Cue Biopharma Seeks Lifeline in Public Offering Amid Cash Crunch

BOSTON, MA – December 18, 2025 – Cue Biopharma announced today its intent to raise capital through a public offering of common stock and warrants, a move that sent its stock price plummeting 30% in after-hours trading. The announcement underscores a critical juncture for the clinical-stage company, which is simultaneously developing a promising class of T-cell-based therapies while navigating a precarious financial position highlighted by a standing “going concern” warning in its financial disclosures.

The proposed offering, managed by H.C. Wainwright & Co., represents a necessary, albeit dilutive, step for a company burning through cash to fund its ambitious research and development pipeline. While the final size and terms remain subject to market conditions, the move is a clear signal of the urgent need for a capital infusion to sustain operations and advance its novel Immuno-STAT® platform.

The Financial Tightrope

For clinical-stage biopharmaceutical firms like Cue Biopharma, the path to commercialization is a capital-intensive marathon. The company’s latest financial reports paint a stark picture of this reality. With recurring operational losses, negative cash flows, and just $18.7 million in cash and equivalents as of September 30, 2025, the company’s auditors have issued a “going concern” qualification. This formal warning indicates substantial doubt about its ability to continue operations for the next twelve months without securing additional funding.

This is not the first time Cue Biopharma has turned to the public markets to shore up its balance sheet. The company raised approximately $12.0 million in a public offering in September 2024 and another $20 million in April 2025. The repeated offerings highlight a persistent cash burn as it pushes its candidates through costly clinical trials. R&D expenses, while reduced from the previous year, still amounted to $4.8 million in the third quarter of 2025, with general and administrative costs adding another $4.9 million.

The sharp negative market reaction to the latest offering announcement is a standard response to the prospect of shareholder dilution. By issuing new shares, the company increases the total number of shares outstanding, which can decrease the value of existing shares. For investors, it creates a difficult calculus: weigh the immediate dilution against the long-term potential of the company’s science, which requires this very funding to have any chance of success.

A Challenging Climate for Biotech

Cue Biopharma's fundraising efforts are set against a challenging backdrop for the entire biotechnology sector. The record-breaking investment highs of 2020 and 2021 have given way to a more sober and cautious market. Venture capital funding has contracted significantly, and the window for initial public offerings (IPOs) has narrowed, forcing many early-stage companies to find alternative ways to stay afloat.

Investors have become more risk-averse, increasingly directing capital toward later-stage companies with assets closer to commercialization and clearer revenue prospects. Companies like Cue, which are still in the clinical development phase without a product on the market, face heightened scrutiny and tougher competition for limited investment dollars.

In this constrained environment, strategic partnerships with large pharmaceutical giants have become a crucial lifeline. Cue Biopharma has successfully leveraged this strategy, securing collaborations with Ono Pharmaceutical for its autoimmune program and, more recently, a significant deal with Boehringer Ingelheim. The Boehringer Ingelheim agreement, announced in April 2025, provided a non-dilutive upfront payment of $12 million and makes Cue eligible for up to $345 million in future milestone payments, validating its technology platform and providing a vital injection of cash.

Betting on a Breakthrough Platform

Despite the financial headwinds, the investor proposition for Cue Biopharma rests squarely on the transformative potential of its proprietary Immuno-STAT® platform. The technology is designed to create injectable biologics that selectively target and modulate disease-specific T cells directly within the body. This approach promises the efficacy of advanced cell therapies without the cost, complexity, and systemic toxicity associated with broader immunotherapies.

The most compelling evidence for this potential comes from its oncology pipeline. The company's lead candidate, CUE-101, has produced impressive data in a Phase 1 trial for patients with HPV+ head and neck squamous cell carcinoma. When combined with the checkpoint inhibitor pembrolizumab, CUE-101 demonstrated a confirmed Overall Response Rate (ORR) of 50% in first-line patients. This result is particularly noteworthy as it significantly outperforms the historical 19% ORR for pembrolizumab monotherapy in a similar patient population. Furthermore, the trial showed a median overall survival of 32 months, a dramatic improvement over the 12.3 months seen with the current standard of care.

Its second candidate, CUE-102, targets the WT1 protein found in various solid tumors. In a Phase 1 trial for late-stage colorectal, gastric, ovarian, and pancreatic cancer patients, CUE-102 monotherapy achieved a 67% disease control rate, including one partial response in a pancreatic cancer patient. More recently, in August 2025, the first patient was dosed in an investigator-sponsored trial of CUE-102 for recurrent glioblastoma, a notoriously difficult-to-treat brain cancer.

The Road Ahead for Autoimmunity

Beyond oncology, Cue Biopharma is leveraging its platform to address autoimmune diseases, an area of immense unmet medical need. Its approach here is to restore immune balance by selectively activating regulatory T cells (Tregs), which act as the immune system's natural peacekeepers.

Its lead autoimmune asset, CUE-401, is being developed to harness the power of TGF-β and IL-2 to re-establish immune tolerance. The program is being advanced in collaboration with Ono Pharmaceutical, with a lead candidate expected to be selected in early 2025. Meanwhile, the CUE-501 program, part of the collaboration with Boehringer Ingelheim, is focused on developing a differentiated B cell depletion therapy.

These partnerships not only provide external validation for the Immuno-STAT® platform but also share the financial burden of development. The success of this latest public offering will be a critical determinant in whether Cue Biopharma has the runway to translate its encouraging clinical data into approved therapies that could one day change the standard of care for patients with cancer and autoimmune diseases.