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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 10-Q

þ | QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended March 31, 2025
OR

☐ | TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from _______ to _______
Commission File Number: 001-37798
Cartesian Therapeutics, Inc.
(Exact name of registrant as specified in its charter)

| Delaware | 26-1622110 |
| (State or other jurisdiction of incorporation or organization) | (I.R.S. Employer Identification No.) |
| 7495 New Horizon Way, Frederick, MD | 21703 |
| (Address of principal executive offices) | (Zip Code) |

(301) 348-8698
(Registrant’s telephone number, including area code)

Securities registered pursuant to Section 12(b) of the Act:
Title of each class | Trading Symbol(s) | Name of each exchange on which registered
Common Stock, $0.0001 par value per share | RNAC | The Nasdaq Stock Market LLC
Securities registered pursuant to Section 12(g) of the Act:
Title of each class
Contingent Value Rights

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes þ No ☐
Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes þ No ☐
Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.

| Large accelerated filer | ☐ |  | Accelerated filer | ☐ |
| Non-accelerated filer | þ |  | Smaller reporting company | þ |
|  |  |  | Emerging growth company | ☐ |

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ☐ No þ
As of April 30, 2025, the registrant had 25,954,291 shares of common stock, par value $0.0001 per share, outstanding.

1

TABLE OF CONTENTS
PART I. FINANCIAL INFORMATION
Item 1. | Financial Statements (unaudited) | 5
| Consolidated Balance Sheets as of March 31, 2025 and December 31, 2024 | 5
| Consolidated Statements of Operations and Comprehensive Loss for the Three Months ended March 31, 2025 and 2024 | 6
| Consolidated Statements of Changes in Convertible Preferred Stock and Stockholders’ Deficit for the Three Months ended March 31, 2025 and 2024 | 7
| Consolidated Statements of Cash Flows for the Three Months ended March 31, 2025 and 2024 | 9
| Notes to Consolidated Financial Statements | 10
Item 2. | Management's Discussion and Analysis of Financial Condition and Results of Operations | 29
Item 3. | Quantitative and Qualitative Disclosures About Market Risk | 37
Item 4. | Controls and Procedures | 37
PART II. OTHER INFORMATION
Item 1. | Legal Proceedings | 39
Item 1A. | Risk Factors | 39
Item 2. | Unregistered Sales of Equity Securities and Use of Proceeds | 39
Item 3. | Defaults Upon Senior Securities | 39
Item 4. | Mine Safety Disclosures | 39
Item 5. | Other Information | 39
Item 6. | Exhibits | 40
| Signatures |

2

FORWARD-LOOKING STATEMENTS
This Quarterly Report on Form 10-Q, or the Quarterly Report, contains forward-looking statements. We intend such forward-looking statements to be covered by the safe harbor provisions for forward-looking statements contained in Section 27A of the Securities Act of 1933, as amended, or the Securities Act, and Section 21E of the Securities Exchange Act of 1934, as amended, or the Exchange Act. All statements other than statements of historical facts contained in this Quarterly Report, including statements regarding our future results of operations and financial position, business strategy, prospective products, product approvals, research and development costs, timing and likelihood of success, the plans and objectives of management for future operations and future results of anticipated products, the impact of future pandemics or similar events on our business and operations and our future financial results, and the period over which we estimate our existing cash and cash equivalents will be sufficient to fund our future operating expenses and capital expenditure requirements are forward-looking statements. These statements involve known and unknown risks, uncertainties and other important factors that may cause our actual results, performance or achievements to be materially different from any future results, performance or achievements expressed or implied by the forward-looking statements.
In some cases, you can identify forward-looking statements by terms such as “may,” “will,” “should,” “expect,” “plan,” “anticipate,” “could,” “intend,” “target,” “project,” “contemplate,” “believe,” “estimate,” “predict,” “potential”, or “continue” or the negative of these terms or other similar expressions. The forward-looking statements in this Quarterly Report are only predictions. We have based these forward-looking statements largely on our current expectations and projections about future events and financial trends that we believe may affect our business, financial condition and results of operations. These forward-looking statements speak only as of the date of this Quarterly Report and are subject to a number of important factors that could cause actual results to differ materially from those in the forward-looking statements, including the factors described under the sections in this Quarterly Report titled “Risk Factors” and “Management’s Discussion and Analysis of Financial Condition and Results of Operations” as well as the following:
•any future payouts under the contingent value right, or CVR, issued to our holders of record as of the close of business on December 4, 2023;
•our ability to achieve the expected benefits or opportunities and related timing with respect to the Merger (as defined below) or to monetize any of our legacy assets;
•our future results of operations and financial position, business strategy, and the length of time that we believe our existing cash resources will fund our operations;
•our market size and our potential growth opportunities;
•our preclinical and clinical development activities;
•our dependence on third-parties, including contract research organizations, or CROs, in the conduct of our preclinical studies and clinical trials;
•the efficacy and safety profile of our product candidates;
•the potential therapeutic benefits and economic value of our product candidates;
•the timing and results of preclinical studies and clinical trials;
•the expected impact of macroeconomic conditions, including from inflation, changes in interest rates, volatile market conditions, current or potential bank failures, and tariffs;
•global events, including the ongoing conflicts between Russia and Ukraine and between Hamas and Israel and geopolitical tensions in and with China on our operations;
•the receipt and timing of potential regulatory designations, approvals and commercialization of product candidates;
•our ability to prevent or minimize the effects of litigation and other contingencies;
•our status as a preclinical and development-stage company and our expectation to incur losses in the future, and the possibility that we never achieve or maintain profitability;
•uncertainties with respect to our ability to access future capital;
•our ability to maximize the value of our pipeline of product candidates;
•our unproven approach to therapeutic intervention;
•our ability to enroll patients in clinical trials, timely and successfully complete those trials and receive necessary regulatory approvals;
•our ability to continue to grow our manufacturing capabilities and resources;
3

•our ability to manufacture our product candidates, which in some cases are manufactured on a patient-by-patient basis;
•our ability to access manufacturing facilities and to receive or manufacture sufficient quantities of our product candidates;
•our ability to maintain our existing or future collaborations or licenses and to seek new collaborations, licenses or partnerships;
•the impact of pandemics or similar events on our operations, the continuity of our business, including our preclinical studies and clinical trials, and general economic conditions;
•our ability to protect and enforce our intellectual property rights;
•federal, state, and foreign regulatory requirements, including U.S. Food and Drug Administration, or FDA, regulation of our product candidates;
•our ability to obtain and retain key executives and retain qualified personnel; and
•developments relating to our competitors and our industry, including the impact of government regulation and policy changes.
Moreover, we operate in an evolving environment. New risks and uncertainties may emerge from time to time, and it is not possible for management to predict all risk and uncertainties.
You should read this Quarterly Report and the documents that we reference in this Quarterly Report completely and with the understanding that our actual future results may be materially different from what we expect. We qualify all of our forward-looking statements by these cautionary statements. Except as required by applicable law, we do not plan to publicly update or revise any forward-looking statements contained herein, whether as a result of any new information, future events, changed circumstances or otherwise.
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PART I. FINANCIAL INFORMATION
Item 1. Financial Statements (unaudited)
Cartesian Therapeutics, Inc. and Subsidiaries
Consolidated Balance Sheets
(Amounts in thousands, except share data and par value)

| March 31, |  | December 31,
| 2025 |  | 2024
Assets |  |  |
Current assets: |  |  |
Cash and cash equivalents | $ | 180,434 |  |  | $ | 212,610 |
Accounts receivable | 1,765 |  |  | 872 |
Prepaid expenses and other current assets | 2,921 |  |  | 3,144 |
Total current assets | 185,120 |  |  | 216,626 |
Non-current assets: |  |  |
Property and equipment, net | 10,174 |  |  | 9,912 |
Right-of-use asset, net | 5,351 |  |  | 5,535 |
In-process research and development assets | 150,600 |  |  | 150,600 |
Goodwill | 48,163 |  |  | 48,163 |
Long-term restricted cash | 1,669 |  |  | 1,669 |
Investments | 2,000 |  |  | 2,000 |
Other assets | 6,053 |  |  | 518 |
Total assets | $ | 409,130 |  |  | $ | 435,023 |
Liabilities, convertible preferred stock, and stockholders’ deficit |  |  |
Current liabilities: |  |  |
Accounts payable | $ | 2,097 |  |  | $ | 288 |
Accrued expenses and other current liabilities | 9,197 |  |  | 12,076 |
Lease liability | 3,704 |  |  | 2,851 |
Contingent value right liability | — |  |  | 7,761 |
Total current liabilities | 14,998 |  |  | 22,976 |
Non-current liabilities: |  |  |
Lease liability, net of current portion | 10,362 |  |  | 11,133 |
Warrant liabilities, net of current portion | 2,018 |  |  | 3,836 |
Contingent value right liability, net of current portion | 387,400 |  |  | 387,739 |
Deferred tax liabilities, net | 16,141 |  |  | 16,141 |
Total liabilities | 430,919 |  |  | 441,825 |
Commitments and contingencies (Note 17) |  |  |
Stockholders’ deficit: |  |  |
Series A Preferred Stock, $0.0001 par value; 134,904.563 shares authorized as of March 31, 2025 and December 31, 2024; 120,790.402 shares issued and outstanding as of March 31, 2025 and December 31, 2024 | — |  |  | — |
Series B Preferred Stock, $0.0001 par value; 437,927 shares authorized as of March 31, 2025 and December 31, 2024; 437,927 shares issued and outstanding as of March 31, 2025 and December 31, 2024 | — |  |  | — |
Preferred stock, $0.0001 par value; 9,427,168.437 shares authorized as of March 31, 2025 and December 31, 2024; no shares issued and outstanding as of March 31, 2025 and December 31, 2024 | — |  |  | — |
Common stock, $0.0001 par value; 350,000,000 shares authorized as of March 31, 2025 and December 31, 2024; 25,936,101 and 25,767,369 shares issued and outstanding as of March 31, 2025 and December 31, 2024, respectively | 3 |  |  | 3 |
Additional paid-in capital | 692,578 |  |  | 689,887 |
Accumulated deficit | (709,781) |  |  | (692,071) |
Accumulated other comprehensive loss | (4,589) |  |  | (4,621) |
Total stockholders’ deficit | (21,789) |  |  | (6,802) |
Total liabilities, convertible preferred stock, and stockholders’ deficit | $ | 409,130 |  |  | $ | 435,023 |

The accompanying notes are an integral part of these unaudited consolidated financial statements.
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Cartesian Therapeutics, Inc. and Subsidiaries
Consolidated Statements of Operations and Comprehensive Loss
(Amounts in thousands, except share and per share data)

|  |  | Three Months Ended March 31,
|  |  |  |  | 2025 |  | 2024
Revenue: |  |  |  |  |  |  |
Collaboration and license revenue |  |  |  |  | $ | 400 |  |  | $ | 5,840 |
Grant revenue |  |  |  |  | 700 |  |  | — |
Total revenue |  |  |  |  | 1,100 |  |  | 5,840 |
Operating expenses: |  |  |  |  |  |  |
Research and development |  |  |  |  | 14,674 |  |  | 9,738 |
General and administrative |  |  |  |  | 8,315 |  |  | 9,450 |
Total operating expenses |  |  |  |  | 22,989 |  |  | 19,188 |
Operating loss |  |  |  |  | (21,889) |  |  | (13,348) |
Interest income |  |  |  |  | 2,015 |  |  | 1,164 |
Change in fair value of warrant liabilities |  |  |  |  | 1,818 |  |  | 1,042 |
Change in fair value of contingent value right liability |  |  |  |  | 346 |  |  | (39,300) |
Change in fair value of forward contract liabilities |  |  |  |  | — |  |  | (6,890) |
Other income, net |  |  |  |  | — |  |  | 508 |
Net loss |  |  |  |  | $ | (17,710) |  |  | $ | (56,824) |
Other comprehensive loss: |  |  |  |  |  |  |
Foreign currency translation adjustment |  |  |  |  | 32 |  |  | (5) |
Total comprehensive loss |  |  |  |  | $ | (17,678) |  |  | $ | (56,829) |
Net loss |  |  |  |  | (17,710) |  |  | (56,824) |
Net loss per share allocable to common stockholders: |  |  |  |  |  |  |
Basic and diluted |  |  |  |  | $ | (0.68) |  |  | $ | (10.50) |
Weighted-average common shares outstanding: |  |  |  |  |  |  |
Basic and diluted |  |  |  |  | 25,902,650 |  |  | 5,414,020 |

The accompanying notes are an integral part of these unaudited consolidated financial statements.
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Cartesian Therapeutics, Inc. and Subsidiaries
Consolidated Statements of Changes in Convertible Preferred Stock and Stockholders’ Deficit
(Amounts in thousands, except share data)

|  |  |  |  |  |  |  |  |  |  |  |  |  |  |  | Accumulated |  |
| Series A |  | Series B |  |  |  |  | Additional |  |  |  |  |  | other |  |
| Preferred Stock |  | Preferred Stock |  | Common stock |  | paid-in |  |  |  | Accumulated |  | comprehensive |  | Stockholders’
| Shares | Amount |  | Shares | Amount |  | Shares | Amount |  | capital |  |  |  | deficit |  | loss |  | deficit
Balance at December 31, 2024 | 120,790.402 |  | $ | — |  |  | 437,927 |  | $ | — |  |  | 25,767,369 |  | $ | 3 |  |  | $ | 689,887 |  |  |  |  | $ | (692,071) |  |  | $ | (4,621) |  |  | $ | (6,802) |
Issuance of common stock upon exercise of options | — |  | — |  |  | — |  | — |  |  | 55,690 |  | — |  |  | 183 |  |  |  |  | — |  |  | — |  |  | 183 |
Issuance of vested restricted stock units | — |  | — |  |  |  |  |  | 113,042 |  | — |  |  | — |  |  |  |  | — |  |  | — |  |  | — |
Stock-based compensation expense | — |  | — |  |  | — |  | — |  |  | — |  | — |  |  | 2,508 |  |  |  |  | — |  |  | — |  |  | 2,508 |
Currency translation adjustment | — |  | — |  |  | — |  | — |  |  | — |  | — |  |  | — |  |  |  |  | — |  |  | 32 |  |  | 32 |
Net loss | — |  | — |  |  | — |  | — |  |  | — |  | — |  |  | — |  |  |  |  | (17,710) |  |  | — |  |  | (17,710) |
Balance at March 31, 2025 | 120,790.402 |  | $ | — |  |  | 437,927 |  | $ | — |  |  | 25,936,101 |  | $ | 3 |  |  | $ | 692,578 |  |  |  |  | $ | (709,781) |  |  | $ | (4,589) |  |  | $ | (21,789) |

On April 4, 2024, the Company effected a 1-for-30 reverse split of its issued and outstanding shares of common stock, or the Reverse Stock Split. As a result of the Reverse Stock Split, all figures in this Quarterly Report on Form 10-Q relating to shares of the Company’s common stock (such as share amounts, per share amounts, and conversion rates and prices), including but not limited to, the consolidated financial statements and footnotes included herein, have been adjusted to reflect the Reverse Stock Split for all periods presented.
The accompanying notes are an integral part of these unaudited consolidated financial statements.
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Cartesian Therapeutics, Inc. and Subsidiaries
Consolidated Statements of Changes in Convertible Preferred Stock and Stockholders’ Deficit
(Amounts in thousands, except share data)

|  |  | Options for Series A |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  | Accumulated |  |
| Series A |  | Preferred |  |  | Series A |  | Series B |  |  |  |  | Additional |  |  |  |  |  | other |  |
| Preferred Stock |  | Stock |  |  | Preferred Stock |  | Preferred Stock |  | Common stock |  | paid-in |  |  |  | Accumulated |  | comprehensive |  | Stockholders’
| Shares | Amount |  | Amount |  |  | Shares | Amount |  | Shares | Amount |  | Shares | Amount |  | capital |  |  |  | deficit |  | loss |  | deficit
Balance at December 31, 2023 | 435,120.513 |  | $ | 296,851 |  |  | $ | 3,703 |  |  |  | — |  | $ | — |  |  | — |  | $ | — |  |  | 5,397,597 |  | $ | 1 |  |  | $ | 179,062 |  |  |  |  | $ | (614,647) |  |  | $ | (4,600) |  |  | $ | (440,184) |
Issuance of Series A Preferred Stock in connection with private placement and settlement of related forward contract | 99,140.326 |  | 75,197 |  |  | — |  |  |  | — |  | — |  |  | — |  | — |  |  | — |  | — |  |  | — |  |  |  |  | — |  |  | — |  |  | — |
Transfer of Series A Preferred Stock and options for Series A Preferred Stock to permanent equity | (534,260.839) |  | (372,048) |  |  | (3,703) |  |  |  | 534,260.839 |  | — |  |  | — |  | — |  |  | — |  | — |  |  | 375,751 |  |  |  |  | — |  |  | — |  |  | 375,751 |
Issuance of common stock upon exercise of options | — |  | — |  |  | — |  |  |  | — |  | — |  |  | — |  | — |  |  | 52,558 |  | — |  |  | 154 |  |  |  |  | — |  |  | — |  |  | 154 |
Issuance of common stock upon exercise of warrants | — |  | — |  |  | — |  |  |  | — |  | — |  |  | — |  | — |  |  | 65,681 |  | — |  |  | 2,877 |  |  |  |  | — |  |  | — |  |  | 2,877 |
Stock-based compensation expense | — |  | — |  |  | — |  |  |  | — |  | — |  |  | — |  | — |  |  | — |  | — |  |  | 1,431 |  |  |  |  | — |  |  | — |  |  | 1,431 |
Currency translation adjustment | — |  | — |  |  | — |  |  |  | — |  | — |  |  | — |  | — |  |  | — |  | — |  |  | — |  |  |  |  | — |  |  | (5) |  |  | (5) |
Net loss | — |  | — |  |  | — |  |  |  | — |  | — |  |  | — |  | — |  |  | — |  | — |  |  | — |  |  |  |  | (56,824) |  |  | — |  |  | (56,824) |
Balance at March 31, 2024 | — |  | $ | — |  |  | $ | — |  |  |  | 534,260.839 |  | $ | — |  |  | — |  | $ | — |  |  | 5,515,836 |  | $ | 1 |  |  | $ | 559,275 |  |  |  |  | $ | (671,471) |  |  | $ | (4,605) |  |  | $ | (116,800) |

The accompanying notes are an integral part of these unaudited consolidated financial statements.
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Cartesian Therapeutics, Inc. and Subsidiaries
Consolidated Statements of Cash Flows
(Amounts in thousands)

| Three Months Ended March 31, |
| 2025 |  | 2024 |  |  |  |  |
Cash flows from operating activities |  |  |  |  |  |  |  |
Net loss | $ | (17,710) |  |  | $ | (56,824) |  |  |  |  |  |
Adjustments to reconcile net loss to net cash used in operating activities: |  |  |  |  |  |  |  |
Depreciation and amortization | 1,156 |  |  | 183 |  |  |  |  |  |
Non-cash lease expense | 184 |  |  | 512 |  |  |  |  |  |
Loss on disposal of property and equipment | — |  |  | 2 |  |  |  |  |  |
Stock-based compensation expense | 2,508 |  |  | 1,431 |  |  |  |  |  |
Warrant liabilities revaluation | (1,818) |  |  | (1,042) |  |  |  |  |  |
Contingent value right liability revaluation | (346) |  |  | 39,300 |  |  |  |  |  |
Forward contract liabilities revaluation | — |  |  | 6,890 |  |  |  |  |  |
Changes in operating assets and liabilities: |  |  |  |  |  |  |  |
Accounts receivable | (893) |  |  | 3,864 |  |  |  |  |  |
Unbilled receivable | — |  |  | 611 |  |  |  |  |  |
Prepaid expenses, deposits and other assets | (5,830) |  |  | 1,652 |  |  |  |  |  |
Accounts payable | 1,819 |  |  | (633) |  |  |  |  |  |
Deferred revenue | — |  |  | (5,437) |  |  |  |  |  |
Accrued expenses and other liabilities | (2,178) |  |  | (6,426) |  |  |  |  |  |
Net cash used in operating activities | (23,108) |  |  | (15,917) |  |  |  |  |  |
Cash flows from investing activities |  |  |  |  |  |  |  |
Purchases of property and equipment | (1,075) |  |  | (602) |  |  |  |  |  |
Net cash used in investing activities | (1,075) |  |  | (602) |  |  |  |  |  |
Cash flows from financing activities |  |  |  |  |  |  |  |
Equity offering costs | (454) |  |  | — |  |  |  |  |  |
Proceeds from exercise of common warrants | — |  |  | 2,877 |  |  |  |  |  |
Proceeds from issuance of Series A Preferred Stock, gross in private placement | — |  |  | 40,000 |  |  |  |  |  |
Proceeds from exercise of stock options | 183 |  |  | 154 |  |  |  |  |  |
Payments of contingent value rights distributions | (7,754) |  |  | — |  |  |  |  |  |
Net cash (used in) provided by financing activities | (8,025) |  |  | 43,031 |  |  |  |  |  |
Effect of exchange rate changes on cash | 32 |  |  | (5) |  |  |  |  |  |
Net change in cash, cash equivalents, and restricted cash | (32,176) |  |  | 26,507 |  |  |  |  |  |
Cash, cash equivalents, and restricted cash at beginning of period | 214,279 |  |  | 78,288 |  |  |  |  |  |
Cash, cash equivalents, and restricted cash at end of period | $ | 182,103 |  |  | $ | 104,795 |  |  |  |  |  |
Non-cash investing and financing activities |  |  |  |  |  |  |  |
Purchase of property and equipment not yet paid | $ | 535 |  |  | $ | — |  |  |  |  |  |

The accompanying notes are an integral part of these unaudited consolidated financial statements.
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Cartesian Therapeutics, Inc. and Subsidiaries
Notes to Consolidated Financial Statements
1. Description of the Business
Cartesian Therapeutics, Inc., or the Company (formerly known as Selecta Biosciences, Inc., or Selecta), was incorporated in Delaware on December 10, 2007, and is headquartered in Frederick, Maryland. The Company is a clinical-stage biotechnology company pioneering cell therapies for the treatment of autoimmune diseases leveraging its proprietary technology and manufacturing platform to enhance cell function. The Company believes its cell therapies have the potential to deliver deep, durable clinical benefit to a broad group of patients with autoimmune diseases because they can be administered over a short period of time, in an outpatient setting, and without pre-treatment chemotherapy.
On November 13, 2023, the Company acquired, in accordance with the terms of the Agreement and Plan of Merger, or the Merger Agreement, the assets of the Delaware corporation which, immediately prior to the Merger (as defined below), was known as Cartesian Therapeutics, Inc., or Old Cartesian, as disclosed in Note 4 to the consolidated financial statements included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2024. The transaction was structured as a stock-for-stock transaction pursuant to which all of Old Cartesian’s outstanding shares of capital stock were exchanged based on a fixed exchange ratio for consideration of 224,099 shares of the common stock, par value $0.0001 per share, of the Company, or the common stock, and 384,930.724 shares of the newly designated Series A Non-Voting Convertible Preferred Stock, par value $0.0001 per share, or the Series A Preferred Stock. The Series A Preferred Stock is intended to have economic rights similar to the common stock, but with only limited voting rights. Additionally, the Company assumed all outstanding stock options of Old Cartesian. The common stock and Series A Preferred Stock related to the Merger were issued on December 5, 2023.
In connection with the Merger, the Company entered into a definitive agreement, or the 2023 Securities Purchase Agreement, for a private investment in public equity transaction, or the 2023 Private Placement, with the Investors (as defined below). The 2023 Securities Purchase Agreement provides for the issuance to the Investors of an aggregate of 149,330.115 shares of Series A Preferred Stock for an aggregate purchase price of approximately $60.25 million. See Note 11 to the consolidated financial statements included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2024 for further discussion of the 2023 Private Placement.
In connection with the Merger, a contractual contingent value right, or CVR, was distributed to the holders of record of the Company’s common stock and 2022 Warrants (as defined below) as of the close of business on December 4, 2023, but was not distributed to holders of shares of common stock or Series A Preferred Stock issued to stockholders of Old Cartesian or the Investors in the transactions. Holders of the CVRs will be entitled to receive certain payments from proceeds received by the Company, if any, related to the disposition or monetization of the Company’s legacy assets following the issuance of the CVRs. For additional information, see Note 7.
On March 27, 2024, the Company’s stockholders approved the conversion of shares of Series A Preferred Stock into shares of common stock. For additional information, see Note 11 to the consolidated financial statements included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2024.
Additionally, on March 27, 2024, the Company’s stockholders approved an amendment to the Company’s restated certificate of incorporation, as amended, or the Charter, to effect a reverse stock split of the Company’s issued and outstanding common stock, at a ratio in the range of 1-for-20 and 1-for-30, with such ratio to be determined at the discretion of the Company’s board of directors, or the Board of Directors. The Board of Directors subsequently approved a final reverse stock split ratio of 1-for-30, and the Company effected the Reverse Stock Split on April 4, 2024. As a result of the Reverse Stock Split, all figures in this Quarterly Report on Form 10-Q relating to shares of the Company’s common stock (such as share amounts, per share amounts, and conversion rates and prices), have been adjusted to reflect the Reverse Stock Split for all periods presented, including reclassifying an amount equal to the reduction in par value of common stock to additional paid-in capital. Shares of common stock underlying outstanding stock options, restricted stock units and warrants were proportionately reduced and the respective exercise prices, if applicable, were proportionately increased in accordance with their terms. Additionally, the conversion ratio of the Company’s Series A Preferred Stock was proportionally adjusted. Stockholders entitled to fractional shares as a result of the Reverse Stock Split received a cash payment in lieu of receiving fractional shares.
On July 2, 2024, the Company entered into a securities purchase agreement, or the 2024 Securities Purchase Agreement, for a private investment in public equity financing, or the 2024 Private Placement, which provided for the issuance of 3,563,247 shares of common stock and 2,937,903 shares of Series B Non-Voting Convertible Preferred Stock, par value $0.0001 per share, or the Series B Preferred Stock, each at a purchase price of $20.00 per share. The 2024 Private Placement resulted in gross proceeds of approximately $130.0 million before deducting placement agent fees and other offering expenses. On September 20, 2024, the Company’s stockholders approved the conversion of shares of Series B Preferred Stock into shares of
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common stock. For additional information, see Note 11 to the consolidated financial statements included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2024.
The Company is subject to risks common to companies in the biotechnology industry including, but not limited to, new technological innovations, protection of proprietary technology, dependence on key personnel, compliance with government regulations and the need to obtain additional financing. Product candidates currently under development will require significant additional research and development efforts, including extensive preclinical and clinical testing and regulatory approval, prior to commercialization. These efforts require significant amounts of additional capital, adequate personnel infrastructure and extensive compliance-reporting capabilities.
The Company’s product candidates are in preclinical and clinical development. There can be no assurance that the Company’s research and development will be successfully completed, that adequate protection for the Company’s intellectual property will be obtained, or maintained, that any products developed will obtain necessary government regulatory approval or that any approved products will be commercially viable. Even if the Company’s product development efforts are successful, it is uncertain when, if ever, the Company will generate significant revenue from product sales. The Company operates in an environment of rapid change in technology and substantial competition from pharmaceutical and biotechnology companies. In addition, the Company is dependent upon the services of its employees and consultants.
Unaudited Interim Financial Information
The accompanying unaudited consolidated financial statements for the three months ended March 31, 2025 and 2024 have been prepared by the Company pursuant to the rules and regulations of the Securities and Exchange Commission, or the SEC, for interim financial statements. Certain information and footnote disclosures normally included in financial statements prepared in accordance with accounting principles generally accepted in the United States of America, or U.S. GAAP, have been condensed or omitted pursuant to such rules and regulations. These consolidated financial statements should be read in conjunction with the Company’s audited consolidated financial statements and the notes thereto for the year ended December 31, 2024 included in the Company’s Annual Report on Form 10-K that was filed with the SEC on March 13, 2025. The unaudited interim financial statements have been prepared on the same basis as the audited consolidated financial statements. In the opinion of management, the accompanying unaudited interim consolidated financial statements contain all adjustments that are necessary for a fair statement of the Company’s financial position as of March 31, 2025, the consolidated results of operations for the three months ended March 31, 2025, and cash flows for the three months ended March 31, 2025. Such adjustments are of a normal and recurring nature. The results of operations for the three months ended March 31, 2025 are not necessarily indicative of the results of operations that may be expected for the year ending December 31, 2025.
Liquidity and Management’s Plan
The future success of the Company is dependent on its ability to develop its product candidates and ultimately upon its ability to attain and sustain profitable operations. The Company is subject to a number of risks similar to other early-stage life science companies, including, but not limited to, successful development of its product candidates, raising additional capital with favorable terms, protection of proprietary technology and market acceptance of any approved future products. The successful development of product candidates requires substantial working capital, which may not be available to the Company on favorable terms or at all.
To date, the Company has financed its operations primarily through public offerings and private placements of its securities, funding received from research grants, collaboration and license arrangements and a credit facility. The Company currently has no source of product revenue, and it does not expect to generate product revenue for the foreseeable future. To date, the Company’s revenue has primarily been from collaboration agreements. The Company has devoted substantially all of its financial resources and efforts to developing its existing product candidates, identifying potential product candidates and conducting preclinical studies and clinical trials. The Company is in the early stages of development of its product candidates, and it has not completed development of any product candidates.
As of March 31, 2025, the Company’s cash, cash equivalents, and restricted cash were $182.1 million, of which $1.7 million was restricted cash related to lease commitments. The Company believes the cash, cash equivalents and restricted cash as of March 31, 2025 will enable it to fund its current planned operations for at least the next 12 months from the date of issuance of these financial statements, though it may pursue additional cash resources through public or private equity or debt financings or by establishing collaborations with other companies. Management’s expectations with respect to its ability to fund current and long term planned operations are based on estimates that are subject to risks and uncertainties. If actual results are different from management’s estimates, the Company may need to seek additional strategic or financing opportunities sooner than would otherwise be expected. However, there is no guarantee that any of these strategic or financing opportunities will be executed on favorable terms, and some could be dilutive to existing stockholders. Further, the liability associated with the CVR Agreement (as defined below) will be settled solely through cash flow received under the Company’s License and Development Agreement, or as so amended, the Sobi License, with Swedish Orphan Biovitrum AB (publ.), or Sobi, and any other Gross Proceeds (as defined in the CVR Agreement) net of certain agreed deductions. Under the CVR Agreement, 100% of all milestone payments, royalties and other amounts paid to the Company or controlled entities under the Sobi License, and any
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other Gross Proceeds will be distributed, net of specified deductions, to holders of the CVRs. There is no obligation to the Company to fund any amount related to the CVR liability. See Note 7.
If the Company is unable to obtain additional funding on a timely basis, it may be forced to significantly curtail, delay, or discontinue one or more of its planned research or development programs or be unable to expand its operations or otherwise capitalize on its commercialization of its product candidates. As of March 31, 2025, the Company had an accumulated deficit of $709.8 million. The Company anticipates operating losses to continue for the foreseeable future due to, among other things, costs related to research and development of its product candidates and its administrative organization.
2. Basis of Presentation
Principles of Consolidation
The consolidated financial statements include the accounts of the Company and its wholly owned subsidiaries, Selecta (RUS), LLC, or Selecta (RUS), a Russian limited liability corporation, Selecta Biosciences Security Corporation, a Massachusetts securities corporation which the Company dissolved in December 2024, and Cartesian Bio, LLC, a Delaware limited liability company, which is a variable interest entity for which the Company is the primary beneficiary. All significant intercompany accounts and transactions have been eliminated.
Use of Estimates
The preparation of consolidated financial statements in conformity with U.S. GAAP requires the Company’s management to make estimates and assumptions that affect the reported amounts of assets and liabilities, the disclosure of contingent assets and liabilities as of the date of the consolidated financial statements and the reported amounts of revenues and expenses during the reporting period. The Company’s management considers many factors in selecting appropriate financial accounting policies and controls, and bases its estimates on historical experience and other market-specific or other relevant assumptions that it believes to be reasonable under the circumstances. In preparing these consolidated financial statements, management used significant estimates in the following areas, among others: fair value of the intangible assets acquired in connection with the Merger, fair value of the CVRs, deferred income taxes, revenue recognition, accrued research and development expenses, stock-based compensation expense, fair value of the liability-classified warrants, and impairment of long-lived assets. The Company assesses the above estimates on an ongoing basis; however, actual results could materially differ from those estimates.
Segment Information
Operating segments are defined as components of an enterprise for which separate and discrete information is available for evaluation by the chief operating decision maker, or the CODM, for the purposes of assessing performance and allocating resources. The Company views its operations and manages its business in one operating segment, which prior to the Merger related to the research and development of nanoparticle immunomodulatory drugs for the treatment and prevention of human diseases and subsequent to the Merger relates to the research and development of cell therapy product candidates. The Company’s CODM function is fulfilled by its Chief Executive Officer. The CODM function assesses performance for the segment and decides how to allocate resources based on consolidated net loss that is also reported on the consolidated statements of operations and comprehensive loss. The CODM function uses net loss to monitor budget versus actual results to assess performance of the segment. Segment assets are the same as total assets on the Company’s consolidated balance sheets. All long-lived assets are located in the United States. Long-lived assets consist of property and equipment, net, and operating lease right-of-use assets.
3. Summary of Significant Accounting Policies
The Company disclosed its significant accounting policies in Note 3 – Summary of Significant Accounting Policies included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2024. There have been no material changes to the Company’s significant accounting policies during the three months ended March 31, 2025.
Recent Accounting Pronouncements
Not Yet Adopted
In December 2023, the FASB issued ASU 2023-09, Income Taxes (Topic 740): Improvements to Income Tax Disclosures (ASU 2023-09), which improves the transparency of income tax disclosures by requiring consistent categories and greater disaggregation of information in the effective tax rate reconciliation and income taxes paid disaggregated by jurisdiction. It also includes certain other amendments to improve the effectiveness of income tax disclosures. This guidance will be effective for the annual periods beginning with the year ended December 31, 2025. Early adoption is permitted. Upon adoption, the guidance can be applied prospectively or retrospectively. The Company does not expect the adoption of this guidance to have a material impact on its consolidated financial statements or disclosures.
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In November 2024, the FASB issued ASU 2024-03, Income Statement Reporting - Comprehensive Income - Expense Disaggregation Disclosures (ASU 2024-03), which requires public companies to disclose, in interim and annual reporting periods, additional information about certain expenses in notes to financial statements, including purchases of inventory, employee compensation, depreciation, amortization of intangible assets, and selling expenses. This guidance will be effective for the annual period beginning the year ended December 31, 2027 and for interim periods beginning January 1, 2028, with early adoption permitted. The Company is currently in the process of evaluating the impact of the standard’s adoption on its consolidated financial statements and related disclosures.
4. Goodwill and Intangible Assets
On November 13, 2023, the Company merged with Old Cartesian in accordance with the terms of the Merger Agreement, by and among Selecta, Sakura Merger Sub I, Inc., a wholly owned subsidiary of Selecta, or First Merger Sub, Sakura Merger Sub II, LLC, a wholly owned subsidiary of Selecta, or Second Merger Sub, and Old Cartesian. Pursuant to the Merger Agreement, First Merger Sub merged with and into Old Cartesian, pursuant to which Old Cartesian was the surviving corporation and became a wholly owned subsidiary of Selecta, or the First Merger. Immediately following the First Merger, Old Cartesian merged with and into Second Merger Sub, pursuant to which Second Merger Sub was the surviving entity, or the Second Merger and, together with the First Merger, the Merger. In connection with the Second Merger, Old Cartesian changed its name to Cartesian Bio, LLC. As a result of the Merger, Selecta changed its corporate name to Cartesian Therapeutics, Inc. See Note 4 to the consolidated financial statements included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2024 for further discussion of the Merger.
Goodwill
The Merger resulted in goodwill of approximately $48.2 million. There were no changes to the carrying value of the Company’s goodwill during the three months ended March 31, 2025.
Intangible Assets
The following summarizes the Company’s indefinite-lived intangible assets, all of which were acquired in the Merger (in thousands):

|  |  |  | March 31, |  | December 31, |  |  |  |
|  |  |  | 2025 |  | 2024 |  |  |  |
Descartes-08 for MG |  |  |  | $ | 93,900 |  |  | $ | 93,900 |  |  |  |  |
Descartes-08 for SLE |  |  |  | 56,700 |  |  | 56,700 |  |  |  |  |
Total in-process research and development assets |  |  |  | $ | 150,600 |  |  | $ | 150,600 |  |  |  |  |

5. Investments
In September 2021, the Company and Cyrus Biotechnology, Inc., or Cyrus, entered into a stock purchase agreement, or the Series B Preferred Stock Purchase Agreement. Pursuant to the Series B Preferred Stock Purchase Agreement, the Company purchased 2,326,934 shares of Cyrus’ Series B Preferred Stock, par value $0.0001 per share, at a purchase price of $0.8595 per share, for $2.0 million.
In accordance with ASC 810, the Company has a variable interest in Cyrus resulting from its equity investment. The Company will share in Cyrus’ expected losses or receive a portion of its expected returns and absorb the variability associated with changes in the entity’s net assets. However, the Company is not the primary beneficiary as it does not have the power to direct the activities most significant to Cyrus, and therefore it is not required to consolidate Cyrus. The Company has recognized the $2.0 million investment of Cyrus’ Series B Preferred Stock at cost on the purchase date.
As of March 31, 2025 and December 31, 2024, no impairment indicators were present and there were no observable price changes. Therefore, the carrying value of the investment in Cyrus is $2.0 million on the accompanying consolidated balance sheets. The Company’s maximum exposure to loss related to this variable interest entity is limited to the carrying value of the investment. The Company has not provided financing to Cyrus other than the amount contractually required by the Series B Preferred Stock Purchase Agreement.
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6. Net Loss Per Share Allocable to Common Stockholders
The Company reported a net loss for the three months ended March 31, 2025 and 2024. The following table sets forth the computation of basic and diluted net loss per share allocable to common stockholders for the three months ended March 31, 2025 and 2024 (in thousands, except share and per-share data):

|  |  | Three Months Ended March 31,
|  |  |  |  | 2025 |  | 2024
Numerator: |  |  |  |  |  |  |
Net loss |  |  |  |  | $ | (17,710) |  |  | $ | (56,824) |
Denominator: |  |  |  |  |  |  |
Weighted-average common shares outstanding - basic and diluted |  |  |  |  | 25,902,650 |  |  | 5,414,020 |
Net loss per share: |  |  |  |  |  |  |
Basic and diluted |  |  |  |  | $ | (0.68) |  |  | $ | (10.50) |

The following table represents the potential dilutive shares of common stock excluded from the computation of the diluted net loss per share allocable to common stockholders for all periods presented, as the effect would have been anti-dilutive:

|  |  | Three Months Ended March 31,
|  |  |  |  | 2025 |  | 2024
Common stock options and restricted stock units |  |  |  |  | 3,047,628 |  |  | 1,811,636 |
Warrants to purchase common stock |  |  |  |  | 692,523 |  |  | 975,132 |
Series A Preferred Stock |  |  |  |  | 4,026,346 |  |  | 17,808,670 |
Series A Preferred Stock options |  |  |  |  | — |  |  | 470,403 |
Series B Preferred Stock |  |  |  |  | 437,927 |  |  | — |
Total |  |  |  |  | 8,204,424 |  |  | 21,065,841 |

7. Fair Value Measurements
The following tables present the Company’s assets and liabilities that are measured at fair value on a recurring basis as of March 31, 2025 and December 31, 2024 (in thousands):

| March 31, 2025
| Total |  | Level 1 |  | Level 2 |  | Level 3
Assets: |  |  |  |  |  |  |
Money market funds (included in cash equivalents) | $ | 39,509 |  |  | $ | 39,509 |  |  | $ | — |  |  | $ | — |
Total assets | $ | 39,509 |  |  | $ | 39,509 |  |  | $ | — |  |  | $ | — |
Liabilities: |  |  |  |  |  |  |
Warrant liabilities | $ | 2,018 |  |  | $ | — |  |  | $ | — |  |  | $ | 2,018 |
Contingent value right liability | $ | 387,400 |  |  | $ | — |  |  | $ | — |  |  | $ | 387,400 |
Total liabilities | $ | 389,418 |  |  | $ | — |  |  | $ | — |  |  | $ | 389,418 |

| December 31, 2024
| Total |  | Level 1 |  | Level 2 |  | Level 3
Assets: |  |  |  |  |  |  |
Money market funds (included in cash equivalents) | $ | 39,088 |  |  | $ | 39,088 |  |  | $ | — |  |  | $ | — |
Total assets | $ | 39,088 |  |  | $ | 39,088 |  |  | $ | — |  |  | $ | — |
Liabilities: |  |  |  |  |  |  |
Warrant liabilities | $ | 3,836 |  |  | $ | — |  |  | $ | — |  |  | $ | 3,836 |
Contingent value right liability | $ | 395,500 |  |  | $ | — |  |  | $ | — |  |  | $ | 395,500 |
Total liabilities | $ | 399,336 |  |  | $ | — |  |  | $ | — |  |  | $ | 399,336 |

There were no transfers within the fair value hierarchy during the three months ended March 31, 2025 or the year ended December 31, 2024.
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Cash, Cash Equivalents, and Restricted Cash
As of March 31, 2025 and December 31, 2024, money market funds were classified as cash and cash equivalents on the accompanying consolidated balance sheets as they mature within 90 days from the date of purchase.
As of March 31, 2025, the Company had restricted cash balances relating to secured letters of credit in connection with its real estate leases. The Company’s consolidated statements of cash flows include the following as of March 31, 2025 and 2024 (in thousands):

| March 31, |
| 2025 |  | 2024 |  |  |  |  |
Cash and cash equivalents | $ | 180,434 |  |  | $ | 103,418 |  |  |  |  |  |
Long-term restricted cash | 1,669 |  |  | 1,377 |  |  |  |  |  |
Total cash, cash equivalents, and restricted cash | $ | 182,103 |  |  | $ | 104,795 |  |  |  |  |  |

Warrants to Purchase Common Stock
In December 2019, the Company issued warrants to purchase common stock in connection with a private placement, or the 2019 Warrants. The outstanding 2019 Warrants expired on December 23, 2024 in accordance with their terms. Pursuant to the terms of the 2019 Warrants, the Company could have been required to settle the 2019 Warrants in cash in the event of certain acquisitions of the Company and, as a result, the 2019 Warrants were required to be measured at fair value and reported as a liability on the balance sheet. On December 20, 2022, the Company amended the terms of the outstanding 2019 Warrants held by certain members of the Board of Directors, or the Amended 2019 Warrants, to remove the cash settlement provision. As a result, the Amended 2019 Warrants were remeasured at fair value on December 20, 2022 and reclassified from a liability to equity on the balance sheet.
In April 2022, the Company issued warrants in connection with an underwritten offering, or the 2022 Warrants. Pursuant to the terms of the 2022 Warrants, the Company could be required to settle the 2022 Warrants in cash in the event of an acquisition of the Company under certain circumstances and, as a result, the 2022 Warrants are required to be measured at fair value and reported as a liability on the balance sheet.
The Company recorded the fair value of the 2019 Warrants and the 2022 Warrants upon issuance using the Black-Scholes valuation model and is required to revalue the 2019 Warrants and the 2022 Warrants at each reporting date, with any changes in fair value recorded in the statements of operations and comprehensive loss. The valuations of the 2019 Warrants and the 2022 Warrants are classified as Level 3 of the fair value hierarchy due to the need to use assumptions in the valuations that are both significant to the fair value measurement and unobservable, including the stock price volatility and the expected life of the 2019 Warrants and the 2022 Warrants. Generally, increases (decreases) in the fair value of the underlying stock and estimated term would result in a directionally similar impact to the fair value measurement.
The estimated fair value of the 2019 Warrants and the 2022 Warrants were determined using the following inputs to the Black-Scholes simulation valuation:
Estimated fair value of the underlying stock. The Company estimates the fair value of the common stock based on the closing stock price at the end of each reporting period.
Risk-free interest rate. The risk-free interest rate is based on the U.S. Treasury at the valuation date commensurate with the expected remaining life assumption.
Dividend rate. The dividend rate is based on the historical rate, which the Company anticipates will remain at zero.
Expected life. The expected life of the 2019 Warrants was assumed to be equivalent to their remaining contractual term which expired on December 23, 2024. The expected life of the 2022 Warrants is assumed to be equivalent to their remaining contractual term which expires on April 11, 2027.
Volatility. The Company estimates stock price volatility based on the Company’s historical volatility for a period of time commensurate with the expected remaining life of the warrants.
The 2019 Warrants expired on December 23, 2024 and therefore, there were no 2019 Warrants outstanding as of December 31, 2024 or March 31, 2025.
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A summary of the Black-Scholes pricing model assumptions used to record the fair value of the 2022 Warrants liability is as follows:

| March 31, |  | December 31,
| 2025 |  | 2024
Risk-free interest rate | 3.89 | % |  | 4.25 | %
Dividend yield | — |  |  | — |
Expected life (in years) | 2.03 |  | 2.28
Expected volatility | 94.79 | % |  | 92.92 | %

The following table reflects a roll-forward of fair value for the Company’s Level 3 warrant liabilities (see Note 11 to these unaudited consolidated financial statements) for the three months ended March 31, 2025 (in thousands):

| Warrant liabilities
Fair value as of December 31, 2024 | $ | 3,836 |
Change in fair value | (1,818) |
Fair value as of March 31, 2025 | $ | 2,018 |

Contingent Value Right
On December 6, 2023, as contemplated by the Merger Agreement, the Company entered into a contingent value rights agreement, or the CVR Agreement, pursuant to which each holder of common stock or a 2022 Warrant as of December 4, 2023 was distributed a CVR, issued by the Company for each share of common stock held directly or underlying a 2022 Warrant held by such holder as of December 4, 2023. Holders of warrants other than the 2022 Warrants will be entitled to receive, upon exercise of such warrants and in accordance with the terms of the warrants, 30 CVRs per each share of common stock underlying such warrants.
Each CVR entitles its holder to distributions of the following, pro-rated on a per-CVR basis, during the period ending on the date on which the Royalty Term (as defined in the Sobi License) ends, or the Termination Date:
•100% of all milestone payments, royalties and other amounts paid to the Company or its controlled affiliates, or the Company Entities, under the Sobi License or, following certain terminations of the Sobi License, any agreement a Company Entity enters into that provides for the development and commercialization of SEL-212; and
•100% of all cash consideration and the actual liquidation value of any and all non-cash consideration of any kind that is paid to or is actually received by any Company Entity prior to the Termination Date pursuant to an agreement relating to a sale, license, transfer or other disposition of any transferable asset of the Company existing as of immediately prior to the Merger, other than those exclusively licensed under the Sobi License or which the Company Entities are required to continue to own in order to comply with the Sobi License.
The distributions in respect of the CVRs will be made on a semi-annual basis, and will be subject to a number of deductions, subject to certain exceptions or limitations, including for (i) certain taxes payable on the proceeds subject to the CVR distribution, (ii) certain out of pocket costs incurred by the Company Entities, including audit and accounting fees incurred in connection with reporting obligations relating to the CVRs and other expenses incurred in the performance of their obligations and other actions under the CVR Agreement, (iii) a fixed semi-annual amount of $0.75 million for general and administrative overhead, (iv) payments made and remaining obligations on lease liabilities of Selecta immediately prior to the Merger and (v) amounts paid and remaining obligations with regard to the Xork product candidate. Each of the deductions described in (iv) and (v) will be made only if certain milestone payments under the Sobi License are made and are also subject to certain adjustments as contemplated in the CVR Agreement. Upon the achievement of a development milestone in June 2024, Sobi became obligated to make a $30.0 million payment to the Company and made such payment in July 2024. The proceeds from this payment, net of deductions specified in the CVR Agreement, were included in the scheduled distribution to the holders of the CVR in March 2025.
The CVRs represent financial instruments that are accounted for under the fair value option election in ASC 825, Financial Instruments, or ASC 825. Under the fair value option election, the CVRs are initially measured at the aggregate estimated fair value of the CVRs and will be subsequently remeasured at estimated fair value on a recurring basis at each reporting period date. The liability was recorded at the date of approval, November 13, 2023, as a dividend. The estimated fair value of the CVR liability was determined using a Monte Carlo simulation model to estimate future cash flows associated with the legacy assets, including the expected milestone and royalty payments under the Sobi License, net of deductions. Changes in fair value of the CVR liability are presented in the consolidated statements of operations and comprehensive loss. The liability value is based on significant inputs not observable in the market such as estimated cash flows, estimated probabilities of success, and expected
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volatility of future revenues, which represent a Level 3 measurement within the fair value hierarchy. The significant inputs used to estimate the fair value of the CVR liability, which represented a financial instrument being accounted for under the fair value option, were as follows:

| March 31, |  | December 31,
| 2025 |  | 2024
Estimated cash flow dates | 2025 - 2038 |  | 2025-2038
Estimated probability of success | 95.0% - 100.0% |  | 95.0% - 100.0%
Expected volatility of future revenues | 22.5 | % |  | 22.0 | %

The following table reflects a roll-forward of fair value for the Company’s Level 3 CVR liability for the three months ended March 31, 2025 (in thousands):

| CVR liability
Fair value as of December 31, 2024 | $ | 395,500 |
Distributions | (7,754) |
Change in fair value | (346) |
Fair value as of March 31, 2025 | $ | 387,400 |

Forward Contract Liabilities
The Company entered into a contract for the issuance of 149,330.115 shares of Series A Preferred Stock as part of the 2023 Private Placement which was settled in multiple tranches. The Company determined the obligation to issue 148,710.488 shares of Series A Preferred Stock to Dr. Timothy A. Springer, a member of the Company’s Board of Directors, and TAS Partners LLC, an affiliate of Dr. Springer, represented a forward contract. See Note 11 to the consolidated financial statements included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2024. The initial fair value of the forward contract liability on November 13, 2023 was insignificant as the fair value of the underlying Series A Preferred Stock was equal to the purchase price of the Series A Preferred Stock as agreed upon in the 2023 Private Placement. Subsequent measurement of the fair value of the forward contract liability was based on the market price of the Company’s common stock, which represented the redemption and conversion value of the Series A Preferred Stock, less the purchase price, on an as-converted basis. The non-cash settlement of a portion of the liability occurred on December 13, 2023 with the issuance of the first tranche of the Series A Preferred Stock for $14.8 million. The non-cash settlement of the remaining second and third tranches occurred on January 12, 2024 and February 11, 2024, respectively, for a total of $35.2 million.
8. Property and Equipment
Property and equipment consists of the following (in thousands):

| March 31, |  | December 31,
| 2025 |  | 2024
Laboratory equipment | $ | 7,690 |  |  | $ | 7,295 |
Computer equipment and software | 417 |  |  | 415 |
Leasehold improvements | 4,076 |  |  | 3,427 |
Furniture and fixtures | 269 |  |  | 268 |
Office equipment | 170 |  |  | 169 |
Construction in process | 480 |  |  | 695 |
Total property and equipment | 13,102 |  |  | 12,269 |
Less: Accumulated depreciation | (2,928) |  |  | (2,357) |
Property and equipment, net | $ | 10,174 |  |  | $ | 9,912 |

Depreciation expense was $0.6 million and $0.2 million for the three months ended March 31, 2025 and 2024, respectively.
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9. Accrued Expenses
Accrued expenses consist of the following (in thousands):

| March 31, |  | December 31,
| 2025 |  | 2024
Payroll and employee related expenses | $ | 1,424 |  |  | $ | 3,534 |
Accrued patent fees | 221 |  |  | 813 |
Accrued external research and development costs | 4,917 |  |  | 2,987 |
Accrued professional and consulting services | 1,668 |  |  | 3,674 |
Property and equipment | 531 |  |  | 782 |
Other | 436 |  |  | 286 |
Accrued expenses | $ | 9,197 |  |  | $ | 12,076 |

10. Leases
7495 New Horizon Way Leases
On February 28, 2024, the Company entered into a lease agreement with 7495 RP, LLC, or the Landlord, pursuant to which it agreed to lease from the Landlord the manufacturing space located at 7495 New Horizon Way, Frederick, Maryland, or the Frederick Lease Agreement. The space consists of 19,199 leasable square feet of integrated manufacturing and office space. The lease commenced on May 1, 2024 which was the date the Landlord delivered full possession of the premises to the Company. The Frederick Lease Agreement will terminate approximately 7.2 years following the commencement date. The Company will have one option to extend the term of the Frederick Lease Agreement for a period of five years at a cost of 100% of the then-fair market value, not to exceed 103% of the then-current base rent.
Base rent, which was due beginning on July 1, 2024, is $0.9 million annually and is subject to an annual upward adjustment of 3% of the then-current rental rate. In addition, the Company is obligated to pay its share of operating costs and taxes related to the property. The Company paid the first month’s rent of $0.1 million upon execution of the Frederick Lease Agreement.
The Company assessed the classification of the lease at the commencement date and concluded it should be accounted for as an operating lease. The Company recorded a lease liability and right-of-use asset of $3.6 million and $3.7 million, respectively, on the commencement date. The Frederick Lease Agreement includes a tenant improvement allowance of up to $0.7 million which was recognized as a reduction in the right-of-use asset and lease liability at the commencement date as the Company was reasonably certain to incur reimbursable costs related to alterations equal to or exceeding the amount. Additionally, the prepaid rent was included as an adjustment to the right-of-use asset. The discount rate of 14% was determined based on the Company’s incremental borrowing rate adjusted for the lease term, including any reasonably certain renewal periods.
Effective May 7, 2024, the Company and the Landlord entered into the first amendment to the Frederick Lease Agreement, or the First Frederick Lease Agreement Amendment, providing for the expansion of the premises leased pursuant to the Frederick Lease Agreement by approximately 7,842 square feet. In connection with the expansion of the leased premises, the Company is obligated to pay $0.3 million in additional annual base rent for the first year of the term, which is subject to an annual upward adjustment of 3% of the then-current rental rate, as well as its share of operating costs and taxes. The lease commenced on May 7, 2024 which was the date the Landlord delivered full possession of the premises to the Company and will be coterminous with the Frederick Lease Agreement. The rent commencement date was September 1, 2024.
The Company assessed the classification of the lease at the commencement date and concluded it should be accounted for as an operating lease. The Company recorded a lease liability and right-of-use asset each of $1.2 million on the commencement date. The First Frederick Lease Agreement Amendment includes a tenant improvement allowance of up to $0.1 million which was recognized as a reduction in the right-of-use asset and lease liability at the commencement date as the Company was reasonably certain to incur reimbursable costs related to alterations equal to or exceeding the amount. The discount rate of 14% was determined based on the Company’s incremental borrowing rate adjusted for the lease term.
Effective August 30, 2024, the Company and the Landlord entered into the second amendment to the Frederick Lease Agreement, or the Second Frederick Lease Agreement Amendment, providing for the expansion of the premises leased pursuant to the Frederick Lease Agreement and First Frederick Lease Agreement Amendment by approximately 2,009 square feet. In connection with the expansion of the leased premises, the Company is obligated to pay $0.1 million in additional annual base rent for the first year of the term, which is subject to an annual upward adjustment of 3% of the then-current rental rate, as well as its share of operating costs and taxes. The lease commenced on September 1, 2024, which was the date the Landlord
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delivered full possession of the premises to the Company and will be coterminous with the Frederick Lease Agreement and the First Frederick Lease Agreement Amendment. The rent commencement date was September 1, 2024.
The Company assessed the classification of the lease at the commencement date and concluded it should be accounted for as an operating lease. The Company recorded a lease liability and right-of-use asset each of $0.3 million on the commencement date. The discount rate of 14% was determined based on the Company’s incremental borrowing rate adjusted for the lease term.
On March 13, 2025, the Company and the Landlord entered into the third amendment to the Frederick Lease Agreement, or the Third Frederick Lease Agreement Amendment, providing for the expansion of the premises leased pursuant to the Frederick Lease Agreement by approximately 6,439 square feet. The Third Frederick Lease Agreement Amendment is expected to become effective on May 12, 2025. In connection with the expansion of the leased premises, the Company is obligated to pay $0.2 million in additional annual base rent for the first year of the term, which is subject to an annual upward adjustment of 3% of the then-current rental rate, as well as its share of operating costs and taxes. The initial term of the Third Frederick Lease Agreement Amendment is expected to commence on September 1, 2025 once the Landlord delivers full possession of the premises to the Company and will be coterminous with the Frederick Lease Agreement, the First Frederick Lease Agreement Amendment and the Second Frederick Lease Agreement Amendment.
The Company secured a letter of credit from Silicon Valley Bank, a division of First-Citizens Bank & Trust Company (successor by purchase to the Federal Deposit Insurance Corporation as Receiver for Silicon Valley Bridge Bank, N.A. (as successor to Silicon Valley Bank)), or SVB, for $0.3 million for the Frederick Lease Agreement, the First Frederick Lease Agreement Amendment and the Second Frederick Lease Agreement Amendment, which is recognized as long-term restricted cash as of March 31, 2025 and December 31, 2024 and renews automatically each year.
65 Grove Street Lease
In July 2019, the Company entered into a lease with BRE-BMR Grove LLC for 25,078 square feet of laboratory and office space located at 65 Grove Street, Watertown, Massachusetts, or the Watertown Lease Agreement. As part of the Watertown Lease Agreement, the Company incurred $0.8 million in on-reimbursable construction costs. The lease began in March 2020, when the Company took control of the office space, and the lease term is eight years. The discount rate of 8.9% was determined based on the Company’s incremental borrowing rate adjusted for the lease term, including any reasonably certain renewal periods. In connection with the Watertown Lease Agreement, the Company secured a letter of credit from SVB for $1.6 million.
On September 1, 2022, the Company entered into an amendment to the Watertown Lease, or the Watertown Lease Agreement Amendment, to expand the Company’s laboratory and office space located at 65 Grove Street, Watertown, Massachusetts by approximately 7,216 square feet. The lease term began on September 1, 2022, consistent with when the Company took control of the office space and expected lease term is 5.7 years. The discount rate of 11.3% was determined based on the Company’s incremental borrowing rate adjusted for the lease term including any reasonably certain renewal periods. Rent payments began in November 2022, and the base rent for the first year is $0.1 million per month. The Company recorded the right-of-use asset and operating lease liabilities of $3.2 million during the year ended December 31, 2022 as control of the premises was transferred to the Company during such year.
On October 6, 2022, the Company entered into a sublease agreement to sublease 7,216 square feet of space currently rented by the Company at 65 Grove Street, Watertown, Massachusetts. The sublease commenced on October 24, 2022. The term of the sublease expired on March 31, 2024 with no option to extend the sublease term. Sublease income is included within other income, net in the consolidated statements of operations and comprehensive loss.
As a result of the sublease agreement, rent payments to BRE-BMR Grove LLC for the lease of the office space increased. The change of consideration in the contract was accounted for as a lease modification and the right-of-use asset and lease liability were remeasured at the modification date of October 24, 2022. The discount rate of 11.9% was determined based on the Company’s incremental borrowing rate adjusted for the lease term including any reasonably certain renewal periods as of October 24, 2022, resulting in a decrease of less than $0.1 million to both the right-of-use asset and lease liabilities.
In May 2023, the Company received notice from BRE-BMR Grove LLC that the requirements to reduce the amount of the letter of credit for the Watertown Lease had been met. In connection therewith, in June 2023, the Company secured a letter of credit from JPMorgan Chase Bank, N.A. for $1.4 million, which is recognized as long-term restricted cash as of March 31, 2025 and December 31, 2024, and renews automatically each year. The $1.6 million letter of credit with SVB was released from restriction and returned to the Company on July 17, 2023, and therefore was reclassified into cash and cash equivalents in the consolidated balance sheets.
On October 31, 2023, in connection with entering into Amendment No. 1 to the Sobi License as described in Note 13, the Company entered into a sublease agreement with Sobi to sublease approximately 5,600 square feet of space currently rented by the Company at 65 Grove Street, Watertown, Massachusetts for which Sobi paid $1.0 million upfront rental payment. The sublease commenced on November 6, 2023. The term of this sublease expired on November 5, 2024. Sublease income is included within other income, net in the consolidated statements of operations and comprehensive loss.
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During the year ended December 31, 2023, the Company determined that the right-of-use asset related to the operating lease for approximately 7,216 square feet at 65 Grove Street was partially impaired as of November 30, 2023. As a result, the Company recognized a $0.7 million right-of-use asset impairment charge in the year ended December 31, 2023.
As a result of the expiration of the sublease to Sobi in November 2024 and the Company’s decision to cease use of its office and laboratory space at 65 Grove Street, Watertown, Massachusetts, the Company assessed the right-of-use assets and related furniture and fixtures associated with the Watertown Lease Agreement and Watertown Lease Agreement Amendment for impairment. The carrying value of each asset group was compared against the future net undiscounted cash flows projected to be generate over the remaining lease terms. These projections included management’s estimates off cash inflows from potential sublease income. The carrying amount of the asset groups was found to be unrecoverable, thus the Company assessed the fair value of each asset group. The fair value was determined using the income approach, whereby the Company discounted the estimated net cash flows using a rate commensurate with the Company’s estimated incremental borrowing rate. As a result of this assessment, which included unrecoverable operating and maintenance costs, the Company determined that each asset group was fully impaired. As such, an impairment charge of $7.6 million was recognized during the year ended December 31, 2024, $7.4 million of which related to the right-of-use assets and $0.2 million related to property and equipment.
704 Quince Orchard Road Leases
In connection with the Merger, the Company acquired two operating leases for office and laboratory space in Gaithersburg, Maryland. These leases expire in January 2027 and do not contain any renewal rights. The discount rate of 11.5% was determined based on the Company’s incremental borrowing rate adjusted for the lease term.
For the three months ended March 31, 2025 and 2024, the components of lease costs were as follows (in thousands):

|  |  | Three Months Ended March 31,
|  |  |  |  | 2025 |  | 2024
Operating lease cost |  |  |  |  | $ | 584 |  |  | $ | 775 |
Variable lease cost |  |  |  |  | 406 |  |  | 397 |
Short-term lease cost |  |  |  |  | 11 |  |  | 3 |
Less: Sublease income |  |  |  |  | — |  |  | (510) |
Total lease cost |  |  |  |  | $ | 1,001 |  |  | $ | 665 |

The maturity of the Company’s operating lease liabilities as of March 31, 2025 were as follows (in thousands):

| March 31, |  |
| 2025 |  |
2025 (remainder) | $ | 3,328 |  |  |
2026 | 4,538 |  |  |
2027 | 4,345 |  |  |
2028 | 2,314 |  |  |
2029 | 1,409 |  |  |
Thereafter | 2,188 |  |  |
Total future minimum lease payments | 18,122 |  |  |
Less: Imputed interest | 4,056 |  |  |
Total operating lease liabilities | $ | 14,066 |  |  |

The supplemental disclosure for the statements of cash flows related to operating leases was as follows (in thousands):

| Three Months Ended March 31,
| 2025 |  | 2024
Cash paid for amounts included in the measurement of lease liabilities: | $ | 317 |  |  | $ | 761 |

The changes in the Company’s right-of-use assets and lease liabilities for the three months ended March 31, 2025 and 2024 are reflected in the non-cash lease expense and accrued expenses and other liabilities, respectively, in the consolidated statements of cash flows.
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The following summarizes additional information related to operating leases:

| March 31,
| 2025 |  | 2024
Weighted-average remaining lease term | 4.4 years |  | 4.0 years
Weighted-average discount rate | 11.8 | % |  | 9.9 | %

11. Equity
Equity Financings
2024 Private Placement
On July 2, 2024, the Company and certain institutional and accredited investors, or the Purchasers, entered into the 2024 Securities Purchase Agreement for the 2024 Private Placement.
Pursuant to the 2024 Securities Purchase Agreement, the Purchasers agreed to purchase an aggregate of 3,563,247 shares of common stock and 2,937,903 shares of Series B Preferred Stock, inclusive of 2,359,500 shares of Series B Preferred Stock purchased by directors and executive officers of the Company, and related parties thereto, each at a price per share of $20.00. The 2024 Private Placement resulted in gross proceeds of approximately $130.0 million before deducting placement agent fees and other offering expenses.
“At-the-Market” Offering
On December 13, 2024, the Company entered into a Sales Agreement, or the Sales Agreement, with Leerink Partners LLC to sell shares of the Company’s common stock, from time to time, through an “at the market” equity offering program under which Leerink Partners LLC will act as sales agent. The shares of common stock sold pursuant to the Sales Agreement will be issued pursuant to the Company’s shelf registration statement on Form S-3 (File No. 333-283803), filed on December 13, 2024 with the SEC, and related prospectus supplement, filed on January 8, 2025 with the SEC, for aggregate gross sales proceeds of up to $100.0 million.
During the three months ended March 31, 2025 and the year ended December 31, 2024, the Company sold no shares of its common stock pursuant to the Sales Agreement.
Warrants
The following is a summary of warrant activity for the three months ended March 31, 2025:

| Number of Warrants |  |
| Equity classified |  | Liability classified |  | Total |  | Weighted-average exercise price
Outstanding at December 31, 2024 | 6,811 |  |  | 685,712 |  |  | 692,523 |  |  | $ | 46.96 |
Outstanding at March 31, 2025 | 6,811 |  |  | 685,712 |  |  | 692,523 |  |  | $ | 46.96 |

See Note 12 to the consolidated financial statements included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2024 for further discussion of the terms related to the Company’s warrants.
Common Stock
On April 4, 2024, the Company implemented the Reverse Stock Split. The Reverse Stock Split became effective at 4:30 p.m. Eastern Time on April 4, 2024. On April 5, 2024, the Company’s common stock began trading on The Nasdaq Global Market on a split-adjusted basis under the symbol “RNAC” with a new CUSIP number, 816212302. As a result of the Reverse Stock Split, every 30 shares of common stock outstanding were combined, automatically and without any action on the part of the Company or its stockholders, into one share of common stock. Stockholders entitled to fractional shares as a result of the Reverse Stock Split received a cash payment in lieu of receiving fractional shares. The Reverse Stock Split did not change the number of authorized shares or par value of the Company’s common or preferred stock.
Preferred Stock
As of March 31, 2025, the Company had 120,790.402 shares of Series A Preferred Stock and 437,927 shares of Series B Preferred Stock issued and outstanding, respectively, which are convertible into 4,464,273 shares of common stock.
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Reserved Shares
The Company has authorized shares of common stock for future issuance as of March 31, 2025 as follows:

| March 31,
| 2025
Exercise of warrants | 692,523 |
Shares available for future stock incentive awards | 4,169,806 |
Unvested restricted stock units | 572,605 |
Outstanding common stock options | 2,475,023 |
Series A Preferred Stock | 4,026,346 |
Series B Preferred Stock | 437,927 |
Total | 12,374,230 |

12. Stock Incentive Plans
The Company maintained the 2008 Stock Incentive Plan, or the 2008 Plan, for employees, consultants, advisors, and directors. The 2008 Plan provided for the granting of incentive and non-qualified stock option and restricted stock awards as determined by the Board of Directors. In connection with the Merger, all outstanding awards issued under the 2008 Plan were cancelled, and the Board of Directors formally terminated the 2008 Plan.
In June 2016, the Company’s stockholders approved the 2016 Incentive Award Plan, or the 2016 Plan, which authorized 40,341 shares of common stock for future issuance under the 2016 Plan and the Company ceased granting awards under the 2008 Plan. Upon the effective date of the 2016 Plan, awards issued under the 2008 Plan remained subject to the terms of the 2008 Plan. Awards granted under the 2008 Plan that expired, lapsed or terminated became available under the 2016 Plan as shares available for future grants.
Additionally, pursuant to the terms of the 2016 Plan, the Board of Directors is authorized to grant awards with respect to common stock, and may delegate to a committee of one or more members of the Board of Directors or executive officers of the Company the authority to grant options and restricted stock units. On December 9, 2020, the Board of Directors established a Stock Option Committee authorized to grant awards to certain employees and consultants subject to conditions and limitations within the 2016 Plan. In June 2024, the Company’s stockholders approved an amendment and restatement of the 2016 Plan to reserve an additional 3,466,544 shares of the Company’s common stock for issuance. In January 2025, the number of shares of common stock that may be issued under the 2016 Plan was increased by 1,030,694. As of March 31, 2025, 3,598,149 shares remain available for future issuance under the 2016 Plan.
In September 2018, the Company’s 2018 Employment Inducement Incentive Award Plan, or the 2018 Inducement Incentive Award Plan, was adopted by the Board of Directors without stockholder approval pursuant to Rule 5635(c)(4) of the Nasdaq Stock Market LLC listing rules, which authorized 39,166 shares of its common stock for issuance. In March 2019, the Board of Directors approved an amendment and restatement of the 2018 Inducement Incentive Award Plan to reserve an additional 66,667 shares of the Company’s common stock for issuance thereunder. In December 2023, the Board of Directors approved an amendment and restatement of the 2018 Inducement Incentive Award Plan to reserve an additional 60,833 shares of the Company’s common stock for issuance thereunder. In June and December 2024, the Board of Directors approved amendments and restatements of the 2018 Inducement Incentive Award Plan to reserve an additional 360,000 and 450,000 shares, respectively, of the Company’s common stock for issuance thereunder. As of March 31, 2025, there are 489,683 shares available for future grant under the 2018 Inducement Incentive Award Plan.
In accordance with the Merger Agreement, the Company assumed Old Cartesian’s 2016 Stock Incentive Plan, or the Old Cartesian Plan. The Old Cartesian Plan permits the granting of options or restricted stock to employees, officers, directors, consultants and advisors to the Company. The unvested common stock options and Series A Preferred Stock options assumed by the Company in connection with the Merger generally vest over a four-year period. Additionally, the stock options granted have a contractual term of ten years and only full shares can be exercised as per the individual award agreements. As of March 31, 2025, there are 36,179 shares available for future grant under the Old Cartesian Plan.
In connection with the Merger, the outstanding stock options to purchase Old Cartesian common stock were converted into stock options to purchase 776,865 shares of common stock and 14,112.299 shares of Series A Preferred Stock of the Company. These replacement awards were revalued at their acquisition-date fair value and then attributed to pre- and post-combination service. This resulted in $2.6 million attributed to post-combination service to be recognized as stock-based compensation expense over the remaining terms of the replacement awards, of which $0.2 million and $0.4 million was recognized as research and development expense in the consolidated statements of operations and comprehensive loss during the three months ended March 31, 2025 and 2024, respectively. Following the stockholder approval of the conversion of the Series A Preferred Stock into shares of common stock, the options exercisable for shares of Series A Preferred Stock became exercisable for shares of common stock.
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Stock-Based Compensation Expense
Stock-based compensation expense by classification included within the consolidated statements of operations and comprehensive loss, was as follows (in thousands):

| Three Months Ended March 31, |  |
| 2025 |  | 2024 |  |  |  |
Research and development | $ | 1,275 |  |  | $ | 712 |  |  |  |  |
General and administrative | 1,233 |  |  | 719 |  |  |  |  |
Total stock-based compensation expense | $ | 2,508 |  |  | $ | 1,431 |  |  |  |  |

Stock Options
The estimated grant date fair values of stock option awards granted under the 2016 Plan and the 2018 Inducement Incentive Award Plan were calculated using the Black-Scholes option pricing model based on the following weighted-average assumptions:

| Three Months Ended March 31, |  |
| 2025 |  | 2024 |  |  |  |
Risk-free interest rate | 4.46 | % |  | 3.95 | % |  |  |  |
Dividend yield | — |  |  | — |  |  |  |  |
Expected term (in years) | 6.20 |  | 6.20 |  |  |  |
Expected volatility | 97.44 | % |  | 95.37 | % |  |  |  |
Weighted-average fair value of common stock | $ | 17.46 |  |  | $ | 19.78 |  |  |  |  |

The expected term of the Company’s stock options granted has been determined utilizing the “simplified” method for awards that qualify as “plain-vanilla” options. Under the simplified method, the expected term is presumed to be the midpoint between the vesting date and the end of the contractual term. The Company utilizes this method due to lack of historical exercise data and the plain nature of its stock-based awards. Expected volatilities are based on the Company’s historical volatility.
The weighted-average grant date fair value of stock options granted during the three months ended March 31, 2025 and 2024 was $14.03 and $15.79, respectively.
As of March 31, 2025, total unrecognized compensation expense related to unvested common stock options was $17.9 million, which is expected to be recognized over a weighted average period of 3.2 years.
The following table summarizes the stock option activity under the 2016 Plan, the 2018 Inducement Incentive Award Plan, and the Old Cartesian Plan for options for common stock:

|  |  |  |  | Weighted-average |  |
| Number of |  |  |  | remaining |  | Aggregate
| common stock |  | Weighted-average |  | contractual term |  | intrinsic value
| options |  | exercise price ($) |  | (in years) |  | (in thousands)
Outstanding at December 31, 2024 | 1,706,035 |  |  | $ | 11.99 |  |  | 7.59 |  | $ | 12,025 |
Granted | 944,909 |  |  | $ | 17.46 |  |  |  |  |
Exercised | (55,690) |  |  | $ | 3.29 |  |  |  |  |
Forfeited | (120,231) |  |  | $ | 18.49 |  |  |  |  |
Outstanding at March 31, 2025 | 2,475,023 |  |  | $ | 13.96 |  |  | 8.17 |  | $ | 7,376 |
Vested at March 31, 2025 | 781,188 |  |  | $ | 6.23 |  |  | 5.67 |  | $ | 6,490 |
Vested and expected to vest at March 31, 2025 | 2,181,547 |  |  | $ | 13.38 |  |  | 8.00 |  | $ | 7,376 |

Restricted Stock Units
During the three months ended March 31, 2025, the Company granted 256,790 restricted stock unit awards with a weighted-average fair value of $16.93 per share based on the closing price of the Company’s common stock on the date of grant under the 2016 Plan, which generally vest over a four-year term. Forfeitures are estimated at the time of grant and are adjusted, if necessary, in subsequent periods if actual forfeitures differ from those estimates. The Company has estimated a forfeiture rate of 10% for restricted stock unit awards based on historical experience.
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Unrecognized compensation expense related to the restricted stock units was $8.0 million as of March 31, 2025, which is expected to be recognized over a weighted-average period of 3.0 years.
The following table summarizes the Company’s restricted stock units under the 2016 Plan and the Old Cartesian Plan:

| Number of shares |  | Weighted-average grant date fair value ($)
Unvested at December 31, 2024 | 444,238 |  |  | $ | 19.86 |
Granted | 256,790 |  |  | 16.93 |
Vested | (113,042) |  |  | 19.66 |
Forfeited | (15,381) |  |  | 17.15 |
Unvested at March 31, 2025 | 572,605 |  |  | $ | 18.63 |

13. Revenue Arrangements
Collaboration and license revenue
Astellas Gene Therapies
License and Development Agreement
In January 2023, the Company entered into the License and Development Agreement, or the Astellas Agreement, with Audentes Therapeutics, Inc., or Astellas. Under the Astellas Agreement, the Company granted Astellas an exclusive license to the Company’s IdeXork technology arising from Xork, to develop and commercialize Xork for use in Pompe disease in combination with an Astellas gene therapy investigational or authorized product. Xork, Genovis’ IgG Protease, was licensed pursuant to an Exclusive License Agreement, or the Genovis Agreement, with Genovis AB (publ.), or Genovis, as described in Note 15 to these unaudited consolidated financial statements. Astellas paid a $10.0 million upfront payment to the Company upon signing of the Astellas Agreement, and the Company was entitled to receive up to $340.0 million in future additional payments over the course of the partnership that were contingent on the achievement of various development and regulatory milestones and, if commercialized, sales thresholds for annual net sales where Xork is used as a pre-treatment for an Astellas investigational or authorized product. The Company was also eligible for tiered royalty payments ranging from low to high single digits. Any proceeds received from milestone payments or royalties relating to Xork would have been required to be distributed to holders of CVRs, net of certain deductions. A more detailed description of the Astellas Agreement and the Company's evaluation of this agreement under ASC 606 can be found in Note 14 to the consolidated financial statements in the Company’s Annual Report on Form 10-K for the year ended December 31, 2024.
In March 2024, the Company was notified by Astellas of its intention to terminate the Astellas Agreement, which occurred effective June 6, 2024.
As of March 31, 2025, there were no unsatisfied performance obligations related to the Astellas Agreement. As of each of March 31, 2025 and December 31, 2024, the Company recorded a receivable of $0.1 million, representing billings for the Xork Development Services (as defined in the Astellas Agreement) that are subject to reimbursement by Astellas. No revenue related to the Astellas Agreement was recognized during the three months ended March 31, 2025. During the three months ended March 31, 2024, revenue of $5.8 million related to the Astellas Agreement was recognized, inclusive of $3.2 million of revenue recognized from performance obligations related to prior periods as a result of the change in transaction price during the three months ended March 31, 2024.
Swedish Orphan Biovitrum AB (publ.)
License and Development Agreement
In June 2020, the Company and Sobi entered into the Sobi License, which was subsequently amended in October 2023. Pursuant to the Sobi License, the Company agreed to grant Sobi an exclusive, worldwide (except as to Greater China) license to develop, manufacture and commercialize the SEL-212 drug candidate, which is currently in development for the treatment of chronic refractory gout. The SEL-212 drug candidate is a pharmaceutical composition containing a combination of SEL-037, or the Compound, and ImmTOR. Pursuant to the Sobi License, in consideration of the license, Sobi agreed to pay the Company a one-time, upfront payment of $75.0 million. Sobi has also agreed to make milestone payments totaling up to $630.0 million to the Company upon the achievement of various development and regulatory milestones and, if commercialized, sales thresholds for annual net sales of SEL-212, and tiered royalty payments ranging from the low double digits on the lowest sales tier to the high teens on the highest sales tier. A more detailed description of the Sobi License and the Company’s evaluation of this agreement under ASC 606 can be found in Note 14 to the consolidated financial statements in the Company’s Annual Report on Form 10-K for the year ended December 31, 2024. Any proceeds received from milestone payments or royalties relating to the Sobi License would be required to be distributed to holders of CVRs, net of certain deductions.
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On June 28, 2024, Sobi initiated a rolling biologics license application to the FDA for SEL-212 for the potential treatment of chronic refractory gout which resulted in the achievement of a development milestone and a $30.0 million payment obligation from Sobi to the Company. As a result, the development milestone was no longer constrained and $30.0 million was recognized as revenue during the year ended December 31, 2024 as there were no remaining performance obligations under the Sobi License. The proceeds from the achievement of the development milestone were received from Sobi in July 2024 and were included, net of deductions as specified in the CVR Agreement, in the distribution to holders of the CVRs in March 2025.
As of each of March 31, 2025 and December 31, 2024, the Company recorded total outstanding receivables of $0.1 million, representing billings for the Phase 3 DISSOLVE program that are subject to reimbursement by Sobi. Additionally, as of March 31, 2025 and December 31, 2024, there was no unbilled receivable outstanding. No revenue was recognized during either of the three months ended March 31, 2025 and 2024.
Transaction Price Allocated to Future Performance Obligations
Remaining performance obligations represent the transaction price of contracts for which work has not been performed, or has been partially performed. As of March 31, 2025 and December 31, 2024, there were no unsatisfied performance obligations from contracts with customers.
Grant revenue
National Institute of Neurological Disorders and Stroke of the National Institutes of Health
In June 2024, the Company received funding approval from the National Institute of Neurological Disorders and Stroke of the National Institutes of Health, or NINDS, for an award of $1.5 million granted for the budget period, which runs from June 2024 through May 2025. Subject to the availability of funds and satisfactory progress of the project, an additional $1.5 million has been recommended by NINDS to be awarded for the budget period June 2025 through May 2026. The funding was provided by NINDS to further the Company’s use of RNA-based CAR-T cells to combat autoantibody-associated autoimmune disorders. Grant funding is to be used solely for manufacturing of RNA-based CAR-T cells and analysis of samples to inform mechanism of action. The award period runs through May 31, 2026. The Company will recognize grant revenue when expenses reimbursable under the grant have been incurred.
As of March 31, 2025 and December 31, 2024, the Company recorded a receivable of $1.3 million and $0.6 million, respectively, that is subject to reimbursement by NINDS. The Company recognized grant revenue of $0.7 million during the three months ended March 31, 2025.
14. Related-Party Transactions
2023 Securities Purchase Agreement
On November 13, 2023, the Company entered into the 2023 Securities Purchase Agreement with (i) Dr. Timothy A. Springer, a member of the Company’s Board of Directors, (ii) TAS Partners LLC, an affiliate of Dr. Springer, and (iii) Seven One Eight Three Four Irrevocable Trust, a trust associated with Dr. Murat Kalayoglu, a member of the Company’s Board of Directors, in which the Company agreed to issue and sell an aggregate of 149,330.115 shares of Series A Preferred Stock for an aggregate purchase price of $60.25 million (see Note 10). The 2023 Private Placement included a delayed settlement mechanism, and as a result, the below issuances and sales to related parties of the Company were made during the three months ended March 31, 2024.

Name |  | Shares of Series A Preferred Stock purchased |  | Total aggregate purchase price (in thousands)
Timothy A. Springer, Ph.D. |  | 99,140.326 |  |  | $ | 40,000 |

Exercise of Amended 2019 Warrants
On March 26, 2024, TAS Partners LLC exercised 65,681 Amended 2019 Warrants, paid the per-share exercise price of $43.80 in cash for an aggregate exercise price of $2.9 million, and received 65,681 shares of common stock and 1,970,443 CVRs.
During the three months ended March 31, 2025, there were no related party transactions.
15. Collaboration and License Agreements
Biogen MA, Inc.
On September 8, 2023, the Company entered into a non-exclusive, sublicensable, worldwide, perpetual patent license agreement, or the Biogen Agreement, with Biogen MA, Inc., or Biogen, to research, develop, make, use, offer, sell and import products or processes containing or using an engineering T-cell modified with an mRNA comprising, or encoding a protein comprising, certain sequences licensed under the Biogen Agreement for the prevention, treatment, palliation and management
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of autoimmune diseases and disorders, excluding cancers, neoplastic disorders, and paraneoplastic disorders. The Company is not obligated to pay Biogen any expenses, fees, or royalties.
The Company may terminate the Biogen Agreement for any reason or no reason, and Biogen may terminate the agreement after a notice-and-cure period of 30 days if the Company fails to pay a fee owed to Biogen or for any other material breach of the agreement. The Biogen Agreement will otherwise expire when all claims of all issued patents within the patents and patent applications licensed to the Company under the Biogen Agreement have expired or been finally rendered revoked, invalid or unenforceable by a decision of a court or government agency.
The Biogen Agreement encompasses patents and patent applications in the PCT/US2010/026825 patent family, which was filed March 10, 2010. In general, all patents that issue in this family have an expected expiration date of March 10, 2030, subject to potential patent term adjustments and/or extensions. For the U.S. patents and applications in this family, U.S. Patent 9,034,324 was awarded 677 days of patent term adjustment, which would extend the expiration date of this patent to January 16, 2032, absent any challenges to the patent term. The other issued patent in this family was not awarded any patent term adjustment, so its expected expiration date is March 10, 2030.
National Cancer Institute of the National Institutes of Health
Effective September 16, 2019, the Company entered into a nonexclusive, worldwide license agreement, or the NCI Agreement, with the U.S. Department of Health and Human Services, represented by the National Cancer Institute of the National Institutes of Health, or NCI.
Under the NCI Agreement, the Company was granted a license under certain NCI patents and patent applications designated in the agreement, to make, use, sell, offer and import products and processes within the scope of the patents and applications licensed under the NCI Agreement when developing and manufacturing anti-BCMA CAR-T cell products for the treatment of myasthenia gravis, pemphigus vulgaris, and immune thrombocytopenic purpura according to methods designated in the NCI Agreement.
In connection with the Company’s entry into the NCI Agreement, Old Cartesian paid to NCI a one-time $0.1 million license royalty payment. Under the NCI Agreement, the Company is further required to pay NCI a low five-digit annual royalty. The Company must also pay earned royalties on net sales in a low single-digit percentage and pay up to $0.8 million in benchmark royalties upon the Company’s achievement of designated benchmarks that are based on the commercial development plan agreed between the parties.
Under the NCI Agreement, the Company must use reasonable commercial efforts to bring licensed products and licensed processes to the point of Practical Application (as defined in the NCI Agreement). Upon the Company’s first commercial sale, the Company must use reasonable commercial efforts to make licensed products and licensed processes reasonably accessible to the United States public. After the Company’s first commercial sale, the Company must make reasonable quantities of licensed products or materials produced via licensed processes available to patient assistance programs and develop educational materials detailing the licensed products. Unless the Company obtains a waiver from NCI, the Company must have licensed products and licensed processes manufactured substantially in the United States. Prior to the first commercial sale, upon NCI’s request, the Company is obligated to provide NCI with commercially reasonable quantities of licensed products made through licensed processes to be used for in vitro research.
Additionally, the Company must use reasonable commercial efforts to initiate a Phase 3 clinical trial of a licensed product by the fourth quarter of 2024, submit a BLA with respect to a licensed product by the fourth quarter of 2026, and make a first commercial sale of a licensed product by the fourth quarter of 2028.
The NCI Agreement terminates upon the expiration of the last to expire of the patent rights licensed thereunder, if not sooner terminated. The NCI Agreement encompasses patents and patent applications in the PCT/US2013/032029 patent family, which was filed March 15, 2013. In general, all patents that issue in this family have an expected expiration of March 15, 2033, subject to potential patent term adjustments and/or extensions. For the U.S. patents and applications in this family, only two patents were awarded patent term adjustments. U.S. Patent 9,765,342 was awarded 297 days of patent term adjustment, which would extend the expiration date of this patent to January 6, 2034, absent any challenges to the patent term. The other patent, U.S. Patent 10,876,123, was awarded three days of patent term adjustment, but this patent is subject to terminal disclaimers filed against other family members, so this patent will not extend beyond the March 15, 2033 date. The other issued patents in this family were not awarded any patent term adjustment, so the expected expiration date for these patents also remains March 15, 2033. There is also a pending patent application which, if issued, will expire on March 15, 2033, but could also be subject to patent term adjustment and to any potential future terminal disclaimers.
NCI has the right to terminate the NCI Agreement, after giving written notice and providing a cure period in accordance with its terms, if the Company is in default of a material obligation. The Company has the unilateral right to terminate the agreement in any country or territory by giving NCI 60 days’ written notice. The Company agreed to indemnify NCI against any liability arising out of the Company’s, sublicensees’ or third parties’ use of the licensed patent rights and licensed products or licensed processes developed in connection with the licensed patent rights.
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Genovis AB (publ.)
License Agreement
In October 2021, the Company entered into the Genovis Agreement with Genovis. Under the Genovis Agreement, the Company paid to Genovis an upfront payment in exchange for an exclusive license to the Xork enzyme technology across all therapeutic uses in humans, excluding research, preclinical, diagnostic and other potential non-therapeutic applications of the enzyme. Genovis was eligible to earn from the Company development and sales-based milestones and sublicensing fees. The Genovis Agreement was assessed for collaboration components and was determined not to be within the scope of ASC 808 as the risk and rewards are not shared by both parties. The Company was to expense costs related to the Genovis Agreement as incurred until regulatory approval was received in accordance with ASC 730. The Company would have assessed the capitalization of costs incurred after the receipt of regulatory approval and, if applicable, would have amortized these payments based on the expected useful life of each asset, typically based on the expected commercial exclusivity period. The Company was also obligated to pay Genovis tiered royalties of low double digit percentages of worldwide annual net sales of collaboration products which would have been expensed as the commercial sales occurred.
In February 2023, the Company made a $4.0 million payment to Genovis as a result of the sublicense of Xork to Astellas. See Note 13 to these unaudited consolidated financial statements for further discussion on the Astellas Agreement.
In March 2024, the Company notified Genovis of its intention to terminate the Genovis Agreement, which occurred effective September 13, 2024.
Shenyang Sunshine Pharmaceutical Co., Ltd
In May 2014, the Company entered into a license agreement, or the 3SBio License, with Shenyang Sunshine Pharmaceutical Co., Ltd., or 3SBio. The Company has paid to 3SBio an aggregate of $7.0 million in upfront and milestone-based payments under the 3SBio License as of March 31, 2025. The Company is required to make future payments to 3SBio contingent upon the occurrence of events related to the achievement of clinical and regulatory approval milestones of up to an aggregate of $15.0 million for products containing the Company’s ImmTOR platform.
16. Income Taxes
As of March 31, 2025, the Company has not recorded any U.S. federal or state income tax benefits for either the net losses the Company has incurred or its earned research and orphan drug credits, due to the uncertainty of realizing a benefit from those items in the future.
17. Commitments and Contingencies
As of March 31, 2025, the Company was not a party to any litigation that could have a material adverse effect on the Company’s business, financial position, results of operations or cash flows.
Other
As permitted under Delaware law, the Company indemnifies its officers, directors, consultants and employees for certain events or occurrences that happen by reason of the relationship with, or position held at the Company. Through March 31, 2025, the Company had not experienced any losses related to these indemnification obligations, and no claims were outstanding. The Company does not expect significant claims related to these indemnification obligations and, consequently, concluded that the fair value of these obligations is negligible, and no related reserves were established.
Additionally, as permitted under Delaware law, the Company indemnifies its directors for certain events or occurrences while the director is, or was, serving at the Company’s request in such capacity. The term of the indemnification is for the director’s lifetime. The maximum potential amount of future payments the Company could be required to make is unlimited; however, the Company has directors’ insurance coverage that limits its exposure and enables it to recover a portion of any future amounts paid. The Company also has indemnification arrangements under certain of its facility leases that require it to indemnify the landlord against certain costs, expenses, fines, suits, claims, demands, liabilities, and actions directly resulting from certain breaches, violations, or non-performance of any covenant or condition of the Company’s lease. The term of the indemnification is for the term of the related lease agreement. The maximum potential amount of future payments the Company could be required to make under these indemnification agreements is unlimited. To date, the Company had not experienced any material losses related to any of its indemnification obligations, and no material claims with respect thereto were outstanding.
The Company is a party in various other contractual disputes and potential claims arising in the ordinary course of business. The Company does not believe that the resolution of these matters will have a material adverse effect on the Company’s business, financial position, results of operations or cash flows.
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18. Restructuring
In April 2023, in light of then-current market conditions, the Board of Directors took steps to extend the Company’s cash runway by pausing further development of the Company’s product candidate, SEL-302, for the treatment of methylmalonic acidemia, and conducting a targeted headcount reduction. On August 17, 2023, the Company announced additional steps to extend cash runway and maximize value for stockholders by continuing to prioritize development of the Company’s product candidate, SEL-212, and support of its collaboration with Astellas for Xork, and pausing further development of all of the Company’s other clinical and preclinical product candidates that it was no longer actively advancing. As a result of these measures, the Company implemented a restructuring plan that resulted in an approximate 90% reduction of the Company’s headcount as of April 2023.
The following table summarizes the change in the Company’s accrued restructuring balance included in accrued expenses and other current liabilities on its consolidated balance sheets (in thousands):

| As of |  |  |  |  |  | As of
| December 31, 2023 |  | Charges |  | Cash Payments |  | March 31, 2024
Severance liability | $ | 3,896 |  |  | $ | 292 |  |  | $ | (3,320) |  |  | $ | 868 |
| As of |  |  |  |  |  | As of
| December 31, 2024 |  | Charges |  | Cash Payments |  | March 31, 2025
Severance liability | $ | 80 |  |  | $ | — |  |  | $ | (80) |  |  | $ | — |

The Company recognized restructuring expenses consisting of one-time cash severance payments and other employee-related costs. The Company recorded these restructuring charges based on each employee’s role to the respective research and development and general and administrative operating expense categories on its consolidated statements of operations and comprehensive loss. For the three months ended March 31, 2025, the Company recognized no restructuring charges. For the three months ended March 31, 2024, the Company recognized $0.2 million in research and development expenses and $0.1 million in general and administrative expenses. Payments for the restructuring plan were completed by March 31, 2025.
19. Segment Information
The following table presents selected financial information with respect to the Company’s single operating segment for the three months ended March 31, 2025 and 2024 (in thousands):

|  | Three Months Ended March 31,
|  | 2025 |  | 2024
Revenue: |  |  |  |
Collaboration and license revenue |  | $ | 400 |  |  | $ | 5,840 |
Grant revenue |  | 700 |  |  | — |
Total revenue |  | 1,100 |  |  | 5,840 |
Less |  |  |  |
Operating expenses: |  |  |  |
Legacy Selecta programs |  | — |  |  | 2,777 |
Descartes-08 for MG |  | 7,036 |  |  | 1,266 |
Early stage programs |  | 990 |  |  | 127 |
Research and development employee expenses |  | 3,702 |  |  | 3,241 |
Research and development stock-based compensation expense |  | 1,275 |  |  | 712 |
Research and development facilities and other expenses |  | 1,671 |  |  | 1,615 |
General and administrative |  | 8,315 |  |  | 9,450 |
Other (income) expense, net (1) |  | (4,179) |  |  | 43,476 |
Net loss |  | $ | (17,710) |  |  | $ | (56,824) |

(1) Includes interest income; foreign currency transaction, net; change in fair value of warrant liabilities; change in fair value of contingent value right liability; change in fair value of forward contract liabilities; and other income, net.
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20. Subsequent Events
The Company has evaluated subsequent events through the date on which the consolidated financial statements were issued. The Company has concluded that no subsequent events have occurred that require disclosure.
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations
The following discussion and analysis of our financial condition and results of operations should be read in conjunction with our unaudited consolidated financial statements and related notes appearing elsewhere in this Quarterly Report and with our audited financial statements and the notes thereto included in our Annual Report on Form 10-K for the year ended December 31, 2024, which we filed with the SEC on March 13, 2025. In addition, you should read the “Risk Factors” and “Information Regarding Forward-Looking Statements” sections of this Quarterly Report and our Annual Report on Form 10-K for the year ended December 31, 2024 for a discussion of important factors that could cause actual results to differ materially from the results described in or implied by the forward-looking statements contained in the following discussion and analysis.
Overview
We are a clinical-stage biotechnology company pioneering cell therapies for the treatment of autoimmune diseases. Unlike DNA cell therapies, our cell therapy method degrades naturally over time without integrating into the cell’s genetic material. Therefore, our cell therapies are distinguished by their capacity to be dosed repeatedly like conventional drugs, administered in an outpatient setting, and given without pre-treatment chemotherapy required with many conventional cell therapies. In our Phase 2b clinical trial in patients with myasthenia gravis, or MG, a chronic autoimmune disease that causes disabling muscle weakness and fatigue, we observed that our lead product candidate, Descartes-08, generated a deep and durable clinical benefit, with 83% of participants maintaining improvements in MG severity scales considered clinically meaningful by expert consensus at six months and sustained improvements in MG severity scales considered clinically meaningful by expert consensus at 12 months. Durability of response in MG is commonly measured over a period of 26 to 52 weeks, and maintenance of response over that period is considered durable.
Merger
On November 13, 2023, the Company (formerly known as Selecta Biosciences, Inc., or Selecta) merged with the private Delaware corporation which, immediately prior to the Merger (as defined below), was known as Cartesian Therapeutics, Inc., or Old Cartesian, in accordance with the terms of an Agreement and Plan of Merger, or the Merger Agreement, by and among
Selecta, Sakura Merger Sub I, Inc., a wholly owned subsidiary of Selecta, or First Merger Sub, Sakura Merger Sub II, LLC, a wholly owned subsidiary of Selecta, or Second Merger Sub, and Old Cartesian. Pursuant to the Merger Agreement, First Merger Sub merged with and into Old Cartesian, pursuant to which Old Cartesian was the surviving corporation and became a wholly owned subsidiary of Selecta, or the First Merger. Immediately following the First Merger, Old Cartesian merged with and into Second Merger Sub, pursuant to which Second Merger Sub was the surviving entity, or the Second Merger and, together with the First Merger, the Merger. In connection with the Second Merger, Old Cartesian changed its name to Cartesian Bio, LLC. In connection with the Merger and pursuant to the Merger Agreement, the Company changed its corporate name to Cartesian Therapeutics, Inc. See Note 4 of the notes to the consolidated financial statements in our Annual Report on Form 10-K for the year ended December 31, 2024 for additional information regarding the Merger.
Financial Operations
To date, we have financed our operations primarily through public offerings and private placements of our securities, funding received from research grants, collaboration and license arrangements and a credit facility. We do not have any products approved for sale and have not generated any product sales.
Except for the year ended December 31, 2022, we have incurred significant operating losses since our inception. We incurred a net loss of $17.7 million and $56.8 million for the three months ended March 31, 2025 and 2024, respectively. As of March 31, 2025, we had an accumulated deficit of $709.8 million. We expect to continue to incur significant expenses and operating losses for the foreseeable future as we:
•advance Descartes-08 for MG into Phase 3 development;
•continue to develop our preclinical and clinical-stage product candidates;
•seek regulatory approvals for any product candidates that successfully complete clinical trials;
•maintain, expand and protect our intellectual property portfolio, including through licensing arrangements;
•hire additional staff, including clinical, scientific and management personnel; and
•incur additional costs associated with continuing to operate as a public company.
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The following table presents our research and development expenses for the three months ended March 31, 2025 and 2024 (in thousands):

|  | Three Months Ended March 31, |  |  |
|  | 2025 |  | 2024 |  |
| Legacy Selecta programs | $ | — |  |  | $ | 2,777 |  |  |  |  |  |
| Descartes-08 for MG | 7,036 |  |  | 1,266 |  |  |  |  |  |
| Early stage programs | 990 |  |  | 127 |  |  |  |  |  |
| Research and development employee expenses | 3,702 |  |  | 3,241 |  |  |  |  |  |
| Research and development stock-based compensation expense | 1,275 |  |  | 712 |  |  |  |  |  |
| Research and development facilities and other expenses | 1,671 |  |  | 1,615 |  |  |  |  |  |
| Total research and development expenses | $ | 14,674 |  |  | $ | 9,738 |  |  |  |  |  |

Until we can generate substantial product revenues, we expect to finance our cash needs through a combination of equity offerings, debt financings, and license and collaboration agreements. We may be unable to raise capital when needed or on reasonable terms, if at all, which would force us to delay, limit, reduce or terminate our product development or future commercialization efforts. We will need to generate significant revenues to achieve profitability, and we may never do so.
Concurrently with the closing of the Merger, we entered into a securities purchase agreement, or the 2023 Securities Purchase Agreement, pursuant to which we agreed to issue 149,330.115 shares of Series A Non-Voting Convertible Preferred Stock, par value $0.0001 per share, or the Series A Preferred Stock, in exchange for aggregate gross proceeds of $60.25 million, or the 2023 Private Placement. We granted customary registration rights to investors in connection with the 2023 Private Placement.
On July 2, 2024, we entered into a securities purchase agreement, or the 2024 Securities Purchase Agreement, for a private investment in public equity financing, or the 2024 Private Placement, which provided for the issuance of 3,563,247 shares of common stock and 2,937,903 shares of Series B Non-Voting Convertible Preferred Stock, par value $0.0001 per share, or the Series B Preferred Stock, each at a purchase price of $20.00 per share. The 2024 Private Placement resulted in gross proceeds of approximately $130.0 million before deducting placement agent fees and other offering expenses. We granted customary registration rights to investors in connection with the 2024 Private Placement.
We believe that our existing cash, cash equivalents, and restricted cash as of March 31, 2025 will enable us to fund our operating expenses and capital expenditure requirements into mid-2027. We have based this estimate on assumptions that may prove to be wrong, and we could use our capital resources sooner than we currently expect.
The consolidated financial information presented below includes the accounts of Cartesian Therapeutics, Inc. and our wholly owned subsidiaries, Selecta (RUS) LLC, a Russian limited liability company, or Selecta (RUS), Selecta Biosciences Security Corporation, a Massachusetts securities corporation which was dissolved in December 2024, and Cartesian Bio, LLC, a Delaware limited liability company, which is a variable interest entity for which we are the primary beneficiary. All intercompany accounts and transactions have been eliminated.
Components of our Results of Operations
Collaboration and license revenue
To date, we have not generated any revenue from product sales. Our revenue consists primarily of collaboration and license revenue, which includes amounts recognized related to upfront and milestone payments for research and development funding under collaboration and license agreements. We expect that any revenue we generate will fluctuate from quarter to quarter because of the timing and amounts of fees, research and development reimbursements and other payments from collaborators. We do not expect to generate revenue from product sales for at least the next several years. If we or our collaborators fail to complete the development of our product candidates in a timely manner or fail to obtain regulatory approval as needed, our ability to generate future revenue will be harmed, and will affect the results of our operations and financial position. For further descriptions of the agreements underlying our collaboration and license revenue, see Note 13 to our unaudited consolidated financial statements included elsewhere in this Quarterly Report.
Grant revenue
Additionally, we generate grant revenue which consists of funding received to perform specific research and development services under grant arrangements.
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Research and development
Our research and development expenses consist of internal and external research and development costs, which primarily include fees paid to contract research organizations, internal manufacturing and quality related expenses, process development costs, internal research and development expenses, as well as fees paid to contract manufacturing organizations. These costs are primarily associated with compensation expenses for our research and development employees, capital equipment and supplies for our process development and manufacturing process, and other related expenses. Our internal research and development employees as well as our indirect costs are shared across multiple development programs and are not solely dedicated to individual programs.
We expense research and development costs as incurred. Conducting a significant amount of research and development is central to our business model. Product candidates in clinical development generally have higher development costs than those in earlier stages of development, primarily due to the size, duration and cost of clinical trials. The successful development of our clinical and preclinical product candidates is highly uncertain. Clinical development timelines, the probability of success and development costs can differ materially from our expectations. For example, if the FDA or another regulatory authority were to require us to conduct clinical trials beyond those which we currently expect will be required for the completion of clinical development of a product candidate, or if we experience significant delays in enrollment in any of our clinical trials, we could be required to expend significant additional financial resources and time to complete any clinical development.
General and administrative
General and administrative expenses consist primarily of salaries and related benefits, including stock-based compensation, related to our executive, finance, business development and support functions. Other general and administrative expenses include facility-related costs not otherwise allocated to research and development expenses, travel expenses for our general and administrative personnel and professional fees for auditing, tax and corporate legal services, including intellectual property-related legal services.
Impairment of long-lived assets
Impairment of long-lived assets consists of impairment charges on our long-lived assets.
Interest income
Interest income consists primarily of income earned on our cash, cash equivalents and marketable securities.
Other income, net
Other income, net consists of non-operating income and non-operating expenses.
Change in fair value of warrant liabilities
Common warrants classified as liabilities are remeasured quarterly at fair value with the change in fair value recognized as a component of earnings.
Change in fair value of contingent value right liability
The contingent value right liability is remeasured quarterly at fair value with the change in fair value recognized as a component of earnings.
Change in fair value of forward contract liabilities
The forward contract liabilities associated with the delayed issuance of the Series A Preferred Stock related to the Merger and 2023 Private Placement are remeasured quarterly and upon settlement at fair value with the change in fair value recognized as a component of earnings.
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Results of Operations
Comparison of the Three Months Ended March 31, 2025 and 2024

|  | Three Months Ended March 31, |  | Increase (Decrease) |
|  | 2025 |  | 2024 |  |
|  | (in thousands, except percentages) |
| Revenue: |  |  |  |  |  |  |  |
| Collaboration and license revenue | $ | 400 |  |  | $ | 5,840 |  |  | $ | (5,440) |  |  | (93) | % |
| Grant revenue | 700 |  |  | — |  |  | 700 |  |  | 100 | % |
| Total revenue | 1,100 |  |  | 5,840 |  |  | (4,740) |  |  | (81) | % |
| Operating expenses: |  |  |  |  |  |  |  |
| Research and development | 14,674 |  |  | 9,738 |  |  | 4,936 |  |  | 51 | % |
| General and administrative | 8,315 |  |  | 9,450 |  |  | (1,135) |  |  | (12) | % |
| Total operating expenses | 22,989 |  |  | 19,188 |  |  | 3,801 |  |  | 20 | % |
| Operating loss | (21,889) |  |  | (13,348) |  |  | (8,541) |  |  | 64 | % |
| Interest income | 2,015 |  |  | 1,164 |  |  | 851 |  |  | 73 | % |
| Change in fair value of warrant liabilities | 1,818 |  |  | 1,042 |  |  | 776 |  |  | 74 | % |
| Change in fair value of contingent value right liability | 346 |  |  | (39,300) |  |  | 39,646 |  |  | (101) | % |
| Change in fair value of forward contract liabilities | — |  |  | (6,890) |  |  | 6,890 |  |  | (100) | % |
| Other income, net | — |  |  | 508 |  |  | (508) |  |  | (100) | % |
| Net loss | $ | (17,710) |  |  | $ | (56,824) |  |  | $ | 39,114 |  |  | (69) | % |

Collaboration and license revenue
During the three months ended March 31, 2025, we recognized $0.4 million of collaboration and license revenue, compared to $5.8 million for the three months ended March 31, 2024, a decrease of $5.4 million. The decrease was primarily due to a recognition of the remaining deferred revenue under the License and Development Agreement, or the Astellas Agreement, with Audentes Therapeutics, Inc., or Astellas, upon notice of termination during the three months ended March 31, 2024.
Grant revenue
During the three months ended March 31, 2025, we recognized $0.7 million of grant revenue. We received funding approval from NINDS during the three months ended June 30, 2024, and as such there was no grant revenue during the three months ended March 31, 2024.
Research and development expenses
The following is a comparison of research and development expenses for the three months ended March 31, 2025 and 2024 (in thousands, except percentages):

| Three Months Ended March 31, |  | Increase (Decrease)
| 2025 |  | 2024 |
Legacy Selecta programs | $ | — |  |  | $ | 2,777 |  |  | $ | (2,777) |  |  | (100) | %
Descartes-08 for MG | 7,036 |  |  | 1,266 |  |  | 5,770 |  |  | 456 | %
Early stage programs | 990 |  |  | 127 |  |  | 863 |  |  | 680 | %
Research and development employee expenses | 3,702 |  |  | 3,241 |  |  | 461 |  |  | 14 | %
Research and development stock-based compensation expense | 1,275 |  |  | 712 |  |  | 563 |  |  | 79 | %
Research and development facilities and other expenses | 1,671 |  |  | 1,615 |  |  | 56 |  |  | 3 | %
Total research and development expenses | $ | 14,674 |  |  | $ | 9,738 |  |  | $ | 4,936 |  |  | 51 | %

For the three months ended March 31, 2025, our research and development expenses were $14.7 million, compared to $9.7 million for the three months ended March 31, 2024, an increase of $5.0 million. The decrease in expenses for legacy Selecta programs was primarily related to decreased expenses for Xork as a result of the termination of the Astellas Agreement in 2024.
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The increase in expenses for Descartes-08 for MG was primarily related to the expenses for the Phase 2b trial and the activities associated with the Phase 3 AURORA trial. The increase in our expenses for early stage programs was primarily related to increased manufacturing operations expenses. The increases in our research and development employee expenses and stock-based compensation expense were primarily a result of headcount growth.
General and administrative expenses
For the three months ended March 31, 2025, our general and administrative expenses were $8.3 million, compared to $9.5 million for the three months ended March 31, 2024, a decrease of $1.2 million. The decrease in cost was primarily the result of reductions in expenses in professional fees incurred in connection with the Merger.
Interest income
Interest income for the three months ended March 31, 2025 was $2.0 million, compared to $1.2 million for the three months ended March 31, 2024, an increase of $0.8 million. The increase in interest income was due to increased investment balance.
Change in fair value of warrant liabilities
For the three months ended March 31, 2025, we recognized $1.8 million of income from the decrease in the fair value of warrant liabilities, compared to $1.0 million of income from the decrease in the fair value of warrant liabilities for the three months ended March 31, 2024, an increase of $0.8 million. Fair value of warrant liabilities was determined utilizing the Black-Scholes valuation methodology. The decrease in warrant value was primarily driven by a decrease in the per-share price of our common stock and the expiration of the warrants we issued in 2019 during the year ended December 31, 2024.
Change in fair value of contingent value right liability
For the three months ended March 31, 2025, we recognized $0.3 million of income from the decrease in the fair value of the CVR liability, compared to $39.3 million of expense associated with the increase in the fair value of the CVR liability for the three months ended March 31, 2024, an increase of $39.6 million. The fair value of the CVR liability was determined utilizing a Monte Carlo simulation model. The decrease in the fair value of the CVR liability was primarily due to changes in interest rates.
Change in fair value of forward contract liabilities
The remaining Series A Preferred Stock forward contract liability was settled during the three months ended March 31, 2024. As such, no change in the fair value of the Series A Preferred Stock forward contract liability is reflected in our unaudited consolidated financial statements for the three months ended March 31, 2025.
Other income, net
During the three months ended March 31, 2025, we recognized no other income, net, compared to $0.5 million for the three months ended March 31, 2024. The decrease was primarily due to a decrease in sublease income. The terms of our subleases expired during the year ended December 31, 2024.
Net loss
Net loss for three months ended March 31, 2025 was $17.7 million as compared to net loss of $56.8 million for the three months ended March 31, 2024, a decrease of $39.1 million The change was primarily due to expenses associated with the change in the fair value of the CVR liability and the change in the fair value of the Series A Preferred Stock forward contract liability during the three months ended March 31, 2024.
Liquidity and Capital Resources
Except for net income for the year ended December 31, 2022, we have incurred recurring net losses since our inception. We expect that we will continue to incur losses and that such losses will increase for the foreseeable future. We expect that our research and development and general and administrative expenses will continue to increase and, as a result, we will need additional capital to fund our operations, which we may raise through a combination of equity offerings, debt financings, third-party funding, potential royalty and/or milestone monetization transactions and other collaborations and strategic alliances.
Our cash, cash equivalents, and restricted cash were $182.1 million as of March 31, 2025, of which $1.7 million was restricted cash related to lease commitments.
In addition to our existing cash equivalents, we from time to time have received and may receive in the future research and development funding pursuant to our collaboration and license agreements. Currently, funding from payments under our collaboration agreements represent our only source of committed external funds.
The liability associated with the contingent value rights agreement, or CVR Agreement, entered into on December 6, 2023, will be settled solely through cash flow received under the Sobi License and any other Gross Proceeds (as such term is defined
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in the CVR Agreement) net of certain agreed deductions. Under the CVR Agreement, 100% of all milestone payments, royalties, and other amounts paid to us or our controlled entities under the Sobi License, and any other Gross Proceeds, in each case net of certain agreed deductions, will be distributed to holders of the CVRs. There is no contractual obligation for us to fund any amount related to the CVR liability.
Collaboration and License Agreements
In-licenses
In September 2023, we entered into a non-exclusive, sublicensable, worldwide, perpetual patent license agreement, or the Biogen Agreement, with Biogen MA, Inc., or Biogen, to research, develop, make, use, offer, sell and import products or processes containing or using an engineering T-cell modified with an mRNA comprising, or encoding a protein comprising, certain sequences licensed under the Biogen Agreement for the prevention, treatment, palliation and management of autoimmune diseases and disorders, excluding cancers, neoplastic disorders, and paraneoplastic disorders. We are not obligated to pay Biogen any expenses, fees, or royalties. For further description of the Biogen Agreement, see Note 15 to our unaudited consolidated financial statements included elsewhere in this Quarterly Report.
Effective September 2019, we entered into a non-exclusive, worldwide license agreement, or the NCI Agreement, with the U.S. Department of Health and Human Services, represented by the National Cancer Institute of the National Institutes of Health, or NCI. Under the NCI Agreement, we were granted a license under certain NCI patents and patent applications designated in the agreement, to make, use, sell, offer and import products and processes within the scope of the patents and applications licensed under the NCI Agreement when developing and manufacturing anti-BCMA CAR-T cell products for the treatment of MG, pemphigus vulgaris, and immune thrombocytopenic purpura according to methods designated in the NCI Agreement. In connection with our entry into the NCI Agreement, we paid to NCI a one-time $0.1 million license royalty payment. Under the NCI Agreement, we are further required to pay NCI a low five-digit annual royalty. We must also pay earned royalties on net sales in a low single-digit percentage and pay up to $0.8 million in benchmark royalties upon our achievement of designated benchmarks that are based on the commercial development plan agreed between the parties. For further description of the NCI Agreement, see Note 15 to our unaudited consolidated financial statements included elsewhere in this Quarterly Report.
Out-licenses
In January 2023, we entered into the Astellas Agreement with Astellas. Under this agreement, Astellas obtained the sole and exclusive right to commercialize Xork for use in Pompe disease in combination with an Astellas gene therapy investigational or authorized product, with a current focus on AT845. In connection with entry into this agreement, we received a $10.0 million upfront payment and were eligible to receive $340.0 million for certain additional development and commercial milestones plus royalties on any potential commercial sales where Xork is used as a pre-treatment for AT845. As a result of the sublicense of Xork to Astellas, we made a $4.0 million payment to Genovis in February 2023. The Astellas Agreement was terminated effective June 6, 2024. For further description of the Astellas Agreement, see Note 13 to our unaudited consolidated financial statements included elsewhere in this Quarterly Report. Amounts paid and remaining obligations with regard to the Xork product candidate not reimbursed by Astellas through the Astellas Agreement were subject to potential reimbursement through deductions to CVR distributions as described in Note 7 to our unaudited consolidated financial statements included elsewhere in this Quarterly Report and were reimbursed in the March 2025 CVR distribution.
In June 2020, we entered into the Sobi License. Sobi paid us a one-time, upfront payment of $75 million, and upon the closing of a private placement of our common stock to Sobi at a price of $138.468 per share, we received an additional $25 million from Sobi. We are eligible to receive $630.0 million in milestone payments upon the achievement of various development and regulatory milestones and sales thresholds for annual net sales of SEL-212, and tiered royalty payments ranging from the low double digits on the lowest sales tier to the high teens on the highest sales tier. Sobi has agreed to fund the Phase 3 clinical program of SEL-212, which commenced in September 2020. In July 2022, we received $10.0 million for the completion of the enrollment of the DISSOLVE II trial. In July 2024, we received $30.0 million for the milestone associated with the initiation of a rolling biologics license application to the FDA for SEL-212 for the potential treatment of chronic refractory gout by Sobi. Proceeds from milestone payments and royalties on sales of SEL-212, if any, are required to be distributed, net of certain agreed deductions, to holders of the CVRs. For further description of the Sobi License, see Note 13 to our unaudited consolidated financial statements included elsewhere in this Quarterly Report.
Financings
On December 13, 2024, we and Leerink Partners LLC entered into a Sales Agreement, or the Sales Agreement. Under the Sales Agreement, we may issue and sell shares of our common stock, from time to time, through Leerink Partners LLC or aggregate gross sales proceeds of up to $100.0 million. During the three months ended March 31, 2025, we sold no shares of our common stock pursuant to the Sales Agreement.
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On November 13, 2023, we entered into the 2023 Securities Purchase Agreement with (i) Dr. Timothy A. Springer, a member of our Board of Directors; (ii) TAS Partners LLC, an affiliate of Dr. Springer, and (iii) Seven One Eight Three Four Irrevocable Trust, a trust associated with Dr. Murat Kalayoglu, a co-founder and the former chief executive officer of Old Cartesian, who joined our Board of Directors effective immediately after the effective time of the Merger, providing for the 2023 Private Placement. In the 2023 Private Placement, we issued and sold an aggregate of 149,330.115 shares of Series A Preferred Stock for an aggregate purchase price of $60.25 million, of which 50,189.789 shares of Series A Preferred Stock were issued and sold in the year ended December 31, 2023 for gross proceeds of $20.25 million, and 99,140.326 shares of Series A Preferred Stock were issued and sold during the three months ended March 31, 2024 for gross proceeds of $40.0 million.
On July 2, 2024, we entered into the 2024 Securities Purchase Agreement for the 2024 Private Placement with certain institutional and accredited investors, or the Purchasers. In the 2024 Private Placement, we issued and sold an aggregate of 3,563,247 shares of common stock and 2,937,903 shares of Series B Preferred Stock for which we generated gross proceeds of approximately $130.0 million.
Future funding requirements
As of the date of this Quarterly Report, we have not generated any revenue from product sales. We do not know when, or if, we will generate revenue from product sales. We will not generate significant revenue from product sales unless and until we obtain regulatory approval and commercialize one of our current or future product candidates. Our primary uses of capital are, and we expect will continue to be, compensation and related expenses, third-party clinical research and development services, laboratory and related supplies, clinical costs, legal and other regulatory expenses, milestone and royalty payments for in-licenses, and general overhead costs. We expect that we will continue to generate losses for the foreseeable future, and we expect the losses to increase as we continue the development of, and seek regulatory approvals for, our product candidates, and begin to commercialize any approved products. We are subject to risks in the development of our products, and we may encounter unforeseen expenses, difficulties, complications, delays and other unknown factors that may adversely affect our business. We expect that we will need substantial additional funding to support our continuing operations.
As of March 31, 2025, we had an accumulated deficit of $709.8 million. We anticipate operating losses to continue for the foreseeable future due to, among other things, costs related to research, development of our product candidates, conducting preclinical studies and clinical trials, and our administrative organization. We will require substantial additional financing to fund our operations and to continue to execute our strategy, and we will pursue a range of options to secure additional capital.
We regularly evaluate various potential sources of additional funding such as strategic collaborations, license agreements, debt issuance, potential royalty and/or milestone monetization transactions and the issuance of equity instruments to fund our operations. If we raise additional funds through strategic collaborations and alliances, which may include existing collaboration partners, we may have to relinquish valuable rights to our technologies or product candidates, or grant licenses on terms that are not favorable to us. To the extent that we raise additional capital through the sale of equity instruments, the ownership interest of our existing stockholders will be diluted, and other preferences may be necessary that adversely affect the rights of existing stockholders.
We believe that our existing cash, cash equivalents, and restricted cash as of March 31, 2025 will enable us to fund our operating expenses and capital expenditure requirements into mid-2027. We may pursue additional cash resources through public or private equity or debt financings, by establishing collaborations with other companies or through the monetization of potential royalty and/or milestone payments pursuant to our existing collaboration and license arrangements. Management’s expectations with respect to our ability to fund current and long-term planned operations are based on estimates that are subject to risks and uncertainties. If actual results are different from management’s estimates, we may need to seek additional strategic or financing opportunities sooner than would otherwise be expected. However, there is no guarantee that any of these strategic or financing opportunities will be executed on favorable terms, and some could be dilutive to existing stockholders. If we are unable to obtain additional funding on a timely basis, we may be forced to significantly curtail, delay, or discontinue one or more of our planned research or development programs or be unable to expand our operations, meet long-term obligations or otherwise capitalize on our commercialization of our product candidates.
Our future capital requirements will depend on many factors, including:
•the scope, progress, results and costs of our clinical trials, preclinical development, manufacturing, laboratory testing and logistics;
•the number of product candidates that we pursue and the speed with which we pursue development;
•our headcount growth and associated costs;
•the costs, timing and outcome of regulatory review of our product candidates;
•the costs and timing of future commercialization activities, including manufacturing, marketing, sales and distribution, for any of our product candidates for which we receive marketing approval;
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•the revenue, if any, from commercial sales of our product candidates for which we receive marketing approval;
•the costs and timing of preparing, filing and prosecuting patent applications, maintaining and enforcing our intellectual property rights and defending any intellectual property-related claims;
•the effect of competing technological and market developments; and
•the extent to which we acquire or invest in businesses, products and technologies, including entering into licensing or collaboration arrangements for product candidates.
Cash Requirements due to Contractual Obligations and Other Commitments
We are under agreement to lease approximately 32,294 square feet of laboratory and office space in Watertown, Massachusetts through May 2028. Remaining lease payments from March 31, 2025 through the end of the lease term total approximately $9.0 million. Payments made and remaining obligations on this lease liability were subject to potential reimbursement through deductions to CVR distributions as described in Note 7 to our unaudited consolidated financial statements included elsewhere in this Quarterly Report and were reimbursed in the March 2025 CVR distribution.
In November 2023, in connection with the Merger, we acquired two leases for office and laboratory space in Gaithersburg, Maryland, which expire in January 2027. Annualized rent is approximately $0.3 million and remaining lease payments from March 31, 2025 through the end of the lease term total approximately $0.6 million.
In February 2024, we entered into an agreement to lease approximately 19,199 square feet of integrated manufacturing and office space in Fredericksburg, Maryland. In May 2024, we entered into an amendment to lease an additional approximately 7,842 square feet at the same site. In August 2024, we entered into a second amendment to lease an additional approximately 2,009 square feet at the same site. In March 2025, we entered into a third amendment to lease an additional approximately 6,439 square feet at the same site. The leases expire coterminously in June 2031. Annualized base rent under the leases is approximately $1.2 million and is subject to annual increases in accordance with the terms of the lease agreement. The leases provide for a tenant improvement allowance of $0.8 million. Remaining lease payments total $9.7 million through the end of the lease term.
We are also party to certain license and collaboration agreements with Biogen, NCI, and Shenyang Sunshine Pharmaceutical Co., Ltd., or 3SBio. We may be obligated to make certain future payments which are contingent upon future events such as our achievement of specified regulatory and commercial milestones, or royalties on net product sales under these agreements. As of March 31, 2025, we were unable to estimate the timing or likelihood of achieving these milestones or generating future product sales. Payments made and remaining obligations on the license agreement with 3SBio are subject to potential reimbursement through deductions to CVR distributions as described in Note 7 to our unaudited consolidated financial statements included elsewhere in this Quarterly Report.
Summary of Cash Flows

|  | Three Months Ended March 31,
(In thousands) |  |  |  | 2025 |  | 2024 |  |
Cash (used in) and provided by: |  |  |  |  |  |  |  |
Operating activities |  |  |  | $ | (23,108) |  |  | $ | (15,917) |  |  |
Investing activities |  |  |  | (1,075) |  |  | (602) |  |  |
Financing activities |  |  |  | (8,025) |  |  | 43,031 |  |  |
Effect of exchange rate changes on cash |  |  |  | 32 |  |  | (5) |  |  |
Net change in cash, cash equivalents, and restricted cash |  |  |  | $ | (32,176) |  |  | $ | 26,507 |  |  |

Operating activities
Net cash used in operating activities for the three months ended March 31, 2025 was $23.1 million compared to $15.9 million for the three months ended March 31, 2024. The increase in cash used in operating activities of $7.2 million was primarily due to $16.0 million of net loss, adjusted for non-cash items, and $7.1 million of cash used in changes in operating assets and liabilities, in each case during the three months ended March 31, 2025 compared to $9.5 million of net loss, adjusted for non-cash items, and $6.4 million of cash used in changes in operating assets and liabilities during the three months ended March 31, 2024.
Investing activities
Net cash used in investing activities for the three months ended March 31, 2025 was $1.1 million compared to $0.6 million in the same period in 2023, a decrease of $0.5 million. The net cash used in investing activities for the three months ended March 31, 2025 and 2024 consisted primarily of purchases of property and equipment.
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Financing activities
Net cash used in financing activities for the three months ended March 31, 2025 was $8.0 million compared to net cash provided by financing activities of $43.0 million for the three months ended March 31, 2024, a decrease of $51.0 million. The net cash used in financing activities in the three months ended March 31, 2025 was primarily the result of payments for the CVR distribution. The net cash provided by financing activities in the three months ended March 31, 2024 was primarily the result of proceeds of the 2023 Private Placement.
Recent Accounting Pronouncements
For a discussion of recently adopted or issued accounting pronouncements refer to Note 3 to our unaudited consolidated financial statements included elsewhere in this Quarterly Report.
Off-Balance Sheet Arrangements
As of March 31, 2025, we did not have any off-balance sheet arrangements as defined in the rules and regulations of the SEC.
Critical Accounting Policies and Use of Estimates
Our management’s discussion and analysis of our financial condition and results of operations is based on our consolidated financial statements, which have been prepared in accordance with accounting principles generally accepted in the United States of America, or U.S. GAAP. The preparation of these consolidated financial statements requires us to make estimates and judgements that affect the reported amounts of assets, liabilities, revenues and expenses, and disclosure of contingent assets and liabilities in our consolidated financial statements. Actual results may differ from these estimates under different assumptions or conditions. During the three months ended March 31, 2025, there were no material changes to our critical accounting policies from those described in our Annual Report on Form 10-K for the year ended December 31, 2024.
Smaller Reporting Company
We qualify as a “smaller reporting company” under the rules of the Securities Act and the Exchange Act. As a result, we may choose to take advantage of certain scaled disclosure requirements available specifically to smaller reporting companies. We will remain a smaller reporting company until the last day of the fiscal year in which the aggregate market value of our common stock held by non-affiliated persons and entities, or our public float, is more than $700 million as of the last business day of our most recently completed second fiscal quarter, or until the fiscal year following the year in which we have at least $100 million in revenue and at least $250 million in public float as of the last business day of our most recently completed second fiscal quarter.
Item 3. Quantitative and Qualitative Disclosures About Market Risk
The market risk inherent in our financial instruments and in our financial position represents the potential loss arising from adverse changes in interest rates. As of March 31, 2025 and December 31, 2024, we had cash, cash equivalents, and restricted cash of $182.1 million and $214.3 million, respectively, consisting of non-interest and interest-bearing money market accounts. Our primary exposure to market risk is interest rate sensitivity, which is affected by changes in the general level of U.S. interest rates. Due to the short-term and the low risk profile of our money market accounts and marketable securities, and our current policy to hold marketable securities to maturity, an immediate 100 basis point change in interest rates would not have a material effect on the fair market value of our cash equivalents or short-term marketable securities.
Item 4. Controls and Procedures
Evaluation of Disclosure Controls and Procedures
Our management, with the participation of our Chief Executive Officer and Chief Financial Officer, evaluated, as of the end of the period covered by this Quarterly Report, the effectiveness of our disclosure controls and procedures (as defined in Rules 13a-15(e) and 15d-15(e) under the Exchange Act). Based on that evaluation, our Chief Executive Officer and Chief Financial Officer concluded that our disclosure controls and procedures were effective at the reasonable assurance level as of March 31, 2025.
Inherent Limitations on Effectiveness of Controls
There are inherent limitations to the effectiveness of any system of internal control over financial reporting. Accordingly, even an effective system of internal control over financial reporting can only provide reasonable assurance with respect to financial statement preparation and presentation in accordance with U.S. GAAP. Our internal controls over financial reporting are subject to various inherent limitations, including cost limitations, judgments used in decision making, assumptions about the likelihood of future events, the soundness of our systems, the possibility of human error, and the risk of fraud. Moreover, projections of any evaluation of effectiveness to future periods are subject to the risk that controls may be inadequate because of changes in conditions and the risk that the degree of compliance with policies or procedures may deteriorate over time.
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Changes in Internal Control over Financial Reporting
There were no changes in our internal control over financial reporting (as defined in Rules 13a-15(f) and 15d-15(f) under the Exchange Act) during the three months ended March 31, 2025 that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.
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PART II. OTHER INFORMATION
Item 1. Legal Proceedings
None.
Item 1A. Risk Factors
See the risk factors previously disclosed in Item 1A of our Annual Report on Form 10-K for the year ended December 31, 2024. There have been no material changes from the risk factors previously disclosed in such filings.
Item 2. Unregistered Sales of Equity Securities and Use of Proceeds
Not applicable.
Item 3. Defaults Upon Senior Securities
None.
Item 4. Mine Safety Disclosures
None.
Item 5. Other Information
During the quarter ended March 31, 2025, no director or officer adopted or terminated any contract, instrument or written plan for the purchase or sale of Cartesian securities intended to satisfy the affirmative defense conditions of Rule 10b5-1(c) under the Exchange Act or any non-Rule 10b5-1 trading arrangement as defined in Item 408(c) of Regulation S-K.
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Item 6. Exhibits
EXHIBIT INDEX

|  |  |  | Incorporated by Reference
Exhibit Number |  | Exhibit Description |  | Form |  | File No. |  | Exhibit |  | Filing Date
2.1* |  | Agreement and Plan of Merger, dated November 13, 2023, by and among Selecta Biosciences, Inc., Sakura Merger Sub I, Inc., Sakura Merger Sub II, LLC, and Cartesian Therapeutics, Inc. |  | 8-K |  | 001-37798 |  | 2.1 |  | 11/13/2023
3.1(a) |  | Restated Certificate of Incorporation of Selecta Biosciences, Inc. |  | 8-K |  | 001-37798 |  | 3.1 |  | 6/29/2016
3.1(b) |  | Certificate of Amendment to the Restated Certificate of Incorporation of Selecta Biosciences, Inc., dated June 21, 2022 |  | 8-K |  | 001-37798 |  | 3.1 |  | 6/21/2022
3.1(c) |  | Certificate of Amendment to the Restated Certificate of Incorporation of Selecta Biosciences, Inc., dated November 13, 2023 |  | 8-K |  | 001-37798 |  | 3.3 |  | 11/13/2023
3.1(d) |  | Certificate of Amendment to the Restated Certificate of Incorporation, as amended, of Cartesian Therapeutics, Inc., dated March 28, 2024. |  | 8-K |  | 001-37798 |  | 3.2 |  | 3/28/2024
3.2 |  | Amended and Restated By-laws of Cartesian Therapeutics, Inc. |  | 10-Q |  | 001-37798 |  | 3.2 |  | 11/13/2023
4.1(a) |  | Certificate of Designation of Preferences, Rights and Limitations of Series A Non-Voting Convertible Preferred Stock |  | 8-K |  | 001-37798 |  | 3.4 |  | 11/13/2023
4.1(b) |  | Certificate of Amendment to the Certificate of Designation of Series A Non-Voting Convertible Preferred Stock, dated March 26, 2024. |  | 8-K |  | 001-37798 |  | 3.1 |  | 3/28/2024
4.2 |  | Certificate of Designation of Preferences, Rights and Limitations of Series B Non-Voting Convertible Preferred Stock |  | 8-K |  | 001-37798 |  | 3.1 |  | 7/2/2024
10.1† |  | Third Amendment to Lease Agreement by and between 7495 RP, LLC and Cartesian Therapeutics, Inc. dated March 12, 2025 |  | - |  | - |  | - |  | Filed herewith
10.2†# |  | Separation Agreement and Release by and between Metin Kurtoglu and Cartesian Therapeutics, Inc. dated April 29, 2025 |  | - |  | - |  | - |  | Filed herewith
31.1 |  | Certification of Principal Executive Officer pursuant to Rule 13a-14(a) or Rule 15d-14(a) of the Securities Exchange Act of 1934, as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002 |  | - |  | - |  | - |  | Filed herewith
31.2 |  | Certification of Principal Financial Officer pursuant to Rule 13a-14(a) or Rule 15d-14(a) of the Securities Exchange Act of 1934, as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002 |  | - |  | - |  | - |  | Filed herewith
32.1 |  | Certification of Principal Executive Officer and Principal Financial Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 |  | - |  | - |  | - |  | Furnished herewith
101.INS |  | Inline XBRL Instance Document (the Instance Document does not appear in the interactive data file because its XBRL tags are embedded within the Inline XBRL document) |  | - |  | - |  | - |  | Filed herewith
101.SCH |  | Inline XBRL Taxonomy Extension Schema Document |  | - |  | - |  | - |  | Filed herewith
101.CAL |  | Inline XBRL Taxonomy Extension Calculation Linkbase Document |  | - |  | - |  | - |  | Filed herewith

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101.DEF |  | Inline XBRL Taxonomy Extension Definition Linkbase Document |  | - |  | - |  | - |  | Filed herewith
101.LAB |  | Inline XBRL Taxonomy Extension Label Linkbase Document |  | - |  | - |  | - |  | Filed herewith
101.PRE |  | Inline XBRL Taxonomy Extension Presentation Linkbase Document |  | - |  | - |  | - |  | Filed herewith
104 |  | Cover Page Interactive Data File (formatted as Inline XBRL and contained in Exhibit 101) |  | - |  | - |  | - |  | Filed herewith

* Certain annexes, schedules and exhibits have been omitted pursuant to Item 601(a)(5) of Regulation S-K. The Company agrees to furnish supplementally a copy of any omitted attachment to the SEC on a confidential basis upon request.
† Certain confidential information contained in this exhibit, marked by brackets and asterisks, has been omitted pursuant to Item 601(b)(10)(iv) of Regulation S-K because the information (i) is not material and (ii) is the type of information that the Company both customarily and actually treats as private and confidential.
# Indicates management contract or compensatory plan.
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SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, this report has been signed by the following persons on behalf of the registrant in the capacities and on the dates indicated.

|  | CARTESIAN THERAPEUTICS, INC.
Date: May 8, 2025 |  | By: | /s/ Carsten Brunn, Ph.D.
|  |  | Carsten Brunn, Ph.D.
|  |  | President and Chief Executive Officer, and Director
|  |  | (Principal Executive Officer)
Date: May 8, 2025 |  | By: | /s/ Blaine Davis
|  |  | Blaine Davis
|  |  | Chief Financial Officer
|  |  | (Principal Financial Officer)

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