Sutro Biopharma, Inc. reported its financial results for the third quarter and the nine months ended September 30, 2024, revealing significant changes in revenue, expenses, and overall financial health compared to the previous fiscal period.

For the three months ended September 30, 2024, Sutro generated revenue of $8.5 million, a substantial decrease of 50% from $16.9 million in the same period of 2023. This decline was primarily attributed to reduced collaboration revenue from partners such as Tasly and Astellas, alongside decreased contributions from Vaxcyte and other collaborations. In contrast, revenue for the nine months ended September 30, 2024, increased by 18% to $47.2 million, up from $40.0 million in the prior year, largely driven by a cumulative catch-up adjustment of $17.8 million related to the Astellas Agreement.

Total operating expenses for the third quarter rose to $76.4 million, a 25% increase from $60.9 million in the prior year, reflecting higher research and development costs, which surged by 36% to $62.1 million. This increase was due to escalated external services, clinical development expenses, and personnel-related costs. Consequently, the loss from operations for the third quarter widened to $67.9 million, compared to $44.0 million in the same period last year. The net loss for the quarter was $48.8 million, slightly improved from $49.3 million in 2023.

For the nine-month period, Sutro reported a net loss of $155.0 million, up from $137.9 million in the previous year, with a notable increase in operating losses driven by heightened research and development expenditures. The accumulated deficit as of September 30, 2024, reached $714.4 million.

Sutro's cash position improved significantly, with cash and cash equivalents totaling $174.6 million as of September 30, 2024, compared to $81.8 million a year earlier. The company also reported total current assets of $405.8 million, although total assets decreased to $451.8 million from $470.7 million at the end of 2023. The increase in cash was bolstered by proceeds from stock offerings and the sale of Vaxcyte common stock, which generated $74.0 million in net proceeds.

Strategically, Sutro has been active in securing partnerships and collaborations, including a significant license agreement with Ipsen, which included a $50 million upfront payment and potential milestone payments. The company continues to focus on advancing its clinical-stage product candidates, particularly luvelta, which is in pivotal trials for treating platinum-resistant ovarian cancer. However, Sutro has not yet generated revenue from commercial product sales and relies heavily on collaboration agreements for its financial support.

Overall, Sutro Biopharma's financial results reflect a challenging environment with increased operational losses, yet the company maintains a strong cash position to support ongoing research and development efforts.