based Compensation Arrangement by Share Based Payment Award [Line Items]            
Service-based awards, vesting period 3 years 12 months        
Service-based awards vesting description   vesting occurs in thirty-six equal monthly installments over a three-year period for initial grants and in twelve equal monthly installments over a twelve-month period for subsequent grants.        
2017 Employee Stock Purchase Plan            
Share Based Compensation Arrangement by Share Based Payment Award [Line Items]            
Stock-based compensation expense   $ 8 $ 12      
Eligible employees withhold percentage of earnings to purchase shares of common stock 15.00%          
Shares available for future issuance   31,483        
Shares reserved for issuance increase percentage of total number of shares of common stock outstanding 1.00%          
Shares Issued under plan   958 700      
2017 Employee Stock Purchase Plan | Maximum            
Share Based Compensation Arrangement by Share Based Payment Award [Line Items]            
Number of shares of common stock reserved for issuance increase on of each calendar year 12,000          
2017 Employee Stock Purchase Plan | On First Date of Offering | Maximum            
Share Based Compensation Arrangement by Share Based Payment Award [Line Items]            
Percentage of fair market value of share of common stock to purchase 85.00%          
2017 Employee Stock Purchase Plan | On Date of Purchase | Maximum            
Share Based Compensation Arrangement by Share Based Payment Award [Line Items]            
Percentage of fair market value of share of common stock to purchase 85.00%          
v3.25.1
Stock-Based Compensation - Summary of Weighted-Average Assumptions Used to Value Stock Options (Details) - $ / shares
 12 Months Ended
Dec. 31, 2024
Dec. 31, 2023
Share Based Compensation Arrangement by Share Based Payment Award [Line Items]    
Fair value of common stock $ 16.88 $ 19.61
Risk-free interest rate 4.08% 4.30%
Dividend yield 0.00% 0.00%
Expected term of options (years) 5 years 11 months 23 days 5 years 7 months 13 days
Volatility 110.15% 114.50%
ESPP    
Share Based Compensation Arrangement by Share Based Payment Award [Line Items]    
Fair value of common stock $ 16.34 $ 26.17
Risk-free interest rate 5.32% 5.20%
Dividend yield 0.00% 0.00%
Expected term of options (years) 6 months 6 months
Volatility 72.58% 119.32%
v3.25.1
Stock-Based Compensation - Summary of Stock Option Activity (Details) - USD ($)
$ / shares in Units, $ in Thousands
 12 Months Ended
Dec. 31, 2024
Dec. 31, 2023
Number of Shares Outstanding    
Outstanding, Beginning 105,791  
Granted 123,600  
Cancelled/Forfeited (16,890)  
Outstanding, Ending 212,501 105,791
Vested and expected to vest 212,501  
Exercisable 68,703  
Weighted-Average Exercise Price    
Outstanding, Beginning $ 206.47  
Granted 16.92  
Cancelled/Forfeited 114.74  
Outstanding, Ending 103.51 $ 206.47
Vested and expected to vest 103.51  
Exercisable $ 265.62  
Weighted-Average Remaining Contractual Term (Years)    
Outstanding 7 years 9 months 25 days 7 years 2 months 1 day
Vested and expected to vest 7 years 9 months 25 days  
Exercisable 6 years 5 months 26 days  
Aggregate Intrinsic Value    
Outstanding $ 760 $ 30
Vested and expected to vest 760  
Exercisable $ 113  
v3.25.1
Stock-Based Compensation - Summary of Restricted Stock Unit Award Transactions (Details) - Restricted Stock Unit Awards
 12 Months Ended
Dec. 31, 2024
$ / shares
shares
Shares  
Outstanding at December 31, 2022 42,237
Granted 0
Forfeited/Cancelled (3,600)
Issued as Common Stock (10,100)
Outstanding at December 31, 2023 28,537
Weighted Avg Grant Date Fair Value  
Outstanding at December 31, 2022 | $ / shares $ 34.22
Granted | $ / shares 0
Forfeited/Cancelled | $ / shares $ 25.75
Issued as Common Stock 25.13
Outstanding at December 31, 2023 | $ / shares $ 38.5
v3.25.1
Stock-Based Compensation - Summary of Stock-Based Compensation Expenses (Details) - USD ($)
$ in Thousands
 12 Months Ended
Dec. 31, 2024
Dec. 31, 2023
Share Based Compensation Arrangement by Share Based Payment Award [Line Items]    
Stock-based compensation expense $ 3,095 $ 3,284
Research and Development    
Share Based Compensation Arrangement by Share Based Payment Award [Line Items]    
Stock-based compensation expense 1,075 1,201
General and Administrative    
Share Based Compensation Arrangement by Share Based Payment Award [Line Items]    
Stock-based compensation expense $ 2,020 $ 2,083
v3.25.1
Income Taxes - Components of Net Loss Before Income Taxes (Details) - USD ($)
$ in Thousands
 12 Months Ended
Dec. 31, 2024
Dec. 31, 2023
Income Tax Disclosure [Abstract]    
United States $ (30,905) $ (31,476)
International (4,573)  
Net loss before taxes $ (35,478) $ (31,476)
v3.25.1
Income Taxes - Additional Information (Details) - USD ($)
 12 Months Ended
Dec. 31, 2024
Dec. 31, 2023
Income Tax Disclosure [Line Items]    
Current income tax expense (benefit) $ 0 $ 0
Deferred income tax expense (benefit) $ 0 0
Amortization period of domestic expenses capitalized 5 years  
Amortization period of foreign expenses capitalized 15 years  
Increase in deferred tax assets related to capitalized research expenses over year $ 1,900,000  
Valuation allowance increase (decrease), amount $ 5,900,000 6,400,000
Cumulative change in ownership percentage 50.00%  
Period for cumulative change in ownership 3 years  
Accruals interest for uncertain tax position $ 0 0
Penalties for uncertain tax positions 0 $ 0
Federal | Research and Development    
Income Tax Disclosure [Line Items]    
Tax credit carryforward $ 752,000  
Tax credit carryforward expiration year 2041  
State | Research and Development    
Income Tax Disclosure [Line Items]    
Tax credit carryforward $ 617,000  
v3.25.1
Income Taxes - Summary of Reconciliations of Income Tax (Details) - USD ($)
$ in Thousands
 12 Months Ended
Dec. 31, 2024
Dec. 31, 2023
Income Tax Disclosure [Abstract]    
Income tax expense (benefit) at federal statutory rate $ (7,450) $ (6,610)
Increase/(decrease) in tax resulting from:    
Change in valuation allowance 6,441 6,541
Nondeductible R&D Expenses 921  
Stock-based compensation expense 90 60
Other $ (2) $ 9
Income tax benefit at federal statutory rate 21.00% 21.00%
Increase/(decrease) in tax resulting from:    
State income taxes 0.00% 0.00%
Change in valuation allowance (18.20%) (20.80%)
Nondeductible R&D Expenses (2.60%) 0.00%
Stock-based compensation expense (0.20%) (0.20%)
Other 0.00% 0.00%
Total 0.00% 0.00%
v3.25.1
Income Taxes - Components of Net Deferred Tax Assets and Liabilities (Details) - USD ($)
$ in Thousands
Dec. 31, 2024
Dec. 31, 2023
Deferred tax assets:    
Accrual to cash adjustment $ 499 $ 433
Start-up costs 7,190 4,508
Patent costs 40 40
Stock-based compensation expense 1,432 1,627
Net operating loss 7,638 6,515
Capitalized R&D 6,813 4,940
Other Deferred Taxes 21 11
R&D Credits 868 528
Total noncurrent deferred tax assets 24,501 18,602
Valuation Allowance $ (24,501) $ (18,602)
v3.25.1
Income Taxes - Summary of Net Operating Losses and Tax Credit Carryforwards (Details)
$ in Thousands
 12 Months Ended
Dec. 31, 2024
USD ($)
Federal  
Operating Loss Carryforwards [Line Items]  
Net operating loss carryforwards expiration year 2041
Tax credit carryforward $ 752
Federal | Post December 31, 2017  
Operating Loss Carryforwards [Line Items]  
Net operating loss carryforwards 32,229
Federal | Pre January 1, 2018  
Operating Loss Carryforwards [Line Items]  
Net operating loss carryforwards $ 11
Net operating loss carryforwards expiration year 2037
State  
Operating Loss Carryforwards [Line Items]  
Net operating loss carryforwards $ 11,602
Net operating loss carryforwards expiration year 2037
Tax credit carryforward $ 617
Foreign  
Operating Loss Carryforwards [Line Items]  
Net operating loss carryforwards $ 192
v3.25.1
Income Taxes - Summary of Reconciliation of Beginning and Ending Amount of Unrecognized Tax Benefits (Details) - USD ($)
$ in Thousands
 12 Months Ended
Dec. 31, 2024
Dec. 31, 2023
Income Tax Disclosure [Abstract]    
Beginning Balance $ 251 $ 157
Additions based on tax positions related to the current year 160 94
Ending Balance $ 411 $ 251
v3.25.1
Related Party Transactions - Additional Information (Details) - USD ($)
 12 Months Ended
Nov. 19, 2024
Jul. 31, 2023
Dec. 31, 2024
Dec. 31, 2023
Related Party Transaction [Line Items]        
Payments for scientific consulting services     $ 479,000 $ 0
Certain Executive Officers and Senior Management | 2024 Private Placement        
Related Party Transaction [Line Items]        
Private placement purchasing amount $ 475,000      
Shares price, per share $ 5.552      
Certain Executive Officers, Senior Management and Board Members | Private Placement        
Related Party Transaction [Line Items]        
Private placement purchasing amount   $ 1,160,000    
Shares price, per share   $ 25.25    
v3.25.1
Employee Benefit Plan - Additional Information (Details)
$ in Thousands
 12 Months Ended
Dec. 31, 2024
USD ($)
Retirement Benefits [Abstract]  
Total cost related to the 401(k) plan $ 138
v3.25.1
Segment Information - Additional Information (Details)
 12 Months Ended
Dec. 31, 2024
Segment
Segment Reporting [Abstract]  
Number of operating segment 1
Segment reporting, CODM, individual title and position or group name srt:ChiefExecutiveOfficerMember
Segment reporting, expense information used by CODM, description Further, the CODM reviews and utilizes functional expenses (research and development and general and administrative) as reported in the statements of operations to manage the Company’s operations. Other segment items included in net loss are interest income and other expense, net. The measure of performance, significant expenses, and other items are each reflected in the statements of operations. In addition to the statements of operations, the CODM is regularly provided with forecasted expense information which is used to determine the Company’s liquidity needs
v3.25.1
Subsequent Events - Additional Information (Details)
 1 Months Ended
Jan. 31, 2025
shares
Subsequent Event | Pre funded warrants | 2023 Private Placement  
Subsequent Event [Line Items]  
Warrants exercised 185,732