Related Parties |
6 Months Ended |
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Jun. 30, 2025 | |
| Related Party Transactions [Abstract] | |
| Related Parties | GeneFab Transaction On August 7, 2023, the Company entered into a framework agreement (“the “GeneFab Framework Agreement”) with GeneFab and Valere Bio, Inc. (“Valere”), a Delaware corporation and the parent company of GeneFab, which is wholly owned by Celadon Partners, LLC, pursuant to which the Company, subject to the terms and conditions therein, sold, assigned and transferred its rights, title and interest in certain of the assets and contractual rights, including all of the Company’s equipment at the Company’s facilities in Alameda and certain of the Company’s non-oncology license rights, intellectual property related to the schematics for and design of the Alameda facility, and subleased to GeneFab its premises under a lease for the Alameda facility. The Company and GeneFab also entered into a development and manufacturing services agreement (“DMSA”), pursuant to which GeneFab will provide certain services to the Company using the subleased Alameda facility and acquired equipment. As part of this transaction, the Company entered into a transition services agreement with GeneFab whereby certain services are to be provided by each party to the other party during a transition period beginning on August 7, 2023. The DMSA was amended and restated on December 10, 2024 as described below. GeneFab is a related party and the Company reports transactions with GeneFab under ASC 850. Refer to Note 12. Related Parties for GeneFab related party considerations. GeneFab prepaid expenses - related party The Company was entitled to $18.9 million in future manufacturing and research activities to be rendered by GeneFab under the services agreement, which are recorded in GeneFab prepaid expenses - related party on the condensed consolidated balance sheets. As of June 30, 2025, the Company had utilized the full amount of this initial prepaid amount for manufacturing and research activities. On December 10, 2024, in connection with the private placement described in further detail in Note 6. Stockholders’ Equity, the Company and GeneFab entered into an amended and restated DMSA, and the Company agreed to make an additional advance payment of $10.0 million to GeneFab, of which $6.0 million and $4.0 million was paid in December 2024 and January 2025, respectively. In June 2025, the Company made an additional advance payment of $2.5 million to GeneFab for additional work as part of the DMSA. These prepayments were recorded in GeneFab prepaid expenses - related party on the condensed consolidated balance sheets. As of June 30, 2025, $5.5 million of these prepayments were remaining for future manufacturing and research activities. GeneFab Economic Share The Company and GeneFab entered into a seller economic share agreement (the “GeneFab Economic Share”), pursuant to which the Company will be entitled to receive ten percent of the realized gains of GeneFab’s parent company arising and resulting from any cash or in-kind distributions from GeneFab in connection with a dividend or sale event, subject to the terms and conditions of the GeneFab Economic Share. The Company elected to account for the GeneFab Economic Share under the fair value option in ASC 825, and the GeneFab Economic Share was recorded as an asset in GeneFab Economic Share - related party on condensed consolidated balance sheet at its fair value of $1.8 million on August 7, 2023. As of June 30, 2025 and December 31, 2024, the Company determined that the fair value of the GeneFab Economic Share was zero. Changes in fair value of the GeneFab Economic Share are reported as a component of other income (expense) in the condensed consolidated statements of operations and comprehensive loss. Refer to Note 10. Fair Value Measurements. GeneFab Note Receivable The total consideration in connection with the transaction was $37.8 million, of which $18.9 million was received by the Company on August 7, 2023 and such payment was netted against prepayment due to GeneFab for future manufacturing and research activities. The remaining $18.9 million was to be paid to the Company in installments in 2024 and 2025 (the “GeneFab Note Receivable”), subject to satisfaction of certain conditions. The Company elected to account for the GeneFab Note Receivable under the fair value option, and the GeneFab Note Receivable was recorded as an asset in GeneFab receivable - related party on the condensed consolidated balance sheet at its fair value of $16.6 million on August 7, 2023. The GeneFab Note Receivable was remeasured each reporting period with changes from remeasurement included in other income (expense) on the condensed consolidated statements of operations and comprehensive loss. On December 10, 2024, in connection with the private placement described in further detail in Note 6. Stockholders’ Equity, the Company, GeneFab and Valere entered into an amendment to the GeneFab Framework Agreement, pursuant to which the GeneFab Note Receivable was waived by the parties. GeneFab Option GeneFab was granted an option to purchase up to 1,963,344 shares (i.e. up to $20.0 million worth) of the Company’s common stock at a per share purchase price of $10.18670 (the “GeneFab Option”). The GeneFab Option becomes exercisable upon the execution of the license agreement, no later than August 7, 2026. The GeneFab Option may be exercised in installments of common stock equal to no more than 19.9% of the outstanding shares of the Company’s common stock as of August 7, 2023. The purchase of the remaining shares under the GeneFab Option requires approval by the Company’s stockholders. The Company determined that the GeneFab Option was a derivative as the terms of the instrument contain certain provisions that preclude equity classification in accordance with ASC 815. As such, the GeneFab Option was recorded as a liability in GeneFab Option - related party on the condensed consolidated balance sheet at its fair value of $9.6 million on August 7, 2023. As of June 30, 2025 and December 31, 2024, the Company determined that the fair value of the GeneFab Option was zero. The GeneFab Option was remeasured each reporting period with changes from remeasurement included in other income (expense) in the condensed consolidated statements of operations and comprehensive loss. Refer to Note 10. Fair Value Measurements. Consolidation and Related Party The Company determined that GeneFab is a variable interest entity since its total equity at risk is not sufficient to finance its activities without additional subordinated financial support. The Company performed a qualitative analysis to determine if it is the primary beneficiary of GeneFab and determined it does not have the power to direct the significant activities of GeneFab. As a result, the Company determined it is not the primary beneficiary and therefore does not consolidate GeneFab. GeneFab is a related party and the Company reports transactions with GeneFab under ASC 850. Refer to Note 12. Related Parties for GeneFab related party considerations. Related PartiesNew Enterprise Associates, Inc. New Enterprise Associates, Inc. (“NEA”) held 14.4% and 9.2% shares of the Company’s common stock as of June 30, 2025 and December 31, 2024, respectively. NEA held one of the seven seats on the Board as of June 30, 2025. As part of the private placement in December 2024 (Note 6), NEA is also entitled to designate one additional director to the Board. Celadon Partners, LLC Celadon Partners, LLC (“Celadon”) held 37.4% and no shares of the Company’s common stock as of June 30, 2025 and December 31, 2024, respectively, and is considered a related party to the Company. Celadon is the parent company of Valere, of which GeneFab is a wholly-owned subsidiary. Celadon was assigned the GeneFab Option in 2024. As part of the private placement in December 2024 (Note 6), Donald Tang, a founder and manager of Celadon, was appointed to the Board. Celadon also was entitled to designate two additional directors to the Board, which Board seats were filled upon Feng Hsiung and Bryan Baum being appointed to the Board in March 2025 and July 2025, respectively. As of June 30, 2025, Celadon held two of the seven seats on the Board. As of the filing date of this Quarterly Report on Form 10-Q (this “Quarterly Report”), Celadon held three of the eight seats on the Board. Refer to Note 15. Subsequent Events for further discussion. Bayer Healthcare LLC Bayer Healthcare LLC (“Bayer”) held 19.9% and 12.2% shares of the Company’s common stock as of June 30, 2025 and December 31, 2024, respectively, and is considered a related party to the Company. Bayer is the parent company of BlueRock Therapeutics LP (“BlueRock”). The Company and BlueRock entered a collaboration and option agreement (“BlueRock Agreement”) in May 2021, pursuant to which the Company and BlueRock, on a program-by-collaboration program basis, collaborate in many aspects for the development of certain therapy products. The Company was responsible for up to $10 million in costs and expenses incurred in connection with the research plan and related activities to be conducted over a three-year research term. The Company completed the initial research plan and related activities in May 2024. If the Company and BlueRock agree to add new research activities to the research plan, then BlueRock will be obligated to reimburse the Company for the costs and expenses incurred. As of June 30, 2025, Bayer has not exercised its option for a license. GeneFab As a result of the transaction with GeneFab (Note 3), GeneFab supports the Company’s clinical manufacturing of our CAR-NK programs, including SENTI-202. GeneFab’s Chief Executive Officer, Philip Lee, Ph.D., was the former Co-Founder and Chief Technology Officer of the Company. The Company determined GeneFab is a related party and the Company reports transactions with GeneFab under ASC 850. The Company recorded the GeneFab Economic Share as an asset, and the GeneFab Option as a liability on the condensed consolidated balance sheets. The Company was entitled for future services from GeneFab and made an advance payment to GeneFab, and such payment was recorded in GeneFab prepaid expenses - related party on the condensed consolidated balance sheets. Refer to Note 3. GeneFab Transaction. The Company and GeneFab entered into a sublease agreement pursuant to which GeneFab subleased the facility included in the Alameda lease and a portion of the Company’s HQ lease. Refer to Note 5. Operating leases. The Company incurred certain costs on behalf of GeneFab under a transition services agreement, and reimbursement of such costs was due from GeneFab. As of June 30, 2025 and December 31, 2024, the Company recorded $0.6 million and $0.7 million, respectively, in GeneFab receivable - related party on the condensed consolidated balance sheet. The Company’s research and development expenses under the services agreement was $3.6 million for both the three months ended June 30, 2025 and 2024, and $7.7 million and $7.3 million, respectively, for the six months ended June 30, 2025 and 2024. Refer to Note 3. GeneFab Transaction.
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