Executive Summary / Key Takeaways

• TransCode Therapeutics (NASDAQ: RNAZ) is a clinical-stage RNA oncology company focused on overcoming the long-standing challenge of delivering RNA therapeutics effectively to tumors and metastases outside the liver using its proprietary TTX platform.
• The lead candidate, TTX-MC138, targeting microRNA-10b, is progressing through a Phase 1a clinical trial in advanced solid tumors, with preliminary data showing no significant safety or dose-limiting toxicities across four escalating dose cohorts and evidence of target engagement.
• The TTX delivery platform, utilizing repurposed iron oxide nanoparticles, is designed for enhanced tumor accumulation and intracellular uptake (claiming up to 98% in preclinical models), potentially offering a significant advantage over existing lipid-based delivery methods.
• Financially, the company faces significant challenges, including recurring operating losses ($12.09M net loss in Q1 2025) and negative cash flow ($3.10M used in operations in Q1 2025), with existing cash ($11.57M at March 31, 2025) projected to fund operations only into the fourth quarter of 2025, raising substantial doubt about its ability to continue as a going concern without additional capital.
• Key risks include the critical need for further financing, potential delisting from Nasdaq due to minimum bid price non-compliance, and the inherent uncertainties and costs associated with clinical trial success and regulatory approval in a highly competitive landscape dominated by larger, more financially stable players.

The Promise of RNA Oncology and TransCode's Differentiated Approach

The fight against cancer, particularly metastatic disease which accounts for the vast majority of cancer deaths, remains one of the most significant challenges in modern medicine. While the human genome holds immense potential for therapeutic intervention, effectively targeting the genetic drivers of cancer within tumor cells has proven elusive for traditional drug modalities like small molecules and monoclonal antibodies, many of which target genes considered "undruggable." Ribonucleic acid (RNA) therapeutics offer a promising alternative, capable of targeting virtually any gene. However, the widespread adoption of RNA therapies in oncology has been hampered by a fundamental hurdle: safe and efficient delivery of these molecules into tumor cells and metastases throughout the body.

TransCode Therapeutics was founded on the belief that this delivery challenge could be overcome through intelligent design. The company positions itself as an RNA oncology platform delivery company, aiming to unlock the full potential of RNA therapeutics by solving the critical issue of targeted delivery. Their core technological differentiator is the proprietary TTX delivery system. This platform leverages repurposed iron oxide nanoparticles, which have a history of clinical safety and are known to accumulate in metastatic sites. Unlike many existing delivery approaches, such as lipid nanoparticles or chemical conjugates like GalNAc, which primarily target the liver, the TTX platform is designed to deliver therapeutic oligonucleotides specifically to tumors and metastases.

The TTX nanocarrier is engineered to be tunable in size, charge, and surface chemistry, allowing it to be optimized for different therapeutic loads and targets. Preclinical data cited by the company suggests a significant advantage, claiming the TTX system can achieve up to 98% uptake of their drug inside cancer cells, compared to approximately 2% for some current delivery systems. This enhanced intracellular delivery is critical for RNA therapeutics to engage their targets effectively. Furthermore, the platform is designed to minimize early clearance by the kidneys and liver, contributing to a longer circulation half-life that facilitates accumulation in target tissues. The magnetic iron core also offers a potential diagnostic benefit, enabling quantification of particle delivery using MRI. The small hydrodynamic size and charge are intended to maximize distribution within the tumor microvasculature, extravasation into the tumor interstitium, and uptake by metabolically active cancer cells.

This modular approach, combining a tunable delivery system with a therapeutic design engine, is central to TransCode's strategy. It is intended to allow the company to efficiently develop a pipeline of RNA therapeutic candidates against a variety of cancer-related genetic targets, potentially saving time and capital resources compared to developing entirely new delivery methods for each target.

Advancing the Lead Candidate: TTX-MC138 in the Clinic

TransCode's lead therapeutic candidate, TTX-MC138, embodies this strategy. It is designed to inhibit microRNA-10b (miR-10b), an RNA molecule widely implicated as a master regulator of metastatic cell viability across numerous cancer types, including breast, pancreatic, ovarian, and colon cancers. Preclinical studies with TTX-MC138 demonstrated inhibition of miR-10b, leading to regression of established metastases in animal models with no reported recurrence or toxicity.

Building on this preclinical promise and supported by a second SBIR Award of $2.00 million from the National Cancer Institute received in September 2024, TransCode commenced a Phase 1a clinical trial for TTX-MC138 in the third quarter of 2024. This multicenter, open-label, dose-escalation and dose-expansion study is enrolling patients with advanced solid tumors at sites including MD Anderson Cancer Center (under an amended collaboration agreement focusing solely on clinical trial participation) and three other locations.

The trial is designed to characterize the safety, pharmacokinetic (PK), pharmacodynamic (PD), and anti-tumor activity of TTX-MC138, with the goal of identifying a maximum tolerated dose (MTD) and confirming target engagement. As of May 8, 2025, the trial had progressed to initial dosing in the fourth cohort, with a total of 15 patients treated across four escalating dose levels. Encouragingly, preliminary data from Cohorts 1, 2, and 3 have shown no significant safety or dose-limiting toxicities. PK and PD data from the initial cohorts have been consistent with preclinical results and findings from a prior Phase 0 clinical trial, which was specifically designed to demonstrate and quantify delivery of radiolabeled TTX-MC138 to metastatic lesions. PD analysis at 24 hours post-dosing provides evidence of miR-10b target engagement, a critical early signal. Furthermore, two patients in the trial have maintained stable disease on treatment for at least seven months, offering preliminary signs of potential clinical benefit.

The strategic importance of the Phase 1a trial extends beyond evaluating TTX-MC138 alone. Successfully demonstrating delivery and target engagement in humans is seen by the company as crucial validation for the entire TTX platform. This validation is expected to de-risk the development of other pipeline candidates, which also rely on the same core delivery technology.

Expanding the Pipeline and Competitive Positioning

Beyond TTX-MC138, TransCode is advancing a preclinical pipeline that leverages the TTX platform across different RNA therapeutic modalities. This includes TTX-siPDL1, an siRNA targeting PD-L1 synthesis, which has shown encouraging preclinical results in pancreatic cancer models. TTX-RIGA is an RNA-based agonist designed to activate the innate immune system via the RIG-I pathway to induce an anti-cancer immune response, with mechanistic studies confirming its approach. The pipeline also includes candidates utilizing long coding RNAs (TTX-mRNA and TTX-CRISPR) and diagnostic assays for measuring microRNA-10b in blood.

In the competitive landscape, TransCode operates within the rapidly evolving field of RNA therapeutics and oncology. Its direct competitors include other biopharmaceutical companies developing RNA-based therapies, such as Synaptogenix (SNPX) and XORTX Therapeutics (XRTX), as well as larger, more established players like Alnylam Pharmaceuticals (ALNY) and those in gene editing like CRISPR Therapeutics (CRSP).

Compared to smaller peers like SNPX and XRTX, TransCode's core technological advantage lies in its potentially more efficient and targeted TTX delivery platform, particularly for metastatic disease. While precise, directly comparable market share figures for all niche competitors are not publicly detailed, TransCode's focus on metastatic cancer provides a unique value proposition in an area where current treatments are often inadequate. The company believes its platform's claimed high intracellular uptake (up to 98% preclinical) could translate into superior product performance metrics, such as enhanced efficacy in tumor regression models, potentially offering a competitive edge in the long run. However, smaller companies like SNPX and XRTX may exhibit slightly better financial efficiency metrics (e.g., operating margins, ROIC) or lower debt levels, potentially positioning them for more stable R&D funding relative to their size.

Against larger players like ALNY, which has established revenue streams and commercialized RNAi products, TransCode is significantly earlier stage and lacks market presence. ALNY benefits from scale, regulatory experience, and global partnerships, enabling faster market adoption for approved products. While TransCode's TTX platform could potentially offer lower operating costs per unit due to efficient targeting, ALNY's commercialized products currently have a substantial lead in market penetration and revenue generation. TransCode's competitive position is currently based on the potential of its technology and pipeline, which remains unproven in late-stage clinical trials.

TransCode's small scale also presents vulnerabilities. Its cash burn rate is higher relative to its market capitalization compared to some peers, impacting margins and increasing reliance on external financing. This contrasts with the financial stability of larger competitors like ALNY. Barriers to entry in this field, such as high R&D costs and the need for specialized expertise and manufacturing, favor larger companies with established infrastructure and funding.

Financial Health, Liquidity, and Pressing Risks

TransCode's financial position reflects its status as a pre-revenue, clinical-stage biopharmaceutical company. The company has incurred significant operating losses since inception and continues to do so as it invests heavily in research and development. For the three months ended March 31, 2025, the net loss attributable to common stockholders was $12.09 million, a substantial increase from the $3.33 million loss in the same period of 2024. This increase was primarily driven by a significant non-cash loss of $9.23 million from the change in fair value of warrant liability, although operating expenses also saw shifts. Research and development expenses increased by $461 thousand to $2.22 million, mainly due to clinical trial start-up costs, while general and administrative expenses decreased by $578 thousand to $0.95 million due to cost management efforts.

Cash flow from operations remains negative, with $3.10 million used in operating activities during the first quarter of 2025, compared to $3.94 million used in the same period of 2024. The company's primary source of funding has been equity financings. Net cash provided by financing activities was $8.85 million in Q1 2025, largely from the March 2025 public offering which raised approximately $8.90 million in net proceeds.

As of March 31, 2025, TransCode had cash of approximately $11.57 million. Based on its current spending rate and planned activities, management believes this cash is sufficient to fund operations and capital requirements into the fourth quarter of 2025. However, critically, management does not believe existing cash will be sufficient to fund requirements for a full 12 months from the date of the financial statements' issuance (May 14, 2025). This assessment, coupled with recurring losses, has led the company to conclude there is substantial doubt about its ability to continue as a going concern without securing additional capital.

This need for further financing is the most pressing risk facing TransCode. The ability to raise additional funds on acceptable terms, or at all, is uncertain. Failure to do so would necessitate significant cost reduction strategies, potentially including delaying, scaling back, or terminating development programs. In a worst-case scenario, this could lead to a restructuring of liabilities, with the likely outcome being a total loss for common stockholders.

Adding to the financial pressure is the risk of delisting from the Nasdaq Capital Market. On May 7, 2025, the company received a notice of non-compliance with the minimum bid price requirement ($1.00 per share). While the company has filed for a hearing to appeal, there is no guarantee of a favorable outcome. Delisting would severely impact stock liquidity and value, making future capital raises significantly more challenging. The company has undertaken multiple reverse stock splits (including a 1-for-28 split effective May 15, 2025) in attempts to address this issue.

Other notable risks include the inherent uncertainties of clinical trials, the potential for adverse global economic conditions or cyberattacks to disrupt operations, and litigation risks, such as the disputed claims by an investment bank for fees.

Conclusion

TransCode Therapeutics represents a high-risk, high-reward investment opportunity centered on the potential of its proprietary TTX delivery platform to revolutionize RNA oncology, particularly for metastatic cancers. The company's strategic focus on overcoming the critical delivery hurdle with a technology claiming significantly higher intracellular uptake in preclinical models is compelling and addresses a major limitation of existing approaches. The progress of the lead candidate, TTX-MC138, through early-stage clinical trials, with initial safety data and evidence of target engagement, provides early validation signals.

However, the path forward is fraught with significant challenges. The company's financial runway is limited, necessitating substantial additional capital within the next few quarters. The going concern uncertainty and the immediate threat of Nasdaq delisting underscore the precariousness of its current position. While the technology holds promise and the pipeline is expanding, successful clinical translation and navigating the competitive landscape dominated by larger, better-funded players require overcoming these financial and operational hurdles. Investors should closely monitor the company's ability to secure financing, the outcome of the Nasdaq listing appeal, and further clinical data readouts for TTX-MC138 as key indicators of whether TransCode can translate its technological potential into sustained value.