cmpx20250630

cmpx20250630_10q.htm

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, DC 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 June 30, 2025

☐	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: 001-39696

COMPASS THERAPEUTICS, INC.

(Exact Name of Registrant as Specified in its Charter)

Delaware

82-4876496

(State or other jurisdiction of

incorporation or organization)

(I.R.S. Employer
Identification No.)

80 Guest St., Suite 601

Boston, Massachusetts

02135

(Address of principal executive offices)

(Zip Code)

Registrant’s telephone number, including area code: (617) 500-8099

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

CMPX

Nasdaq Capital Market

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.

Large accelerated filer	☐	Accelerated filer	☐

Non-accelerated filer	☒	Smaller reporting company	☒

		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 ☒

As of August 4, 2025, the registrant had 138,282,498 shares of common stock, $0.0001 par value per share, outstanding.

Auditor Firm Id: 596

Auditor Name: CohnReznick LLP

Auditor Location: Melville, NY U.S.A.

Table of Contents

		Page
PART I.	FINANCIAL INFORMATION	1
Item 1.	Financial Statements (Unaudited)	1
	Condensed Consolidated Balance Sheets (Unaudited)	1
	Condensed Consolidated Statements of Operations and Comprehensive Loss (Unaudited)	2
	Condensed Consolidated Statements of Stockholders’ Equity (Unaudited)	3
	Condensed Consolidated Statements of Cash Flows (Unaudited)	4
	Notes to Unaudited Condensed Consolidated Financial Statements	5
Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	13
Item 3.	Quantitative and Qualitative Disclosures About Market Risk	20
Item 4.	Controls and Procedures	20
PART II.	OTHER INFORMATION	21
Item 1.	Legal Proceedings	21
Item 1A.	Risk Factors	21
Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds	22
Item 3.	Defaults Upon Senior Securities	22
Item 4.	Mine Safety Disclosures	22
Item 5.	Other Information	22
Item 6.	Exhibits	22

	Signatures	23

PART I—FINANCIAL INFORMATION

Item 1. Financial Statements

Compass Therapeutics, Inc. and Subsidiaries

Condensed Consolidated Balance Sheets

(In thousands, except par value)

	June 30, 2025 (unaudited)			December 31, 2024 (Note 1)
Assets
Current assets:
Cash and cash equivalents	$	22,856		$	43,483
Marketable securities		78,093			83,239
Prepaid expenses and other current assets		5,246			6,029
Total current assets		106,195			132,751
Property and equipment, net		131			353
Operating lease, right-of-use ("ROU") asset		9,804			6,731
Restricted cash		568			568
Total assets	$	116,698		$	140,403
Liabilities and Stockholders' Equity
Current liabilities:
Accounts payable	$	2,595		$	2,249
Accrued expenses		10,992			6,287
Operating lease obligations, current portion		271			338
Total current liabilities		13,858			8,874
Operating lease obligations, long-term portion		9,633			6,296
Total liabilities		23,491			15,170
Commitments and contingencies (Note 7)
Stockholders' equity:
Common stock, $0.0001 par value: 300,000 shares authorized; 138,282 and 137,820 shares issued and outstanding at June 30, 2025 and December 31, 2024, respectively		14			14
Additional paid-in-capital		494,182			489,692
Accumulated other comprehensive income		208			210
Accumulated deficit		(401,197	)		(364,683	)
Total stockholders' equity		93,207			125,233
Total liabilities and stockholders' equity	$	116,698		$	140,403

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

Compass Therapeutics, Inc. and Subsidiaries

Condensed Consolidated Statements of Operations and Comprehensive Loss (Unaudited)

(In thousands, except per share data)

	Three Months Ended June 30,						Six Months Ended June 30,
	2025			2024			2025			2024
Licensing revenue	$	—		$	850		$	—		$	850
Operating expenses:
Research and development		16,415			11,174			29,476			20,695
General and administrative		4,651			4,721			9,556			7,969
Total operating expenses		21,066			15,895			39,032			28,664
Loss from operations		(21,066	)		(15,045	)		(39,032	)		(27,814	)
Other income		1,185			1,969			2,518			3,951
Net loss	$	(19,881	)	$	(13,076	)	$	(36,514	)	$	(23,863	)
Net loss per share - basic and diluted	$	(0.14	)	$	(0.10	)	$	(0.26	)	$	(0.17	)
Basic and diluted weighted average shares outstanding		138,282			137,589			138,259			137,098
Other comprehensive loss:
Net loss	$	(19,881	)	$	(13,076	)	$	(36,514	)	$	(23,863	)
Unrealized gain (loss) on marketable securities		18			(1	)		(2	)		(128	)
Comprehensive loss	$	(19,863	)	$	(13,077	)	$	(36,516	)	$	(23,991	)

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

Compass Therapeutics, Inc. and Subsidiaries

Condensed Consolidated Statements of Stockholders’ Equity (Unaudited)

(In thousands)

	Common Stock				Additional Paid-in			Accumulated Other Comprehensive			Accumulated			Total Stockholders'
	Shares		Amount		Capital			(Loss) Income			Deficit			Equity
Balance at December 31, 2024		137,820	$	14	$	489,692		$	210		$	(364,683	)	$	125,233
Share-based awards, net of tax remittance		462		—		(815	)		—			—			(815	)
Stock-based compensation		—		—		2,514			—			—			2,514
Unrealized loss on marketable securities		—		—		—			(20	)		—			(20	)
Net loss		—		—		—			—			(16,633	)		(16,633	)
Balance at March 31, 2025		138,282		14		491,391			190			(381,316	)		110,279
Stock-based compensation		—		—		2,791			—			—			2,791
Unrealized loss on marketable securities		—		—		—			18			—			18
Net loss		—		—		—			—			(19,881	)		(19,881	)
Balance at June 30, 2025		138,282	$	14	$	494,182		$	208		$	(401,197	)	$	93,207


Balance at December 31, 2023		127,668	$	13	$	463,796		$	37		$	(315,308	)	$	148,538
Common shares issued, net of costs of $0.5 million		9,790		1		17,568			—			—			17,569
Share-based awards, net of tax remittance		131		—		(136	)		—			—			(136	)
Stock-based compensation		—		—		2,003			—			—			2,003
Unrealized loss on marketable securities		—		—		—			(127	)		—			(127	)
Net loss		—		—		—			—			(10,787	)		(10,787	)
Balance at March 31, 2024		137,589		14		483,231			(90	)		(326,095	)		157,060
Stock-based compensation		—		—		2,121			—			—			2,121
Unrealized loss on marketable securities		—		—		—			(1	)		—			(1	)
Net loss		—		—		—			—			(13,076	)		(13,076	)
Balance at June 30, 2024		137,589	$	14	$	485,352		$	(91	)	$	(339,171	)	$	146,104

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

Compass Therapeutics, Inc. and Subsidiaries

Condensed Consolidated Statements of Cash Flows (Unaudited)

(In thousands)

	For the Six Months Ended June 30,
	2025			2024
Cash flows from operating activities:
Net loss	$	(36,514	)	$	(23,863	)
Adjustments to reconcile net loss to net cash used in operating activities:
Depreciation and amortization		240			306
Share-based compensation		5,305			4,124
Amortization of premium and discount on marketable securities		(102	)		(1,103	)
ROU asset amortization		491			623
Changes in operating assets and liabilities:
Prepaid expenses and other current assets		783			(5,899	)
Accounts payable		346			(2,898	)
Accrued expenses		4,705			4,713
Operating lease liability		(294	)		(645	)
Net cash used in operating activities		(25,040	)		(24,642	)
Cash flows from investing activities:
Purchase of property and equipment		(18	)		—
Purchases of marketable securities		(58,005	)		(72,950	)
Proceeds from sale or maturities of marketable securities		63,251			75,334
Net cash provided by investing activities		5,228			2,384
Cash flows from financing activities:
Proceeds from issuance of common stock		—			18,113
Issuance costs from issuance of common stock		—			(543	)
Taxes paid related to net shares settlement of RSUs		(815	)		(136	)
Net cash (used in) provided by financing activities		(815	)		17,434
Net change in cash, cash equivalents and restricted cash		(20,627	)		(4,824	)
Cash, cash equivalents and restricted cash at beginning of period		44,051			24,228
Cash, cash equivalents and restricted cash at end of period	$	23,424		$	19,404
Reconciliation of cash, cash equivalents and restricted cash to the Condensed Consolidated Balance Sheets
Cash and cash equivalents	$	22,856		$	19,404
Restricted cash		568			—
Total cash, cash equivalents and restricted cash	$	23,424		$	19,404
Supplemental disclosure of cash flow information
Unrealized loss on marketable securities	$	(2	)	$	(128	)

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

Compass Therapeutics, Inc. and Subsidiaries

Notes to Unaudited Condensed Consolidated Financial Statements

1.	Nature of Business and Basis of Presentation

Compass Therapeutics, Inc. (“Compass” or the “Company”) is a clinical-stage, oncology-focused biopharmaceutical company developing proprietary antibody-based therapeutics to treat multiple human diseases. Our scientific focus is on the relationship between angiogenesis and the immune system. Our pipeline includes novel product candidates that leverage our understanding of the tumor microenvironment, including both angiogenesis-targeted agents and immune-oncology focused agents. These product candidates are designed to optimize critical biological pathways required for an effective anti-tumor response to cancer. These pathways include modulation of the microvasculature via angiogenesis-targeted agents; induction of a potent immune response via activators on effector cells in the tumor microenvironment; and alleviation of immunosuppressive mechanisms used by tumors to evade immune surveillance. We plan to advance our product candidates through clinical development as both standalone therapies and in combination with our proprietary drug candidates as long as their continued development is supported by clinical and nonclinical data. References to Compass or the Company herein include Compass Therapeutics, Inc. and its wholly owned subsidiaries.

The Company is subject to risks and uncertainties common to companies in the biotechnology and pharmaceutical industries. There can be no assurance that the Company’s research and development will be successfully completed, that adequate protection for the Company’s technology will be obtained, that any products developed will obtain necessary government regulatory approval or that any approved products will be commercially viable. 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.

In the opinion of management, the accompanying unaudited condensed consolidated financial statements include all normal and recurring adjustments (which consist primarily of accruals, estimates and assumptions that impact the financial statements) considered necessary to present fairly the Company’s consolidated financial position as of June 30, 2025 and its consolidated results of operations, comprehensive loss and changes in stockholders’ equity for the three and six months ended June 30, 2025 and 2024 and cash flows for the six months ended June 30, 2025 and 2024. Operating results for the three and six months ended June 30, 2025 are not necessarily indicative of the results that may be expected for the year ending December 31, 2025.

The unaudited condensed consolidated financial statements include the accounts of Compass Therapeutics, Inc. and its subsidiaries, and have been prepared by the Company in conformity with accounting principles generally accepted in the United States of America (“GAAP”) and pursuant to the rules and regulations of the Securities and Exchange Commission (“SEC”) for interim financial statements. Certain information and footnote disclosures normally included in financial statements prepared in accordance with GAAP have been condensed or omitted pursuant to such rules and regulations. The condensed consolidated balance sheet at December 31, 2024 has been derived from the audited consolidated financial statements at that date but does not include all of the information and footnotes required by GAAP for complete financial statements. Accordingly, these condensed consolidated financial statements should be read in conjunction with the Company’s audited financial statements in the Company’s Annual Report on Form 10-K for the fiscal year ended December 31, 2024 (the “Annual Report”).

Liquidity

Since our inception, we have devoted substantially all of our efforts to organizing and staffing our Company, business planning, raising capital, research and development activities, building our intellectual property portfolio and providing general and administrative support for these operations. We have funded our operations with proceeds from the sale of our equity securities and borrowing from debt arrangements. Through June 30, 2025, we have received $430 million in gross proceeds from the sale of equity securities. As of June 30, 2025, we had cash, cash equivalents and marketable securities of $101 million. Based on our research and development plans, we expect that such cash resources will enable us to fund our operating expenses and capital expenditure requirements into 2027.

2.	Summary of Significant Accounting Policies

There have been no material changes to the significant accounting policies previously disclosed in the Company’s Annual Report.

3.	Fair Value Measurements

The following tables represent the Company’s financial assets that are measured at fair value on a recurring basis and indicate the level of the fair value hierarchy utilized to determine such fair values (in thousands):

	Fair Value Measurements as of June 30, 2025 (000's):
	Quoted Prices in Active Markets for Identical Assets (Level 1)		Significant Other Observable Inputs (Level 2)		Significant Unobservable Inputs (Level 3)		Fair Value
Assets
Corporate bonds	$	—	$	61,175	$	—	$	61,175
Commercial paper		9,415		—		—		9,415
Certificates of deposit		—		918		—		918
U.S. government treasuries		2,734		—		—		2,734
Asset-backed securities		—		3,851		—		3,851
Money market funds (cash equivalents)		3,730		—		—		3,730
Total assets	$	15,879	$	65,944	$	—	$	81,823

	Fair Value Measurements as of December 31, 2024 (000's):
	Quoted Prices in Active Markets for Identical Assets (Level 1)		Significant Other Observable Inputs (Level 2)		Significant Unobservable Inputs (Level 3)		Fair Value
Assets
Corporate bonds	$	—	$	44,963	$	—	$	44,963
Commercial paper		12,084		—		—		12,084
Certificates of deposit		—		15,269		—		15,269
U.S. government treasuries		4,399		—		—		4,399
Asset-backed securities		—		6,524		—		6,524
Money market funds (cash equivalents)		23,880		—		—		23,880
Total assets	$	40,363	$	66,756	$	—	$	107,119

4.	Marketable Securities

The objectives of the Company’s investment policy are to ensure the safety and preservation of invested funds, as well as to maintain liquidity sufficient to meet cash flow requirements. The Company invests its excess cash in securities issued by financial institutions, commercial companies, and government agencies that management believes to be of high credit quality in order to limit the amount of its credit exposure. The Company has not realized any net losses from its investments.

Unrealized gains and losses on investments that are available for sale are recognized in accumulated other comprehensive (loss) income, unless an unrealized loss is considered to be other than temporary, in which case the unrealized loss is charged to operations. The Company periodically reviews its investments for other than temporary declines in fair value below cost basis and whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable.

The Company believes the individual unrealized losses represent temporary declines primarily resulting from interest rate changes. Realized gains and losses are included in other income in the condensed consolidated statements of operations and comprehensive loss and are determined using the specific identification method with transactions recorded on a trade date basis. The Company classifies marketable securities that are available for use in current operations as current assets on the condensed consolidated balance sheet.

The following tables summarize marketable securities held (in thousands):

	Fair Value Measurements as of June 30, 2025 Using:
	Amortized Cost		Unrealized gains		Unrealized Losses			Fair Value
Assets
Corporate bonds	$	60,981	$	199	$	(5	)	$	61,175
Commercial paper		9,414		2		(1	)		9,415
Certificates of deposit		918		—		—			918
U.S. government treasuries		2,737		—		(3	)		2,734
Asset-backed securities		3,835		16		—			3,851
Total assets	$	77,885	$	217	$	(9	)	$	78,093

	Fair Value Measurements as of December 31, 2024 Using:
	Amortized Cost		Unrealized gains		Unrealized Losses			Fair Value
Assets
Corporate bonds	$	44,794	$	175	$	(6	)	$	44,963
Commercial paper		12,081		5		(2	)		12,084
Certificates of deposit		15,262		8		(1	)		15,269
U.S. government treasuries		4,408		2		(11	)		4,399
Asset-backed securities		6,484		40		—			6,524
Total assets	$	83,029	$	230	$	(20	)	$	83,239

	As of
	June 30, 2025		December 31, 2024
Maturing in one year or less	$	42,338	$	56,386
Maturing after one year through two years		35,755		26,853
Total	$	78,093	$	83,239

5.	Property and Equipment

Property and equipment consist of the following (in thousands):

	June 30, 2025			December 31, 2024
Equipment	$	4,734		$	4,716
Leasehold improvements		1,612			1,612
Software		364			364
Furniture and fixtures		22			22
Total property and equipment–at cost		6,732			6,714
Less: Accumulated depreciation		(6,601	)		(6,361	)
Property and equipment, net	$	131		$	353

Depreciation and amortization expense for each of the six months ended June 30, 2025 and 2024 was $0.2 million and $0.3 million respectively.

6.	Accrued Expenses

Accrued expenses consist of the following (in thousands):

	June 30,		December 31,
	2025		2024
Project expenses	$	8,604	$	2,873
Compensation and benefits		2,004		2,793
Other		384		621
Total accrued expenses	$	10,992	$	6,287

The increase in project expenses is primarily from $8.2 million of accrued manufacturing expenses, including $3.6 million of minimum contractual obligations related to CTX-10726.

7.	Commitments and Contingencies

Leases

The Company has evaluated its leases under ASC 842, Leases, and determined that it has one lease that is classified as an operating lease. The classification of this lease is consistent with the Company’s determination under the previous accounting standard.

When available, the Company will use the rate implicit in the lease to discount lease payments to present value; however, the Company’s current lease does not provide an implicit rate. Therefore, the Company used its incremental borrowing rate of 6.25% to discount the lease payments based on the date of the lease commencement.

The Company has one operating lease for its corporate office and laboratory facility (“Facility”) that was signed in December 2020. The Company moved into the Facility in January 2021. The Facility lease has an initial term of four years and five months, beginning on January 1, 2021.

The terms of the Facility lease were modified effective September 27, 2024 through the execution of a new lease. The modified terms extended the non-cancelable lease term through May 2031. The modified terms also included the right to use an additional 10,724 square feet that became available for the Company’s use in May 2025. The classification and incremental borrowing rate for the lease did not change as a result of this lease modification. Right-of-use assets obtained in exchange for new operating lease liabilities due to the lease modification were $9.9 million for a total right-of-use assets as of June 30, 2025 of $9.8 million. The remaining lease term of the Facility lease is 4.9 years as of June 30, 2025. The Company has $568 thousand of restricted cash associated with an irrevocable letter of credit required by the landlord to enter into this lease.

Lease costs related to the Facility were $0.4 million and $0.3 million for the three months ending June 30, 2025 and 2024, respectively and $0.8 million and $0.6 million for the six months ending June 30, 2025 and 2024, respectively. Cash payments related to the Facility were $0.2 million and $0.3 million for the three months ending June 30, 2025 and 2024, respectively and $0.5 million and $0.7 million for the six months ending June 30, 2025 and 2024, respectively.

The table below presents the undiscounted cash flows for the lease term. The undiscounted cash flows are reconciled to the operating lease liabilities recorded on the condensed consolidated balance sheet (in thousands):

	(000's)
Remainder of 2025	$	382
Years ending December 31,
2026		1,588
2027		2,204
2028		2,249
2029		2,294
2030		2,356
Thereafter		995
Total minimum lease payments		12,068
Less: amount of lease payments representing interest		(2,164	)
Present value of future minimum lease payments		9,904
Less: operating lease obligations, current portion		(271	)
Operating lease obligations, long-term portion	$	9,633

Defined Contribution Plan

The Company has a 401(k) defined contribution plan (the “401(k) Plan”) for substantially all its employees. Eligible employees may make pre-tax or post-tax (Roth) contributions to the 401(k) Plan up to statutory limits. The Company matches employee contributions to the plan up to 6% of salary. The Company made matching contributions of $0.1 million for each of the three months ended June 30, 2025 and 2024. The Company made matching contributions of $0.2 million for each of the six months ended June 30, 2025 and 2024.

8.	Stock-Based Compensation

Stock-based compensation expense for the three and six months ended June 30, 2025 and 2024 was classified in the condensed consolidated statement of operations as follows (in thousands):

SEC Form 10-Q filed by Compass Therapeutics Inc.