Executive Summary / Key Takeaways

• Calidi Biotherapeutics is a clinical-stage biotechnology company pioneering novel oncolytic virus (OV) platforms, NeuroNova, SuperNova, and RedTail, designed to overcome the critical challenge of immune clearance and enable systemic delivery for metastatic cancer treatment.
• The company's RedTail platform, an engineered enveloped vaccinia virus, represents a significant technological leap, demonstrating efficient dissemination to metastatic sites in preclinical models and complete tumor eradication when combined with genetic payloads like IL-15 superagonist.
• Recent operational milestones, including the Fast Track Designation for CLD-201 (SuperNova) in soft tissue sarcoma and the anticipated Phase I trial for CLD-401 (RedTail) by late 2026, underscore the potential of its pipeline.
• Despite these advancements, Calidi faces a precarious financial position, marked by recurring losses, negative cash flows, and an accumulated deficit of $132.4 million as of June 30, 2025, leading to substantial doubt about its ability to continue as a going concern.
• The company's ability to successfully execute its ambitious clinical roadmap and secure substantial additional funding through equity or debt financings will be paramount to realizing the promise of its differentiated technology and addressing its critical liquidity needs.

The Immuno-Oncology Frontier and Calidi's Vision

Calidi Biotherapeutics, founded in 2014, is at the forefront of genetic medicines and oncolytic virus (OV) therapies, aiming to revolutionize cancer treatment. The company's journey began with foundational licensing agreements in 2021, securing exclusive rights for investigational new drugs (INDs) from Northwestern University and City of Hope for brain tumor and high-grade glioma treatments. This strategic foundation laid the groundwork for its innovative pipeline, including the NNV1 and NNV2 programs. Calidi's core mission addresses a significant hurdle in immuno-oncology: the rapid elimination of oncolytic viruses by the patient's immune system, which has historically limited their efficacy to local tumor delivery and hindered success in widespread metastatic disease.

Calidi's overarching strategy centers on developing proprietary platforms that protect oncolytic viruses, enhance their amplification, and modify the tumor microenvironment (TME) to elicit a robust anti-tumor immune response. Its technological differentiators are designed to overcome the limitations of existing OV therapies, including the only FDA-approved oncolytic virus, Amgen 's T-VEC, which is administered intratumorally. The company's approach involves two primary technological pillars: stem cell-based delivery and an engineered enveloped virus.

The NeuroNova and SuperNova platforms utilize oncolytic viruses embedded within allogeneic stem cells. This innovative encapsulation is designed to protect the viruses from neutralizing antibodies, complement inactivation, and innate immune cell attack, while simultaneously enhancing viral amplification within the cells. These platforms also aim to modify the TME, improving cell targeting and viral amplification at the tumor site. Preclinical studies have shown "substantial benefit over unprotected virus in preclinical studies of intratumoral delivery" for this approach. However, the inherent size of stem cells presents a limitation, as this method "does not allow for systemic delivery of virus to tumor metastases in animal models."

Recognizing this challenge, Calidi leveraged its learnings to develop the RedTail platform, a novel enveloped vaccinia virus engineered for systemic delivery. This platform features proprietary modifications, including the engineered expression of CD55 on the enveloped virus, which enables it to evade immune clearance and specifically replicate within tumor tissue. Crucially, "because the virus is not encapsulated in stem cells, it is thousands of times smaller than the NeuroNova or SuperNova products and disseminates efficiently into metastatic sites in syngeneic animal models." This systemic capability is a potential game-changer, allowing the RedTail virus to deliver potent genetic payloads, such as IL-15 superagonist, directly into the TME. Preclinical data for CLD-401, the first lead from the RedTail platform, demonstrated its ability to be administered "systemically and clear metastatic sites in syngeneic tumor mouse models with demonstrated enhanced biological efficacy," with the combination driving "complete tumor eradication in the tumor models compared to the RedTail virus alone."

These technological advancements are critical for investors, as they directly address a major unmet need in cancer therapy: effective systemic treatment for metastatic disease. The RedTail platform, in particular, offers the potential for broader applicability and enhanced efficacy compared to current intratumoral OV approaches. The company's R&D initiatives are progressing, with CLD-201 (SuperNova) receiving Fast Track Designation from the U.S. FDA in July 2025 for soft tissue sarcoma, which could accelerate its development and regulatory review. CLD-401 (RedTail) is expected to commence a Phase I trial by the end of 2026. Furthermore, Calidi's incorporation of Nova Cell, Inc. in May 2024 to explore regenerative medicine applications for its stem cell programs, including cosmetics and orthopedics, signals a strategic intent to diversify future revenue streams beyond oncology.

Competitive Arena: Innovating Against Giants and Peers

Calidi operates in a highly competitive immuno-oncology landscape, vying for market share and investor attention against both established pharmaceutical giants and innovative biotech peers. Key direct competitors include Replimune Group Inc. , Amgen Inc. , and Merck & Co., Inc. , each with distinct strategies and market positions.

Replimune (REPL), a clinical-stage peer, focuses on engineered herpes simplex viruses (RPx platform) for solid tumors. While REPL has a more advanced clinical pipeline and has shown less negative gross and operating margins (0.00% for both in 2025) compared to Calidi's significantly negative margins (-29.19% gross, -1328.32% operating TTM), Calidi's stem cell-based NeuroNova and SuperNova platforms offer a unique value proposition. These platforms aim for potentially greater precision and safety in tumor targeting, differentiating Calidi in niche markets like high-grade gliomas. However, REPL's more established clinical momentum suggests it may lead in innovation speed and market share capture in broader solid tumor indications.

Amgen and Merck represent the formidable presence of large, diversified pharmaceutical companies. Amgen , with its commercialized oncolytic virus T-VEC for melanoma, boasts extensive resources, global reach, and a proven track record. Its 2024 gross profit margin of 62% and operating margin of 22% starkly contrast with Calidi's early-stage unprofitability. Merck , a global leader in immuno-oncology with drugs like PD-1 inhibitors, also demonstrates robust financial health (2024 gross profit margin of 76%, operating margin of 32%). Calidi's technological edge lies in its targeted delivery mechanisms, particularly the systemic capabilities of RedTail, which could offer advantages over Amgen 's intratumoral T-VEC and Merck 's broader immune modulation. However, Calidi's smaller scale and early-stage development mean it lags significantly in market positioning, product breadth, and financial performance compared to these giants.

Calidi's competitive advantages are rooted in its proprietary technology, which directly addresses the immune clearance problem for oncolytic viruses. The ability of its stem cell platforms to protect and amplify viruses, and especially the RedTail platform's capacity for efficient systemic dissemination, could translate into superior efficacy and patient safety. This differentiation could lead to stronger customer loyalty in specific oncology niches and potentially higher pricing power if clinical success is achieved. However, Calidi's smaller scale and early-stage status are significant competitive disadvantages. This exposes the company to the immense financial and commercialization power of larger players like Amgen (AMGN) and Merck (MRK), who can dominate market access and pricing. The high R&D costs and stringent regulatory hurdles in immuno-oncology act as barriers to entry, protecting existing players like Calidi, but also favoring well-capitalized competitors.

Financial Performance: A High-Burn, High-Potential Trajectory

Calidi Biotherapeutics' financial performance reflects its status as a clinical-stage biotechnology company with an ambitious development pipeline. The company has consistently reported recurring losses from operations and negative cash flows, accumulating a significant deficit of $132.4 million as of June 30, 2025. This trajectory is typical for biotech firms heavily invested in research and development, which do not generate product sales revenue until regulatory approval.

For the six months ended June 30, 2025, Calidi reported a net loss of $10.8 million, following a net loss of $5.8 million for the second quarter of 2025. This compares to a net loss of $12.99 million for the six months ended June 30, 2024, indicating a slight reduction in losses year-over-year. Operating expenses for the first half of 2025 totaled $10.7 million, a 14% decrease from $12.5 million in the prior year period. Research and development (R&D) expenses saw a modest increase of $0.1 million (2%) to $5.0 million, primarily driven by a $0.5 million increase in consulting expenses and a $0.1 million increase in rent, partially offset by decreases in salaries and benefits ($0.3 million) and drug manufacturing/preclinical expenses ($0.2 million). This reflects the ongoing investment required to advance its clinical programs.

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General and administrative (G&A) expenses, however, decreased significantly by $1.9 million (25%) to $5.7 million for the six months ended June 30, 2025. This reduction was primarily attributable to lower legal fees ($0.6 million), salaries and benefits ($0.4 million), insurance ($0.3 million), investor relations ($0.2 million), and public company expenses ($0.2 million). The decrease in G&A, alongside the slight increase in R&D, suggests a strategic reallocation of resources towards core development activities while optimizing administrative overhead. Other income/expenses, net, also saw a $0.4 million decrease in net expense, mainly due to reduced interest expense ($0.4 million) and a favorable change in the fair value of derivatives ($0.1 million), partially offset by a $0.1 million decrease in grant income from the California Institute for Regenerative Medicine (CIRM).

Despite these efforts to manage expenses, Calidi's liquidity remains a critical concern. As of June 30, 2025, the company held $5.3 million in cash and $0.1 million in restricted cash. During the first six months of 2025, cash used in operating activities amounted to $12.0 million. Management has explicitly stated "substantial doubt about the Company's ability to continue as a going concern within 12 months from the date of issuance of the unaudited condensed consolidated financial statements." This assessment underscores the urgent need for additional capital.

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To address its funding requirements, Calidi has actively engaged in financing activities. In the first half of 2025, the company secured approximately $6.6 million from public offerings and $3.5 million from a March Registered Direct Offering and Concurrent Private Placement. Subsequent to the quarter end, in July 2025, a warrant inducement letter generated approximately $4.6 million in gross proceeds. Further demonstrating its continuous need for capital, Calidi priced a $6 million underwritten public offering on August 20, 2025, which closed at $6.9 million including the full exercise of the over-allotment option on August 21, 2025. These frequent capital raises, alongside two reverse stock splits (1-for-10 in July 2024 and 1-for-12 in August 2025), highlight the company's reliance on equity financing to sustain operations and its efforts to maintain NYSE American listing requirements.
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Outlook and Risks: The Path Ahead

Calidi's outlook is characterized by an anticipated increase in operational expenses as its product candidates advance through the pipeline. Management expects research and development costs to rise significantly in the foreseeable future as clinical trials commence and development efforts intensify for CLD-101, CLD-201, and CLD-400. General and administrative expenses are also projected to increase to support business expansion, R&D growth, additional personnel, and the ongoing costs associated with operating as a public company. Should Calidi achieve regulatory approval for any product candidates without a third-party commercialization partner, it anticipates incurring substantial expenses to build out sales, marketing, and distribution capabilities.

The company's current cash position is explicitly stated as insufficient to complete the development of CLD-101, CLD-201, and CLD-400, necessitating substantial additional funding. This continuous need for capital is the primary driver behind the "going concern" warning. While recent and subsequent financing activities have provided some relief, the long development cycles inherent in biotechnology mean that Calidi will likely require further significant capital injections.

Investors must weigh the promising technological advancements against a backdrop of considerable risks. The inherent uncertainties of clinical development, including potential trial failures, delays, or unexpected safety issues, pose a fundamental risk to the investment thesis. Regulatory approval is not guaranteed, and even if achieved, successful commercialization in a competitive market is challenging. The company's dependence on key personnel and its ability to protect its intellectual property are also critical. Furthermore, broader economic conditions, such as rising interest rates and volatile equity markets, could impact Calidi's ability to secure future financing on favorable terms.

The reliance on equity financing carries the risk of significant dilution for existing stockholders. The potential for substantial sales of common stock by selling securityholders could further depress the stock price, complicating future capital raises. Legal proceedings, including a complaint from a former Chief Accounting Officer alleging defamation and constructive discharge, and a securities fraud complaint, introduce additional uncertainties and potential financial liabilities, the outcomes of which are currently unestimable. These factors collectively underscore the high-risk nature of an investment in Calidi, despite the innovative potential of its technology.

Conclusion

Calidi Biotherapeutics stands at a pivotal juncture, embodying the high-stakes nature of clinical-stage biotechnology. Its core investment thesis is firmly rooted in the potential of its differentiated oncolytic virus platforms, particularly the RedTail technology, to address the long-standing challenge of systemic delivery for metastatic cancer. The preclinical data for RedTail, demonstrating efficient dissemination and complete tumor eradication in animal models, coupled with the Fast Track Designation for CLD-201, highlight a compelling scientific narrative that could transform cancer treatment.

However, this promising scientific trajectory is shadowed by a critical financial reality. Calidi's recurring losses, negative cash flows, and the explicit "going concern" warning underscore the immense capital requirements of its ambitious clinical roadmap. While the company has demonstrated an ability to raise funds through frequent public offerings and warrant exercises, the continuous need for financing, along with the dilutive impact of these activities and the recent reverse stock splits, presents a significant challenge. For investors, Calidi represents a speculative opportunity where the potential for groundbreaking technological leadership in immuno-oncology is balanced against a precarious financial position and the inherent risks of clinical development. The company's ability to translate its scientific innovation into clinical success and secure the necessary funding will be the ultimate determinant of its long-term viability and shareholder value.