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Item 2. Management’s Discussion and Analysis

2023-11-02 compared with 2023-08-02 · 67 added, 103 removed, 227 unchanged (43% of the section changed)

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The primary endpoint is objective response rate (ORR) and the key secondary endpoint is duration of response (DoR).

We recently initiated the EXPAND trial, which is expected to enroll approximately 70 patients with R/R LBCL and is intended to demonstrate the overall contribution of ALLO-647 to the benefit to risk ratio of the lymphodepletion regimen for ALLO-501A.

In the first quarter of 2023, we initiated the EXPAND trial, which is expected to enroll approximately 70 patients with R/R LBCL and is intended to demonstrate the overall contribution of ALLO-647 to the benefit to risk ratio of the lymphodepletion regimen for ALLO-501A.

Patients will be randomized to receive the same single 120 million CAR+ cell dose of ALLO-501A as in the ALPHA2 trial and either lymphodepletion with fludarabine and cyclophosphamide (control arm) or the lymphodepletion regimen of the ALPHA2 trial (active arm).

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Assuming favorable outcomes and subject to FDA discussions, we plan to seek FDA approval of ALLO-501A and ALLO-647 on the basis of the ALPHA2 trial and the EXPAND companion trial.

We are sponsoring two clinical trials in adult patients with R/R multiple myeloma, a Phase 1 clinical trial (the UNIVERSAL trial) of ALLO-715 and a Phase 1 clinical trial (the IGNITE trial) of ALLO-605, our first product candidate to incorporate our TurboCAR technology.

TurboCAR technology allows cytokine signaling to be engineered selectively into CAR T cells and has shown the ability to improve the potency and persistence of the cells and to delay exhaustion of the cells in preclinical models.

TurboCAR TM technology allows cytokine signaling to be engineered selectively into CAR T cells and has shown the ability to improve the potency and persistence of the cells and to delay exhaustion of the cells in preclinical models.

We are currently reviewing and optimizing the manufacturing process for our BCMA program and are not enrolling patients in the UNIVERSAL and IGNITE trials at this time.

We also continue to advance the Phase 1 clinical trial (the TRAVERSE trial) of ALLO-316, an allogeneic CAR T cell product candidate targeting CD70, in adult patients with advanced or metastatic clear cell renal cell carcinoma (ccRCC).

Subject to ongoing results in the TRAVERSE trial, we intend to complete planned dose exploration and initiate expansion cohort enrollment in 2023.

Our Phase 1 clinical trial (the TRAVERSE trial) of ALLO-316, an allogeneic CAR T cell product candidate targeting CD70, in adult patients with advanced or metastatic clear cell renal cell carcinoma (ccRCC) is ongoing.

Subject to ongoing results in the TRAVERSE trial, we intend to complete planned dose exploration and initiate expansion cohort enrollment in early 2024.

Since inception, we have had significant operating losses.

Our net losses were $78.0 million and $176.7 million for the three and six months ended June 30, 2023, respectively.

As of June 30, 2023, we had an accumulated deficit of $1.4 billion.

As of June 30, 2023, we had $544.5 million in cash and cash equivalents and investments and we expect our cash runway to fund operations into 2H 2025.

Our net losses were $61.3 million and $238.0 million for the three and nine months ended September 30, 2023, respectively.

As of September 30, 2023, we had an accumulated deficit of $1.5 billion.

As of September 30, 2023, we had $497.7 million in cash and cash equivalents and investments and we expect our cash runway to fund operations into 2H 2025.

We expect to continue to incur net losses for the foreseeable future, and we expect our research and development expenses and general and administrative expenses will continue to increase.

Recent Developments

On June 15, 2023, we presented updated data at the International Conference on Malignant Lymphoma (ICML) from the Phase 1 ALPHA/ALPHA2 trials of ALLO-501/501A in 33 CAR T naïve patients with relapsed/refractory (r/r) large B-cell lymphoma (LBCL) treated with the Alloy manufacturing process material across different CAR T dosing and lymphodepletion regimens.

Earlier in June, data from the 12 patients, a subset of these 33 CAR T naïve patients, who received regimen being utilized in ongoing Phase 2 trials was presented at American Society of Clinical Oncology (ASCO) Annual Meeting.

The updated analysis (data cutoff April 20, 2023) of ALPHA/ALPHA2 examined data from all 33 CAR T-naïve patients with r/r LBCL who were treated with a single infusion or consolidation therapy (two planned infusions) of ALLO-501/501A manufactured using the Alloy manufacturing process.

Patients received lymphodepletion with fludarabine (30 mg/m2/day x 3 days) and cyclophosphamide (300 mg/m2/day x 3 days) and varying doses of ALLO-647 (from 13 mg/day to 30 mg/day x 3 days).

The median time from enrollment to the start of therapy was three days and 100% of patients received product per specifications.

No patients received bridging therapy.

The dosing breakdown for the 33 patients included in this data set is as follows:

• 12 patients treated with a single dose of ALLO-501/501A and FCA90 lymphodepletion (Phase 2 regimen;

recap of the ASCO 2023 data presentation)

• 6 patients treated with a single dose of ALLO-501/501A and FCA<90 lymphodepletion

• 15 patients treated with consolidation dosing of ALLO-501/501A and split lymphodepletion

CAR T- Naïve Patients with r/r LBCL

Alloy Manufacturing Process

(N=33) Phase 2

Regimen (N=12) FCA<90

(N=6) Consolidation

Dosing (N=15)

Overall Response Rate (ORR), n (%) 19 (58) 8 (67) 3 (50) 8 (53)

Complete Response Rate (CR), n (%) 14 (42) 7 (58) 1 (17) 6 (40)

6 Month Complete Response, n (%) 10 (30) 5 (42) 0 5 (33)

Seven of 12 (58%) patients receiving the Phase 2 regimen achieved a CR and five (42%) maintained a CR through Month 6.

Of the five patients who were in CR at 6 months, four (80%) remained in CR.

The fifth patient had disease progression at 24 months.

The median duration of response was 23.1 months with three patients remaining in remission for over 24 months and the longest remaining in remission for over 31 months.

Across all 33 patients the CR rate was 42% with 30% maintaining a CR at Month 6.

These results indicating complete responses are more common with lymphodepletion regimens containing 90 mg of ALLO-647 (FCA90).

Median duration of response for both the overall population (n=33) and the patients treated with the Phase 2 regimen (n=12) was 23.1 months.

CAR T- Naïve Patients with r/r LBCL

(N=33) Phase 2

Regimen (N=12) FCA<90

(N=6) Consolidation

CRS 8 (24) 0 4 (33) 0 1 (17) 0 3 (20) 0

Neurotoxicity 13 (39) 2 (6) 4 (33) 0 2 (33) 0 7 (47) 2 (13)

ICANS 0 0 0 0 0 0 0 0

GvHD 0 0 0 0 0 0 0 0

IRR 16 (49) 3 (9) 8 (67) 0 3 (50) 1 (17) 5 (33) 2 (13)

Infection 19 (58) 5 (15) 8 (67) 1 (8) 3 (50) 1 (17) 8 (53) 3 (20)

Prolonged Gr3+ Cytopenia — 4 (12) — 2 (17) — 0 — 2 (13)

Across the 33 patients, treatment was generally well tolerated with no incidences of Grade 3 or greater cytokine release syndrome, and no cases of immune effector cell-associated neurotoxicity syndrome or graft versus host disease.

Cytopenia and infections were manageable and comparable to the experience with autologous CAR T cell therapies in patients with r/r LBCL.

The ALPHA/ALPHA2 Phase 1 trials were designed to assess the safety, tolerability, and preliminary efficacy at increasing dose levels of ALLO-501 and ALLO-501A, allogeneic CAR T cell product candidates that target CD19.

In addition to exploring multiple cell doses, these studies evaluated various doses of ALLO-647, our proprietary lymphodepleting antibody is designed to prevent premature rejection of AlloCAR T cells.

We are currently enrolling the potentially pivotal Phase 2 ALPHA2 trial of ALLO-501A in LBCL and expect to complete enrollment in the first half of 2024 with the first data readout planned by the end of 2024.

We are currently enrolling in Canada and expect enrollment in Europe to begin in the third quarter of 2023 and in Australia by year-end.

In addition, we are conducting EXPAND, a trial in which patients with LBCL are randomized to receive a lymphodepletion regimen comprised of fludarabine and cyclophosphamide with or without ALLO-647.

EXPAND is currently open to enrollment in the US and is expected to be open in additional regions in 2023.

We continue enrollment in the potentially pivotal Phase 2 ALPHA2 trial of ALLO-501A in relapsed/refractory (R/R) large B cell lymphoma (LBCL).

In addition to previous regulatory approvals to initiate the ALPHA2 trial in the U.S.

and Canada, during the third quarter of 2023, we received regulatory approvals to expand this trial to include European and Australian clinical trial sites, and we have initiated the trial at a number of sites.

We expect to complete enrollment in the first half of 2024 with the first data readout planned by the end of 2024.

We also continue enrollment in our EXPAND trial, which is expected to support licensure of ALLO-647, the Company’s anti-CD52 monoclonal antibody used in conjunction with standard low-dose FC (fludarabine, 30 mg/m2 and cyclophosphamide 300 mg/m2, daily for 3 days) lymphodepletion regimens.

In addition to previous regulatory approval to initiate the EXPAND trial in the U.S., during the third quarter of 2023, we received regulatory approval to include European clinical trial sites and have opened enrollment in that region.

Effective August 2, 2023, Eric T.

Schmidt, Ph.D.

resigned from his position as our Chief Financial Officer and on October 16, 2023, we appointed Geoffrey Parker as our Chief Financial Officer.

On August 14, 2023, we appointed Earl Douglas as our General Counsel.

Our Research and Development and License Agreements

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On October 6, 2020, we entered into a strategic five-year collaboration agreement with The University of Texas MD Anderson Cancer Center (MD Anderson) for the preclinical and clinical investigation of allogeneic CAR T cell product candidates.

See Note 6 to our consolidated financial statements included elsewhere in this report for further description of the agreement with MD Anderson.

See Note 6 to our condensed consolidated financial statements included elsewhere in this report for further description of the agreement with MD Anderson.

License Agreement with Allogene Overland Biopharm (CY) Limited

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Components of Results of Operations

As of June 30, 2023, our revenue has been exclusively generated from our collaboration and license agreement with Allogene Overland Biopharm (PRC) Co., Limited.

As of September 30, 2023, our revenue has been exclusively generated from our collaboration and license agreement with Allogene Overland Biopharm (PRC) Co., Limited.

See Note 6 to our financial statements appearing elsewhere in this Quarterly Report for more information related to our recognition of revenue and the Allogene Overland Biopharm (PRC) Co., Limited agreement.

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To date, our research and development expenses have related primarily to discovery efforts, preclinical and clinical development, and manufacturing of our product candidates.

Research and development expenses for the three and six months ended June 30, 2023 included costs associated with our clinical and preclinical stage pipeline candidates and research into

Research and development expenses for the three and nine months ended September 30, 2023 included costs associated with our clinical and preclinical stage pipeline candidates and research into

newer technologies.

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Other Income (Expenses)

Other income (expenses) consists of non-operating income and expenses, including primarily our share of equity investments' net losses for the period.

Other income (expenses) consists of non-operating income and expenses, including primarily our share of net losses for the period from, and impairment of, our equity method investments.

Results of Operations

Comparison of the Three Months Ended June 30, 2023 and 2022

The following sets forth our results of operations for the three months ended June 30, 2023 and 2022 (dollars in thousands):

Three Months Ended June 30, Change

Comparison of the Three Months Ended September 30, 2023 and 2022

The following sets forth our results of operations for the three months ended September 30, 2023 and 2022 (dollars in thousands):

Three Months Ended September 30, Change

2023 2022 $ %

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Interest and other income, net 6,205 1,002 5,203 *

Other (expenses) income (1,249) 1,492 (2,741) *

Total other income, net 2,529 1,807 722 40 %

Other expenses (4,545) (1,661) (2,884) *

Total other income (expense), net 1,660 (659) 2,319 *

Net Loss $ (61,315) $ (83,148) $ 21,833 (26) %

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Collaboration revenue - related party

Collaboration revenue was less than $0.1 million for the three months ended June 30, 2023 and 2022.

Revenue recognized in the three months ended June 30, 2023 and 2022 was due to the delivery of the know-how performance obligations related to the License Agreement entered into with Allogene Overland on December 14, 2020.

Collaboration revenue was less than $0.1 million for the three months ended September 30, 2023 and 2022.

Revenue recognized in the three months ended September 30, 2023 and 2022 was due to the delivery of the know-how performance obligations related to the License Agreement entered into with Allogene Overland on December 14, 2020.

Research and Development Expenses

Research and development expenses were $62.0 million and $57.2 million for the three months ended June 30, 2023 and 2022, respectively.

The increase of $4.9 million was driven primarily by a decrease in Servier cost recoveries of $11.0 million, offset by a decrease in personnel related costs of $5.2 million and a decrease in external costs relating to the advancement of our product candidates due to the timing of development activities and manufacturing runs of $0.9 million.

Research and development expenses were $46.0 million and $63.6 million for the three months ended September 30, 2023 and 2022, respectively.

The decrease of $17.7 million was driven primarily by a decrease in external costs relating to the advancement of our product candidates due to the timing of development activities and manufacturing runs of $10.3 million and a decrease in personnel related costs of $6.6 million, of which $4.3 million was stock-based compensation expense.

General and Administrative Expenses

General and administrative expenses were $18.5 million and $19.5 million for the three months ended June 30, 2023 and 2022, respectively.

The decrease of $1.0 million was primarily due to a decrease in personnel related costs of $0.6 million and a decrease in expenses related to outside services of $0.3 million.

General and administrative expenses were $17.0 million and $18.9 million for the three months ended September 30, 2023 and 2022, respectively.

The decrease of $1.9 million was primarily due to a decrease in personnel related costs of $2.1 million, of which $1.5 million was stock-based compensation expense.

Interest and Other Income, Net

Interest and other income, net was $3.8 million and $0.3 million for the three months ended June 30, 2023 and 2022, respectively.

Interest and other income, net was $6.2 million and $1.0 million for the three months ended September 30, 2023 and 2022, respectively.

The increase of $5.2 million was due to higher yields and a corresponding increase in the interest earned on our cash, cash equivalents and investments.

Comparison of the Six Months Ended June 30, 2023 and 2022

The following sets forth our results of operations for the six months ended June 30, 2023 and 2022 (dollars in thousands):

Six Months Ended June 30, Change

Comparison of the Nine Months Ended September 30, 2023 and 2022

The following sets forth our results of operations for the nine months ended September 30, 2023 and 2022 (dollars in thousands):

Nine Months Ended September 30, Change

2023 2022 $ %

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Interest and other income, net 12,042 1,809 10,233 *

Other (expenses) income (2,942) 1,142 (4,084) *

Total other income, net 2,895 1,949 946 49 %

Other expenses (7,487) (519) (6,968) *

Total other income (expense), net 4,555 1,290 3,265 *

Net Loss $ (238,008) $ (237,785) $ (223) — %

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Collaboration revenue - related party

Collaboration revenue was $0.1 million for the six months ended June 30, 2023 and 2022.

Revenue recognized in the six months ended June 30, 2023 and 2022 was due to the delivery of the know-how performance obligations related to the License Agreement entered into with Allogene Overland on December 14, 2020.

Collaboration revenue was $0.1 million for the nine months ended September 30, 2023 and 2022.

Revenue recognized in the nine months ended September 30, 2023 and 2022 was due to the delivery of the know-how performance obligations related to the License Agreement entered into with Allogene Overland on December 14, 2020.

Research and Development Expenses

Research and development expenses were $142.3 million and $117.3 million for the six months ended June 30, 2023 and 2022, respectively.

The increase of $24.9 million was driven primarily by a decrease in Servier cost recoveries of $16.1 million and an increase in external costs relating to the advancement of our product candidates due to the timing of development activities and manufacturing runs of $11.0 million, offset by a decrease in personnel related costs of $4.4 million.

Research and development expenses were $188.3 million and $181.0 million for the nine months ended September 30, 2023 and 2022, respectively.

The increase of $7.3 million was driven primarily by a decrease in Servier cost recoveries of $19.7 million and an increase in facilities costs of $1.7 million, offset by a decrease in personnel related costs of $10.9 million, of which $12.2 million was a decrease in stock-based compensation expense, and a decrease in external costs relating to the advancement of our product candidates due to the timing of development activities and manufacturing runs of $3.0 million.

General and Administrative Expenses

General and administrative expenses were $37.4 million and $39.4 million for the six months ended June 30, 2023 and 2022, respectively.

The decrease of $2.0 million was primarily due to a decrease in personnel related costs of $1.3 million and a decrease in expenses related to outside services of $0.7 million.

General and administrative expenses were $54.4 million and $58.3 million for the nine months ended September 30, 2023 and 2022, respectively.

The decrease of $3.9 million was primarily due to a decrease in personnel related costs of $3.5 million, of which $3.4 million was stock-based compensation expense.

Interest and Other Income, Net

Interest and other income, net was $5.8 million and $0.8 million for the six months ended June 30, 2023 and 2022, respectively.

Interest and other income, net was $12.0 million and $1.8 million for the nine months ended September 30, 2023 and 2022, respectively.

The increase of $10.2 million was due to higher yields and a corresponding increase in the interest earned on our cash, cash equivalents and investments.

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To date, we have incurred significant net losses and negative cash flows from operations.

As of June 30, 2023, we had $544.5 million in cash and cash equivalents and investments.

As of September 30, 2023, we had $497.7 million in cash and cash equivalents and investments.

We anticipate that the aggregate of our current cash and cash equivalents and investments available for operations will be sufficient to fund our operations for at least the next 12 months from the date this Quarterly Report on Form 10-Q is filed with the SEC.

Our operations have been financed primarily by net proceeds from the sale and issuance of our convertible preferred stock, the issuance of convertible promissory notes, net proceeds from our IPO, our at-the-market (ATM) offerings, our June 2020 underwritten public offering, and upfront cash payment of $40.0 million received in December 2020 pursuant to our License Agreement with Allogene Overland.

In connection with our IPO in 2018, we sold an aggregate of 20,700,000 shares of our common stock (inclusive of 2,700,000 shares of common stock pursuant to the over-allotment option granted to the

underwriters) at a price of $18.00 per share and received approximately $343.3 million in net proceeds.

In November 2019, we entered into a sales agreement with Cowen and Company, LLC (Cowen), as amended on November 2, 2022, under which we may from time to time issue and sell shares of our common stock through Cowen in ATM offerings for an aggregate offering price of up to $250.0 million.

In connection with our IPO in 2018, we sold an aggregate of 20,700,000 shares of

our common stock (inclusive of 2,700,000 shares of common stock pursuant to the over-allotment option granted to the underwriters) at a price of $18.00 per share and received approximately $343.3 million in net proceeds.

In November 2019, we entered into a sales agreement with Cowen and Company, LLC (Cowen), as amended on November 2, 2022 and November 2, 2023, under which we may from time to time issue and sell shares of our common stock through Cowen in ATM offerings.

During the year ended December 31, 2019, we sold an aggregate of 1,965,082 shares of common stock in ATM offerings resulting in net proceeds of $54.2 million.

During the year ended December 31, 2020, we sold an aggregate of 848,663 shares of common stock in ATM offerings resulting in net proceeds of $26.2 million.

In June 2023, we sold an aggregate of 20,288,330 shares of common stock in ATM offerings resulting in net proceeds of $87.9 million.

As of June 30, 2023, $77.9 million remains available for sale under the sales agreement with Cowen.

During the nine months ended September 30, 2023, we sold an aggregate of 20,894,565 shares of common stock in ATM offerings resulting in net proceeds of $91.1 million.

The specified dollar limit on the amount of common stock that may be sold under the sales agreement was removed pursuant to the November 2, 2023 amendment to the sales agreement.

In June 2020, we sold 13,457,447 shares of our common stock, which included 1,755,319 shares sold pursuant to the full exercise of the underwriters' option to purchase additional shares, in an underwritten public offering at a price of $47.00 per share, which resulted in net proceeds of approximately $595.7 million after deducting the underwriting discounts and commissions and other expenses.

The following table summarizes our cash flows for the periods indicated:

Six Months Ended June 30,

Nine Months Ended September 30,

(In thousands)

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Operating Activities

During the six months ended June 30, 2023, cash used in operating activities of $128.5 million was attributable to a net loss of $176.7 million, partially offset by non-cash charges of $45.2 million and an increase of $3.0 million in our net operating assets and liabilities.

The non-cash charges consisted primarily of stock-based compensation expense of $35.4 million, depreciation of $7.2 million, our share of equity investments' net losses for the period of $2.9 million, net amortization and accretion on investment securities of $0.6 million, and non-cash rent expense of $0.4 million.

The change in operating assets and liabilities was primarily due to a $5.6 million increase in accrued and other current liabilities and a $1.4 million decrease in prepaid expenses and other current assets, offset by a $3.2 million decrease in accounts payable and a $0.7 million decrease in deferred revenue.

During the six months ended June 30, 2022, cash used in operating activities of $110.8 million was attributable to a net loss of $154.6 million, partially offset by non-cash charges of $58.8 million and an increase of $14.9 million in our net operating assets and liabilities.

During the nine months ended September 30, 2023, cash used in operating activities of $184.0 million was attributable to a net loss of $238.0 million, partially offset by non-cash charges of $65.9 million and an increase of $11.9 million in our net operating assets and liabilities.

The non-cash charges consisted primarily of stock-based compensation expense of $50.7 million, depreciation of $10.7 million, our share of equity investments' net losses and impairment for the period of $7.5 million, net amortization and accretion on investment securities of $3.5 million, and non-cash rent expense of $0.5 million.

The change in operating assets and liabilities was primarily due to a $7.2 million decrease in accounts payable, a $7.1 million decrease in accrued and other current liabilities, a $0.6 million decrease in deferred revenue, and a $0.4 million increase in other long-term assets, offset by a $3.6 million decrease in prepaid expenses and other current assets.

During the nine months ended September 30, 2022, cash used in operating activities of $158.4 million was attributable to a net loss of $237.8 million, partially offset by non-cash charges of $86.5 million and an increase of $7.1 million in our net operating assets and liabilities.

The non-cash charges consisted primarily of stock-based compensation expense of $66.4 million, depreciation of $11.2 million, our share of equity investments' net losses for the period of $4.0 million, net amortization and accretion on investment securities of $2.7 million, and non-cash rent expense of $2.2 million.

The change in operating assets and liabilities was primarily due to a $8.5 million increase in prepaid expenses and other current assets, a $3.3 million decrease in accrued and other current liabilities, a $2.8 million increase in other long-term assets, and a $1.6 million decrease in other long-term liabilities, offset by a $0.9 million increase in accounts payable and a $0.4 million increase in deferred revenue.

The change in operating assets and liabilities was primarily due to a $3.2 million increase in other long-term assets, a $2.8 million increase in prepaid expenses and other current assets, a $1.4 million decrease in accrued and other current liabilities, and a $2.1 million decrease in other long-term liabilities, offset by a $1.9 million increase in accounts payable and a $0.5 million increase in deferred revenue.

Investing Activities

During the six months ended June 30, 2023, net cash provided by investing activities of $130.1 million was related to cash provided by investment maturities of $296.3 million and cash provided by investment sales of $5.6 million, offset by cash used in purchases of investments of $170.5 million and cash used in the purchase of property and equipment of $1.3 million.

During the six months ended June 30, 2022, net cash provided by investing activities of $31.7 million was related to cash provided by investment maturities of $185.8 million, offset by cash used in purchases of investments of $150.9 million and cash used in the purchase of property and equipment of $3.3 million.

During the nine months ended September 30, 2023, net cash provided by investing activities of $95.8 million was related to cash provided by investment maturities of $461.5 million and cash provided by investment sales of $5.6 million, offset by cash used in purchases of investments of $369.9 million and cash used in the purchase of property and equipment of $1.3 million.

During the nine months ended September 30, 2022, net cash provided by investing activities of $56.6 million was related to cash provided by investment maturities of $260.4 million, offset by cash used in purchases of investments of $200.3 million and cash used in the purchase of property and equipment of $3.5 million.

Financing Activities

During the six months ended June 30, 2023, cash provided by financing activities of $91.3 million was related to $87.9 million in net proceeds from the issuance of common stock through ATM transactions, $1.7 million of cash provided by the sale of common stock through our employee stock purchase plan, and $1.6 million of cash provided by the issuance of common stock upon exercise of stock options.

During the six months ended June 30, 2022, cash provided by financing activities of $1.8 million was related to $1.5 million of cash provided by the sale of common stock through our employee stock purchase plan and $0.3 million of cash provided by the issuance of common stock upon exercise of stock options.

During the nine months ended September 30, 2023, cash provided by financing activities of $95.5 million was related to $91.1 million in net proceeds from the issuance of common stock through ATM transactions, $2.5 million of cash provided by the sale of common stock through our employee stock purchase plan, and $1.9 million of cash provided by the issuance of common stock upon exercise of stock options.

During the nine months ended September 30, 2022, cash provided by financing activities of $2.9 million was related to $2.5 million of cash provided by the sale of common stock through our employee stock purchase plan and $0.4 million of cash provided by the issuance of common stock upon exercise of stock options.

Material Cash Commitments and Requirements

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The payment obligations under the license agreements are contingent upon future events such as our achievement of specified development, regulatory and commercial milestones and we will be required to make development milestone payments and royalty payments in connection with the sale of products developed under these agreements.

As of June 30, 2023, we were unable to estimate the timing or likelihood of achieving the milestones or making future product sales.

As of September 30, 2023, we were unable to estimate the timing or likelihood of achieving the milestones or making future product sales.

For additional information regarding our agreements, see Note 6 to our condensed consolidated financial statements included elsewhere in this report.

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These agreements generally provide for termination or cancellation, other than for costs already incurred.

As of June 30, 2023, we had non-cancellable purchase commitments of $0.4 million.

As of September 30, 2023, we had non-cancellable purchase commitments of $4.0 million.

On October 6, 2020, we announced we entered into a strategic five-year collaboration agreement with MD Anderson for the preclinical and clinical investigation of allogeneic CAR T cell product candidates.

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Payment of this funding is contingent on mutual agreement to study orders in order for any study to be included under the alliance.

We made an upfront payment of $3.0 million to MD Anderson in the year ended December 31, 2020.

We made an upfront payment of $3.0 million to MD Anderson in the year ended December 31, 2020 and made an additional

upfront payment of $3.0 million to MD Anderson in October 2023.

We are obligated to make further payments to MD Anderson each year upon the anniversary of the agreement effective date through the duration of the agreement term.

The agreement may be terminated by either party for material breach by the other party.

Individual studies may be terminated for, among other things, material breach, health and safety concerns or where the institutional review board, the

review board at the clinical site with oversight of the clinical study, requests termination of any study.

Individual studies may be terminated for, among other things, material breach, health and safety concerns or where the institutional review board, the review board at the clinical site with oversight of the clinical study, requests termination of any study.

Where any legal or regulatory authorization is finally withdrawn or terminated, the relevant study will also terminate automatically.

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Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-Q

Item 2. Management’s Discussion and Analysis