NKGen Biotech Reports Significant Net Loss and Working Capital Deficit in Q2 2024

NKGen Biotech, Inc. reported significant financial developments in its 10-Q filing for the quarter ending June 30, 2024. The company experienced a net loss of $16.1 million for the three months ended June 30, 2024, a 105% increase from a net loss of $7.8 million in the same period of 2023. For the six months ended June 30, 2024, the net loss was $21.5 million, compared to $16.2 million for the same period in 2023, reflecting a 33% increase. The net loss per share for Q2 2024 was $(0.67), up from $(0.59) in Q2 2023.

Total expenses for the three months ended June 30, 2024, were $7.5 million, a 13% increase from $6.6 million in Q2 2023. Research and development expenses decreased by 24% to $3.1 million, while general and administrative expenses surged by 71% to $4.4 million, primarily due to increased professional fees and personnel costs. For the six months ended June 30, 2024, total expenses rose to $15.1 million, a 12% increase from $13.4 million in the prior year.

As of June 30, 2024, NKGen reported cash and cash equivalents of $79,000, up from $26,000 at the end of 2023. However, total current assets decreased from $1.9 million to $1.2 million, while total current liabilities increased from $39.5 million to $51.4 million, leading to a working capital deficit of approximately $50.2 million. The total stockholders’ deficit also widened from $(58.7 million) to $(69.7 million).

The company has been actively seeking additional capital to support its operations, primarily through various financing methods, including senior convertible promissory notes and related party loans. Proceeds from the issuance of convertible promissory notes totaled $8.9 million for the six months ended June 30, 2024, compared to $4.8 million in the same period of 2023. The company has expressed substantial doubt about its ability to continue as a going concern, indicating that it may need to reduce spending or cease operations if adequate funding is not secured.

Strategically, NKGen completed a business combination on September 29, 2023, which involved the conversion of legacy equity into the company's common stock. The company has also received FDA IND clearances for its product candidates, SNK01 and SNK02, aimed at treating neurodegenerative diseases and cancer, respectively. Despite these advancements, NKGen anticipates continued operating losses and significant expenses related to ongoing clinical trials and research and development activities.