Centessa Pharmaceuticals : 2023 UK Annual Report and Accounts

UNITED STATES

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WASHINGTON, D.C. 20549

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CENTESSA PHARMACEUTICALS PLC

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Registered number: 12973576

CENTESSA PHARMACEUTICALS PLC PARENT

COMPANY FINANCIAL STATEMENTS FOR THE YEAR

ENDED 31 DECEMBER 2023

ANNUAL REPORT AND FINANCIAL STATEMENTS

INTRODUCTION AND CONTENTS

Centessa Pharmaceuticals PLC (the "Company", or the "Parent Company") is a public limited company incorporated under the laws of England and Wales with American Depositary Shares ("ADS's") (representing its ordinary shares on a 1:1 basis) listed on the NASDAQ Global Select Market and traded under the symbol "CNTA".

To meet US securities law reporting requirements, the Company is required to file an annual report on Form 10-K with the United States Securities and Exchange Commission (the "SEC"), which includes the audited consolidated financial statements of the Company and its subsidiaries (the "Group") prepared in accordance with accounting principles generally accepted in the United States of America ("U.S. GAAP"). To meet UK statutory requirements for being a quoted company under the UK Companies Act 2006 (the "Companies Act"), the Company is required to file Consolidated financial statements.

The contents of this Annual Report are as follows:
Title		Page(s)
Company Information	2
A letter from our CEO	3
Strategic Report	5
Directors' Report	11
Directors' Remuneration Report	14
Statement of Directors' Responsibilities in Respect of the Annual Report and the Financial Statements	39
Independent Auditors' Report	40
Company Balance Sheet	47
Company Statement of Changes in Equity	48
Notes to the Financial Statements	49
UK Statutory Disclosures Relevant to the Financial Statements	59
Annual Report on Form 10-K	Appendix 1

This "Annual Report", as mentioned throughout these UK financial documents, is comprised of the reports listed above and the Annual Report on Form 10- K (the "Form 10-K") filed with the SEC on 19 March 2024. For the purposes of this Annual Report, the exhibits to the Form 10-K are not incorporated by reference.

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	COMPANY INFORMATION
Directors	Francesco De Rubertis (Non-Executive Director)
	Dr Arjun Goyal (Non-Executive Director)
	Mary Lynne Hedley (Non-Executive Director)
	Samarth Kulkarni (Non-Executive Director)
	Dr Saurabh Saha (Executive Director)
	Carol Stuckley (Non-Executive Director)
	Dr Brett Zbar (Non-Executive Director)
	Mathias Hukkelhoven (Non-Executive Director)
Former Directors	There were no resignations in the period.
Secretary	Iqbal Hussain
Registered number	12973576
Registered office	3rd Floor, 1 Ashley Road
	Altrincham
	Cheshire
	WA14 2DT
	United Kingdom
Independent auditors	KPMG LLP
	2 Forbury Place
	33 Forbury Road
	Reading
	RG1 3AD
	United Kingdom

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A LETTER FROM OUR CEO

2023 marked another year of great progress at Centessa. As I reflect on our accomplishments, I am proud to report significant progress across our most advanced pipeline programs, highlighting our commitment to pursuing the best assets in a focused and capital efficient manner with the aim of delivering transformational medicines for patients.

Hemophilia Program

Our most advanced product candidate, SerpinPC, is an investigational, subcutaneously administered novel inhibitor of activated protein C ("APC") in registrational trials as a potential treatment for hemophilia. To date, our Phase 2a clinical data has shown SerpinPC to have a favourable safety and tolerability profile, as well as evidence of sustained efficacy in patients with hemophilia. Most recently, in 2023, we presented additional longer-term data from the ongoing Phase 2a study that further reinforce our confidence in SerpinPC's potential to be a first-in-class subcutaneously administered therapy with a differentiated safety profile for individuals with hemophilia B, subject to regulatory review and approval. In 2023, we also received Fast Track designation for SerpinPC for the treatment of hemophilia B from the U.S. Food and Drug Administration (FDA), which we believe is important recognition of SerpinPC's novel mechanism of action and underscores the critical need for new treatment options. SerpinPC is now in registrational trials for the treatment of hemophilia B with and without inhibitors, PRESent-3 and PRESent-2, respectively.

Orexin Agonist Program

We are thrilled with the advancements we have made with our orexin agonist development program. Our lead product candidate, ORX750, is an investigational, orally administered, selective orexin receptor 2 (OX2R) agonist for the treatment of narcolepsy with potential expansion into other sleep disorders. In 2023, we presented preclinical data at the World Sleep Congress showing that ORX750 closely mimics the function of the endogenous orexin peptide, which is often missing in individuals with narcolepsy. We believe these data support a potential best-in-class profile for ORX750 for the treatment of narcolepsy and other sleep-wake disorders. Following clearance of our Investigational New Drug application ("IND") from the FDA in April 2024, we recently initiated a Phase 1 first-in-human ("FIH"), clinical trial of ORX750 for the treatment of narcolepsy. The Phase 1 study will evaluate the safety, tolerability and pharmacokinetics ("PK") of single-ascending doses ("SAD") and multiple-ascending doses ("MAD") of ORX750 in healthy adult subjects. In parallel to the SAD, a cross-over pharmacodynamic ("PD") assessment will be performed utilizing the Maintenance of Wakefulness Test ("MWT") and Karolinska Sleepiness Scale ("KSS") in acutely sleep-deprived healthy adult subjects which is intended to provide proof-of-concept ("PoC") data to enable dose selection for NT1, NT2 and IH indications. The study has a maximum exposure limit specified by the FDA which we believe significantly exceeds the predicted efficacious doses of ORX750 in indications associated with or without orexin loss; therefore, we do not expect this limit to affect any of the planned clinical development activities for ORX750. The limit was based on a convulsion seen in a single canine at the maximum dose tested in a non-GLP dose range finding study. We expect to share PoC data in acutely sleep-deprived healthy volunteers in the second half of 2024.

LockBody Technology Platform

We also continue to evaluate our proprietary LockBody® technology platform. In 2023, we started the first-in-human clinical trial of our lead LockBody candidate, LB101, in patients with solid tumors. LB101 is an investigational, conditionally tetravalent PD-L1xCD47 bispecific monoclonal antibody designed to selectively drive potent effector function activity, such as CD47, into the tumor microenvironment while avoiding systemic toxicity. We look to this Phase 1/2a study to provide valuable insights regarding the safety and tolerability of LB101, as well as the performance of our LockBody platform in a clinical setting.

Looking ahead, we are excited about the potential of these pipeline programs to bring transformative medicines to patients in need. We enter 2024 with strong momentum and anticipate key clinical milestones for these programs across the year.

I would like to express my gratitude to our team for their work and relentless dedication to our mission. We remain deeply committed to keeping patients at the center of all that we do. This focus affirms our purpose and inspires us to pursue extraordinary results for patients who are in need of new treatments. There is much work ahead and I am confident that we are well-positioned to continue to drive both innovation and long-term value for the benefit of all our stakeholders.

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Thank you for your support and trust in our company.

Sincerely,

Saurabh Saha, M.D., Ph.D.

Board Member and Chief Executive Officer

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STRATEGIC REPORT

All references in this Annual Report to "CENTESSA", the "Company", the "Group", "we," "us" and "our" refer to Centessa Pharmaceuticals PLC and its subsidiaries. The directors present their UK Statutory Strategic Report on the Group and the audited financial statements for the 52 weeks ended 31 December 2023. The comparative period covers the period from 1 January 2022 to 31 December 2022. The information in this document that is referred to in the following table shall be deemed to comply with the Companies Act requirements for the Strategic Report.

Principal Activities

We are a clinical-stage pharmaceutical company with a mission to discover, develop and ultimately deliver medicines that are transformational for patients.

Our Programs

Our most advanced product candidate is SerpinPC, a subcutaneously administered novel inhibitor of activated protein C ("APC") being developed as a potential treatment for hemophilia. SerpinPC is designed with a novel mechanism of action ("MoA") to prevent and reduce bleeds. To date, clinical data from our ongoing Phase 2a study in HA and HB subjects has shown SerpinPC to have a favorable tolerability profile, as well as evidence of sustained clinical activity, as measured by a reduction in the all-bleeds annualized bleed rates ("ABRs"). Based on these data, we believe SerpinPC has the potential to be a first-in-class subcutaneously administered therapy with a differentiated tolerability profile for individuals with hemophilia. We are currently evaluating SerpinPC in two ongoing Phase 2b interventional registrational studies for hemophilia, with and without inhibitors: PRESent-2 (moderately severe to severe HB without inhibitors, and severe HA with and without inhibitors) and PRESent-3 (HB with inhibitors). These interventional studies were preceded by a non-interventional (i.e., observational) feeder study, PRESent-5, which was initiated in December 2022. We dosed the first subject in the registrational PRESent-2 study in July 2023, and dosed the first subject in the registrational PRESent-3 study in October 2023. In parallel, we continue to work with the FDA and a number of regulators outside the U.S. on our product process development and qualification activities. This streamlined, integrated development program is designed to support a BLA for the treatment of HB, with or without inhibitors, as the initial indication for SerpinPC. The FDA granted SerpinPC orphan drug designation in September 2022, and Fast Track designation in May 2023, both for the treatment of HB. While the initial focus of our ongoing clinical development program is HB, with and without inhibitors, we believe SerpinPC has the potential to treat all types of hemophilia regardless of severity or inhibitor status and it may also prevent bleeding associated with other bleeding disorders. We continue to assess registrational plans for HA.

We are advancing our oral orexin receptor 2 (OX2R) agonist program for the treatment of narcolepsy and other sleep-wake disorders with potential expansion into broader neurological disorders. In March 2023, we announced our development candidate, ORX750, an orally administered, selective OX2R agonist for the treatment of narcolepsy and other sleep disorders. In October 2023, we shared a robust set of preclinical data which we believe support ORX750's potential as a best-in-class oral OX2R agonist for these indications. We are focused on rapidly moving ORX750 through IND-enabling studies, obtaining IND clearance and initiating clinical development of ORX750 with the goal of sharing clinical proof of concept data in sleep-deprived healthy volunteers in 2024. In addition to ORX750, we are exploring follow-up molecules for potential expansion opportunities into a range of broader neurological indications.

Following clearance of our IND from the FDA in January 2023, we initiated a Phase 1/2a FIH clinical trial of LB101 for the treatment of solid tumors and dosed the first subject in March 2023. LB101, our first LockBody development candidate, is a conditionally tetravalent PD-L1xCD47 bispecific monoclonal antibody. We look to this study to provide valuable insights regarding the safety and tolerability of LB101, as well as the performance of our LockBody platform in a clinical setting. The outcome of this study will help us to determine the level of investment we make to further advance LB101, our LockBody technology platform and future LockBody development candidates. In August 2023, we announced our second LockBody development candidate, LB206, an investigational conditionally bivalent PD-L1xCD3 bispecific monoclonal antibody for the treatment of solid tumors, and shared new preclinical data which demonstrated single agent regressions of large tumors with LB206 in a difficult-to-treat mouse xenograft model. LB206 is in preclinical development.

Our team

We are led by a management team with both subject matter expertise and extensive R&D experience from leading biotech and pharmaceutical companies. In addition, our program teams are comprised of both inventors of our assets and renowned leaders in their respective fields. Our extensive knowledge of both our assets and drug development

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informs our decision-making to advance the science and clinical path to demonstrate pharmacological activity and proof-of-concept, with the goal of achieving an efficient timeframe and cost-effective development.

Our approach

We have a track record of making judicious capital and resource allocation decisions for discovery and development efforts across our portfolio, and expeditiously evaluating and terminating programs when the data do not support advancement. Consistent with this approach and as part of ongoing portfolio management, in the first half of 2023, we deprioritized and paused all development activities associated with (i) CBS001, a neutralizing therapeutic mAb to the inflammatory membrane form of LIGHT for inflammatory / fibrotic diseases following suspension of dosing in the multiple ascending dose (MAD) stage of the Phase 1 study of CBS001 in December 2022 as a result of protocol defined stopping criterion being met, (ii) CBS004, a therapeutic mAb targeting BDCA-2 for the potential treatment of autoimmune diseases, and (iii) MGX292, a protein-engineered variant of human bone morphogenetic protein 9 ("BMP9") for the treatment of pulmonary arterial hypertension ("PAH"); (2) in H2 of 2023, we terminated MGX292 and terminated the associated license with Cambridge Enterprise and the University of Cambridge; and, (3) in November, 2023, we out-licensed the global rights to CBS004 to AnaptysBio, Inc.

Where the requirements of the strategic report in accordance with the Companies Act 2006 have been met in the Form 10-K, details of this have been provided in the table below and referenced to the Form 10-K accordingly. Additional requirements which are not met by Form 10-K have been disclosed separately at the end of the Statutory Strategic Report. The Form 10-K is attached in Appendix 1, and forms part of this report by cross reference.

Required item in the Strategic Report	Company Response and where information can be found in the
	Annual Report on Form 10-K, if applicable
A fair review of the company's business, including use of key performance	Part I, Item 1: Business; Overview - p.5
indicators	Part II, Item 7: Management Discussion & Analysis of Financial
	Condition and Results of Operations ("MD&A") - under the subheadings
	of:
	Overview - p.118
	Results of operations - p.121
	Liquidity and capital resources - Sources of liquidity and cash flow -
	p.124
A description of the principal risks and uncertainties facing the company	Part I, Item 1A: Risk Factors - p.46

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Information about the company's employees and other non-financial information	Part I, Item 1: Employees and Human Capital - p.45
	Part I, Item 1A: Risks Factors; Risks Related to our Reliance on Third
	Parties - discussed under the topic "If our third-party manufacturers use
	hazardous and biological materials in a manner that causes injury or
	violates applicable law, we may be liable for damages" - p.70.
	Part I, Item 1A: Risks Factors; Risks Related to our Business and
	Industry - discussed under the topic "If we fail to comply with
	environmental, health and safety laws and regulations, we could
	become subject to fines or penalties or incur costs that could have a
	material adverse effect of the success of our business." - p.89.
Description of the company's strategy and business model	Part I, Item 1: Business; Overview - p.5
	Part I, Item 1: Business; Our Operating Model - p.5
Main trends and factors likely to affect the future development, performance and	Part I, Item 1A: Risk Factors - p.46
position of the company's business	Part I, Item 1: Business; Overview - p.5
	Part II, Item 7: Management Discussion & Analysis of Financial
	Condition and Results of Operations ("MD&A") - under the
	subheadings of:
	Overview - p.118
	Results of operations - p.121
	Liquidity and capital resources - p.124
Risk management objectives and policies of the entity	Part I, Item 1A: Risk Factors; Risks Related to our Business and Industry
	- p.89

Other information required within the Strategic Report which is not included in the Form 10-K

Key Performance Indicators (KPIs):

Given the Group's operational inception in January 2021 and the focus of the business, KPI's for the Group are centered on operational execution and effective cash management.

The directors and management review the Group's total liquidity position and cash burn as part of the management of overall liquidity, cash runway and capital requirements.

At 31 December 2023, the Group's total liquidity position was $256.6M (2022: $393.6M) and expects its existing cash and cash equivalents and short-term investments will be sufficient to fund the Group's operations into 2026 without drawing on the remaining available tranches under the Oberland Capital financing agreement.

Corporate Governance Report (Section 172(1), Companies Act 2006 Statement)

The directors of Centessa, and all directors of UK subsidiaries must act in accordance with a set of general duties including (but not limited to) a duty to act in a way that they consider, in good faith, would most likely promote the success of the Company for the benefit of its members as a whole and in doing so must have regard (amongst other matters) to the matters set out in sub-paragraphs (a) to (f) of Section 172 of the Companies Act:

• The likely consequences of any decision in the long term
• The interests of the company's employees

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• The need to foster the company's business relationships with suppliers, customers and others
• The impact of the company's operations on the community and the environment
• The desirability of the company maintaining a reputation for high standards of business conduct
• The need to act fairly as between members of the company

Section 172(1) Companies Act	Company Response and where information can be found in the Annual Report on Form 10-K, or elsewhere in
Requirements	this Annual Report, if applicable.
the likely consequences of any	See Part I, Item 1: Business; Overview section of 10-K - p.5
decisions in the long term
the interest of the company's	Diversity and inclusion are important to the Group's growth strategy and align with the Group's values of integrity and
employees	equality. Appointments within the Group are made on merit according to a balance of skills and experience. Whilst
	acknowledging the benefits of diversity, individual appointments are made irrespective of personal characteristics such
	as race, disability, gender, sexual orientation, religion or age.
	A breakdown of employment statistics as of 31 December 2023 is as follows:

Position	Male	Female	Total
Company Executive Director*	1	-	1
Executive Officers	4	2	6
All other Employees	35	30	65
Total Employees	40	32	72
Non-Executive Directors	5	2	7
Total Employees and Non-Executive Directors	45	34	79
___________
* Chief Executive Office
A breakdown of employment statistics as of 31 December 2022 is as follows:
Position	Male	Female	Total
Company Executive Director*	1	-	1
Executive Officers	6	2	8
All other Employees	41	33	74
Total Employees	48	35	83
Non-Executive Directors	5	2	7
Total Employees and Non-Executive Directors	53	37	90
___________
* Chief Executive Officer

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