Viracta Therapeutics, Inc., a clinical-stage precision oncology company focused on virus-associated cancers, reported significant financial developments in its recent 10-Q filing for the quarter ending September 30, 2024. The company had 39,744,222 shares of common stock outstanding as of November 11, 2024, and continues to operate as a non-shell company.

As of September 30, 2024, Viracta's cash and cash equivalents stood at $13.1 million, a slight increase from $12.3 million at the end of 2023. However, total current assets decreased sharply to $21.8 million from $55.0 million, reflecting a substantial decline in total assets from $56.7 million to $22.0 million. The company reported a net debt of $16.9 million, down from $25.3 million, while total current liabilities also decreased to $28.6 million from $38.4 million. Notably, total stockholders’ equity shifted to a deficit of $6.6 million from a positive equity of $18.3 million at the end of 2023.

Operating expenses for the three months ended September 30, 2024, were $10.2 million, down from $12.5 million in the same period of 2023. For the nine-month period, operating expenses decreased to $33.7 million from $37.1 million year-over-year. The net loss for the third quarter was $10.6 million, an improvement from $12.6 million in the prior year, while the nine-month net loss decreased to $29.5 million from $37.3 million.

The company has not generated any revenue from product sales to date, and it anticipates ongoing net losses and cash outflows, indicating a need for additional capital to fund operations. In July 2024, Viracta implemented a reduction in force affecting approximately 23% of its workforce, followed by another reduction impacting 42% in November 2024, aimed at aligning resources with pipeline priorities and reducing cash burn.

Viracta's lead product candidate, Nana-val, is currently under investigation in multiple clinical trials, including the NAVAL-1 trial for EBV+ lymphoma. The company has paused its EBV+ solid tumor program to focus on the lymphoma program. Additionally, the company amended its license agreement with Day One Biopharmaceuticals in March 2024, resulting in a $5.0 million pre-commercialization milestone payment.

The company faces substantial doubt about its ability to continue as a going concern due to recurring losses and negative cash flows. As of September 30, 2024, Viracta's accumulated deficit reached $295.5 million, and it is actively seeking additional funding through equity or debt financing to support its ongoing clinical trials and operational needs.