Connect Biopharma (CNTB 1.10%), a biotechnology company developing therapies for inflammatory diseases, released its second quarter 2025 earnings on August 13, 2025. The main highlight was a substantial drop in GAAP revenue, from $24.1 million in Q2 2024 to just $48,000 in Q2 2025. Reported GAAP earnings per share (EPS) were $(0.23) for Q2 2025. Research and development spending (GAAP) increased sharply, reflecting new and ongoing clinical trials, while cash reserves declined but remained adequate.
| Metric | Q2 2025 | Q2 Estimate | Q2 2024 | Y/Y Change |
|---|---|---|---|---|
| EPS (GAAP) | $(0.23) | $(0.22) | $0.27 | (185.2%) |
| Revenue (GAAP) | $48,000 | $0 | $24.1 million | 99.2% |
| Research and Development Expense | $8.8 million | $5.3 million | 65.6% | |
| General and Administrative Expense | $4.7 million | $5.1 million | (7.8%) | |
| Cash, Cash Equivalents and Short-term Investments (End of Period) | $71.8 million | N/A |
Source: Analyst estimates for the quarter provided by FactSet.
Business Overview and Key Focus Areas
Connect Biopharma works to develop new therapies targeting immune and inflammatory diseases. Its primary focus is on rademikibart, a monoclonal antibody product designed to treat asthma and chronic obstructive pulmonary disease (COPD). The company is in a pre-commercial phase, meaning it does not yet sell products and relies on licensing revenue and existing cash to fund research and development. Most of its near-term success hinges on progressing clinical trials and achieving regulatory approvals for rademikibart and other pipeline candidates.
Recently, the company has increased its emphasis on clinical development and regulatory strategy. It is running global clinical trials in asthma and COPD, especially in regions like the United States and China. Success factors include demonstrating strong clinical efficacy, maintaining a robust intellectual property portfolio, and navigating necessary regulatory submissions both in China and, in the future, in the U.S. The company also remains active in managing costs and securing enough funding to carry operations through critical trial milestones.
Quarter in Detail: Clinical, Financial, and Strategic Developments
This period was defined by the absence of new licensing income and a steeper investment in research and development activities. Revenue (GAAP) dropped from $24.1 million in Q2 2024 to just $48,000 in Q2 2025. Last year, the company received a one-time payment from a licensing deal with Simcere Pharmaceutical, aiding the bottom line. With milestone payments not recurring, GAAP revenue returned to minimal cost reimbursements.
Research and development expense (GAAP) was $8.8 million in Q2 2025, up from $5.3 million in Q2 2024. This increase reflects costs for recruiting in new clinical trials, particularly for rademikibart. General and administrative expense for the three months ended June 30, 2025, was $4.7 million, compared to $5.1 million for the same period in 2024.
Of note for product development, rademikibart is a monoclonal antibody aimed at blocking the interleukin-4 receptor alpha protein, an approach designed to treat inflammatory airway diseases like asthma and COPD. This quarter, the company progressed with patient recruitment in its Phase 2 “Seabreeze STAT” asthma and COPD studies, expecting clinical results in the first half of 2026. Additionally, Simcere submitted a new drug application for rademikibart to Chinese authorities for atopic dermatitis, opening the door for up to $110 million in future milestone payments if regulatory or commercial success is achieved.
The company signaled several strategic adjustments. The company announced plans to terminate its American Depositary Receipt (ADR) program and list its ordinary shares directly on Nasdaq. This transition aims to cut fees for current shareholders and increase institutional investor visibility. There were no major new partnership deals or fresh patent announcements during the period, but previous patent protections for the drug pipeline remain in effect. End-of-period cash, cash equivalents, and short-term investments (GAAP) totaled $71.8 million as of June 30, 2025, down from $93.7 million as of December 31, 2024. Management expects its cash, cash equivalents, and short-term investments will be sufficient to fund operations into 2027.
Looking Ahead
There was no formal financial outlook for the year or next quarter. Management said existing funds should cover operations into 2027, which would allow time for key clinical trial results. The “Seabreeze STAT” asthma and COPD trials, which may deliver topline data in the first half of 2026, remain the most important near-term milestones to watch. If Simcere’s regulatory efforts in China succeed, milestone and royalty payments could provide needed resources for further development.
Investors and observers should monitor cash use, progress in ongoing clinical trials, and any changes in the regulatory or competitive landscape.
Revenue and net income presented using U.S. generally accepted accounting principles (GAAP) unless otherwise noted.
