Form 10-Q

Large accelerated filer

Accelerated filer

Non-accelerated
filer

Smaller reporting company

Emerging growth company

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

FORM

10-Q

(Mark One)

☒	QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(D) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended December 31, 2024

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

For the transition period from

Commission File Number

001-39267

BENITEC BIOPHARMA INC.

(Exact name of registrant as specified in its charter)


Delaware		84-462-0206
(State or other jurisdiction of incorporation or organization)		(IRS Employer Identification No.)

3940 Trust Way, Hayward, California 94545

(Address of principal executive offices & zip code)

(510)

780-0819

(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, par value $0.0001	BNTC	The Nasdaq Stock Market LLC

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 ☒ 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 ☒ 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.

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 ☐ or No ☒

We had 23,451,475 shares of our common stock outstanding as of the close of business on

February

14, 2025.

BENITEC BIOPHARMA INC.

INDEX TO FORM 10-Q


SPECIAL NOTE REGARDING FORWARD LOOKING STATEMENTS		3

PART I-FINANCIAL INFORMATION		4

ITEM 1.	Financial Statements	4
	Consolidated Balance Sheets as of December 31, 2024 (Unaudited) and June 30, 2024	4
	Consolidated Statements of Operations and Comprehensive Loss for the Three and Six Months Ended December 31, 2024 and 2023 (Unaudited)	5
	Consolidated Statements of Stockholders’ Equity for the Three and Six Months Ended December 31, 2024 and 2023 (Unaudited)	6
	Consolidated Statements of Cash Flows for the Six Months Ended December 31, 2024 and 2023 (Unaudited)	7
	Notes to Consolidated Financial Statements (Unaudited)	8
ITEM 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	23
ITEM 3.	Quantitative and Qualitative Disclosures About Market Risk	54
ITEM 4.	Controls and Procedures	54

PART II-OTHER INFORMATION

ITEM 1.	Legal Proceedings	55
ITEM 1A.	Risk Factors	55
ITEM 2.	Unregistered Sales of Equity Securities and Use of Proceeds	55
ITEM 3.	Defaults Upon Senior Securities	55
ITEM 4.	Mine Safety Disclosures	55
ITEM 5.	Other Information	55
ITEM 6.	Exhibits	56

SIGNATURES		57

SPECIAL NOTE REGARDING FORWARD-LOOKING STATEMENTS

This Report contains forward-looking statements that are subject to a number of risks and uncertainties, many of which are beyond our control. Our forward-looking statements relate to future events or our future performance and include, but are not limited to, statements concerning our business strategy, future commercial revenues, market growth, capital requirements, new product introductions, expansion plans and the adequacy of our funding. All statements, other than statements of historical fact included in this Report, are forward-looking statements. When used in this Report, the words “could,” “believe,” “anticipate,” “intend,” “estimate,” “expect,” “may,” “continue,” “predict,” “potential,” “project,” or the negative of these terms, and similar expressions are intended to identify forward-looking statements, although not all forward-looking statements contain such identifying words. These statements involve known and unknown risks, uncertainties and other important factors that may cause our actual results, levels of activity, performance or achievements to be materially different from the information expressed or implied by these forward-looking statements.

Some of the risks and uncertainties that may cause our actual results, performance or achievements to differ materially from those expressed or implied by forward-looking statements include the following:

•

the success of our plans to develop and potentially commercialize our product candidates;

•

the timing of the completion of preclinical studies and clinical trials;

•

the timing and sufficiency of patient enrollment and dosing in any future clinical trials;

•

the timing of the availability of data from our clinical trials;

•

the timing and outcome of regulatory filings and approvals;

•

the development of novel AAV vectors;

•

our potential future out-licenses and collaborations;

•

the plans of licensees of our technology;

•

the clinical utility and potential attributes and benefits of ddRNAi and our product candidates, including the potential duration of treatment effects and the potential for a “one shot” cure;

•

our intellectual property position and the duration of our patent portfolio;

•

expenses, ongoing losses, future revenue, capital needs and needs for additional financing, and our ability to access additional financing given market conditions and other factors, including our capital structure;

•

the length of time over which we expect our cash and cash equivalents to be sufficient to execute on our business plan;

•

unanticipated delays;

•

further research and development and the results of clinical trials possibly being unsuccessful or insufficient to meet applicable regulatory standards or warrant continued development;

•

the ability to enroll sufficient numbers of subjects in clinical trials;

•

determinations made by the U.S. Food and Drug Administration and other governmental authorities;

•

regulatory developments in the United States of America;

•

our ability to protect and enforce our patents and other intellectual property rights;

•

our dependence on our relationships with our collaboration partners and other third parties;

•

the efficacy or safety of our products and the products of our collaboration partners;

•

the acceptance of our products and the products of our collaboration partners in the marketplace and market competition;

•

sales, marketing, manufacturing and distribution requirements;

•

greater than expected expenses, expenses relating to litigation or strategic activities;

•

the impact of, and our ability to remediate, the identified material weakness in our internal controls over financial reporting;

•

our ability to satisfy our capital needs through increasing revenue and obtaining additional financing; and

•

the impact of local, regional and national and international economic conditions and events;

as well as other risks detailed under the caption “Risk Factors” in this Report and in other reports filed with the SEC. Although we believe that we have a reasonable basis for each forward-looking statement contained in this Report, we caution you that these statements are based on a combination of facts and important factors currently known by us and our expectations of the future, about which we cannot be certain. Such statements are based on assumptions and the actual outcome will be affected by known and unknown risks, trends, uncertainties and factors that are beyond our control or ability to predict. We have based the forward-looking statements included in this Report on information available to us on the date of this Report or on the date thereof. Except as required by law we undertake no obligation to revise or update any forward-looking statements, whether as a result of new information, future events or otherwise. You are advised to consult any additional disclosures that we may make directly to you or through reports that we, in the future, may file with the SEC, including annual reports on Form 10-K, quarterly reports on Form 10-Q and current reports on Form 8-K.

All forward-looking statements included herein or in documents incorporated herein by reference are expressly qualified in their entirety by the cautionary statements contained or referred to elsewhere in this Report.

PART I—FINANCIAL INFORMATION

ITEM 1. Financial Statements

BENITEC BIOPHARMA INC.

Consolidated Balance Sheets

(in thousands, except par value and share amounts)


	December 31, 2024			June 30, 2024
	(Unaudited)
Assets
Current assets:
Cash and cash equivalents	$	78,283		$	50,866
Restricted cash		62			63
Trade and other receivables		2			229
Prepaid and other assets		366			516

Total current assets		78,713			51,674
Property and equipment, net		151			179
Deposits		25			25
Prepaid and other assets		42			62
Right-of-use assets		137			270

Total assets	$	79,068		$	52,210

Liabilities and stockholders’ equity
Current liabilities:
Trade and other payables	$	2,415		$	4,165
Accrued employee benefits		537			475
Lease liabilities, current portion		137			284

Total current liabilities		3,089			4,924
Non-current accrued employee benefits		38			38

Total liabilities		3,127			4,962

Commitments and contingencies (Note 11)
Stockholders’ equity:
Preferred stock, $0.0001 par value—5,000,000 shares authorized; no shares issued and outstanding at December 31, 2024 and June 30, 2024, respectively		—			—
Common stock, $0.0001 par value—160,000,000 shares authorized; 23,451,475 shares and 10,086,119 shares issued and outstanding at December 31, 2024 and June 30, 2024, respectively		2			1
Additional paid-in capital		279,302			238,398
Accumulated deficit		(202,675	)		(190,259	)
Accumulated other comprehensive loss		(688	)		(892	)

Total stockholders’ equity		75,941			47,248

Total liabilities and stockholders’ equity	$	79,068		$	52,210

The accompanying notes are an integral part of these consolidated financial statements.

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BENITEC BIOPHARMA INC.

Consolidated Statements of Operations and Comprehensive Loss

(Unaudited)

(in thousands, except share and per share amounts)


	Three Months Ended						Six Months Ended
	December 31,						December 31,
	2024			2023			2024			2023
Revenue:
Licensing revenues from customers	$	—		$	—		$	—		$	—

Total revenues		—			—			—			—
Operating expenses
Royalties and license fees		—			1			—			(105	)
Research and development		5,072			5,102			8,657			9,531
General and administrative		3,538			1,824			5,744			3,375

Total operating expenses		8,610			6,927			14,401			12,801

Loss from operations		(8,610	)		(6,927	)		(14,401	)		(12,801	)
Other income (loss):
Foreign currency transaction gain (loss)		(294	)		152			(201	)		96
Interest income (expense), net		823			(6	)		1,427			(12	)
Other expense, net		(40	)		(16	)		(5	)		(34	)
Gain on extinguishment of liabilities		764			—			764			—
Unrealized loss on investment		—			(1	)		—			(1	)

Total other income, net		1,253			129			1,985			49

Net loss	$	(7,357	)	$	(6,798	)	$	(12,416	)	$	(12,752	)

Other comprehensive income:
Unrealized foreign currency translation gain (loss)		305			(172	)		204			(122	)

Total other comprehensive income (loss)		305			(172	)		204			(122	)

Total comprehensive loss	$	(7,052	)	$	(6,970	)	$	(12,212	)	$	(12,874	)

Net loss	$	(7,357	)	$	(6,798	)	$	(12,416	)	$	(12,752	)

Deemed dividends		—			—			—			(619	)

Net loss attributable to common shareholders	$	(7,357	)	$	(6,798	)	$	(12,416	)	$	(13,371	)

Net loss per share:
Basic and diluted	$	(0.33	)	$	(2.64	)	$	(0.76	)	$	(5.65	)

Weighted average number of shares outstanding: basic and diluted		22,075,332			2,576,347			16,368,314			2,366,706

The accompanying notes are an integral part of these consolidated financial statements.

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BENITEC BIOPHARMA INC.

Consolidated Statements of Stockholders’ Equity

(Unaudited)

(in thousands, except share amounts)


	Common Stock				Additional Paid-in		Accumulated			Accumulated Other Comprehensive			Total Stockholders’
	Shares		Amount		Capital		Deficit			Loss			Equity
Balance at June 30, 2023		1,671,485	$	—	$	168,921	$	(167,889	)	$	(830	)	$	202
Issuance of common stock, pre-funded warrants, and common warrants sold for cash, net of offering costs of $2,964		875,949		—		27,919		—			—			27,919
Anti-dilution adjustment to warrants		—		—		619		(619	)		—			—
Share-based compensation		—		—		91		—			—			91
Foreign currency translation gain		—		—		—		—			50			50
Net loss		—		—		—		(5,954	)		—			(5,954	)

Balance at September 30, 2023		2,547,434		—		197,550		(174,462	)		(780	)		22,308
Exercise of pre-funded warrants		25,000		—		—		—			—			—
Exercise of Series 2 warrants		20,000		—		39		—			—			39
Share-based compensation		—		—		93		—			—			93
Foreign currency translation loss		—		—		—		—			(172	)		(172	)
Net loss		—		—		—		(6,798	)		—			(6,798	)

Balance at December 31, 2023		2,592,434	$	—	$	197,682	$	(181,260	)	$	(952	)	$	15,470

Balance at June 30, 2024		10,086,119	$	—	$	238,398	$	(190,259	)	$	(892	)	$	47,248
Exercise of pre-funded warrants		1,768,454		—		—		—			—			—
Exercise of Series 2 warrants		857,845		—		1,655		—			—			1,655
Exercise of common warrants		5,181,347		—		20,002		—			—			20,002
Share-based compensation		—		—		435		—			—			435
Foreign currency translation loss		—		—		—		—			(101	)		(101	)
Net loss		—		—		—		(5,059	)		—			(5,059	)

Balance at September 30, 2024		17,893,765		—		260,490		(195,318	)		(993	)		64,180
Exercise of pre-funded warrants		606,129		—		—		—			—			—
Exercise of Series 2 warrants		642,160		—		1,240		—			—			1,240
Exercise of common warrants, net of issuance cost of $2		4,309,421		—		16,630		—			—			16,630
Share-based compensation		—		—		943		—			—			943
Foreign currency translation gain		—		—		—		—			305			305
Net loss		—		—		—		(7,357	)		—			(7,357	)

Balance at December 31, 2024		23,451,475	$	—	$	279,303	$	(202,675	)	$	(688	)	$	75,941

The accompanying notes are an integral part of these consolidated financial statements.

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BENITEC BIOPHARMA INC.

Consolidated Statements of Cash Flows

(Unaudited)

(in thousands)


	Six Months Ended December 31,
	2024			2023
Cash flows from operating activities:
Net loss	$	(12,416	)	$	(12,752	)
Adjustments to reconcile net loss to net cash used in operating activities:
Depreciation and amortization		39			36
Amortization of right-of-use assets		133			126
Unrealized loss on investment		—			1
Gain on extinguishment of liabilities		(764	)		—
Share-based compensation expense		1,378			184
Changes in operating assets and liabilities:
Trade and other receivables		226			—
Prepaid and other assets		165			846
Trade and other payables		(980	)		1,707
Accrued employee benefits		77			46
Lease liabilities		(147	)		(136	)

Net cash used in operating activities		(12,289	)		(9,942	)

Cash flows from investing activities:
Purchase of property and equipment		(12	)		—

Net cash used in investing activities		(12	)		—
Cash flows from financing activities:
Proceeds from exercise of pre-funded warrants, series 2 warrants and common warrants		39,529			30,922
Share issuance transaction costs		(2	)		(2,964	)

Net cash provided by financing activities		39,527			27,958

Effects of exchange rate changes on cash, cash equivalents, and restricted cash		190			(118	)

Net increase in cash, cash equivalents, and restricted cash		27,416			17,898
Cash, cash equivalents, and restricted cash, beginning of period		50,929			2,490

Cash, cash equivalents, and restricted cash, end of period	$	78,345		$	20,388

Supplemental disclosure of cash flow information
Deemed dividend	$	—		$	619

The accompanying notes are an integral part of these consolidated financial statements.

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BENITEC BIOPHARMA INC.

Notes to Consolidated Financial Statements

(Unaudited)

1. Business

Benitec Biopharma Inc. (the “Company”, “we”, “our”) is a corporation formed under the laws of Delaware, United States of America, on November 22, 2019 and listed on the Nasdaq Capital Market (“Nasdaq”) under the symbol “BNTC”. Benitec Biopharma Inc. is the parent entity of a number of subsidiaries including the previous parent entity Benitec Biopharma Limited (“BBL”). BBL was incorporated under the laws of Australia in 1995 and was listed on the Australian Securities Exchange, or ASX, from 1997 until April 15, 2020. On August 14, 2020, BBL reorganized as a Proprietary Limited company and changed its name to Benitec Biopharma Proprietary Limited. The Company’s business focuses on the development of novel genetic medicines. Our proprietary platform is called “Silence and Replace”

DNA-directed

RNA interference. The proprietary “Silence and Replace”

DNA-directed

RNA interference platform combines RNA interference, or RNAi, with gene therapy to create medicines that simultaneously facilitate sustained silencing of disease-causing genes and concomitant delivery of wildtype replacement genes following a single administration of the therapeutic construct.

During the year ended June 30, 2021, the Company completed an organization restructuring as part of the commercial desire to provide a more efficient structure for the future as the Company transitioned its operations to the United States.

The Company’s fiscal year end is June 30. References to a particular “fiscal year” are to our fiscal year end June 30 of that calendar year.

The consolidated financial statements of Benitec Biopharma Inc. are presented in United States dollars and consist of Benitec Biopharma Inc. and its wholly owned subsidiaries as listed below. Aside from Benitec Biopharma Proprietary Limited, the international subsidiaries are dormant.


		Principal place of business/country of incorporation
Benitec Biopharma Proprietary Limited (“BBL”)		Australia
Benitec Australia Proprietary Limited		Australia
Benitec Limited		United Kingdom
Benitec, Inc.		USA
Benitec LLC		USA
RNAi Therapeutics, Inc.		USA
Tacere Therapeutics, Inc.		USA
Benitec IP Holdings, Inc.		USA

2. Basis of Presentation and Summary of Significant Accounting Policies

Basis of Presentation

The Company’s consolidated financial statements contained in this Quarterly Report on Form

10-Q

have been prepared in accordance with generally accepted accounting principles in the U.S. (“GAAP”) for interim financial information and with the instructions to Form

10-Q

and Article 8 of U.S. Securities and Exchange Commission (“SEC”) Regulation

S-X.

Accordingly, certain information and disclosures required by GAAP for annual financial statements have been omitted. In the opinion of management, all adjustments, consisting of normal recurring adjustments, considered necessary for a fair presentation have been included. Interim financial results are not necessarily indicative of results anticipated for the full year. These consolidated financial statements should be read in conjunction with the Company’s audited financial statements and accompanying notes included in the Company’s Annual Report on Form

10-K

for the year ended June 30, 2024.

Reference is frequently made herein to the Financial Accounting Standards Board (the “FASB”) Accounting Standards Codification (“ASC”). This is the source of authoritative GAAP recognized by the FASB to be applied to

non-governmental

entities.

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Principles of Consolidation

The consolidated financial statements include the Company’s accounts and the accounts of its wholly owned subsidiaries. All intercompany transactions and balances have been eliminated.

Use of Estimates

The preparation of the Company’s consolidated financial statements requires management to make estimates and assumptions that impact the reported amounts of assets, liabilities and expenses and the disclosure of contingent assets and liabilities in the Company’s consolidated financial statements and accompanying notes. The most significant estimates and assumptions in the Company’s consolidated financial statements relate to accrued research and development expense and valuation of equity-based instruments issued for other than cash. These estimates and assumptions are based on current facts, historical experience and various other factors believed to be reasonable under the circumstances, the results of which form the basis for making judgments about the carrying values of assets and liabilities and the recording of expenses that are not readily apparent from other sources. Actual results may differ materially and adversely from these estimates. To the extent there are material differences between the estimates and actual results, the Company’s future results of operations will be affected.

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Risks and Uncertainties

The Company is subject to risks and uncertainties common to early-stage companies in the biotechnology industry, including, but not limited to, development by competitors of new technological innovations, protection of proprietary technology, dependence on key personnel, reliance on single-source vendors and collaborators, availability of raw materials, patentability of the Company’s products and processes and clinical efficacy and safety of the Company’s products under development, compliance with government regulations and the need to obtain additional financing to fund operations.

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 technological change and substantial competition from other pharmaceutical and biotechnology companies. In addition, the Company is dependent upon the services of its employees, consultants and other third parties.

Segment Reporting

Operating segments are identified as components of an enterprise about which separate discrete financial information is available for evaluation by the chief operating decision-maker in making decisions regarding resource allocation and assessing performance. The Company views its operations and manages its business in one operating segment.

Foreign Currency Translation and Other Comprehensive Income (Loss)

The Company’s functional currency and reporting currency is the United States dollar. BBL’s functional currency is the Australian dollar (AUD). Assets and liabilities are translated at the exchange rate in effect at the balance sheet date. Revenues and expenses are translated at the average rate of exchange prevailing during the reporting period. Equity transactions are translated at each historical transaction date spot rate. Translation adjustments arising from the use of different exchange rates from period to period are included as a component of stockholders’ equity as “Accumulated other comprehensive loss.” Gains and losses resulting from foreign currency translation are included in the consolidated statements of operations and comprehensive loss as other comprehensive income (loss).

Other comprehensive income (loss) for all periods presented consists entirely of foreign currency translation gains and losses.

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Fair Value Measurements

The Company measures its financial assets and liabilities in accordance with GAAP using ASC 820,

Fair Value Measurements

. For certain financial instruments, including cash and cash equivalents, accounts receivable, and accounts payable, the carrying amounts approximate fair value due to their short maturities.

The Company follows accounting guidance for financial assets and liabilities. ASC 820 defines fair value, provides guidance for measuring fair value and requires certain disclosures. The guidance utilizes a fair value hierarchy that prioritizes the inputs to valuation techniques used to measure fair value into three broad levels. The following is a brief description of those three levels:


Level 1:		Observable inputs such as quoted prices (unadjusted) in active markets for identical assets or liabilities.

Level 2:		Inputs, other than quoted prices that are observable, either directly or indirectly. These include quoted prices for similar assets or liabilities in active markets and quoted prices for identical or similar assets or liabilities in markets that are not active.

Level 3:		Unobservable inputs in which little or no market data exists, therefore developed using estimates and assumptions developed by us, which reflect those that a market participant would use.

Cash and Cash Equivalents

Cash and cash equivalents include cash on hand and at banks, short-term deposits with an original maturity of three months or less with financial institutions. There were no cash equivalents as of December 31, 2024 and June 30, 2024.

Restricted cash balances of $62 thousand and $63 thousand as of December 31, 2024 and June 30, 2024, respectively, are used to secure the Company’s credit card.

Concentrations of Risk

Financial instruments that potentially subject the Company to significant concentration of credit risk consist primarily of cash. The Company maintains deposits at federally insured financial institutions in excess of federally insured limits. The Company has not experienced any losses in such accounts, and management believes that the Company is not exposed to significant credit risk due to the financial position of the depository institutions in which those deposits are held.

Trade and Other Receivables

The Company adopted ASC 326—

Financial Instruments—Credit Losses (Topic 326

) as of July 1, 2023. As such, the Company estimates current expected credit losses (CECL) on trade and other receivables on an ongoing basis, and will recognize those expected credit losses immediately. Estimates of current expected credit losses will be based on analyses of individual customer circumstances and historical

write-off

experience. The Company’s analyses will consider the aging of receivable accounts, customer creditworthiness, and general economic conditions.

Property and Equipment

Property and equipment are stated at cost, net of accumulated depreciation and amortization. Expenditures for maintenance and repairs are expensed as incurred; additions, renewals, and improvements are capitalized. When property and equipment are retired or otherwise disposed of, the related cost and accumulated depreciation and amortization are removed from the respective accounts, and any gain or loss is included in operations. Depreciation and amortization of property and equipment is calculated using the straight-line basis over the following estimated useful lives:


Software		3-4 years
Lab equipment		3-7 years
Computer hardware		3-5 years
Leasehold improvements		shorter of the lease term or estimated useful lives

Impairment of Long-Lived Assets

Property and equipment are reviewed for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable. Recoverability of long-lived assets to be held and used is measured by a comparison of the carrying amount of an asset to the estimated undiscounted future cash flows expected to be generated by the asset. If the carrying amount of an asset exceeds its estimated undiscounted future cash flows, an impairment charge is recognized by the amount by which the carrying amount of the asset exceeds the fair value of the assets. Fair value is generally determined using the asset’s expected future discounted cash flows or market value, if readily determinable.

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Trade and other payables

These amounts represent liabilities for goods and services provided to the Company prior to the end of the period and which are unpaid. Due to their short-term nature, they are measured at cost and are not discounted. The amounts are unsecured and are usually paid within 30 days of recognition.

Leases

At lease commencement, the Company records a lease liability based on the present value of lease payments over the expected lease term. The Company calculates the present value of lease payments using the discount rate implicit in the lease, unless that rate cannot be readily determined. In that case, the Company uses its incremental borrowing rate, which is the rate of interest that the Company would have to pay to borrow on a collateralized basis an amount equal to the lease payments over the expected lease term. The Company records a corresponding

right-of-use

lease asset based on the lease liability, adjusted for any lease incentives received and any initial direct costs paid to the lessor prior to the lease commencement date.

After lease commencement, the Company measures its leases as follows: (i) the lease liability based on the present value of the remaining lease payments using the discount rate determined at lease commencement; and (ii) the

right-of-use

lease asset based on the remeasured lease liability, adjusted for any unamortized lease incentives received, any unamortized initial direct costs and the cumulative difference between rent expense and amounts paid under the lease agreement. Any lease incentives received and any initial direct costs are amortized on a straight-line basis over the expected lease term. Rent expense is recorded on a straight-line basis over the expected lease term.

Basic and Diluted Net Loss Per Share

Basic net loss per share is calculated by dividing net loss by the weighted-average number of common shares outstanding during the period. Diluted net loss per share is calculated by dividing net loss by the weighted-average number of common shares outstanding plus potential common shares. Stock options, warrants and convertible instruments are considered potential common shares and are included in the calculation of diluted net loss per share using the treasury stock method when their effect is dilutive. Potential common shares are excluded from the calculation of diluted net income (loss) per share when their effect is anti-dilutive. As of December 31, 2024, and June 30, 2024, there were 25,551,630 and 35,453,286 potential common shares, respectively, that were excluded from the calculation of diluted net loss per share because their effect was anti-dilutive.

Revenue Recognition

The Company recognizes revenue in accordance with ASC 606—

Revenue from Contracts with Customers

(“ASC 606”). The core principle of ASC 606 is that entities are to recognize revenue to depict the transfer of promised goods and services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services.

The Company recognizes revenue in accordance with that core principle by applying the following steps: Step 1: Identify the contract(s) with a customer.

Step 2: Identify the performance obligations in the contract.

Step 3: Determine the transaction price.

Step 4: Allocate the transaction price to the performance obligations in the contract.

Step 5: Recognize revenue when (or as) the entity satisfies a performance obligation.

The Company applies judgement in determining whether contracts entered into fall within the scope of ASC 606. In doing so, management considers the commercial substance of the transaction and how risks and benefits of the contract accrue to the various parties to the contract.

Management has also made the judgement that the grant of the license and transfer of associated

know-how

and materials are accounted for as one performance obligation as they are not considered to be distinct; they are highly interrelated and could not provide benefits to the customer independently from each other. Judgements were made in relation to the transfer of the license and

know-how

and whether this should be recognized over time or a point in time. The point in time has been determined with regard to the point at which the transfer of

know-how

has substantially been completed and the customer has control of the asset and the ability to direct the use of and receive substantially all of the remaining benefits.

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Licensing revenues

Revenue from licensees of the Company’s intellectual property reflects the transfer of a right to use the intellectual property as it exists at the point in time in which the license is transferred to the customer. Consideration can be variable and is estimated using the most likely amount method and is constrained to the extent that it is probable that a significant reversal will not occur. Revenue is recognized as or when the performance obligations are satisfied.

The Company recognizes contract liabilities for consideration received in respect of unsatisfied performance obligations and reports these amounts as other liabilities in the consolidated balance sheet. Similarly, if the Company satisfies a performance obligation before it receives the consideration, the Company recognizes either a contract asset or a receivable in its consolidated balance sheet, depending on whether something other than the passage of time is required before the consideration is due.

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Royalties

Revenue from licensees of the Company’s intellectual property reflect a right to use the intellectual property as it exists at the point in time in which the license is granted. Where consideration is based on sales of product by the licensee, revenue is recognized when the customer’s subsequent sales of products occur.

Services revenue

Revenue is earned (constrained by variable considerations) from the provision of research and development services to customers. Services revenue is recognized when performance obligations are either satisfied over time or at a point in time. Generally, the provision of research and development services under a contract with a customer will represent satisfaction of a performance obligation over time where the Company retains the right to payment for services performed but not yet completed.

Research and Development Expense

Research and development expenses relate primarily to the cost of conducting clinical and

pre-clinical

trials.

Pre-clinical

and clinical development costs are a significant component of research and development expenses. The Company records accrued liabilities for estimated costs of research and development activities conducted by third-party service providers, which include the conduct of

pre-clinical

studies and clinical trials, and contract manufacturing activities. The Company records the estimated costs of research and development activities based upon the estimated amount of services provided but not yet invoiced and includes these costs in trade and other payables on the consolidated balance sheets and within research and development expenses on the consolidated statements of operations and comprehensive loss.

The Company accrues for these costs based on factors such as estimates of the work completed and in accordance with agreements established with its third-party service providers. The Company makes significant judgments and estimates in determining the accrued liabilities balance at the end of each reporting period. As actual costs become known, the Company adjusts its accrued liabilities. The Company has not experienced any material differences between accrued costs and actual costs incurred.

Share-based Compensation Expense

The Company records share-based compensation in accordance with ASC 718,

Stock Compensation

. ASC 718 requires the fair value of all share-based compensation awarded to employees and

non-employees

to be recorded as an expense over the shorter of the service period or the vesting period. The Company determines employee and

non-employee

share-based compensation based on the grant-date fair value using the Black-Scholes Option Pricing Model.

Income Taxes

The Company is subject to Australia and United States income tax laws. The Company follows ASC 740,

Accounting for Income Taxes

, when accounting for income taxes, which requires an asset and liability approach to financial accounting and reporting for income taxes. Deferred income tax assets and liabilities are computed annually for temporary differences between the financial statements and tax bases of assets and liabilities that will result in taxable or deductible amounts in the future based on enacted tax laws and rates applicable to the periods in which the differences are expected to affect taxable income. Valuation allowances are established when necessary to reduce deferred tax assets to the amount more likely than not to be realized. For uncertain tax positions that meet a “more likely than not” threshold, the Company recognizes the benefit of uncertain tax positions in the consolidated financial statements. The Company’s practice is to recognize interest and penalties, if any, related to uncertain tax positions in income tax expense in the consolidated statements of operations.

Recent Accounting Pronouncements

In June 2016, the FASB issued ASU

No. 2016-13:

Financial Instruments—Credit Losses (Topic 326

). This ASU represents a significant change in the accounting for credit losses model by requiring immediate recognition of management’s estimates of current expected credit losses (CECL). Under the prior model, losses were recognized only as they were incurred. The Company adopted this ASU effective July 1, 2023 and determined that its impact on the accompanying consolidated financial statements is immaterial.

Recently Issued Accounting Standards Not Yet Adopted

In December 2023, the FASB issued ASU

No. 2023-09,

Income Taxes (Topic 740) – Improvements to Income Tax Disclosures

, which enhances the transparency, effectiveness, and comparability of income tax disclosures by requiring consistent categories and greater disaggregation of information related to income tax rate reconciliations and the jurisdictions in which income taxes are paid. This guidance is effective for annual periods beginning after December 15, 2024 with early adoption permitted. The Company is currently evaluating the impact of the ASU on its income tax disclosures within the consolidated financial statements.

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In November 2023, the FASB issued ASU

No. 2023-07,

Segment Reporting (Topic 280) – Improvements to Reportable Segment Disclosures

, which improves reportable segment disclosure requirements, primarily through enhanced disclosures about significant segment expenses. This ASU also expands disclosure req

uire

ments to enable users of financial sta

teme

nts to better

unde

rstand the entity’s measurement and assessment of segment performance and resource allocation. This guidance is effective for fiscal years beginning after December 15, 2023, and interim periods within fiscal years beginning after December 15, 2024, with early adoption permitted. The Company is currently evaluating the impact of the ASU on its disclosures within the consolidated financial statements.

3. Liquidity

The accompanying consolidated financial statements have been prepared assuming that the Company will continue as a going concern. For the six months ended December 31, 2024, and 2023, the Company incurred net losses of $12.4 million and $12.8 million, respectively, and used cash in operations of $12.3 million and $9.9 million, respectively. The Company expects to continue to incur additional operating losses in the foreseeable future.

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The Company’s business focuses on the development of novel genetic medicines and, at this stage in the Company’s development, the Company has not established a source of revenue to cover its full operating costs, and as such, is dependent on funding operations through capital financing activities. As of December 31, 2024, the Company had $78.3 million in cash and cash equivalents. On April 22, 2024 we closed a private investment in public equity (PIPE) financing in which we sold 5,749,152 shares of common stock at a price per share of $4.80 and, in lieu of shares of common stock,

pre-funded

warrants to purchase up to an aggregate of 2,584,239 shares of common stock at a price per

pre-funded

warrant of $4.7999, to certain accredited institutional investors. The

pre-funded

warrants were immediately exercisable until exercised in full at an exercise price of $0.0001 per share of common stock. Gross proceeds from the financing totaled $40.0 million. The Company also received additional cash during the six months ended December 31,2024 due to warrant exercises totaling $39.5 million. See Note 9. Stockholders Equity. We estimate that our cash and cash equivalents will be sufficient to fund the Company’s operations for at least the next twelve months from the date of this report.

The Company’s ability to continue as a going concern is dependent upon its ability to manage its net loss, become profitable, and obtain adequate financing. While the Company believes in its ability to generate revenue and raise additional funds, there can be no assurances to that effect. The financial statements do not include any adjustments to reflect the possible future effects on the recoverability and classification of assets or the amounts and classification of liabilities that might be necessary if the Company is unable to continue as a going concern due to unsuccessful product development or commercialization, or the inability to obtain adequate financing in the future.

4. Cash, cash equivalents, and restricted cash


(US$’000)	December 31, 2024		June 30, 2024
Cash at bank	$	78,283	$	50,866
Restricted cash		62		63

Total	$	78,345	$	50,929

5. Prepaid and other assets


(US$’000)	December 31, 2024			June 30, 2024
Prepaid expenses	$	407		$	577
Market value of listed shares		1			1

Total other assets		408			578
Less: non-current portion		(42	)		(62	)

Current portion	$	366		$	516

6. Property and equipment, net


(US$’000)	December 31, 2024			June 30, 2024
Software	$	6		$	6
Lab equipment		1,533			1,521
Computer hardware		32			32
Leasehold improvements		24			24

Total property and equipment, gross		1,595			1,583

Accumulated depreciation and amortization		(1,444	)		(1,404	)

Total property and equipment, net	$	151		$	179

Depreciation and amortization expense was $14 thousand and $39 thousand for the three and six months ended December 31, 2024, and $17 thousand and $36 thousand respectively, for the same periods in 2023.

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7. Trade and other payables


(US$’000)	December 31, 2024		June 30, 2024
Trade payable	$	593	$	1,351
Accrued consultant fees		16		75
Accrued professional fees		118		97
Accrued clinical development project costs		1,596		2,504
Other payables		92		138

Total	$	2,415	$	4,165

During the period ended December 31, 2024, the Company agreed to resolve disputed

trade payables and accrued clinical development project costs of $

1.2

million with a vendor for $

495

thousand. This settlement resulted in a gain of $

764

thousand r

ecorded in the statement of operations and other comprehensive loss under other income (expense) for the period.

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8. Leases

The Company has entered into an operating lease for office space under an agreement that expires in 2025. The lease requires the Company to pay utilities, insurance, taxes, and other operating expenses. The Company’s lease does not contain any residual value guarantees or material restrictive covenants.

The tables below show the changes during the six months ended December 31, 2024:


(US$’000)	Operating lease right- of- use assets
Balance at July 1, 2024	$	270
Amortization of right of use asset		(133	)

Operating lease right-of-use asset at December 31, 2024	$	137


(US$’000)	Operating lease liabilities
Balance at July 1, 2024	$	284
Principal payments on operating lease liabilities		(147	)

Operating lease liabilities at December 31, 2024		137
Less: non-current portion		—

Current portion at December 31, 2024	$	137

As of December 31, 2024, the Company’s operating lease has a remaining lease term of 0.5 years and a discount rate of 4.67%. The maturities of the operating lease liabilities are as follows:


(US$’000)	December 31, 2024
2025	$	139

Total operating lease payments		139
Less imputed interest		(2	)

Present value of operating lease liabilities	$	137

The Company recorded lease liabilities and

right-of-use

lease assets for the lease based on the present value of lease payments over the expected lease term, discounted using the Company’s incremental borrowing rate. Rent expense was $0.1 million and $0.1 million for the three and six months ended December 31, 2024, respectively,

$0.1 million and $0.1 million for the same periods in 2023.

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9. Stockholders’ equity

Preferred Stock

On December 6, 2024, the stockholders of the Company approved an amendment (the “Amendment”) to the Company’s Amended and Restated Certificate of Incorporation, as amended, to authorize the issuance of 5,000,000 shares of preferred stock, par value $0.0001. As of December 31, 2024, there were no preferred shares issued and outstanding.

Common Stock

On December 8, 2021, the stockholders of the Company approved an amendment (the “Charter Amendment”) to the Company’s Amended and Restated Certificate of Incorporation to increase the total number of authorized shares of common stock of the Company from 10,000,000 to 40,000,000, which became effective on December 17, 2021. On December 7, 2022, the stockholders of the Company approved another amendment to the Company’s Amended and Restated Certificate of Incorporation to increase the number of authorized shares of common stock from 40,000,000 to 160,000,000. The Charter Amendment was filed with the Secretary of State of the State of Delaware and became effective December 9, 2022. On July 26, 2023, the Company effected a

1-for-17

reverse stock split (the “Reverse Stock Split”) .

On October 11, 2024, the Company into a Sales Agreement (the “Sales Agreement”) with Leerink Partners LLC (the “Agent”). Pursuant to the terms of the Sales Agreement, the Company may offer and sell shares of the Company’s common stock having an aggregate offering amount of up to $75 million from time to time through the Agent. The Agent will use its commercially reasonable efforts, as the agent and subject to the terms of the Sales Agreement, to sell the shares offered. Sales of the shares, if any, may be made in sales deemed to be an

“at-the-market

offering” as defined in Rule 415 under the Securities Act of 1933, as amended. The Company may also agree to sell shares to the Agent as principal for its own account on terms agreed to by the Company and the Agent. The Agent will be entitled to a commission from the Company of 3.0% of the gross proceeds from the sale of shares sold under the Sales Agreement. In addition, the Company has agreed to reimburse certain expenses incurred by the Agent in connection with the offering.

Warrants

December 6, 2019, investors were issued four Purchase Warrants that were exercisable into 12,600 fully paid shares of common stock should the Purchase Warrants be exercised in full (“Purchase Warrants”). The exercise price for the Purchase Warrants is $178.50 per share issued on exercise of a Purchase Warrant. The Purchase Warrants are exercisable, in whole or in part, any time from the date of issue until the fifth anniversary of the date of issue (December 6, 2024). On April 22, 2020, the Company issued 2,201 shares of common stock in connection with a cashless exercise of Purchase Warrants exercisable for 6,300 shares of common stock. The Company did not have an effective registration statement registering the resale of the Warrant Shares by the Holder at the time the Holder wanted to exercise the warrant; therefore, the Holder carried out a cashless exercise. The formula for conducting a cashless exercise was outlined in the Warrant agreement.

6,300

purchase warrants remained unexercised and expired in December 2024.

On September 15, 2022, we closed an underwritten public offering in which we issued and sold (i) 1,037,520 shares of the Company’s common stock, (ii) 12,171,628

pre-funded

warrants, which, after giving effect to the Reverse Stock Split, are currently exercisable into 715,979 shares of common stock at an exercise price of $0.0017 per share until exercised in full and (iii) 29,809,471 Series 2 warrants (the “Series 2 Warrants”), which, after giving effect to the Reverse Stock Split, are currently exercisable into 1,753,503 shares of common stock at an exercise price of $11.22 per share. The Series 2 warrants sold in the offering became exercisable commencing December 9, 2022, the date on which the Company had both (a) received approval from its stockholders to increase the number of shares of common stock it is authorized to issue and (b) effected such stockholder approval by filing with the Secretary of State of the State of Delaware a certificate of amendment to its Amended and Restated Certificate of Incorporation, and will expire on the fifth anniversary of such initial exercise date. The combined purchase price for each share of common stock and accompanying common warrant was $10.20, which was allocated as $10.03 per share of common stock and $0.17 per common warrant. The Series 2 Warrants contain an exercise price adjustment mechanism providing that certain issuances of common stock (or common stock equivalents), if made at a price lower than the then existing exercise price of such Series 2 Warrants would reset the exercise price to such lower price. As a result of the August 11, 2023 public offering, the exercise price of the Series 2 Warrants has been automatically reset as of the closing time of such public offering to $1.9299. For the six months ended December 31, 2023, we recorded a deemed dividend, for accounting purposes, during the fiscal quarter ended September 30, 2024 of $618,987 as a result of an adjustment to the exercise price of its Series 2 Warrants due to an exercise price adjustment provision in such warrants.

On October 17, 2022 and October 27, 2022, investors exercised 117,939 and 9,804

pre-funded

warrants, respectively, at an exercise price of $0.0017 per share.

On August 11, 2023 we closed an underwritten public offering in which we sold 875,949 shares of common stock, 15,126,226

pre-funded

warrants to purchase 15,126,226 shares of common stock, and 16,002,175 common warrants to purchase up to 16,002,175 shares of common stock. The combined purchase price for each share of common stock and accompanying common warrant was $1.93, which was allocated as $1.9299 per share of common stock and $0.0001 per common warrant. Each

pre-funded

warrant was sold together with one common warrant at a combined price of $1.9299, which was allocated as $1.9298 per

pre-funded

warrant and $0.0001 per common warrant. The

pre-funded

warrants were immediately exercisable until exercised in full at an exercise price of $0.0001 per share of common stock. The common warrants were immediately exercisable at an exercise price of $3.86 per share of common stock and will expire on the fifth anniversary of such initial exercisable date. In addition, the Company granted the underwriter a

30-day

option to purchase up to 2,331,606 additional shares of common stock and/or up to 2,331,606 additional common warrants. The underwriter partially exercised this option and purchased 458,134 additional shares of common stock and 458,134 additional common warrants. These additional shares are included in the total sold on August 11, 2023. Net proceeds from the offering, including the impact of the underwriter’s partial exercise of its option and net of underwriting discounts, commissions, and other offering expenses, totaled $27.9 million.

On October 17, 2023 an investor exercised 25,000

pre-funded

warrants at an exercise price of $0.0001 per share. On November 24, 2023, an investor exercised 20,000 Series 2 warrants at an exercise price of $1.93 per share. On March 15, 2024 and March 18, 2024, investors exercised 105,888 and 26,472

pre-funded

warrants, respectively, at an exercise price of $0.0001 per share.

On April 10, 2024 and April 19, 2024, investors exercised 25,000 Series 2 warrants on each date, at an exercise price of $1.93 per share. On April 22, 2024, an investor exercised 28,039 Series 2 warrants at an exercise price of $1.93 per share. On April 23, 2024, May 8, 2024, and May 21, 2024, investors exercised 27,500, 697,475, and 13,212 common warrants, respectively, at an exercise price of $3.86 per share.

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On April 22, 2024 we closed a private investment in public equity (PIPE) financing in which we sold 5,749,152 shares of common stock at a price per share of $4.80 and, in lieu of shares of common stock,

pre-funded

warrants to purchase up to an aggregate of 2,584,239 shares of common stock at a price per

pre-funded

warrant of $4.7999, to certain accredited institutional investors. The

pre-funded

warrants were immediately exercisable until exercised in full at an exercise price of $0.0001 per share of common stock. Gross proceeds from the financing totaled $40.0 million.

Net proceeds, net of commissions and other offering expenses, totaled approximately $37.1 million.

On April 26, 2024, April 28, 2024, and May 16, 2024, investors exercised 350,000, 438,000, and 7,947

pre-funded

warrants, respectively, at an exercise price of $0.0001 per share.

On July 25, 2024, an investor exercised 269,609 Series 2 warrants at an exercise price of $1.93 per share. On September 12, 2024, an investor exercised 200,000

pre-funded

warrants at an exercise price of $0.0001 per share.

On August 29, 2024, the Company’s stockholders approved the exercise of certain existing warrants issued in April 2024, September 15, 2022 and August 11, 2023 in accordance with the rules of the Nasdaq Stock Market which otherwise would be subject to the Beneficial Ownership Limitation.

On September 26, 2024, investors exercised 1,368,180

pre-funded

warrants at an exercise price of $0.0001 per share and exercised 5,181,347 common warrants at an exercise price of $3.86 per share. Also on September 26, 2024, an investor exercised 588,236 Series 2 warrants at an exercise price of $1.93 per share. On September 27, 2024, an investor exercised 200,274

pre-funded

warrants on a cashless basis.

On October 15, 2024, an investor exercised 425,000

pre-funded

warrants at an exercise price of $0.0001 per share. On October 15, 2024, October 17, 2024, October 18, 2024, and October 29, 2024, investors exercised 1,496,214, 308,803, 950,000, 1,554,404 common warrants, respectively, at an exercise price of $3.86 per share. Also on October 29, 2024, an investor exercised 588,239 Series 2 warrants at an exercise price of $1.93 per share.

On December 12, 2024, an investor exercised 181,129

pre-funded

warrants on a cashless basis. Also on December 18, 2024, investors exercised 53,921 Series 2 warrants at an exercise price of $1.93 per share.

Total proceeds received by the Company during the

six-month

period ended December 31, 2024 from the exercises of warrants totaled $39.5

million

As of December 31, 2024, there were 20,898,490 warrants outstanding.

The activity related to warrants for the six months ended December 31, 2024, is summarized as follows:


	Common Stock from Warrants		Weighted- average Exercise Price (per share)
Outstanding at July 1, 2024		34,271,146	$	1.85
Pre-funded warrants exercised		1,768,454	$	0.0001
Series 2 warrants exercised		857,845	$	1.9299
Common warrants exercised		5,181,347	$	3.86

Outstanding and exercisable at September 30, 2024		26,463,500	$	1.57

Pre-funded warrants exercised		606,129	$	0.0001
Series 2 warrants exercised		642,160	$	1.9299
Common warrants exercised		4,309,421	$	3.86
Purchase warrants expired		6,300	$	178.50

Outstanding and exercisable at December 31, 2024		20,898,490	$	1.08

Equity Incentive Plan

Employee Share Option Plan

In connection with its

re-domiciliation

to the United States, the Company assumed BBL’s obligations with respect to the settlement of options that were issued by BBL prior to the

re-domiciliation

pursuant to the Benitec Officers’ and Employees’ Share Option Plan (the “Plan”). This includes the Company’s assumptions of the Plan and all award agreements pursuant to which each of the options were granted. Each option when exercised entitles the option holder to one share in the Company. Options are exercisable on or before an expiry date, do not carry any voting or dividend rights and are not transferable except on death of the option holder or in certain other limited circumstances. Employee options vest one third on each anniversary of the applicable grant date for three years. If an employee dies, retires, or otherwise leaves the organization, and certain other conditions have been satisfied, generally the employee has 12 months to exercise their options, or the options are cancelled. After the

Re-domiciliation,

no new options have been or will be issued under the Plan.

On July 1, 2024, the Plan and all options granted thereunder expired by its and their terms.

Equity and Incentive Compensation Plan

On December 9, 2020, the Company’s stockholders approved the Company’s 2020 Equity and Incentive Compensation Plan (the “2020 Plan”). The 2020 Plan provides for the grant of various equity awards. Currently, only stock options are outstanding under the 2020 Plan. Each option when exercised entitles the option holder to one share of the Company’s common stock. Options are exercisable on or before an expiry date, do not carry any voting or dividend rights, and are not transferable except on death of the option holder or in certain other limited circumstances. Employee stock options vest in increments of

one-third

on each anniversary of the applicable grant date over three years.

Non-employee

director options vest in increments of

one-third

on the day prior to each of the Company’s next three annual stockholder meetings following the grant date. Executive Options granted on December 9, 2024, and December 27, 2024, vest in sixteen substantially equal quarterly installments on the last day of each full fiscal quarter of the Company ending after the grant date. If an option holder dies or terminates employment or service due to Disability (as defined in the 2020 Plan), the option holder generally has 12 months to exercise their vested options, or the options are cancelled. If an option holder otherwise leaves the Company, other than for a termination by the Company for Cause (as defined in the 2020 Plan), the option holder generally has 90 days to exercise their vested options, or the options are cancelled. The maximum contractual term of options granted under the 2020 Plan is ten years. Upon the consummation of a Change in Control (as defined in the 2020 Plan), all unvested stock options will immediately vest as of immediately prior to the Change in Control.

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On December 8, 2021, the Company’s stockholders approved an amendment to the 2020 Plan, which increased the number of shares of the Company’s common stock reserved under the 2020 Plan to 108,823 (as adjusted for the Reverse Stock Split). For the fiscal year ended June 30, 2024, our named executive officers (“NEO’s”) were each granted equity incentive awards under the 2020 Plan. On December 6, 2023, the Company’s stockholders approved an amendment to the 2020 Plan, which increased the number of shares of the Company’s common stock reserved under the 2020 Plan to 1,204,537. On August 29, 2024, the Company’s stockholders approved an amendment to the 2020 Plan, which increased the number of shares of the Company’s common stock reserved under the 2020 Plan to 8,204,537.

Equity Awards

The activity related to equity awards, which are comprised of stock options during the six months ended December 31, 2024 is summarized as follows:


	Stock Options		Weighted- average Exercise Price		Weighted- average Remaining Contractual Term		Aggregate Intrinsic Value
Outstanding at June 30, 2024		1,182,140	$	6.58		9.51 years	$	2,342,847
Granted		3,470,000		12.16		9.94 years		1,615,500
Expired		—		—		—		—
Forfeited		—		—		—		—

Outstanding at December 31, 2024		4,652,140	$	10.75		9.71 years	$	10,407,270
Exercisable at December 31, 2024		96,700	$	24.12		7.66 years	$	534,417

Share-Based Compensation Expense

The classification of share-based compensation expense is summarized as follows:


	Three Months Ended				Six Months Ended
	December 31,
(US$’000)	2024		2023		2024		2023
Research and development	$	123	$	33	$	236	$	67
General and administrative		820		60		1,142		117

Total share-based compensation expense	$	943	$	93	$	1,378	$	184

As of December 31, 2024, there was $40.0 million of unrecognized share-based

compensation

expense related to stock options issued under the Share Option Plan and the 2020 Plan, which is expected to be recognized over a weighted average period of 3.74 years.

10. Income taxes

For the three and six months ended December 31, 2024, and December 31, 2023, respectively, the Company did not recognize a provision or benefit for income taxes as it has incurred net losses. In addition, the net deferred tax assets generated from net operating losses are fully offset by a valuation allowance as the Company believes it is not more likely than not that the benefit will be realized.

11. Commitments and contingencies

Contract commitments

The Company enters into contracts in the normal course of business with third-party contract research organizations, contract development and manufacturing organizations and other service providers and vendors. These contracts generally provide for termination on notice and, therefore, are cancellable contracts and not considered contractual obligations and commitments.

Contingencies

From time to time, the Company may become subject to claims and litigation arising in the ordinary course of business. The Company is not a party to any material legal proceedings, nor is it aware of any material pending or threatened litigation.

12. Related party transactions

During the six month periods ended December 31, 2024 and December 31, 2023, the Company did not enter into any related party transactions.

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13. Subsequent events

On January 30, 2025, the Company entered into an operating lease for office space in Los Angeles, California that expires in

July 2026

for $15 thousand per month.

The fifth Subject in the BB-301 Phase 1b/2a clinical trial (NCT06185673) was safely treated with the low-dose of BB-301 in early February 2025.

On February 13, 2025, the Compensation Committee of the Company’s board of directors approved a change to the base salary of Megan Boston, the Company’s CFO, from USD$415k to USD$531.9k to be effective March 1, 2025. The base salary change was approved in anticipation of Ms. Boston relocating from Australia to Los Angeles, California. In connection with such relocation, the Compensation Committee also approved moving and transitional housing allowances in aggregate amounts of approximately $5,000 and $18,000, respectively.

Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations

You should read the following discussion and analysis of financial condition and operating results together with our consolidated financial statements and the related notes and other financial information included elsewhere in this document.

Company Overview

We endeavor to become the leader in discovery, development, and commercialization of therapeutic agents capable of addressing significant unmet medical need via the application of the silence and replace approach to the treatment of genetic disorders.

Benitec Biopharma Inc. (“Benitec” or the “Company” or in the third person, “we” or “our”) is a clinical-stage biotechnology company focused on the advancement of novel genetic medicines with headquarters in Hayward, California. The proprietary platform, called DNA-directed RNA interference, or ddRNAi, combines RNA interference, or RNAi, with gene therapy to create medicines that facilitate sustained silencing of disease-causing genes following a single administration. The unique therapeutic constructs also enable the simultaneous delivery of wildtype replacement genes, facilitating the proprietary “silence and replace” approach to the treatment of genetically defined diseases. The Company is developing a silence and replace-based therapeutic (BB-301) for the treatment of Oculopharyngeal Muscular Dystrophy (OPMD), a chronic, life-threatening genetic disorder.

BB-301 is a silence and replace-based genetic medicine currently under development by Benitec. BB-301 is an AAV-based gene therapy designed to permanently silence the expression of the disease-causing gene (to slow, or halt, the biological mechanisms underlying disease progression in OPMD) and to simultaneously replace the mutant gene with a wildtype gene (to drive restoration of function in diseased cells). This fundamental therapeutic approach to disease management is called “silence and replace.” The silence and replace mechanism offers the potential to restore the normative physiology of diseased cells and tissues and to improve treatment outcomes for patients suffering from the chronic, and potentially fatal, effects of OPMD. BB-301 has been granted Orphan Drug Designation in the United States and the European Union.

The targeted gene silencing effects of RNAi, in conjunction with the durable transgene expression achievable via the use of modified viral vectors, imbues the silence and replace approach with the potential to produce permanent silencing of disease-causing genes along with simultaneous replacement of the wild type gene function following a single administration of the proprietary genetic medicine. We believe that this novel mechanistic profile of the current and future investigational agents developed by Benitec could facilitate the achievement of robust and durable clinical activity while greatly reducing the frequency of drug administration traditionally expected for medicines employed for the management of chronic diseases. Additionally, the achievement of permanent gene silencing and gene replacement may significantly reduce the risk of patient non-compliance during the course of medical management of potentially fatal clinical disorders.

We will require additional financing to progress our product candidates through to key inflection points.

Our proprietary technology platforms are designated as DNA-directed RNA interference, or “ddRNAi”, and “silence and replace.” ddRNAi is designed to produce permanent silencing of disease-causing genes, by combining RNA interference, or RNAi, with viral delivery agents typically associated with the field of gene therapy (i.e., viral vectors). Modified AAV vectors are employed to deliver genetic constructs which encode short hairpin RNAs that are, then, serially expressed and processed to produce siRNA molecules within the transduced cell for the duration of the life of the target cell. These newly introduced siRNA molecules drive

permanent silencing of the expression of the disease-causing gene. The silence and replace approach further bolsters the biological benefits of permanent silencing of disease-causing genes by incorporating multifunctional genetic constructs within the modified AAV vectors to create an AAV-based gene therapy agent that is designed to silence the expression of disease-causing genes (to slow, or halt, the underlying mechanism of disease progression) and to simultaneously replace the mutant genes with normal, “wildtype” genes (to drive restoration of function in diseased cells). This fundamentally distinct therapeutic approach to disease management offers the potential to restore the underlying physiology of the treated tissues and, in the process, improve treatment outcomes for patients suffering from the chronic and, potentially, fatal effects of diseases like Oculopharyngeal Muscular Dystrophy (OPMD).

Traditional gene therapy is defined by the introduction of an engineered transgene to correct the pathophysiological derangements derived from mutated or malfunctioning genes. Mutated genes can facilitate the intracellular production of disease-causing proteins or hamper the production of critical, life-sustaining, proteins. The introduction of a new transgene can facilitate the restoration of production of normal proteins within the diseased cell, thus restoring natural biological function. Critically, the implementation of this traditional method of gene therapy cannot eliminate the expression, or the potential deleterious effects of, the underlying mutant gene (as mutant proteins may be continually expressed and aggregate or drive the aggregation of other native proteins within the diseased cell). In this regard, the dual capabilities of the proprietary silence and replace approach to silence a disease-causing gene via ddRNAi and simultaneously replace the wild type activity of a mutant gene via the delivery of an engineered transgene could facilitate the development of differentially efficacious treatments for a range of genetic disorders.

Overview of RNAi and the siRNA Approach

The mutation of a single gene can cause a chronic disease via the resulting intracellular production of a disease-causing protein (i.e., an abnormal form of the protein of interest), and many chronic and/or fat

SEC Form 10-Q filed by Benitec Biopharma Inc.