0001485003-24-000009 | 10-Q | XBRL Viewer

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Unaudited Consolidated Balance Sheets (Parenthetical) - $ / shares	Mar. 31, 2024	Dec. 31, 2023
Statement of Financial Position [Abstract]
Preferred stock, par value (in USD per share)	$ 0.001	$ 0.001
Preferred stock, shares authorized (in shares)	5,000,000	5,000,000
Preferred stock, shares issued (in shares)	0	0
Preferred stock, shares outstanding (in shares)	0	0
Common stock, par value (in USD per share)	$ 0.001	$ 0.001
Common stock, shares authorized (in shares)	350,000,000	350,000,000
Common stock, shares issued (in shares)	41,542,744	40,609,915
Common stock, shares outstanding (in shares)	41,542,744	40,609,915

Stockholders' Equity	3 Months Ended
Stockholders' Equity	Mar. 31, 2024
Stockholders' Equity Note [Abstract]
Stockholders' Equity	Stockholders’ Equity On March 7, 2023, in connection with the closing of the Merger, the following is reflected on the unaudited interim consolidated statements of convertible preferred stock and stockholders’ equity (deficit) for the three months ended March 31, 2023: (i) the sale of 3,730,608 shares of common stock in a pre-closing funding at $8.21 per share for total proceeds of $30.6 million, (ii) the issuance of 5,059,338 shares of common stock upon the settlement of the Company’s $35.0 million convertible promissory note, accrued interest and related derivative liability, (iii) the conversion of convertible preferred stock and exchangeable shares previously presented as noncontrolling interests into 18,872,711 shares of common stock, (iv) the issuance of 10,374,272 shares of common stock to Sesen Bio stockholders as consideration for the Merger.

- Definition

The entire disclosure for equity.

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+ Details

Pay vs Performance Disclosure - USD ($) $ in Thousands	3 Months Ended
Pay vs Performance Disclosure - USD ($) $ in Thousands	Mar. 31, 2024	Mar. 31, 2023
Pay vs Performance Disclosure
Net loss	$ (18,978)	$ (24,642)

- Definition

The portion of profit or loss for the period, net of income taxes, which is attributable to the parent.

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+ Details

Moderna Collaboration and License Agreement (Tables)

3 Months Ended

Mar. 31, 2024

Revenue from Contract with Customer [Abstract]

Schedule of Estimated Revenue Expected to be Recognized in The Future Related to Performance Obligations

The following table includes estimated revenue expected to be recognized in the future related to performance obligations that are unsatisfied as of March 31, 2024 (in thousands):


	Transaction price unsatisfied
Performance obligations:
Research and development	$	45,786
Option rights	45,000
Total performance obligations	$	90,786

Schedule of Changes in Deferred Revenue

The following table summarizes the changes in deferred revenue (in thousands):


	Three Months Ended March 31,
	2024		2023
Balance at the beginning of the period	$	46,413	$	47,459
Deferral of revenue	3,173		2,920
Recognition of unearned revenue	(3,397)		(3,243)
Balance at the end of the period	$	46,189	$	47,136

Merger with Sesen Bio - Schedule of Net Assets Acquired in the Merger (Details) - USD ($) $ in Thousands	1 Months Ended
	Mar. 31, 2023	Mar. 07, 2023
Merger with Sesen Bio
Cash and cash equivalents		$ 37,873
Marketable securities		44,588
Prepaid expenses and other assets		1,316
Restricted cash		30
Accounts payable and accrued expenses		(3,499)
Total net assets acquired		80,308
Less: Transaction costs		(8,264)
Total net assets acquired less transaction costs		$ 72,044
Carisma Therapeutics Inc.
Merger with Sesen Bio
Severance and personnel costs paid	$ 4,600

- Details

Name:	dei_LegalEntityAxis=carm_CarismaTherapeuticsInc.Member
Namespace Prefix:
Data Type:	na
Balance Type:
Period Type:

Summary of Significant Accounting Policies - Narrative (Details)	3 Months Ended
	Mar. 31, 2024 segment
Accounting Policies [Abstract]
Number of operating segments	1

Commitments and Contingencies - Schedule of Supplemental Cash Flow Information (Details) - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2024	Mar. 31, 2023
Cash paid for amounts included in the measurement of lease liabilities:
Operating cash used in operating leases	$ 1,463	$ 1,448
Operating cash used in finance leases	236	45
Financing cash used in finance leases	$ 1,319	$ 106

Subsequent Events	3 Months Ended
Subsequent Events	Mar. 31, 2024
Subsequent Events [Abstract]
Subsequent Events	Subsequent Events The Company has evaluated subsequent events from the balance sheet date through May 9, 2024, the issuance date of these unaudited interim consolidated financial statements, and has not identified any additional items that have not previously been mentioned elsewhere requiring disclosure.

Unaudited Consolidated Statements of Operations and Comprehensive Loss - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2024	Mar. 31, 2023
Statement of Comprehensive Income [Abstract]
Collaboration revenues	$ 3,397	$ 3,243
Operating expenses:
Research and development	17,462	16,641
General and administrative	5,445	9,574
Total operating expenses	22,907	26,215
Operating loss	(19,510)	(22,972)
Change in fair value of derivative liability	0	(84)
Interest income (expense), net	532	(1,477)
Pre-tax loss	(18,978)	(24,533)
Income tax expense	0	(109)
Net loss	$ (18,978)	$ (24,642)
Share information:
Net loss per share of common stock, basic (in USD per share)	$ (0.46)	$ (1.93)
Net loss per share of common stock, diluted (in USD per share)	$ (0.46)	$ (1.93)
Weighted-average shares of common stock outstanding, basic (in shares)	40,938,464	12,783,523
Weighted-average shares of common stock outstanding, diluted (in shares)	40,938,464	12,783,523
Comprehensive loss
Net loss	$ (18,978)	$ (24,642)
Unrealized gain on marketable securities	0	177
Comprehensive loss	$ (18,978)	$ (24,465)

Commitments and Contingencies - Schedule of Future Maturities of Lease Liabilities (Details) $ in Thousands	Mar. 31, 2024 USD ($)
Operating Leases
2024 (remaining nine months)	$ 2,195
2025	2,628
2026	427
2027	232
2028	240
Thereafter	184
Total future minimum payments	5,906
Less imputed interest	(673)
Present value of lease liabilities	5,233
Finance Leases
2024 (remaining nine months)	1,153
2025	1,261
2026	20
Total future minimum payments	2,434
Less imputed interest	(175)
Present value of lease liabilities	$ 2,259

Stock-based Compensation

3 Months Ended

Mar. 31, 2024

Share-Based Payment Arrangement [Abstract]

Stock-based Compensation

2017 Stock Incentive Plan

Legacy Carisma adopted the CARISMA Therapeutics Inc. 2017 Stock Incentive Plan, as amended (the Legacy Carisma Plan), that provided for the grant of incentive stock options to employees, directors, and consultants. The maximum term of options granted under the Legacy Carisma Plan was ten years, and stock options typically vested over a four-year period. The Company’s stock options vest based on the terms in the awards agreements and generally vest over four years. Upon completion of the Merger, the Company assumed the Legacy Carisma Plan and the outstanding and unexercised options issued thereunder, and ceased granting awards under the Legacy Carisma Plan.

2014 Stock Incentive Plan

The Sesen Bio, Inc. Amended and Restated 2014 Stock Incentive Plan, as amended (the Sesen Bio 2014 Plan), provides for the grant of incentive and non-qualified stock options, restricted stock awards and restricted stock units, stock appreciation rights and other stock-based awards to the Company’s employees, officers, directors, consultants, and advisors, with amounts and terms of grants determined by the Company’s board of directors at the time of grant.

Stock options outstanding under the Sesen Bio 2014 Plan generally vest over a four-year period at the rate of 25% of the grant vesting on the first anniversary of the date of grant and 6.25% of the grant vesting at the end of each successive three-month period thereafter. Stock options granted under the Sesen Bio 2014 Plan are exercisable for a period of ten years from the date of grant.

On March 7, 2023, the Company amended and restated the Sesen Bio 2014 Plan to (i) change the name of the plan to the Carisma Therapeutics Inc. 2014 Amended and Restated Stock Incentive Plan (the 2014 Plan) and (ii) adopt a new form of stock option agreement and a new form of restricted stock unit agreement for the grant of options and restricted stock units under the 2014 Plan. On June 6, 2023, the Company’s stockholders approved an amendment and restatement of the Company’s 2014 Plan, which amendment and restatement had previously been adopted by the Company’s board of directors, subject to stockholder approval. The 2014 Plan provides for increases to the number of shares reserved for issuance thereunder each January, 1 equal to 4% of the total shares of the Company's common stock outstanding as of immediately preceding December 31, unless a lesser amount is stipulated by the Company's board of directors. Accordingly, 1,624,397 shares were added to the reserve as of January 1, 2024. As of March 31, 2024, approximately 4.3 million shares of common stock remained available for issuance.

2014 Employee Stock Purchase Plan

The Sesen Bio 2014 Employee Stock Purchase Plan (the Sesen Bio 2014 ESPP) provides employees with the opportunity to purchase shares of common stock at a 15% discount to the market price through payroll deductions or lump sum cash investments. The purpose of the Sesen Bio 2014 ESPP is to enhance employee interest in the success and progress of the Company by encouraging employee ownership of common stock. On March 7, 2023, the Company amended and restated the Sesen Bio 2014 ESPP to (i) change the name of the plan to Carisma Therapeutics Inc. 2014 Employee Stock Purchase Plan and (ii) restate and integrate all prior amendments thereto. As of March 31, 2024, 0.2 million shares of common stock remained available for issuance.

The following table summarizes stock option activity for the three months ended March 31, 2024:


	Options	Weighted average exercise price		Weighted average remaining contractual term (years)	Aggregate Intrinsic Value (in thousands)
Outstanding as of December 31, 2023	6,023,370	$	3.94
Exercised	(1,579)	1.42			$	2
Granted	2,226,000	2.10
Forfeited	(37,244)	5.58

Outstanding as of March 31, 2024	8,210,547	$	3.43	8.20	$	4,241
Exercisable as of March 31, 2024	2,737,710	$	1.24	6.00	$	3,443
Vested and expected to vest at March 31, 2024	8,210,547	$	3.43	8.20	$	4,241

The weighted-average grant-date per share fair values of options granted during the three months ended March 31, 2024 and 2023 were $1.72 and $2.64, respectively. The fair values in the three months ended March 31, 2024 and 2023 were estimated using the Black-Scholes option-pricing model based on the following assumptions:


	Three Months Ended March 31,
	2024	2023
Risk-free interest rate	3.77% - 3.89%	2.92% - 4.03%
Expected term	6 years	6 years
Expected volatility	103.39% - 105.96%	57.77% - 62.65%
Expected dividend yield	—	—

Stock-Based Compensation Expense

The Company recorded stock-based compensation expense in the following expense categories in its accompanying unaudited interim consolidated statements of operations:


	Three Months Ended March 31,
		2024		2023
Research and development		$	436	$	10
General and administrative		621		255
		$	1,057	$	265

The Company recognized stock-based compensation expense of $0.2 million related to the modification of Sesen Bio options assumed in connection with the Merger during three months ended March 31, 2023. Compensation cost for awards not vested as of March 31, 2024 was $13.9 million and will be expensed over a weighted-average period of 3.2 years

Commitments and Contingencies - Narratives (Details) - USD ($) $ in Thousands	1 Months Ended	3 Months Ended
	Mar. 31, 2023	Mar. 31, 2024
Commitments and Contingencies
Financing liability		$ 2,259
Laboratory equipment
Commitments and Contingencies
Financing liability		2,300
Penn License Agreement \| Penn
Commitments and Contingencies
Annual payments to be made		25,000
Additional milestone payments for first CAR-M product		1,700
Penn License Agreement \| Penn \| Maximum
Commitments and Contingencies
Milestone payments		10,900
Additional milestone payments		$ 30,000
Novartis Agreement
Commitments and Contingencies
Agreement term	5 years
Renewal term	1 year
Amount payable per calendar year for reserved capacity	$ 1,000
Termination fee payable	$ 4,000

Background	3 Months Ended
Background	Mar. 31, 2024
Organization, Consolidation and Presentation of Financial Statements [Abstract]
Background	Background Overview Carisma Therapeutics Inc., a Delaware corporation (collectively with its subsidiaries, the Company), is a clinical-stage cell therapy company focused on using the Company’s proprietary chimeric antigen receptor macrophage and monocyte (CAR-M) cell therapy platform to develop transformative immunotherapies to treat cancer and other serious diseases. The Company has created a comprehensive cell therapy platform to enable the therapeutic use of engineered macrophages and monocytes, which belong to a subgroup of white blood cells called myeloid cells. The Company’s focus is its proprietary CAR-M cell therapy platform, which redirects macrophages against specific tumor associated antigens and enables targeted anti-tumor immunity by utilizing genetically modified myeloid cells (macrophages and monocytes) to express chimeric antigen receptors (CARs), enabling these potent innate immune cells to recognize specific tumor associated antigens on the surface of tumor cells. In late March 2024, the Company and its board of directors approved a revised operating plan to reduce monthly operating expenses and conserve cash to begin implementation in April 2024. The plan, includes several measures such as, including prioritizing CT-0525, the Company's second product, as its lead anti-human epidermal growth factor receptor 2 (HER2) product candidate going forward, suspending the enrollment of new patients for CT-0508 in line with the clinical judgment of the clinical site principal investigator, pausing further development of CT-1119, reducing the workforce, including employees engaged in research and development and general and administration activities, and decreasing spending on other non-essential activities. The Company expects to pay the majority of the workforce reduction costs in the second quarter of 2024. The revised operating plan considers expenses pertaining to severance costs and potential termination and exit fees. Although the Company plans to continue ongoing activities under its open label Phase 1 clinical trial of CT-0508 and its sub-study utilizing CT-0508 in combination with pembrolizumab, enrollment of new patients will be suspended in line with the clinical judgment of the clinical site principal investigator. All patients currently enrolled or in screening will continue participation per protocol through the end of study milestone and will complete all required activities. The Company has also elected to pause further development of CT-1119, a mesothelin-targeted CAR-Monocyte, pending additional financing. Under its revised operating plan, the Company will continue to focus on its in vivo mRNA/lipid nanoparticle (LNP) CAR-M programs in partnership with ModernaTX Inc. (Moderna). The Company’s early research and development of multiple assets for the potential treatment of diseases beyond oncology, including fibrosis and other immunologic and inflammatory diseases, also remains ongoing. Pipeline Using its proprietary macrophage and monocyte cell therapy platform, the Company is developing a pipeline of product candidates with an initial focus on advancing multiple ex vivo autologous and in vivo CAR-M therapies for the treatment of solid tumors. The Company is also pursuing early research and development of multiple assets for the potential treatment of diseases beyond oncology, including fibrosis and other immunologic and inflammatory diseases. The Company's ex vivo oncology, fibrosis, and immunology programs are wholly owned. Additionally, under a collaboration agreement (the Moderna License Agreement), with Moderna (Note 11), the Company is developing in vivo CAR-M therapies utilizing Moderna's mRNA/LNP technology. The Company's second product, which the Company has prioritized as its lead product candidate, CT-0525, a CAR-Monocyte intended to treat solid tumors that over-express HER2, utilizes a novel approach to CAR-M therapy that engineers patients' monocytes directly, without ex vivo differentiation into macrophages, as the Company currently does for CT-0508. The CAR-Monocyte approach utilizes a single day manufacturing process, which enables the manufacture of up to ten billion cells from a single apheresis, and leverages an automated, closed-system manufacturing process. In addition, the CAR-Monocyte approach has the potential to improve upon the potential anti-tumor effect of a CAR-Macrophage. By increasing the cell yield, a CAR-Monocyte enables a larger dose than a CAR-Macrophage. In addition, CAR-Monocyte has the potential for improved persistence and trafficking, which were observed in pre-clinical studies. The Company believes that the increased cell yield, and the improved persistence and trafficking may improve tumor control. In November 2023, the Company received United States Food and Drug Administration (FDA) clearance of its investigational new drug application (IND) for CT-0525. In addition to CT-0525, the Company’s first product candidate to enter clinical development, CT-0508, is the first CAR-Macrophage to be evaluated in a human clinical trial and is intended to treat solid tumors that over-express HER2, a protein that is over-expressed on the surface of a variety of solid tumors, including breast cancer, gastric cancer, esophageal cancer, salivary gland cancer, and numerous others. CT-0508 has been granted “Fast Track” status for the treatment of patients with HER2 over-expressing solid tumors by the FDA. CT-0508 is currently being studied in a multi-center open label Phase 1 clinical trial in the United States. This ongoing first-in-human study evaluates the safety, tolerability, and manufacturing feasibility of CT-0508 along with several customary exploratory secondary endpoints. In addition to the development of ex vivo CAR-M cell therapies, the Company is developing in vivo CAR-M cell therapies, wherein immune cells are directly engineered within the patient’s body. To advance the Company’s in vivo CAR-M therapeutics, the Company established a strategic collaboration with Moderna (Note 11). In the fourth quarter of 2023, the Company presented pre-clinical data from this collaboration demonstrating that CAR-M can be directly produced in vivo, successfully redirecting endogenous myeloid cells against tumor-associated antigens using mRNA/LNP. Additionally, the pre-clinical data demonstrated feasibility, tolerability, and early efficacy of in vivo CAR-M against metastatic solid tumors. In December 2023, the Company announced the nomination of the collaboration's first lead candidate, which will target an antigen present on a solid tumor with significant unmet medical need. In addition to acting as a first line of defense in the innate immune system, macrophages and monocytes are found in all tissues in the body where they serve key regulatory functions such as wound healing, termination of immune responses and tissue regeneration. Using the Company's macrophage and monocyte engineering platform, the Company is pursuing early research and development of multiple assets for the potential treatment of diseases beyond oncology, including fibrosis and other immunologic and inflammatory diseases. In the second quarter of 2024, the Company achieved preclinical proof of concept in its liver fibrosis program, demonstrating the anti-fibrotic potential of engineered macrophages in two liver fibrosis models. The Company expects to nominate a development candidate in the first quarter of 2025. Reverse Merger with Sesen Bio On March 7, 2023, the Company (formerly publicly-held Sesen Bio, Inc.) consummated a merger with CTx Operations, Inc. (formerly privately-held CARISMA Therapeutics Inc.) (Legacy Carisma) pursuant to an Agreement and Plan of Merger and Reorganization, as amended (the Merger Agreement), by and among the Company, Legacy Carisma and Seahawk Merger Sub, Inc. (Merger Sub), a Delaware corporation and wholly-owned subsidiary of the Company. The Merger Agreement provided for the merger of Merger Sub with and into Legacy Carisma, with Legacy Carisma continuing as a wholly-owned subsidiary of the Company and the surviving corporation of the merger (the Merger). Pursuant to the Merger Agreement, the Company changed its name from “Sesen Bio, Inc.” to “Carisma Therapeutics Inc.” At the closing of the Merger, (a) each then outstanding share of Legacy Carisma common stock and convertible preferred stock (including shares of Legacy Carisma common stock issued in connection with the pre-closing financing transaction described below) were converted into shares of Sesen Bio, Inc. (Sesen Bio) common stock at an exchange ratio of 1.8994 shares of Sesen Bio for each share of Legacy Carisma (the Exchange Ratio), and (b) each then outstanding stock option to purchase Legacy Carisma common stock was assumed by Sesen Bio, with necessary adjustments to reflect the Exchange Ratio. Except as otherwise indicated, references herein to “Carisma,” the “Company,” or the “Combined Company,” refer to Carisma Therapeutics Inc. on a post-Merger basis, and references to “Legacy Carisma” refer to the business of privately-held CARISMA Therapeutics Inc. prior to the completion of the Merger. References to “Sesen Bio” refer to Sesen Bio, Inc. prior to the completion of the Merger. Basis of Presentation and Exchange Ratio As discussed in Note 4, the Merger was accounted for as reverse capitalization under which the historical financial statements of the Company prior to the Merger are Legacy Carisma. All common stock, per share and related information presented in the consolidated financial statements and notes prior to the Merger has been retroactively adjusted to reflect the Exchange Ratio.

Related-Party Transactions (Details) - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2024	Mar. 31, 2023
Related-Party Transactions
Research and development	$ 17,462	$ 16,641
Penn
Related-Party Transactions
Research and development		$ 400

Summary of Significant Accounting Policies (Tables)

3 Months Ended

Mar. 31, 2024

Accounting Policies [Abstract]

Schedule of Fair Value Hierarchy of Assets and Liabilities Measured on Recurring Basis

The following fair value hierarchy table presents information about the Company’s assets and liabilities measured at fair value on a recurring basis:


(in thousands)	Fair value measurement at reporting date using
	(Level 1)		(Level 2)		(Level 3)
March 31, 2024
Assets:
Cash equivalents – money markets accounts	$	52,752	$	—	$	—

December 31, 2023
Assets:
Cash equivalents – money markets accounts	$	62,999	$	—	$	—

Schedule of Anti-Dilutive Securities

The following potentially dilutive securities have been excluded from the computation of diluted weighted-average shares of common stock outstanding, as they would be anti-dilutive:


	March 31,
	2024	2023
Stock options	8,210,547	4,184,047

Development-Stage Risks and Liquidity (Details) - USD ($) $ in Thousands	Mar. 31, 2024	Dec. 31, 2023
Development-Stage Risks and Liquidity
Accumulated deficit	$ 264,080	$ 245,102
Cash, cash equivalents and marketable securities	$ 56,500

- Definition

Amount of accumulated undistributed earnings (deficit).

+ References + Details

Insider Trading Arrangements	3 Months Ended
Insider Trading Arrangements	Mar. 31, 2024
Trading Arrangements, by Individual
Rule 10b5-1 Arrangement Adopted	false
Non-Rule 10b5-1 Arrangement Adopted	false
Rule 10b5-1 Arrangement Terminated	false
Non-Rule 10b5-1 Arrangement Terminated	false

Summary of Significant Accounting Policies

3 Months Ended

Mar. 31, 2024

Accounting Policies [Abstract]

Summary of Significant Accounting Policies

Interim Financial Statements

The summary of significant accounting policies is included in the Company’s audited consolidated financial statements and related notes as of and for the year ended December 31, 2023 found in the Annual Report filed on Form 10-K filed with the SEC on April 1, 2024.

The accompanying unaudited interim consolidated financial statements have been prepared in accordance with U.S. generally accepted accounting principles (GAAP). Any references in these notes to applicable guidance is meant to refer to GAAP as found in Accounting Standards Codification (ASC) and Accounting Standards Update (ASU) promulgated by the Financial Accounting Standards Board (FASB).

The accompanying unaudited interim consolidated financial statements include the accounts of the Company and its wholly owned subsidiaries. In the opinion of management, the accompanying unaudited interim consolidated financial statements include all normal and recurring adjustments (which consist primarily of accruals, estimates and assumptions that impact the unaudited interim consolidated financial statements) considered necessary to present fairly the Company’s financial position as of March 31, 2024 and its results of operations for the three months ended March 31, 2024 and 2023. Operating results for the three months ended March 31, 2024 are not necessarily indicative of the results that may be expected for the year ending December 31, 2024. The unaudited interim consolidated financial statements, presented herein, do not contain all of the required disclosures under GAAP for annual financial statements. The accompanying unaudited interim consolidated financial statements should be read in conjunction with the audited consolidated financial statements and related notes as of and for the year ended December 31, 2023 found in the Annual Report filed on Form 10-K filed with the SEC on April 1, 2024.

Use of Estimates

The preparation of unaudited interim consolidated financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the unaudited interim consolidated financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from such estimates. Estimates and assumptions are periodically reviewed, and the effects of revisions are reflected in the unaudited interim consolidated financial statements in the period they are determined to be necessary.

Significant areas that require management’s estimates include the stock-based compensation assumptions, the estimated useful lives of property and equipment, and accrued research and development expenses.

Fair Value of Financial Instruments

Management believes that the carrying amounts of the Company’s financial instruments, including cash equivalents and accounts payable, approximate fair value due to the short-term nature of those instruments.

Fair Value Measurements

The Company utilizes valuation techniques that maximize the use of observable inputs and minimize the use of unobservable inputs to the extent possible. The Company determines fair value based on assumptions that market participants would use in pricing an asset or liability in the principal or most advantageous market. When considering market participant assumptions in fair value measurements, the following fair value hierarchy distinguishes between observable and unobservable inputs, which are categorized in one of the following levels:

•Level 1 Inputs: Unadjusted quoted prices in active markets for identical assets or liabilities accessible to the reporting entity at the measurement date.

•Level 2 Inputs: Other than quoted prices included in Level 1 inputs that are observable for the asset or liability, either directly or indirectly, for substantially the full term of the asset or liability.

•Level 3 Inputs: Unobservable inputs for the asset or liability used to measure fair value to the extent that observable inputs are not available, thereby allowing for situations in which there is little, if any, market activity for the asset or liability at the measurement date.

The following fair value hierarchy table presents information about the Company’s assets and liabilities measured at fair value on a recurring basis:


(in thousands)	Fair value measurement at reporting date using
	(Level 1)		(Level 2)		(Level 3)
March 31, 2024
Assets:
Cash equivalents – money markets accounts	$	52,752	$	—	$	—

December 31, 2023
Assets:
Cash equivalents – money markets accounts	$	62,999	$	—	$	—

During the three months ended March 31, 2024 and 2023, there were no transfers between Level 1, Level 2 and Level 3.

Concentration of credit risk

Financial instruments that potentially subject the Company to significant concentrations of credit risk consist primarily of cash and cash equivalents. The Company maintains deposits in federally insured financial institutions in excess of federally insured limits. The Company has not experienced any losses in such accounts and believes it is not exposed to significant risk on its cash and cash equivalents.

Segment information

Operating segments are defined as components of an enterprise about which separate discrete information is available for evaluation by the chief operating decision maker, or decision-making group, in deciding how to allocate resources and in assessing performance. The Company views its operations and manages its business in one segment.

Net loss per share

Basic net loss per share of common stock is computed by dividing net loss by the weighted-average number of shares of common stock outstanding during each period. Diluted net loss per share of common stock includes the effect, if any, from the potential exercise or conversion of securities, such as convertible preferred stock and stock options, which would result in the issuance of incremental shares of common stock. For diluted net loss per share, the weighted-average number of shares of common stock is the same for basic net loss per share due to the fact that when a net loss exists, potentially dilutive securities are not included in the calculation as their impact is anti-dilutive.

The following potentially dilutive securities have been excluded from the computation of diluted weighted-average shares of common stock outstanding, as they would be anti-dilutive:


	March 31,
	2024	2023
Stock options	8,210,547	4,184,047

Recently issued accounting pronouncements

In November 2023, the FASB issued ASU 2023-07, Segment Reporting (Topic 280): Improvements to Reportable Segment Disclosures (ASU 2023-07), which requires disclosure of incremental segment information on an annual and interim basis. This ASU is effective for fiscal years beginning after December 15, 2023, and interim periods within fiscal years beginning after December 15, 2024 on a retrospective basis. The Company is currently evaluating the effect of this pronouncement on its disclosures.

In December 2023, the FASB issued ASU 2023-09, Income Taxes (Topic 740): Improvements to Income Tax Disclosures (ASU 2023-09), which expands the disclosures required for income taxes. This ASU is effective for fiscal years beginning after December 15, 2024, with early adoption permitted. The amendment should be applied on a prospective basis while retrospective application is permitted. The Company is currently evaluating the effect of this pronouncement on its disclosures.

Related-Party Transactions	3 Months Ended
Related-Party Transactions	Mar. 31, 2024
Related Party Transactions [Abstract]
Related-Party Transactions	Related-Party Transactions The Company has outstanding licensing and scientific research agreements with Penn, a significant stockholder as of March 31, 2023 (Note 7). As of December 31, 2023, Penn was no longer a significant stockholder. The Company recognized $0.4 million of research and development expenses for the three months ended March 31, 2023 related to the Penn License Agreement. The Company has a collaboration and license agreement with Moderna, a significant stockholder (Note 11).

- Definition

The entire disclosure for related party transactions. Examples of related party transactions include transactions between (a) a parent company and its subsidiary; (b) subsidiaries of a common parent; (c) and entity and its principal owners; and (d) affiliates.

+ References

Reference 1: http://www.xbrl.org/2003/role/disclosureRef
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-Name Accounting Standards Codification
-Section 50
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Reference 2: http://www.xbrl.org/2003/role/disclosureRef
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Reference 3: http://www.xbrl.org/2003/role/disclosureRef
-Topic 946
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Reference 4: http://www.xbrl.org/2003/role/disclosureRef
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Reference 5: http://www.xbrl.org/2003/role/disclosureRef
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Reference 6: http://www.xbrl.org/2003/role/disclosureRef
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Reference 7: http://www.xbrl.org/2003/role/disclosureRef
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Reference 10: http://www.xbrl.org/2003/role/disclosureRef
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Reference 11: http://www.xbrl.org/2003/role/disclosureRef
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Reference 13: http://www.xbrl.org/2003/role/disclosureRef
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-URI https://asc.fasb.org//1943274/2147483326/850-10-50-1

+ Details

Merger with Sesen Bio (Tables)

3 Months Ended

Mar. 31, 2024

Business Combination and Asset Acquisition [Abstract]

Schedule of Net Assets Acquired in the Merger

The following table shows the net assets acquired in the Merger (in thousands):


	March 7, 2023
Cash and cash equivalents	$	37,873
Marketable securities	44,588
Prepaid expenses and other assets	1,316
Restricted cash	30
Accounts payable and accrued expenses	(3,499)
Total net assets acquired	80,308
Less: Transaction costs	(8,264)
Total net assets acquired less transaction costs	$	72,044

Accrued Expenses

3 Months Ended

Mar. 31, 2024

Payables and Accruals [Abstract]

Accrued Expenses

Accrued expenses consisted of the following (in thousands):


	March 31, 2024		December 31, 2023
Research and development	$	3,165	$	3,131
Professional fees	669		1,366
Compensation and related expenses	881		3,100

Other	14		65

	$	4,729	$	7,662

Stock-based Compensation - Schedule of Stock Option Activity (Details) - USD ($) $ / shares in Units, $ in Thousands	3 Months Ended
	Mar. 31, 2024	Mar. 31, 2023
Options
Outstanding as of December 31, 2023 (in shares)	6,023,370
Exercised (in shares)	(1,579)
Granted (in shares)	2,226,000
Forfeited (in shares)	(37,244)
Outstanding as of March 31, 2024 (in shares)	8,210,547
Exercisable as of March 31, 2024 (in shares)	2,737,710
Vested and expected to vest at March 31, 2024 (in shares)	8,210,547
Weighted average exercise price
Outstanding as of December 31, 2023 (in USD per share)	$ 3.94
Exercised (in USD per share)	1.42
Granted (in USD per share)	2.10
Forfeited (in USD per share)	5.58
Outstanding as of March 31, 2024 (in USD per share)	3.43
Exercisable as of March 31, 2024 (in USD per share)	1.24
Vested and expected to vest at March 31, 2024 (in USD per share)	3.43
Share based compensation arrangement by share based payment award options grants in period weighted average grant date fair value (in USD per share)	$ 1.72	$ 2.64
Weighted average remaining contractual term (years)
Outstanding as of March 31, 2024	8 years 2 months 12 days
Exercisable as of March 31, 2024	6 years
Vested and expected to vest at March 31, 2024	8 years 2 months 12 days
Aggregate Intrinsic Value
Exercised	$ 2
Outstanding as of March 31, 2024	4,241
Exercisable as of March 31, 2024	3,443
Vested and expected to vest at March 31, 2024	$ 4,241

Commitments and Contingencies - Schedule of Lease Costs (Details) - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2024	Mar. 31, 2023
Commitments and Contingencies Disclosure [Abstract]
Operating lease cost	$ 1,469	$ 1,433
Finance lease cost:
Amortization of lease assets	1,298	297
Interest on lease liabilities	236	45
Total finance lease cost	1,534	342
Variable lease cost	472	750
Total lease cost	$ 3,475	$ 2,525

Stock-based Compensation - Schedule of Stock-based Compensation Expense (Details) - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2024	Mar. 31, 2023
Stock-based Compensation
Stock-based compensation expense	$ 1,057	$ 265
Future compensation cost for awards not vested	$ 13,900
Weighted-average period compensation cost of unvested awards to be expensed	3 years 2 months 12 days
Sesen Bio, Inc.
Stock-based Compensation
Stock-based compensation expense		200
Research and development
Stock-based Compensation
Stock-based compensation expense	$ 436	10
General and administrative
Stock-based Compensation
Stock-based compensation expense	$ 621	$ 255

Background (Details)	Mar. 07, 2023
CARISMA Therapeutics Inc, Legacy, Stockholders \| Sesen Bio, Inc. \| Carisma Therapeutics Inc.
Background
Common stock at an exchange ratio	1.8994

Prepaid Expenses and other assets (Tables)

3 Months Ended

Mar. 31, 2024

Deferred Costs, Capitalized, Prepaid, and Other Assets Disclosure [Abstract]

Schedule of Prepaid Expenses and Other Assets

Prepaid expenses and other assets consisted of the following (in thousands):


	March 31, 2024		December 31, 2023
Research and development	$	1,232	$	278
Insurance	887		402
Deposits	1,548		891
Other	771		1,295
	$	4,438	$	2,866

Summary of Significant Accounting Policies (Policies)

3 Months Ended

Mar. 31, 2024

Accounting Policies [Abstract]

Interim Financial Statements

Use of Estimates

Fair Value of Financial Instruments

Fair Value Measurements

•Level 1 Inputs: Unadjusted quoted prices in active markets for identical assets or liabilities accessible to the reporting entity at the measurement date.

The following fair value hierarchy table presents information about the Company’s assets and liabilities measured at fair value on a recurring basis:


(in thousands)	Fair value measurement at reporting date using
	(Level 1)		(Level 2)		(Level 3)
March 31, 2024
Assets:
Cash equivalents – money markets accounts	$	52,752	$	—	$	—

December 31, 2023
Assets:
Cash equivalents – money markets accounts	$	62,999	$	—	$	—

During the three months ended March 31, 2024 and 2023, there were no transfers between Level 1, Level 2 and Level 3.

Concentration of credit risk

Segment information

Net loss per share

The following potentially dilutive securities have been excluded from the computation of diluted weighted-average shares of common stock outstanding, as they would be anti-dilutive:


	March 31,
	2024	2023
Stock options	8,210,547	4,184,047

Recently issued accounting pronouncements

- Definition

Disclosure of accounting policy for segment reporting.

+ References + Details

Commitments and Contingencies

3 Months Ended

Mar. 31, 2024

Commitments and Contingencies Disclosure [Abstract]

Commitments and Contingencies

Leases

The Company has operating leases for its laboratory and office space in Philadelphia, Pennsylvania. The Company’s operating leases have term end dates ranging from 2024 to 2029. The Company also has obligations under an arrangement for the use of certain laboratory equipment that are classified as finance leases that commenced in 2022 and have end dates ranging from 2024 to 2026. Effective February 2024, the Company renewed an existing operating lease with an end date through 2026. In April 2024, in connection with the revised operating plan, the Company communicated a termination notice to the lessor of the operating lease. The termination is effective as of August 2024.

The Company’s operating and finance lease right-of-use (ROU) assets and the related lease liabilities are initially measured at the present value of future lease payments over the lease term. The Company is responsible for payment of certain real estate taxes, insurance and other expenses on certain of its leases. These amounts are generally considered to be variable and are not included in the measurement of the ROU assets and lease liability. The Company accounts for non-lease components, such as maintenance, separately from lease components.

The Company carries laboratory equipment from failed sale leasebacks, as property and equipment, net on the accompanying unaudited interim consolidated balance sheets. The ongoing lease payments are recorded as reductions to the finance liability and interest expense. As of March 31, 2024, the Company had a $2.3 million financing liability recorded in other current liabilities and other long-term liabilities on the unaudited interim consolidated balance sheets.

The elements of the lease costs were as follows (in thousands):


	Three Months Ended March 31,
	2024		2023
Operating lease cost	$	1,469	$	1,433
Finance lease cost:
Amortization of lease assets	1,298		297
Interest on lease liabilities	236		45
Total finance lease cost	1,534		342
Variable lease cost	472		750
Total lease cost	$	3,475	$	2,525

Lease term and discount rate information related to leases was as follows:


	March 31,
	2024		2023
Weighted-average remaining lease term (in years)
Operating leases	2.3		2.2
Finance leases	1.5		1.9

Weighted-average discount rate
Operating leases	9.3	%	9.5	%
Finance leases	9.0	%	9.0	%

Supplemental cash flow information was as follows (in thousands):


	Three Months Ended March 31,
	2024		2023
Cash paid for amounts included in the measurement of lease liabilities:
Operating cash used in operating leases	$	1,463	$	1,448
Operating cash used in finance leases	$	236	$	45
Financing cash used in finance leases	$	1,319	$	106

Future maturities of lease liabilities were as follows as of March 31, 2024 (in thousands):


	Operating Leases		Finance Leases
Fiscal year ending:
2024 (remaining nine months)	$	2,195	$	1,153
2025	2,628		1,261
2026	427		20
2027	232		—
2028	240		—
Thereafter	184		—
Total future minimum payments	5,906		2,434
Less imputed interest	(673)		(175)
Present value of lease liabilities	$	5,233	$	2,259

Licensing and Sponsored Research Agreements

Under a license agreement with The Trustees of the University of Pennsylvania (Penn), entered into in November 2017 (Penn License Agreement), the Company is required to make annual payments of $25,000. Penn is eligible to receive up to $10.9 million per product in development upon the achievement of certain clinical, regulatory and commercial milestone events. There are additional milestone payments required to be paid of up to $30.0 million per product in commercial milestones and up to an additional $1.7 million in development and regulatory milestone payments for the first CAR-M product directed to mesothelin. Additionally, the Company is obligated to pay Penn single-digit royalties based on its net sales.

In March 2023, the Company entered into a manufacturing and supply agreement (Novartis Agreement) with Novartis Pharmaceuticals Corporation (Novartis) for the manufacturing of the Company’s CT-0508 product candidate. The Novartis Agreement is for five years and shall renew automatically for additional one-year periods unless and until terminated by either party. In addition to paying to manufacture the product, the Company will also pay $1.0 million per calendar year, payable in quarterly payments, for reserved capacity starting on the date on which the Novartis site is declared ready to produce CT-0508 as determined by the Company. In the event of termination without cause by the Company, a termination fee equal to $4.0 million will be payable by Carisma to Novartis which, pursuant to the terms of the agreement, can be credited in full against amounts due for a substitute product.

Contingencies

Liabilities for loss contingencies, arising from claims, assessments, litigation, fines, penalties, and other sources are recorded when it is probable that a liability has been incurred and the amount of the assessment and/or remediation can be reasonably estimated. No such loss contingencies were probable nor reasonably estimable as of March 31, 2024.

Stockholders' Equity (Details) - USD ($) $ / shares in Units, $ in Thousands		3 Months Ended
	Mar. 07, 2023	Mar. 31, 2024	Mar. 31, 2023
Stockholders' Equity Note [Abstract]
Shares issued in a pre-closing funding (in shares)	3,730,608
Issue price per share (in USD per share)	$ 8.21
Sale of common stock under Open Market Sales Agreement, net of issuance costs	$ 30,600	$ 2,282
Issuance of common stock upon settlement of convertible promissory note, accrued interest, and related derivative liability (in shares)	5,059,338
Issuance of common stock upon settlement of convertible promissory note, accrued interest, and related derivative liability	$ 35,000		$ 42,447
Shares issued upon conversion of convertible preferred stock and exchangeable shares previously presented as noncontrolling interests (in shares)	18,872,711
Issuance of common stock to Sesen Bio shareholders in reverse capitalization (in shares)	10,374,272

- Definition

Equity impact of the value of new stock issued during the period. Includes shares issued in an initial public offering or a secondary public offering.

+ References + Details

Summary of Significant Accounting Policies - Schedule of Anti-Dilutive Securities (Details) - shares	3 Months Ended
	Mar. 31, 2024	Mar. 31, 2023
Stock options
Net loss per share
Anti-dilutive securities (in shares)	8,210,547	4,184,047

Development-Stage Risks and Liquidity	3 Months Ended
Development-Stage Risks and Liquidity	Mar. 31, 2024
Development-Stage Risks and Liquidity
Development-Stage Risks and Liquidity	Development-Stage Risks and Liquidity The accompanying unaudited interim consolidated financial statements have been prepared on a going-concern basis, which contemplates the realization of assets and satisfaction of liabilities in the normal course of business. The Company has incurred losses and negative cash flows from operations since inception and has an accumulated deficit of $264.1 million as of March 31, 2024. The Company anticipates incurring additional losses until such time, if ever, that it can generate significant sales from its product candidates currently in development. As of March 31, 2024, the Company had $56.5 million in cash and cash equivalents. Absent any other action, the Company would have required additional liquidity to continue its operations over the next 12 months, which would have raised substantial doubt about its ability to continue as a going concern. As discussed in Note 1, in late March 2024, the Company and its board of directors approved a revised operating plan that suspends certain development programs, reduces its workforce and decreases other non-essential activities to extend the Company’s cash runway. The Company projects this revised operating plan will alleviate the substantial doubt that has been raised by significantly decreasing expenses, thereby reducing ongoing liquidity needs to enable the continuation of operations for at least 12 months from the issuance date of these unaudited interim consolidated financial statements. The Company is subject to those risks associated with any specialty biotechnology company that has substantial expenditures for research and development. There can be no assurance that the Company’s research and development projects will be successful, that products developed will obtain necessary regulatory approval, or that any approved product will be commercially viable. In addition, the Company operates in an environment of rapid technological change and is largely dependent on the services of its employees and consultants.

Prepaid Expenses and other assets

3 Months Ended

Mar. 31, 2024

Deferred Costs, Capitalized, Prepaid, and Other Assets Disclosure [Abstract]

Prepaid Expenses and other assets

Prepaid expenses and other assets consisted of the following (in thousands):


	March 31, 2024		December 31, 2023
Research and development	$	1,232	$	278
Insurance	887		402
Deposits	1,548		891
Other	771		1,295
	$	4,438	$	2,866

Unaudited Consolidated Statement of Cash Flows - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2024	Mar. 31, 2023
Cash flows from operating activities:
Net loss	$ (18,978)	$ (24,642)
Adjustment to reconcile net loss to net cash used in operating activities:
Depreciation and amortization expense	1,693	705
Stock-based compensation expense	1,057	265
Reduction in the operating right of use assets	1,360	1,329
Amortization of debt discount	0	1,283
Change in fair value of derivative liability	0	84
Accretion on marketable securities	0	(163)
Write-off of property and equipment	67	0
Non-cash interest expense	236	41
Changes in operating assets and liabilities:
Prepaid expenses and other assets	(1,572)	(1,623)
Accounts payable	(1,826)	2,823
Accrued expenses	(2,933)	(4,445)
Deferred revenue	(224)	(323)
Operating lease liabilities	(1,355)	(868)
Other long term liabilities	50	0
Net cash used in operating activities	(22,425)	(25,534)
Cash flows from investing activities:
Purchase of marketable securities	0	(34,460)
Proceeds from the sale of marketable securities	0	31,000
Purchases of property and equipment	(17)	(135)
Net cash used in investing activities	(17)	(3,595)
Cash flows from financing activities:
Cash, cash equivalents and restricted cash acquired in connection with the reverse recapitalization	0	37,903
Payment of reverse recapitalization finance costs	0	(1,742)
Proceeds from the issuance of common stock in pre-closing financing	0	30,640
Payment of principal related to finance lease liabilities	(1,319)	(106)
Proceeds from failed sale-leaseback arrangement	686	1,092
Payment of finance liability from failed sale-leaseback arrangement	(303)	(45)
Proceeds from the exercise of stock options	2	0
Sale of common stock under Open Market Sales Agreement, net of issuance costs	2,286	0
Net cash provided by financing activities	1,352	67,742
Net (decrease) increase in cash, cash equivalents and restricted cash	(21,090)	38,613
Cash, cash equivalents and restricted cash at beginning of the period	77,605	24,194
Cash, cash equivalents and restricted cash at end of the period	56,515	62,807
Supplemental disclosures of cash flow information:
Cash paid for interest	50	45
Supplemental disclosure of non-cash financing and investing activities:
Conversion of convertible preferred stock and non-controlling interests upon Merger	0	122,204
Conversion of convertible promissory note, accrued interest and derivative liability upon Merger	0	42,447
Reverse recapitalization costs in accrued expenses	0	4,071
Unrealized gain on marketable securities	0	177
Right-of-use assets obtained in exchange for new operating lease liabilities	4,337	0
Right-of-use assets obtained in exchange for new financing lease liabilities	2,470	0
Property and equipment in accounts payable	$ 59	$ 49

Commitments and Contingencies (Tables)

3 Months Ended

Mar. 31, 2024

Commitments and Contingencies Disclosure [Abstract]

Schedule of Lease Costs

The elements of the lease costs were as follows (in thousands):


	Three Months Ended March 31,
	2024		2023
Operating lease cost	$	1,469	$	1,433
Finance lease cost:
Amortization of lease assets	1,298		297
Interest on lease liabilities	236		45
Total finance lease cost	1,534		342
Variable lease cost	472		750
Total lease cost	$	3,475	$	2,525

Schedule of Lease Term and Discount Rate Information

Lease term and discount rate information related to leases was as follows:


	March 31,
	2024		2023
Weighted-average remaining lease term (in years)
Operating leases	2.3		2.2
Finance leases	1.5		1.9

Weighted-average discount rate
Operating leases	9.3	%	9.5	%
Finance leases	9.0	%	9.0	%

Schedule of Supplemental Cash Flow Information

Supplemental cash flow information was as follows (in thousands):


	Three Months Ended March 31,
	2024		2023
Cash paid for amounts included in the measurement of lease liabilities:
Operating cash used in operating leases	$	1,463	$	1,448
Operating cash used in finance leases	$	236	$	45
Financing cash used in finance leases	$	1,319	$	106

Schedule of Future Maturities of Lease Liabilities

Future maturities of lease liabilities were as follows as of March 31, 2024 (in thousands):


	Operating Leases		Finance Leases
Fiscal year ending:
2024 (remaining nine months)	$	2,195	$	1,153
2025	2,628		1,261
2026	427		20
2027	232		—
2028	240		—
Thereafter	184		—
Total future minimum payments	5,906		2,434
Less imputed interest	(673)		(175)
Present value of lease liabilities	$	5,233	$	2,259

Stock-based Compensation (Tables)

3 Months Ended

Mar. 31, 2024

Share-Based Payment Arrangement [Abstract]

Schedule of Stock Option Activity

The following table summarizes stock option activity for the three months ended March 31, 2024:


	Options	Weighted average exercise price		Weighted average remaining contractual term (years)	Aggregate Intrinsic Value (in thousands)
Outstanding as of December 31, 2023	6,023,370	$	3.94
Exercised	(1,579)	1.42			$	2
Granted	2,226,000	2.10
Forfeited	(37,244)	5.58

Outstanding as of March 31, 2024	8,210,547	$	3.43	8.20	$	4,241
Exercisable as of March 31, 2024	2,737,710	$	1.24	6.00	$	3,443
Vested and expected to vest at March 31, 2024	8,210,547	$	3.43	8.20	$	4,241

Schedule of Estimated Using The Black-Scholes Option-Pricing Model

The fair values in the three months ended March 31, 2024 and 2023 were estimated using the Black-Scholes option-pricing model based on the following assumptions:


	Three Months Ended March 31,
	2024	2023
Risk-free interest rate	3.77% - 3.89%	2.92% - 4.03%
Expected term	6 years	6 years
Expected volatility	103.39% - 105.96%	57.77% - 62.65%
Expected dividend yield	—	—

Schedule of Stock-based Compensation Expense

The Company recorded stock-based compensation expense in the following expense categories in its accompanying unaudited interim consolidated statements of operations:


	Three Months Ended March 31,
		2024		2023
Research and development		$	436	$	10
General and administrative		621		255
		$	1,057	$	265

Accrued Expenses (Details) - USD ($) $ in Thousands	Mar. 31, 2024	Dec. 31, 2023
Payables and Accruals [Abstract]
Research and development	$ 3,165	$ 3,131
Professional fees	669	1,366
Compensation and related expenses	881	3,100
Other	14	65
Total accrued expenses	$ 4,729	$ 7,662

Commitments and Contingencies - Schedule of Lease Term and Discount Rate Information (Details)	Mar. 31, 2024	Mar. 31, 2023
Weighted-average remaining lease term (in years)
Operating leases	2 years 3 months 18 days	2 years 2 months 12 days
Finance leases	1 year 6 months	1 year 10 months 24 days
Weighted-average discount rate
Operating leases	9.30%	9.50%
Finance leases	9.00%	9.00%

Unaudited Consolidated Statements of Convertible Preferred Stock and Stockholders' Equity (Deficit) - USD ($) $ in Thousands	Total	Common stock	Additional paid-in capital	Accumulated other comprehensive (loss) income	Accumulated deficit	Noncontrolling interests
Beginning balance (in shares) at Dec. 31, 2022	8,700,885
Beginning balance at Dec. 31, 2022	$ 107,808
Convertible preferred stock
Conversion of convertible preferred stock and non-controlling interests to common stock (in shares)	(8,700,885)
Conversion of convertible preferred stock and non-controlling interests to common stock	$ (107,808)
Ending balance (in shares) at Mar. 31, 2023	0
Ending balance at Mar. 31, 2023	$ 0
Beginning balance (in shares) at Dec. 31, 2022		2,217,737
Beginning balance at Dec. 31, 2022	(142,670)	$ 2	$ 1,197	$ (41)	$ (158,223)	$ 14,395
Stockholders' Equity (Deficit)
Stock-based compensation	265		265
Unrealized gain on marketable securities	177			177
Issuance of common stock for cash in pre-closing financing (in shares)		3,730,608
Issuance of common stock for cash in pre-closing financing	30,640	$ 4	30,636
Issuance of common stock upon settlement of convertible promissory note, accrued interest, and related derivative liability (in shares)		5,059,338
Issuance of common stock upon settlement of convertible promissory note, accrued interest, and related derivative liability	42,447	$ 5	42,442
Issuance of common stock to Sesen Bio shareholders in reverse capitalization (in shares)		10,374,272
Issuance of common stock to Sesen Bio shareholders in reverse capitalization	72,044	$ 10	72,034
Conversion of convertible preferred stock and non-controlling interests to common stock (in shares)		18,872,711
Conversion of convertible preferred stock and non-controlling interests to common stock	107,809	$ 19	122,185			(14,395)
Net loss	(24,642)				(24,642)
Ending balance (in shares) at Mar. 31, 2023		40,254,666
Ending balance at Mar. 31, 2023	$ 86,070	$ 40	268,759	136	(182,865)	0
Beginning balance (in shares) at Dec. 31, 2023	0
Beginning balance at Dec. 31, 2023	$ 0
Ending balance (in shares) at Mar. 31, 2024	0
Ending balance at Mar. 31, 2024	$ 0
Beginning balance (in shares) at Dec. 31, 2023		40,609,915
Beginning balance at Dec. 31, 2023	$ 26,532	$ 40	271,594	0	(245,102)	0
Stockholders' Equity (Deficit)
Exercise of stock options (in shares)	1,579	1,579
Exercise of stock options	$ 2		2
Stock-based compensation	1,057		1,057
Sale of common stock under Open Market Sales Agreement, net of issuance costs (in shares)		931,250
Sale of common stock under Open Market Sales Agreement, net of issuance costs	2,282	$ 1	2,281
Unrealized gain on marketable securities	0
Net loss	(18,978)				(18,978)
Ending balance (in shares) at Mar. 31, 2024		41,542,744
Ending balance at Mar. 31, 2024	$ 10,895	$ 41	$ 274,934	$ 0	$ (264,080)	$ 0

Summary of Significant Accounting Policies - Schedule of Fair Value Hierarchy of Assets and Liabilities Measured on Recurring Basis (Details) - Recurring - USD ($) $ in Thousands	Mar. 31, 2024	Dec. 31, 2023
Level 1
Assets:
Cash equivalents – money markets accounts	$ 52,752	$ 62,999
Level 2
Assets:
Cash equivalents – money markets accounts	0	0
Level 3
Assets:
Cash equivalents – money markets accounts	$ 0	$ 0

Moderna Collaboration and License Agreement

3 Months Ended

Mar. 31, 2024

Revenue from Contract with Customer [Abstract]

Moderna Collaboration and License Agreement

In January 2022, the Company entered into the Moderna License Agreement, which provides for a broad strategic collaboration to discover, develop and commercialize in vivo engineered CAR-M therapeutics for up to twelve oncology programs. Under the Moderna License Agreement, the Company and Moderna initiate research programs during a research term, focused on the discovery and research of products directed to biological targets. Moderna’s mRNA platform builds on continuous advances in basic and applied mRNA science, delivery technology and manufacturing, and has allowed the development of therapeutics and vaccines for infectious diseases, immuno-oncology, rare diseases, cardiovascular diseases and auto-immune diseases. Moderna has the right to designate up to twelve research targets as development targets. The first five research targets have been designated and all programs are currently in the discovery phase. Moderna funds the cost of the Company's activities in accordance with an agreed research budget. The Company is responsible for discovering and optimizing development candidates, and Moderna is responsible for the clinical development thereafter. Pursuant to the Moderna License Agreement, the Company and Moderna formed a joint steering committee (JSC) that is responsible for the coordination and oversight of all research activities to which the Company is responsible for providing. The JSC is comprised of representatives from the Company and Moderna and with Moderna having final decision-making authority, subject to specified limitations.

During the term of the Moderna License Agreement, the Company and its affiliates are subject to various exclusivity obligations under which the Company is not permitted to research, develop or commercialize particular products outside of the collaboration, including products for use as in vivo therapies in the field of oncology, products directed to any target included in the collaboration, or products containing a polypeptide provided by the Company to Moderna in connection with a research program that are directed to any development target. Additionally, the Company has granted Moderna an exclusive worldwide royalty free license to the Company’s intellectual property associated with the product candidates that permits Moderna to conduct its research and development activities. Upon Moderna’s election of a development target (and payment of a related development target designation milestone) for commencement of pre-clinical development of a product candidate, the Company will grant Moderna an exclusive worldwide, sublicensable royalty bearing license to develop, manufacture and commercialize the product candidate.

Under the terms of the Moderna License Agreement, Moderna made an upfront non-refundable payment of $45.0 million to the Company. Assuming Moderna develops and commercializes 12 products, each directed to a different development target, the Company is eligible to receive up to between $247.0 million and $253.0 million per product in development target designation, development, regulatory and commercial milestone payments. Moderna also will reimburse the Company for all costs incurred by the Company in connection with its research and development activities under the Moderna License Agreement plus a reasonable margin for the respective services performed (with a minimum commitment to reimburse $10.0 million in research and development costs over the first three years from execution of the Moderna License Agreement). The Company is also eligible to receive tiered mid-to-high single digit royalties of net sales of any products that are commercialized under the agreement, which may be, subject to reductions. In addition, Moderna has agreed to cover the cost the Company incurs for certain milestone payments and royalties that the Company owes as a licensor under one of its intellectual property in-license agreements with Penn, which is sublicensed to Moderna under the Moderna License Agreement. Moderna may deduct these royalties in part from any royalties owed to the Company. The Moderna License Agreement terminates on a product-by-product basis upon the latest of expiration of the applicable product patents, expiration of regulatory exclusivity and the tenth anniversary of first commercial sale, unless terminated earlier by the Company or Moderna.

At commencement, the Company identified several potential performance obligations within the Moderna License Agreement, including research and development services on research targets, option rights held by Moderna, a non-exclusive royalty-free license to use the Company’s intellectual property to conduct research and development activities and participation on the JSC. The Company determined that there were 2 performance obligations comprised of (i) research and development services and (ii) option rights.

For the research and development services, the stand-alone selling price was determined considering the expected passthrough costs and cost of the research and development services and a reasonable margin for the respective services. The material rights from the option rights were valued based on the estimated discount at which the option is priced and the Company’s estimated probability of the options’ exercise as of the time of the agreement. The transaction price allocated to research and development services is recognized as collaboration revenues as the research and development services are provided to satisfy the underlying obligation related to the research and development target. The transfer of control occurs

over this period and, in management’s judgment, is the best measure of progress towards satisfying the performance obligation.

The transaction price of $45.0 million allocated to the options rights, which are considered material rights, will be recognized in the period that Moderna elects to exercise or elects to not exercise its option right to license and commercialize the underlying research and development target.

The Company included the $45.0 million up-front and nonrefundable payment and $73.9 million of variable consideration for expected research and development services to be performed during the five-year contract term, inclusive of passthrough costs, in the transaction price as of the outset of the arrangement. During the three months ended March 31, 2024 and 2023, the Company recognized $3.4 million and $3.2 million, respectively, of research and development services as collaboration revenues. The Company recognized $28.2 million of collaboration revenues since inception of the Moderna License Agreement through March 31, 2024. The following table includes estimated revenue expected to be recognized in the future related to performance obligations that are unsatisfied as of March 31, 2024 (in thousands):


	Transaction price unsatisfied
Performance obligations:
Research and development	$	45,786
Option rights	45,000
Total performance obligations	$	90,786

Amounts due to the Company for satisfying the revenue recognition criteria or that are contractually due based upon the terms of the collaboration agreements are recorded as accounts receivable in the Company’s unaudited interim consolidated balance sheets. Contract liabilities consist of amounts received prior to satisfying the revenue recognition criteria, which are recorded as deferred revenue in the Company’s unaudited interim consolidated balance sheets.

The following table summarizes the changes in deferred revenue (in thousands):


	Three Months Ended March 31,
	2024		2023
Balance at the beginning of the period	$	46,413	$	47,459
Deferral of revenue	3,173		2,920
Recognition of unearned revenue	(3,397)		(3,243)
Balance at the end of the period	$	46,189	$	47,136

The current portion of deferred revenue represents advanced payments received from Moderna for costs expected to be incurred by the Company within the next twelve months. The noncurrent portion of deferred revenue represents the $45.0 million upfront, non-refundable and non-creditable payment allocated to customer option right which is not expected to be recognized within the next 12 months.

- Definition

The entire disclosure of revenue from contract with customer to transfer good or service and to transfer nonfinancial asset. Includes, but is not limited to, disaggregation of revenue, credit loss recognized from contract with customer, judgment and change in judgment related to contract with customer, and asset recognized from cost incurred to obtain or fulfill contract with customer. Excludes insurance and lease contracts.

+ References

Reference 1: http://www.xbrl.org/2003/role/disclosureRef
-Topic 606
-SubTopic 10
-Name Accounting Standards Codification
-Section 50
-Paragraph 9
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147479806/606-10-50-9

Reference 2: http://www.xbrl.org/2003/role/disclosureRef
-Topic 606
-SubTopic 10
-Name Accounting Standards Codification
-Section 50
-Paragraph 10
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147479806/606-10-50-10

Reference 3: http://www.xbrl.org/2003/role/disclosureRef
-Topic 606
-SubTopic 10
-Name Accounting Standards Codification
-Section 50
-Paragraph 15
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147479806/606-10-50-15

Reference 4: http://www.xbrl.org/2003/role/disclosureRef
-Topic 606
-SubTopic 10
-Name Accounting Standards Codification
-Section 50
-Paragraph 12
-Subparagraph (a)
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147479806/606-10-50-12

Reference 5: http://www.xbrl.org/2003/role/disclosureRef
-Topic 606
-SubTopic 10
-Name Accounting Standards Codification
-Section 50
-Paragraph 12
-Subparagraph (b)
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147479806/606-10-50-12

Reference 6: http://www.xbrl.org/2003/role/disclosureRef
-Topic 606
-SubTopic 10
-Name Accounting Standards Codification
-Section 50
-Paragraph 12
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+ Details

Stock-based Compensation - Narratives (Details) - shares		3 Months Ended
	Jan. 01, 2024	Mar. 31, 2024
Two Thousand Seventeen Stock Incentive Plan \| Stock options
Stock-based Compensation
Vesting period		4 years
Two Thousand Seventeen Stock Incentive Plan \| Stock options \| Maximum
Stock-based Compensation
Terms		10 years
Two Thousand Fourteen Stock Incentive Plan
Stock-based Compensation
Vesting period		4 years
Vesting on first anniversary (as a percent)		25.00%
Vesting at the end of each three-month period after first anniversary (as a percent)		6.25%
Shares authorized for repurchase, compared to total common stock outstanding (as a percent)		4.00%
Number of additional shares authorized for issuance under share-based payment arrangement.	1,624,397
Shares available for issuance		4,300,000
Two Thousand Fourteen Stock Incentive Plan \| Stock options
Stock-based Compensation
Vesting period		10 years
Two Thousand Fourteen Employee Stock Purchase Plan
Stock-based Compensation
Shares available for issuance		200,000
Discount to the market price (as a percent)		15.00%

Merger with Sesen Bio

3 Months Ended

Mar. 31, 2024

Business Combination and Asset Acquisition [Abstract]

Merger with Sesen Bio

On March 7, 2023, Legacy Carisma completed the Merger with Sesen Bio as discussed in Note 1. The Merger was accounted for as a reverse recapitalization under GAAP because the primary assets of Sesen Bio were cash, cash equivalents and marketable securities. For financial reporting purposes Legacy Carisma was determined to be the accounting acquirer. As a result of the Merger, the net assets of Sesen Bio were recorded at their acquisition-date fair value in the consolidated financial statements and the reported operating results prior to the Merger are those of Legacy Carisma.

The following table shows the net assets acquired in the Merger (in thousands):


	March 7, 2023
Cash and cash equivalents	$	37,873
Marketable securities	44,588
Prepaid expenses and other assets	1,316
Restricted cash	30
Accounts payable and accrued expenses	(3,499)
Total net assets acquired	80,308
Less: Transaction costs	(8,264)
Total net assets acquired less transaction costs	$	72,044

Subsequent to March 7, 2023, the Company paid $4.6 million of severance and personnel costs related to Sesen Bio.

Accrued Expenses (Tables)

3 Months Ended

Mar. 31, 2024

Payables and Accruals [Abstract]

Schedule of Accrued Expenses

Accrued expenses consisted of the following (in thousands):


	March 31, 2024		December 31, 2023
Research and development	$	3,165	$	3,131
Professional fees	669		1,366
Compensation and related expenses	881		3,100

Other	14		65

	$	4,729	$	7,662

Cover - shares	3 Months Ended
Cover - shares	Mar. 31, 2024	May 07, 2024
Cover [Abstract]
Document Type	10-Q
Document Quarterly Report	true
Document Period End Date	Mar. 31, 2024
Document Transition Report	false
Entity File Number	001-36296
Entity Registrant Name	Carisma Therapeutics Inc.
Entity Incorporation, State or Country Code	DE
Entity Tax Identification Number	26-2025616
Entity Address, Address Line One	3675 Market Street
Entity Address, Address Line Two	Suite 200
Entity Address, City or Town	Philadelphia
Entity Address, State or Province	PA
Entity Address, Postal Zip Code	19104
City Area Code	267
Local Phone Number	491-6422
Title of 12(b) Security	Common Stock, $0.001 par value per share
Trading Symbol	CARM
Security Exchange Name	NASDAQ
Entity Current Reporting Status	Yes
Entity Interactive Data Current	Yes
Entity Filer Category	Non-accelerated Filer
Entity Small Business	true
Entity Emerging Growth Company	false
Entity Shell Company	false
Entity Common Stock, Shares Outstanding		41,542,744
Entity Central Index Key	0001485003
Current Fiscal Year End Date	--12-31
Amendment Flag	false
Document Fiscal Year Focus	2024
Document Fiscal Period Focus	Q1

Moderna Collaboration and License Agreement - Schedule of Estimated Revenue Expected to be Recognized in The Future Related to Performance Obligations (Details) $ in Thousands	Mar. 31, 2024 USD ($)
Performance obligations:
Research and development	$ 45,786
Option rights	45,000
Total performance obligations	$ 90,786

Moderna Collaboration and License Agreement - Schedule of Changes in Deferred Revenue (Details) - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2024	Mar. 31, 2023
Movement in Deferred Revenue [Roll Forward]
Balance at the beginning of the period	$ 46,413	$ 47,459
Deferral of revenue	3,173	2,920
Recognition of unearned revenue	(3,397)	(3,243)
Balance at the ending of the period	$ 46,189	$ 47,136

Moderna Collaboration and License Agreement - Narratives (Details) $ in Thousands	1 Months Ended	3 Months Ended		27 Months Ended
	Jan. 31, 2022 USD ($) target product	Mar. 31, 2024 USD ($) obligation	Mar. 31, 2023 USD ($)	Mar. 31, 2024 USD ($)
Moderna Collaboration and License Agreement
Research and development services as collaboration revenues		$ 3,400	$ 3,200
Collaboration revenues		$ 3,397	$ 3,243
Collaboration and License Agreement \| Research and Development Services
Moderna Collaboration and License Agreement
Variable consideration	$ 73,900
Term of contract	5 years
Noncurrent portion of deferred revenue	$ 45,000
Collaboration and License Agreement \| Moderna
Moderna Collaboration and License Agreement
Maximum of research targets \| target	12
Number of research targets, designate as development targets \| target	12
Number of research targets designated \| target	5
Collaboration and License Agreement \| Moderna \| Research and Development Services
Moderna Collaboration and License Agreement
Upfront non-refundable payment received	$ 45,000
Number of products developed and commercialized \| product	12
Minimum commitment to reimburse research and development costs	$ 10,000
Period of reimbursement of research and development costs	3 years
Number of performance obligations \| obligation		2
Collaboration and License Agreement \| Moderna \| Minimum \| Research and Development Services
Moderna Collaboration and License Agreement
Amount receivable per product	$ 247,000
Collaboration and License Agreement \| Moderna \| Maximum \| Research and Development Services
Moderna Collaboration and License Agreement
Amount receivable per product	$ 253,000
Moderna License Agreement
Moderna Collaboration and License Agreement
Collaboration revenues				$ 28,200

Stock-based Compensation - Schedule of Estimated Using The Black-Scholes Option-Pricing Model (Details) - Stock options	3 Months Ended
	Mar. 31, 2024	Mar. 31, 2023
Stock-based Compensation
Expected term	6 years	6 years
Expected dividend yield	0.00%	0.00%
Minimum
Stock-based Compensation
Risk-free interest rate	3.77%	2.92%
Expected volatility	103.39%	57.77%
Maximum
Stock-based Compensation
Risk-free interest rate	3.89%	4.03%
Expected volatility	105.96%	62.65%

- Definition

Line items represent financial concepts included in a table. These concepts are used to disclose reportable information associated with domain members defined in one or many axes to the table.

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Reference 3: http://www.xbrl.org/2003/role/disclosureRef
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Reference 4: http://www.xbrl.org/2003/role/disclosureRef
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+ Details

Prepaid Expenses and other assets (Details) - USD ($) $ in Thousands	Mar. 31, 2024	Dec. 31, 2023
Deferred Costs, Capitalized, Prepaid, and Other Assets Disclosure [Abstract]
Research and development	$ 1,232	$ 278
Insurance	887	402
Deposits	1,548	891
Other	771	1,295
Prepaid Expense and Other Assets	$ 4,438	$ 2,866

Unaudited Consolidated Balance Sheets - USD ($) $ in Thousands	Mar. 31, 2024	Dec. 31, 2023
Current assets:
Cash and cash equivalents	$ 56,515	$ 77,605
Prepaid expenses and other assets	4,438	2,866
Total current assets	60,953	80,471
Property and equipment, net	7,550	6,764
Right of use assets – operating leases	5,150	2,173
Deferred financing costs	142	146
Total assets	73,795	89,554
Current liabilities:
Accounts payable	2,166	3,933
Accrued expenses	4,729	7,662
Deferred revenue	1,189	1,413
Operating lease liabilities	2,474	1,391
Finance lease liabilities	1,390	544
Other current liabilities	1,193	965
Total current liabilities	13,141	15,908
Deferred revenue	45,000	45,000
Operating lease liabilities	2,759	860
Finance lease liabilities	869	328
Other long-term liabilities	1,131	926
Total liabilities	62,900	63,022
Commitments and contingencies (Note 7)
Stockholders’ equity:
Preferred stock $0.001 par value, 5,000,000 shares authorized, none issued or outstanding	0	0
Common stock $0.001 par value, 350,000,000 shares authorized, 41,542,744 and 40,609,915 shares issued and outstanding at March 31, 2024 and December 31, 2023, respectively	41	40
Additional paid-in capital	274,934	271,594
Accumulated deficit	(264,080)	(245,102)
Total stockholders’ equity	10,895	26,532
Total liabilities and stockholders’ equity	$ 73,795	$ 89,554