10-Q: Silence Therapeutics Reports Q3 2025 Losses Amid Pipeline Progress

Silence Therapeutics plc reported increased net losses and decreased revenue for Q3 2025, while advancing its Divesiran and Zerlasiran clinical programs and navigating collaboration changes.

Summary

• Net loss for the three months ended September 30, 2025, was $21.0 million, compared to $35.5 million for the same period in 2024.
• Net loss for the nine months ended September 30, 2025, was $76.8 million, compared to $57.6 million for the same period in 2024.
• Revenue for the three months ended September 30, 2025, was $0.2 million, a decrease of $1.3 million from $1.5 million in Q3 2024.
• Revenue for the nine months ended September 30, 2025, was $0.5 million, a significant decrease of $17.4 million from $17.9 million in the same period in 2024.
• Cash and cash equivalents and short-term investments totaled $102.2 million as of September 30, 2025, down from $121.3 million in cash and cash equivalents at December 31, 2024.
• Research and development costs increased by $13.2 million to $59.0 million for the nine months ended September 30, 2025, primarily due to the advancement of proprietary programs like Divesiran Phase 2 and Zerlasiran Phase 3 readiness.
• General and administrative expenses decreased by $2.7 million to $18.6 million for the nine months ended September 30, 2025, partly due to reduced SEC reporting requirements and restructuring efforts.
• The SANRECO Phase 2 clinical trial for Divesiran (PV) has completed patient enrollment, with initial topline results anticipated in Q3 2026.
• Zerlasiran (Lp(a)) has completed core Phase 3 readiness activities, and the company is seeking a third-party partner for its Phase 3 development and potential commercialization.
• The Mallinckrodt and Hansoh collaboration agreements have concluded, with no further development being pursued by the partners, and Silence Therapeutics retaining global rights for the Hansoh targets.
• A non-recurring reduction in workforce was implemented in June 2025, resulting in $1.3 million in restructuring charges for the three months ended June 30, 2025.

Sentiment

Score: 4

Explanation: The sentiment is moderately negative due to significant increases in net loss and decreases in revenue, coupled with a reduction in cash. While pipeline progress (Divesiran enrollment, Zerlasiran Phase 3 readiness) and a projected cash runway into 2028 (contingent on milestones) offer some positive outlook, the immediate financial performance and the conclusion of two collaborations without further development are concerning. The need for future capital raises is explicitly stated, indicating ongoing financial pressure.

Positives

• Divesiran (SLN124) Phase 2 clinical trial for polycythemia vera (PV) is fully enrolled, with initial topline results expected in Q3 2026.
• Divesiran has received Fast Track and orphan drug designations from the U.S. FDA and orphan drug designation from the European Commission for PV.
• Zerlasiran (SLN360) has completed core Phase 3 readiness activities, including manufacturing and supply scale-up, and the company is actively seeking a third-party partner for its Phase 3 development and commercialization.
• Positive regulatory feedback was received from the FDA and EMA on the Phase 3 cardiovascular outcomes study design for Zerlasiran.
• An undisclosed siRNA product candidate from the mRNAi GOLD platform is in Phase 1 development through the collaboration with AstraZeneca.
• General and administrative expenses decreased by $2.7 million for the nine months ended September 30, 2025, reflecting cost reduction efforts.
• The company believes its current cash, cash equivalents, and treasury instruments are sufficient to fund operating expenses and capital expenditure requirements into 2028, including anticipated milestone payments from existing collaborations.

Negatives

• Net loss increased to $76.8 million for the nine months ended September 30, 2025, from $57.6 million in the prior year period.
• Revenue significantly decreased to $0.5 million for the nine months ended September 30, 2025, from $17.9 million in the prior year period, primarily due to a $15.7 million decrease from the AstraZeneca Collaboration (no milestones recorded in 2025 vs. $10 million in 2024).
• Cash and cash equivalents and short-term investments decreased to $102.2 million as of September 30, 2025, from $121.3 million at December 31, 2024.
• The Mallinckrodt Collaboration for SLN501 has concluded, with Mallinckrodt not pursuing further development.
• The Hansoh Collaboration has concluded, with Hansoh not pursuing further development, although Silence Therapeutics retains global rights for the three targets.
• Net cash outflow from operating activities increased by $4.8 million for the nine months ended September 30, 2025, mainly due to reduced milestone payments.
• A non-recurring reduction in workforce was implemented in June 2025, incurring $1.3 million in restructuring charges.

Risks

• The company has incurred recurring losses since inception and expects to incur operating losses for the foreseeable future, requiring additional funding.
• Inability to obtain future funding could impact financial condition, business strategies, and potentially lead to delays, reductions, or elimination of R&D programs, or inability to continue operations as a going concern.
• The company and its third-party partners are subject to stringent and evolving U.S. and foreign data privacy and security laws (e.g., GDPR, CCPA), with potential for regulatory investigations, litigation, fines, and business disruptions for non-compliance.
• Cross-border data transfer mechanisms (e.g., EEA Standard Contractual Clauses, EU-U.S. Data Privacy Framework) are subject to legal challenges, and inability to lawfully transfer personal data could lead to significant adverse consequences.
• The U.S. Department of Justice's rule on 'Preventing Access to U.S. Sensitive Personal Data and Government-Related Data by Countries of Concern' may impact business activities, vendor engagements, data sharing, and investor agreements.
• Use of generative AI technologies by employees and personnel could result in additional compliance costs, regulatory investigations, and lawsuits due to evolving regulations and privacy obligations.
• Healthcare legislative and other regulatory reform measures in the U.S. (e.g., OBBBA, proposals from Trump administration) may negatively impact business, prevent or delay marketing approval, restrict post-approval activities, and affect profitability.
• Uncertainty regarding UK-US and US-EU trade agreements, including potential tariffs on pharmaceuticals, could impact supply chains and manufacturing strategies.
• The EU Clinical Trials Regulation (CTR) has led to added barriers for clinical trials, including regulatory complexity and increased administrative burden.
• Changes in the UK regulatory framework for clinical trials, while aiming for streamlining, could still present new challenges or delays.
• Health Technology Assessment (HTA) processes in EU Member States are becoming more common and could influence pricing and reimbursement status, with concerns about insufficient slots for joint scientific advice leading to data gaps and delays.
• A decrease in data and market exclusivity opportunities for product candidates in the EU could lead to earlier generic or biosimilar competition and reduced reimbursement status due to proposed revisions to pharmaceutical legislation.

Future Outlook

The company expects to incur operating losses for the foreseeable future as it continues research and development efforts and seeks regulatory approval for product candidates. It believes existing cash, cash equivalents, and future anticipated milestone payments from existing collaborations will be sufficient to fund operating expenses and capital expenditure requirements into 2028. However, the company will need to raise additional funding to support its operations and clinical development activities, with future milestone payments being dependent on achieving certain development or regulatory objectives that may not occur. The company is seeking a third-party partner for Phase 3 development and potential future commercialization of Zerlasiran.

Management Comments

• We expect to incur operating losses for the foreseeable future as we continue our research and development efforts, seek to obtain regulatory approval of our product candidates and pursue any future product candidates we may develop.
• We believe that our current cash and cash equivalents are sufficient to fund our operating expenses for at least the next twelve months from the issuance date of these unaudited condensed consolidated financial statements.
• We will need to raise additional funding to fund our operation expenses and capital expenditure requirements in relation to our clinical development activities.
• We are committed to maximizing our mRNAi GOLD platform by advancing a pipeline of both wholly owned and partnered programs.
• Beyond the liver, we are focused on progressing our extra-hepatic programs based on initial clinical feedback.

Industry Context

Silence Therapeutics operates in the highly competitive and capital-intensive RNA therapeutics industry, specifically focusing on siRNA molecules for gene silencing. The company's pipeline, including Divesiran for polycythemia vera and Zerlasiran for high Lp(a), addresses areas of significant unmet medical need. The conclusion of collaborations with Mallinckrodt and Hansoh highlights the inherent risks and evolving nature of partnerships in drug development. The pursuit of a third-party partner for Zerlasiran's Phase 3 development is a common strategy in the biotech industry to share costs and leverage larger pharmaceutical companies' resources and commercialization capabilities. The increasing regulatory scrutiny on drug pricing and data privacy, as well as evolving clinical trial regulations in the EU and UK, reflect broader industry challenges that could impact development timelines and market access.

Comparison to Industry Standards

• NA

Stakeholder Impact

• Shareholders: Face increased net losses and decreased revenue, potentially impacting share value. The need for future capital raises could lead to dilution. Pipeline progress offers long-term potential.
• Employees: A reduction in workforce was implemented in June 2025, impacting terminated employees.
• Customers/Partners: Mallinckrodt and Hansoh collaborations have concluded, indicating changes in product development strategies for those partners. AstraZeneca collaboration continues but with reduced revenue recognition in the current period.
• Creditors: The company's ability to fund operations into 2028 is contingent on anticipated milestone payments and potential future capital raises, which could affect credit risk perception.

Next Steps

• Announce initial topline results from the SANRECO Phase 2 clinical trial of Divesiran in the third quarter of 2026.
• Seek a third-party partner for Phase 3 development and potential future commercialization of Zerlasiran.
• Continue research and development efforts for existing and future product candidates.
• Potentially raise additional funding through public or private financings, debt financing, or new collaboration agreements.
• Evaluate the impact of new accounting guidance (ASU 2023-09 and ASU 2024-03/2025-01) on future disclosures.

Key Dates

Recommendation

The company faces significant financial headwinds with increased losses and sharply declining revenue, primarily due to a lack of milestone payments from collaborations in the current period and the conclusion of two partnerships. While the cash runway is projected into 2028, this is contingent on future milestone achievements and the explicit need for additional funding. The advancement of Divesiran into Phase 2 with expected topline results in Q3 2026 and Zerlasiran's Phase 3 readiness with an active search for a partner represent crucial long-term value drivers. However, the immediate financial performance and the inherent risks of clinical development and securing new partnerships warrant a 'hold' recommendation. Investors should monitor the upcoming Divesiran results and progress in securing a Zerlasiran partner before making further investment decisions.

Keywords

RNA therapeutics, siRNA, mRNAi GOLD platform, Divesiran, SLN124, Polycythemia Vera, PV, Zerlasiran, SLN360, Lipoprotein(a), Lp(a), AstraZeneca collaboration, clinical trials, biotechnology, drug development, SEC filing, 10-Q, financial results, research and development, orphan drug, Fast Track designation