Sana Biotechnology, Inc. (SANA) Cash Flow Statement

The OCF/NI ratio has ranged from 0.35 to 1.16, with 2024Q2 showing cash burn exceeding net loss (ratio 1.16) due to working capital swings. Recent quarters (2026Q2 ratio 0.52) show cash burn moderating relative to losses, but this is largely because SBC and D&A (totaling ~$7.5M quarterly) are non-cash. Investors should focus on the cash burn rate, not net loss, as the true liquidity drain.

The FCF trajectory shows a clear pivot to conserve cash, with quarterly burn settling in the $30-40M range since 2025Q3. However, this stabilization is not a sign of health but a survival measure, as the company still has zero revenue and must fund all operations externally. The improvement is driven by reduced R&D and capex, not by any operational cash generation.

Capex now represents a negligible portion of total cash outflows, suggesting the company is not investing in manufacturing capacity or lab expansion. This may limit future scalability if clinical trials succeed, but it is a rational choice given the liquidity constraints. The low capital intensity reflects a virtual company model, relying on external partners for manufacturing.

The working capital fluctuations appear driven by timing of payables and receivables, not by operational efficiency, as there is no revenue to drive a traditional cycle. Positive changes in some quarters (e.g., 2025Q4 +$3.4M) may indicate delayed payments to vendors, which could strain relationships. These swings are immaterial relative to the $30-40M quarterly burn and do not alter the fundamental cash drain.

The absence of capital returns is expected for a pre-revenue biotech, but the lack of any acquisition activity (except minor $248K and $635K in 2026Q1 and 2025Q4) suggests management is not pursuing inorganic growth. The only deployment is operational burn, which is unsustainable given the $71.9M cash balance. This underscores the imminent need for external financing, likely dilutive.

The divergence between net income and operating cash flow is significant, with SBC and D&A accounting for the majority of the gap. This suggests that while the company is burning cash rapidly, the economic reality is slightly less severe than the income statement implies. However, the cumulative cash burn of $437M still far exceeds the current cash balance, highlighting the critical need for additional capital.