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Commitments and Contingencies
 3 Months Ended
Mar. 31, 2024
Commitments and Contingencies Disclosure [Abstract]  
Commitments and Contingencies 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,
20242023
Operating lease cost$1,469 $1,433 
Finance lease cost:
Amortization of lease assets1,298 297 
Interest on lease liabilities236 45 
Total finance lease cost1,534 342 
Variable lease cost472 750 
Total lease cost$3,475 $2,525 
Lease term and discount rate information related to leases was as follows:
March 31,
20242023
Weighted-average remaining lease term (in years)
Operating leases2.32.2
Finance leases1.51.9
Weighted-average discount rate
Operating leases9.3 %9.5 %
Finance leases9.0 %9.0 %
Supplemental cash flow information was as follows (in thousands):
Three Months Ended
March 31,
20242023
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 
20252,628 1,261 
2026427 20 
2027232 — 
2028240 — 
Thereafter184 — 
Total future minimum payments5,906 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.