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Item 7. Management’s Discussion and Analysis

2025-03-10 compared with 2024-03-11 · 141 added, 162 removed, 251 unchanged (55% of the section changed)

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You should read the following discussion and analysis of our financial condition and results of operations together with our consolidated financial statements and the related notes included in this Annual Report on Form 10-K.

This discussion and analysis contain forward-looking statements, including statements regarding our intentions, plans, objections and expectations for our business.

This discussion and analysis contain forward-looking statements, including statements regarding our intentions, plans, projections and expectations for our business.

Forward-looking statements are based upon current beliefs, plans and expectations related to future events and our future financial performance and are subject to risks, uncertainties and assumptions.

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We are a clinical-stage C lustered R egularly I nterspaced S hort P alindromic R epeats (“CRISPR”) genome-editing biopharmaceutical company dedicated to developing transformative therapies for patients with devastating diseases.

Our genome-editing platform, including our novel chRDNA ( C RISPR h ybrid R NA- DNA , or “chRDNA,” pronounced “chardonnay”) technology, enables more precise genome editing to develop cell therapies that are armored to improve activity against diseases.

We are advancing a pipeline of allogeneic, or off-the-shelf, cell therapies from our chimeric antigen receptor (“CAR”) T (“CAR-T”) cell and CAR-natural killer (“CAR-NK”) cell platforms as readily available therapeutic treatments for patients.

We are initially focused on advancing our allogeneic cell therapies for the treatment of hematologic malignancies.

Our therapies are directed at established cell surface targets for which autologous CAR-T cell therapeutics have already demonstrated clinical proof of concept, including CD19 and B cell maturation antigen (“BCMA”), as well as targets such as C-type lectin-like molecule-1 (“CLL-1,” also known as CD371).

We use our chRDNA technologies to armor our cell therapies through multiple genome-editing strategies, such as checkpoint disruption, immune cloaking, or a combination of these two strategies, to enhance activity against devastating diseases.

Our lead product candidate, CB-010, is an allogeneic CAR-T cell therapy that is, to our knowledge, the first anti-CD19 allogeneic, or off-the-shelf, CAR-T cell therapy to be evaluated in patients with second-line relapsed or refractory large B cell lymphoma (“r/r LBCL”).

To our knowledge, CB-010 is also the first clinical-stage allogeneic anti-CD19 CAR-T cell therapy with programmed cell death protein 1 (“PD-1”) removed from the CAR-T cell surface by a genome-edited knockout of the PDCD1 gene.

CB-010 is being evaluated in our ongoing ANTLER phase 1 clinical trial in adult patients with r/r B-NHL.

In the dose escalation portion of our ANTLER clinical trial, 16 patients, the majority of whom were third-line or later, were enrolled and treated with a single dose of CB-010.

Three dose levels of CB-010 were evaluated:

dose level 1 (40x10 6 viable CAR-T cells, n=8), dose level 2 (80x10 6 viable CAR-T cells, n=5), and dose level 3 (120x10 6 viable CAR-T cells, n=3).

CB-010 was generally well-tolerated with adverse events as expected for anti-CD19 CAR-T cell therapies.

Based on these encouraging dose escalation data, we are evaluating CB-010 in second-line LBCL patients in the dose expansion portion of the ongoing ANTLER trial to determine the recommended phase 2 dose (“RP2D”).

CB-010 has received regenerative medicine advanced therapy (“RMAT”) designation for r/r LBCL, fast track designation for relapsed or refractory B cell non-Hodgkin lymphoma (“r/r B-NHL”), and orphan drug designation for follicular lymphoma (“FL”), from the U.S.

Food and Drug Administration (“FDA”).

Our second product candidate, CB-011, is an allogeneic CAR-T cell therapy that is, to our knowledge, the first anti-BCMA CAR-T cell therapy incorporating an immune cloaking approach that includes both the removal of the endogenous beta-2 microglobulin (“B2M”) protein and insertion of a beta-2-microglobulin–human-leukocyte-antigen-E–peptide transgene (“B2M–HLA-E”).

This strategy is designed to reduce CAR-T cell rejection by both patient T cells and natural killer (“NK”) cells to potentially enable more durable antitumor activity.

CB-011 is being evaluated in our CaMMouflage phase 1 clinical trial in adult patients with relapsed or refractory multiple myeloma (“r/r MM”).

Dose level 1 (50x10 6 viable CAR-T cells, n=3) and dose level 2 (150x10 6 viable CAR-T cells, n=3) have been cleared in our CaMMouflage trial without any observed dose-limiting toxicities (“DLTs”), and we are currently enrolling patients at dose level 3 (450x10 6 viable CAR-T cells).

CB-011 was granted fast track and orphan drug designations for r/r MM from the FDA.

The third product candidate from our CAR-T cell platform is CB-012, an allogeneic CAR-T cell therapy targeting CLL-1 (also known as CD371).

CB-012 is, to our knowledge, the first allogeneic CAR-T cell therapy with both checkpoint disruption and immune cloaking strategies, and its manufacture requires a total of five genome edits.

We believe that CLL-1 is an attractive target for acute myeloid leukemia (“AML”) due to its expression on myeloid cancer cells, its enrichment in leukemic stem cells, and its absence on hematopoietic stem cells (“HSCs”).We have dosed the first patient in

our AMpLify phase 1 clinical trial, which is evaluating CB-012 in adult patients with relapsed or refractory AML (“r/r AML”) at dose level 1 (25x10 6 viable CAR-T cells).

Our genome-editing platform, including our novel chRDNA ( C RISPR h ybrid R NA- DNA , or “chRDNA,” pronounced “chardonnay”) technology, enables more precise genome editing of allogeneic cell therapies.

Our allogeneic chimeric antigen receptor (“CAR”) -T (“CAR-T”) cell therapy product candidates are manufactured in advance with cells from healthy donors, with the goal of enabling broad patient access, rapid patient treatment, and increased manufacturing scale.

Our allogeneic CAR-T cell therapy product candidates in clinical development are directed at established cell surface targets against which autologous CAR-T cell therapeutics have already demonstrated clinical proof of concept, including CD19 and B cell maturation antigen (“BCMA”), as well as targets such as C-type lectin-like molecule-1 (“CLL-1”).

We are advancing our pipeline of allogeneic CAR-T cell therapies with the following four clinical development programs targeting the treatment of hematologic malignancies and autoimmune diseases:

an allogeneic anti-CD19 CAR-T cell therapy, being evaluated in patients with relapsed or refractory B cell non-Hodgkin lymphoma (“r/r B-NHL”) in our ANTLER phase 1 clinical trial

also being evaluated in patients with lupus nephritis (“LN”) and in patients with extrarenal lupus (“ERL”) in our GALLOP phase 1 clinical trial

an allogeneic anti-BCMA CAR-T cell therapy, being evaluated in patients with relapsed or refractory multiple myeloma (“r/r MM”) in our CaMMouflage phase 1 clinical trial

an allogeneic anti-CLL-1 CAR-T cell therapy, being evaluated in patients with relapsed or refractory acute myeloid leukemia (“r/r AML”) in our AMpLify phase 1 clinical trial

Since our founding in 2011, we have devoted substantially all of our resources to organizing and staffing, business planning, raising capital, expanding our genome-editing platform technologies, developing our product candidates and building our pipeline, creating and maintaining our intellectual property portfolio, and establishing arrangements with third parties for the manufacture, testing, and clinical trial evaluations of our product candidates.

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We anticipate that our expenses will increase substantially as we:

• advance the ANTLER phase 1 clinical trial and initiate the planned pivotal phase 3 clinical trial for our CB-010 product candidate, the CaMMouflage phase 1 clinical trial for our CB-011 product candidate, and the AMpLify phase 1 clinical trial for our CB-012 product candidate;

• advance clinical trials for our CAR-T cell therapy product candidates;

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• continue our current research programs and our preclinical and clinical development of our other current product candidates and any other product candidates we identify and choose to develop;

• hire additional clinical, quality control, regulatory, technical operations, and scientific personnel;

• hire additional personnel, as needed;

• seek to identify additional research programs and additional product candidates;

• further develop our genome-editing technologies;

• acquire or in-license technologies;

• acquire or in-license intellectual property or new technologies;

• expand, maintain, enforce, and defend our intellectual property portfolio;

• seek regulatory and marketing approvals for any of our product candidates that successfully complete clinical trials, if any;

• establish and expand manufacturing capabilities and supply chain capacity for our product candidates;

• add operational, legal, financial, and management information systems and personnel;

• expand manufacturing capabilities and supply chain capacity for our product candidates;

• experience any delays, challenges, or other issues associated with any of the above, including the failure of clinical trials meeting endpoints, unanticipated preclinical results, or clinical trial data subject to differing interpretations, or the occurrence of potential safety issues or other development or regulatory challenges;

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• establish a sales, marketing, and distribution infrastructure to commercialize any product candidates for which we obtain marketing approval;

• continue to operate as a public company.

• continue to operate as a public company, including defending against any class action securities litigation.

We do not own or operate any manufacturing facilities.

We use multiple contract manufacturing organizations (“CMOs”) to individually manufacture, under current good manufacturing processes, our chRDNA guides, Cas9 and Cas12a proteins, plasmids, and adeno-associated virus serotype 6 (“AAV6”) vectors used in the manufacture of our cell therapy product candidates as well as the CAR-T and CAR-NK cell therapy product candidates themselves.

We expect to continue to rely on our CMOs for the manufacturing of our preclinical study and clinical trial materials, and most of these

CMOs have capabilities for commercial manufacturing.

We expect to continue to rely on our CMOs for manufacturing our preclinical study and clinical trial materials, and most of these CMOs have capabilities for commercial manufacturing.

Additionally, we may decide to build our own manufacturing facility in the future to provide greater flexibility and control over our clinical or commercial manufacturing needs.

Because of the numerous risks and uncertainties associated with therapeutic product development, we may never achieve profitability and, unless and until we are able to develop and commercialize our product candidates, we will need to continue to raise additional capital.

Until we can generate significant revenue from product sales, if ever, we expect to finance our operations through equity offerings (including our at-the-market facility), debt financings, collaborations and strategic alliances, licensing arrangements, or other sources.

Until we can generate significant revenue from product sales, if ever, we expect to finance our operations through equity offerings (including our at-the-market equity offering program), debt financings, collaborations and strategic alliances, licensing arrangements, and/or other sources.

There are no assurances that we will be successful in obtaining an adequate level of financing to support our business plans as needed on acceptable terms, or at all.

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We have not generated any revenue from product sales to date and do not expect to generate any revenue from the sale of products in the foreseeable future.

If our development efforts for our product candidates are successful and result in regulatory approval and commercialization, we may generate revenue in the future from product sales.

We cannot predict if, when, or to what extent we will generate revenue from the commercialization and sale of our product candidates if we succeed in obtaining regulatory approval for these product candidates.

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Under these agreements, we license rights to certain intellectual property controlled by us.

The terms of these arrangements typically include payments to us of one or more of the following:

The terms of these arrangements typically include payments to us of one or

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more of the following:

nonrefundable, upfront license fees or exclusivity fees;

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See Note 4 to our consolidated financial statements included elsewhere in this Annual Report on Form 10-K for additional information.

For the foreseeable future, we expect substantially all of our revenue will be generated from licensing and collaboration agreements.

For the foreseeable future, we expect substantially all our revenue will be generated from licensing and collaboration agreements.

Operating Expenses

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• costs associated with acquiring technology and intellectual property licenses that have no alternative future uses, sublicensing revenues, and milestones;

• costs incurred in connection with the preclinical and clinical development and manufacturing of our product candidates, including under agreements CMOs, suppliers, clinical research organizations (“CROs”), and clinical sites;

• costs incurred in connection with the preclinical and clinical development and manufacturing of our product candidates, including under agreements with CMOs, suppliers, clinical research organizations (“CROs”), and clinical sites;

• other research and development costs, including laboratory materials and supplies, and consulting services.

Internal costs include:

• personnel-related costs, including salaries, benefits, and share-based compensation expense, for our research and development personnel;

• personnel-related costs, including salaries, benefits, and stock-based compensation expense, for our research and development personnel;

• allocated facilities and other overhead expenses, including expenses for rent, facilities maintenance, and depreciation.

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however, we do not track costs that are deployed across multiple programs.

We do not allocate internal costs as several of our departments support multiple programs and our payroll and other personnel expenses are not tracked on a program-by-program basis.

Research and development activities are central to our business model.

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We expect that our research and development expenses will increase substantially for the foreseeable future as we continue to implement our business strategy;

advance our product candidates through clinical trials and later stages of development;

advance our product candidates through clinical trials and commercialization;

conduct preclinical studies and clinical trials for our other product candidates;

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We are also unable to predict when, if ever, we will generate revenue and material net cash inflows from the commercialization and sale of any of our product candidates for which we may obtain marketing approval.

We may never succeed in achieving regulatory approval for any of our product candidates.

We may never succeed in achieving regulatory

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approval for any of our product candidates.

The duration, costs, and timing of preclinical studies, clinical trials, and development of our product candidates will depend on a variety of factors, including:

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• our ability to not infringe, misappropriate, or otherwise violate third-party intellectual property rights;

• clearance of IND applications to initiate clinical trials on new product candidates;

• successful enrollment in, and completion of, our clinical trials on our product candidates;

• timely clearance of IND applications to initiate clinical trials of new product candidates;

• successful enrollment in, and completion of, our clinical trials of our product candidates;

• data from our clinical trials that support an acceptable risk-benefit profile of our product candidates for the intended patient populations and that demonstrate safety and efficacy;

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• establishment of agreements with CMOs and suppliers for clinical and commercial supplies and scaling up manufacturing processes and capabilities to support our clinical trials;

• receipt of marketing approvals from applicable regulatory authorities;

• receipt of timely responses and marketing approvals from applicable regulatory authorities;

• grant of regulatory exclusivity for our product candidates;

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• expanded indications and patient populations for our products.

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The following table summarizes our research and development expenses for the periods indicated:

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Expenses related to licenses, sublicensing revenue, and milestones

Services provided by CROs, CMOs, and other third parties that conduct preclinical studies and clinical trials on our behalf 45,777 30,367 15,410

$ 4,828 $ 2,777 $ 2,051

Services provided by CROs, CMOs, and third parties that conduct preclinical studies and clinical trials on our behalf

49,261 45,777 3,484

Other research and development expenses 23,560 16,967 6,593

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We accrue for these reimbursements as the respective expenses are incurred and classify such reimbursements as a reduction of general and administrative expenses.

During the years ended December 31, 2023 and 2022, we recorded $1.5 million and $3.5 million, respectively, of patent cost reimbursements as a reduction to general and administrative expense.

During the years ended December 31, 2024, and 2023, we recorded $1.2 million and $1.5 million, respectively, of patent cost reimbursements as a reduction to general and administrative expenses.

We expect that our general and administrative expenses will increase in the future as a result of expanding our operations, including hiring personnel, preparing for potential commercialization of our product candidates, and additional facility occupancy costs, as well as other expenses necessary to support the growth and operations of a clinical-stage public company.

Other Income (Expense)

Other income (expense) consists primarily of interest income earned on cash and marketable securities and the change in fair value of the Memorial Sloan Kettering Cancer Center (“MSKCC”) success payments liability under our Exclusive License Agreement, dated November 13, 2020 with MSKCC (“MSKCC Agreement”).

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Results of Operations

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Other income (expense)

Change in fair value of equity securities (6) (133) 127

Change in fair value of the MSKCC success payments liability 2,154 (1,288) 3,442

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Total other income 17,502 14,182 3,320

Net loss before provision for income taxes (101,877) (99,351) (2,526)

Provision for income taxes 193 70 123

Net loss before (benefit from) provision for income taxes (149,114) (101,877) (47,237)

(Benefit from) provision for income taxes (9) 193 (202)

Net loss $ (149,105) $ (102,070) $ (47,035)

Licensing and Collaboration Revenue

Licensing and collaboration revenue increased by $20.6 million to $34.5 million for the year ended December 31, 2023 from $13.9 million for the year ended December 31, 2022.

This increase primarily relates to a $16.8 million increase in revenue recognized under the now-terminated Collaboration and License Agreement (as amended, “AbbVie Agreement”) with AbbVie Manufacturing Management Unlimited Company (“AbbVie”).

Licensing and collaboration revenue decreased by $24.5 million to $10.0 million for the year ended December 31, 2024, from $34.5 million for the year ended December 31, 2023.

This decrease primarily relates to a $24.8 million decrease in revenue recognized under the now-terminated Collaboration and License Agreement (as amended, “AbbVie Agreement”) with AbbVie Manufacturing Management Unlimited Company (“AbbVie”).

In connection with the termination of the AbbVie Agreement, we recognized the remaining deferred revenue of $20.8 million during the year ended December 31, 2023.

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Research and development expenses increased by $18.1 million to $130.2 million for the year ended December 31, 2024 from $112.1 million for the year ended December 31, 2023.

This increase was primarily related to an increase of $15.4 million of external CMO and CRO activities for our clinical CAR-T cell therapy product candidates, including an increase of $5.1 million due to timing of CMO activities, and $10.3 million in CRO activities for clinical

$11.3 million in personnel-related expenses, including stock-based compensation, due to headcount increases;

and $3.3 million in facilities and other allocated expenses.

These increases were partially offset by a $0.4 million decrease in expenses related to licenses, sublicensing revenue, and milestones.

This increase was primarily related to (i) an increase of $6.6 million in other research and development expenses to advance preclinical and clinical development for our programs, as well as other consulting services related to research and development;

(ii) an increase of $4.1 million in personnel-related expenses, including an increase in salary and benefit expense of $2.5 million, an increase in stock-based compensation expense of $1.1 million, and $0.5 million of one-time expenses associated with the reduction in force that occurred during the third quarter of 2024;

(iii) a net increase of $3.5 million in external CMO and CRO activities for our clinical CAR-T cell therapy product candidates, driven by (a) an increase of $9.8 million in CRO activities for clinical trials;

partially offset by (b) a decrease of $6.3 million due to timing of CMO activities;

(iv) an increase of $2.1 million in

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expenses related to licenses, sublicensing revenue, and milestones;

and (v) an increase of $1.8 million in other facilities and allocated expenses.

General and Administrative Expenses

General and administrative expenses increased by $8.0 million to $46.5 million for the year ended December 31, 2024, from $38.5 million for the year ended December 31, 2023.

This increase was primarily related to increases of $3.1 million in personnel-related expenses, including stock-based compensation, due to headcount increases;

and $0.9 million in facilities and other allocated expenses.

These increases were partially offset by decreases of $2.4 million in legal and director and officer insurance expenses, and other service related expenses;

and a $1.0 million in patent prosecution and maintenance costs.

This increase was primarily related to increases of $5.7 million in legal and other service-related expenses, including $3.9 million of costs related to a securities class action litigation settlement, and $2.3 million in personnel-related expenses, including an increase in salary and benefit expense of $0.4 million, an increase in stock-based compensation expense of $1.8 million, and $0.1 million of one-time expenses associated with the reduction in force that occurred during the third quarter of 2024.

Total Other Income

Total other income increased by $3.3 million for the year ended December 31, 2024, as compared to the year ended December 31, 2023.

We recognized a loss related to the change in the fair value of the MSKCC success payments liability in the amount of $1.3 million for the year ended December 31, 2023.

We recognized a gain related to the change in the fair value of the MSKCC success payments liability in the amount of $2.2 million for the year ended December 31, 2024.

We recognized a $10.7 million increase in other income during the year ended December 31, 2023 compared to December 31, 2022.

The increase primarily relates to an increase of $10.7 million in interest income earned from marketable securities in 2023.

We recognized a loss related to the change in the fair value of the MSKCC success payments liability in the amount of $1.3 million for the year ended December 31, 2023.

An income tax benefit of less than $0.1 million was recognized for the year ended December 31, 2024, which was primarily related to deferred state taxes.

An income tax expense of $0.2 million was recognized for the year ended December 31, 2023, which was primarily related to deferred state taxes.

An income tax expense of $0.1 million was recognized for the year ended December 31, 2022, which was primarily related to current federal taxes of $0.2 million, partially offset by a state deferred tax benefit of $0.1 million.

Liquidity, Capital Resources, and Capital Requirements

Sources of Liquidity

Since our inception, we have not generated any revenue from product sales and have incurred significant operating losses and negative cash flows from our operations.

We have funded our operations through sales of our capital stock, including sales of our convertible preferred stock, which generated approximately $150.1 million in aggregate net proceeds through 2021, from our initial public offering (“IPO”) in 2021, which generated approximately $321.0 million in net proceeds, and from an underwritten follow-on public offering in 2023 which generated approximately $134.4 million in net proceeds.

We have also received approximately $88.4 million in net proceeds from the sale of Intellia common stock through 2020.

Additionally, we received a $25.0 million equity investment from Pfizer, Inc.

(“Pfizer”) through a private placement transaction in June 2023.

Through December 31, 2023, we received approximately $95.1 million from licensing agreements, licensing and collaboration agreements, a service agreement, patent assignments, and government grants, including $36.7 million that was received from AbbVie under the now-terminated AbbVie Agreement.

On August 9, 2022, we filed a universal shelf registration statement on Form S-3 (“Shelf Registration Statement”) with the SEC, which allows us to, from time to time, sell up to $400.0 million of common stock, preferred stock, debt securities, warrants, rights, or units comprised of any combination thereof (including the $100.0 million of common stock reserved for our at-the-market equity offering program described below).

The Shelf Registration Statement was declared effective by the SEC on August 16, 2022.

As of December 31, 2023, we had sold securities in an aggregate amount of $144.9 million under the Shelf Registration Statement.

On August 9, 2022, we entered into an Open Market Sale Agreement SM (the “ATM Sales Agreement”) with Jefferies LLC (“Jefferies”), pursuant to which, upon the terms and subject to the conditions and limitations set forth in the ATM Sales Agreement, we may, from time to time, in our sole discretion, issue and sell, through Jefferies, acting as sales agent, up to $100.0 million of our shares of common stock, by any method permitted by law deemed to be an “at the

market offering” as defined in Rule 415(a)(4) of the Securities Act of 1933, as amended (“Securities Act”).

Since our inception through December 31, 2024, we have raised an aggregate net proceeds of $836.2 million to fund our operations through our initial public offering (“IPO”);

sales of convertible preferred stock;

follow-on public offering;

proceeds from our licensing, licensing and collaboration, service, and patent assignment agreements, including sales of Intellia stock;

private placements;

at-the-market equity offerings;

and government grants.

As of December 31, 2024, we had cash, cash equivalents, and marketable securities of $249.4 million.

On August 9, 2022, we filed a universal shelf registration statement on Form S-3 (“Shelf Registration Statement”) with the U.S.

Securities and Exchange Commission (“SEC”), which allows us to, from time to time, sell up to $400.0 million of common stock, preferred stock, debt securities, warrants, rights, or units comprised of any combination thereof (including the $100.0 million of common stock reserved for our at-the-market equity offering program described below).

The Shelf Registration Statement was declared effective by the SEC on August 16, 2022, and will expire after three years.

At-the-Market Equity Offering Program

Jefferies uses commercially reasonable efforts consistent with its normal sales and trading practices to sell shares from time to time, based upon our instructions (including any price or size limits or other customary parameters or conditions we may impose).

We will pay Jefferies a commission equal to 3.0% of the aggregate gross proceeds of any shares sold through Jefferies pursuant to the ATM Sales Agreement.

For the year ended December 31, 2023, we sold 168,635 shares of our common stock under the ATM Sales Agreement at an average price per share of $7.32 for aggregate gross proceeds of $1.2 million ($1.0 million net of offering expenses).

In February 2024, we sold 1,594,171 shares of our common stock under the ATM Sales Agreement, at an average price per share of $7.33 for aggregate gross proceeds of $11.7 million ($11.3 million, net of offering expenses).

In July and August 2023, we issued and sold a total of 22,115,384 shares of our common stock in an underwritten follow-on public offering at a price to the public of $6.50 per share, which included the full exercise of the underwriters’ right to purchase 2,884,615 additional shares of our common stock.

We pay Jefferies a commission equal to 3.0% of the aggregate gross proceeds of any shares sold through Jefferies pursuant to the ATM Sales Agreement.

Through December 31, 2024, we sold an aggregate of 3,588,696 shares of our common stock under the ATM Sales Agreement at an average price per share of $4.71 for aggregate gross proceeds of $16.9 million ($16.2 million net of offering expenses).

During the year ended December 31, 2024, we sold 3,420,061 shares of our common stock, in a series of sales, at an average price of $4.58 per share under the ATM Sales Agreement for aggregate gross proceeds of $15.7 million ($15.2 million net of offering expenses).

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During the year ended December 31, 2023, we sold 168,635 shares of our common stock, in a series of sales, at an average price of $7.32 per share under the ATM Sales Agreement for aggregate gross proceeds of $1.2 million ($1.0 million net of offering expenses).

Follow-on Public Offering

In July and August 2023, we issued and sold a total of 22,115,384 shares of our common stock in an underwritten follow-on public offering at a price of $6.50 per share, which included the full exercise of the underwriters’ right to purchase 2,884,615 additional shares of our common stock.

The total net proceeds from the offering were approximately $134.4 million, after deducting underwriting discounts and commissions and offering expenses.

The shares were sold under the Shelf Registration Statement.

As of December 31, 2023, we had cash, cash equivalents, and marketable securities of $372.4 million.

Funding Requirements

We expect that our existing cash, cash equivalents, and marketable securities will be sufficient to fund our current operating plan for at least the next 12 months from the date this Annual Report on Form 10-K is filed.

We have based these estimates on our current assumptions, which may require future adjustments based on our ongoing business decisions.

We will continue to be dependent upon equity financing, debt financing, collaboration and licensing arrangements, and/or other forms of capital raises at least until we are able to generate significant positive cash flows from our operations.

We have no current ongoing material financing commitments, such as lines of credit or guarantees, that are expected to affect our liquidity over the next five years, except for our lease commitments, and payments under certain of our license agreements as described in Note 4 and Note 9, respectively, to our consolidated financial statements included elsewhere in this Annual Report on Form 10-K.

Based on our current operating plan, we expect that our existing cash, cash equivalents, and marketable securities will be sufficient to fund our current operating plan for at least the next 12 months from the date of this Annual Report on Form 10-K.

We have based these estimates on our current assumptions, which may require future adjustments based on our ongoing business decisions.

Contractual Obligations and Commitments

We enter into contracts in the normal course of business with suppliers, CMOs, CROs, clinical trial sites, licensors, assignors, and the like.

These agreements provide for termination at the request of either party generally with less than one-year notice and, therefore, we believe that our non-cancelable obligations under these agreements are not material.

Some of these agreements include contingent payments that will become payable if and when we achieve certain development, regulatory, clinical, and/or commercial milestones.

As of December 31, 2023, the satisfaction and timing of such contingent payments is uncertain and is not reasonably estimable.

We have milestones, royalties, and/or other payments due to third parties under our existing license and assignment agreements.

See Note 9 to our consolidated financial statements included elsewhere in this Annual Report on Form 10-K.

We cannot estimate when such payments will be due and none of these events is probable to occur as of December 31, 2023.

MSKCC Agreement Success Payments

Under the MSKCC Agreement, we are obligated to make success payments to MSKCC of up to $35.0 million if our stock price increases by certain multiples of increasing value based on a comparison of the fair market value of our common stock with $5.1914 per share, adjusted for future stock splits, during a specified time period.

The relevant time period commences when the first patient is dosed with our first CLL-1 product candidate (CB-012) in the first phase 1 clinical trial and ends upon the earlier of the third anniversary of approval of our biologics license application (“BLA”) by the FDA or 10 years from the date the first patient was dosed with our first CLL-1 product candidate in the first phase 1 clinical trial.

As of December 31, 2023 the timing and likelihood of triggering the MSKCC success payments are uncertain.

See note 4 to our consolidated financial statements included elsewhere in this Annual Report on Form 10-K for more information about the MSKCC success payments liability.

We have operating lease agreements for our office spaces.

As of December 31, 2023, we had lease payment obligations totaling $41.7 million, of which $3.5 million is due within 12 months.

Strategic Investment

On June 29, 2023, we entered into a Securities Purchase Agreement (“Securities Purchase Agreement”) with Pfizer, Inc.

(“Pfizer”) pursuant to which we, in a private placement transaction, agreed to issue and sell to Pfizer 4,690,431 shares of our common stock, par value $0.0001 per share, at a purchase price of $5.33 per share, for aggregate gross proceeds of approximately $25.0 million (“Pfizer Investment”).

The issuance and sale of the shares to Pfizer closed on June 30, 2023.

We granted certain registration rights to Pfizer under the Securities Purchase Agreement covering the resale of the shares.

Unless otherwise agreed by Pfizer, we have agreed to use the proceeds from the Pfizer Investment solely in connection with (i) the development program for our allogeneic anti-BCMA CAR-T cell therapy known as CB-011 product candidate that is being evaluated in our CaMMouflage clinical trial and/or (ii) any other single-targeted anti-BCMA CAR-T cell therapy using an anti-BCMA single-chain variable fragment owned or controlled by us (collectively, cell therapies described in clauses (i) and (ii) are referred to as a “BCMA Product Candidate”), for 36 months beginning on June 29, 2023.

On June 29, 2023, in connection with the Pfizer Investment, we and Pfizer also entered into an Information Rights Agreement, having a 36-month term.

Under the Information Rights Agreement, we granted Pfizer a 30-calendar day right of first negotiation (“ROFN”) if we commence or engage with any third party with respect to a potential grant of rights to develop and/or commercialize a BCMA Product Candidate, including, without limitation, a license agreement, a co-promotion/co-commercialization agreement, a profit share agreement, a joint venture agreement, or an asset sale agreement (a “Grant of Program Rights”).

If we and Pfizer do not reach an agreement with respect to a Grant of Program Rights within the 30-day period, then we may pursue negotiations and enter into an agreement with any third party.

If we and such third party do not reach agreement on the Grant of Program Rights within a specified time period, Pfizer’s right of first negotiation will be reinstated.

Under the Information Rights Agreement, we also granted Pfizer the right to designate one representative to serve on our scientific advisory board (“SAB”).

Through an information sharing committee, we provide calendar quarter updates to Pfizer regarding the development program for a BCMA Product Candidate.

Additionally, we agreed to provide Pfizer access to any preclinical or interim or final clinical data (including raw data) and results generated as part of the development program for a BCMA Product Candidate at the same time that we provide such data to a third party (other than to our service providers or the FDA or other regulatory authorities), subject to certain confidentiality exceptions.

On June 29, 2023, we and Pfizer also entered into a Voting Agreement, pursuant to which, for a period of 12 months, Pfizer agreed to cause our voting securities that Pfizer beneficially owns (within the meaning of Rules 13d-3 or 13d-5 under the Securities Exchange Act of 1934, as amended (“Exchange Act”)) in excess of 4.99% of our then issued and outstanding voting securities to be voted (i) with respect to any matter directly relating to remuneration of directors, directors’ insurance, or indemnification or release from liability of directors, in a manner proportionally consistent with the votes properly cast for and against by holders of voting securities not beneficially owned by Pfizer, and (ii) with respect to any other matter in which Pfizer shall have the right to vote such voting securities, in accordance with the recommendation of our board of directors or any applicable committee thereof.

Funding Requirements

Our primary use of cash is to fund operating expenses and research and development expenditures.

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Our future funding requirements will depend on many factors, including the following:

• the initiation, progress, timing, costs, and results of preclinical studies and clinical trials for our product candidates;

• the initiation, progress, timing, costs, and results of preclinical studies for our programs and clinical trials for our product candidates;

• the clinical development plans we establish for these product candidates;

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• the outcome, timing, and cost of meeting regulatory requirements established by the FDA and other comparable foreign regulatory authorities;

• the potential impact of proposed reductions in government spending and personnel under the new Administration;

• whether we enter into any collaboration agreements and the terms of any such agreements;

• the cost of filing and prosecuting our patent applications, and maintaining and enforcing our patents and other intellectual property rights;

• the extent to which we acquire or in-license other product candidates and technologies;

• the extent to which we acquire or in-license other product candidates, intellectual property, and new technologies;

• the cost of defending intellectual property disputes, including patent infringement actions brought by third parties against our products after we receive regulatory approval;

• the effect of competing technological and market developments;

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• the cost and timing of completion of commercial-scale outsourced manufacturing activities or the cost and timing of completion of clinical-scale and commercial-scale internal manufacturing activities;

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• the impact of inflationary pressures on the cost of our operations;

• the costs associated with being a public company.

• the costs of operating as a public company, including defending against class action securities litigation.

Furthermore, our operating plans may change, and we expect to need additional funds to meet operational needs and capital requirements for clinical trials and other research and development expenditures.

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If we raise additional capital through debt financing, we may be subject to covenants limiting or restricting our ability to take specific actions, such as incurring additional debt, making capital expenditures, or declaring dividends.

The disruption and volatility in the global and domestic capital markets resulting from heightened inflation, capital market volatility,

interest rate and currency rate fluctuations, artificial intelligence, government agency changes under the new Administration, any potential economic slowdown or recession, including trade wars or civil or political unrest (such as the ongoing war between Ukraine and Russia, conflict in the Middle East, and tension between China and Taiwan) may

increase the cost of capital and limit our ability to access capital.

If we raise additional capital through the sale of equity or convertible debt securities, the issuance of these securities could result in dilution to our stockholders.

If we raise additional capital through marketing and distribution arrangements or other collaborations, strategic alliances, or licensing arrangements with third parties or other sources, we may have to relinquish certain valuable rights to our product candidates, technologies, future revenue streams, or research programs or grant licenses on terms that may not be favorable to us.

Contractual Obligations and Commitments

We enter into contracts in the normal course of business with suppliers, CMOs, CROs, clinical trial sites, licensors, assignors, and the like.

These agreements provide for termination at the request of either party generally with less than one-year’s notice and, therefore, we believe that our non-cancelable obligations under these agreements are not material.

Some of these agreements include contingent payments that will become payable if and when we achieve certain development, regulatory, clinical, and/or commercial milestones.

As of December 31, 2024, the satisfaction and timing of such contingent payments is uncertain and is not reasonably estimable.

We have milestones, royalties, and/or other payments due to third parties under our existing license and assignment agreements.

See Note 9 to our consolidated financial statements included elsewhere in this Annual Report on Form 10-K.

We cannot estimate when such payments will be due and none of these events is probable as of December 31, 2024.

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MSKCC Agreement Success Payments

Under the MSKCC Agreement, we are obligated to make success payments to MSKCC of up to $35.0 million if our stock price increases by certain multiples of increasing value based on a comparison of the fair value of our common stock with $5.1914 per share, adjusted for future stock splits, during a specified time period.

The relevant time period commenced on February 13, 2024, when the first patient was dosed with our anti-CLL-1 product candidate (CB-012) in our AMpLify phase 1 clinical trial and ends upon the earlier of the third anniversary of approval of our biologics license application (“BLA”) by the FDA or 10 years from February 13, 2024.

As of December 31, 2024, the timing and likelihood of triggering the MSKCC success payments are uncertain.

See Note 4 to our consolidated financial statements included elsewhere in this Annual Report on Form 10-K for more information about the MSKCC success payments liability.

We have two operating lease agreements for our laboratory and office space.

As of December 31, 2024, we had lease payment obligations totaling $38.1 million, of which $4.3 million is due within 12 months.

Strategic Investment

On June 29, 2023, we entered into a Securities Purchase Agreement (“Securities Purchase Agreement”) with Pfizer, Inc.

The issuance and sale of the shares to Pfizer closed on June 30, 2023.

We granted certain registration rights to Pfizer under the Securities Purchase Agreement covering the resale of the shares.

Unless otherwise agreed by Pfizer, we have agreed to use the proceeds from the Pfizer Investment solely in connection with (i) the development program for our allogeneic anti-BCMA CAR-T cell therapy product candidate (CB-011) that is being evaluated in our CaMMouflage phase 1 clinical trial and/or (ii) any other single-targeted anti-BCMA CAR-T cell therapy using an anti-BCMA single-chain variable fragment owned or controlled by us (collectively, cell therapies described in clauses (i) and (ii) are referred to as a “BCMA Product Candidate”), for 36 months beginning on June 29, 2023.

On June 29, 2023, in connection with the Pfizer Investment, we and Pfizer also entered into an Information Rights Agreement, having a 36-month term.

If we and Pfizer do not reach an agreement with respect to a Grant of Program Rights within the 30-day period, then we may pursue negotiations and enter into an agreement with any third party.

If we and such third party do not reach agreement on the Grant of Program Rights within a specified time period, Pfizer’s right of first negotiation will be reinstated.

Under the Information Rights Agreement, we also granted Pfizer the right to designate one representative to serve on our scientific advisory board (“SAB”).

Through an information sharing committee, we provide calendar quarter updates to Pfizer regarding the development program for a BCMA Product Candidate.

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Comparison of the Years Ended December 31, 2024, and 2023

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Cash used in operating activities $ (138,200) $ (93,291) $ (44,909)

Cash used in investing activities (68,183) (93,249) 25,066

Cash provided by (used in) investing activities 86,607 (68,183) 154,790

Cash provided by financing activities 16,724 154,298 (137,574)

Net decrease in cash and cash equivalents

Net decrease in cash, and cash equivalents, and restricted cash

$ (34,869) $ (7,176) $ (27,693)

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Cash used in operating activities in the year ended December 31, 2024, was primarily due to our net loss of $149.1 million, adjusted by non-cash charges of $16.0 million and net changes in our net operating assets and liabilities of $5.1 million.

Our 2023 non-cash charges were primarily comprised of $13.8 million of stock-based compensation, $3.5 million of depreciation and amortization expense, $2.0 million of non-cash lease expense, and change in the fair value of the MSKCC success payments liability of $1.3 million, which were partially offset by the accretion of discounts on marketable securities of $4.4 million.

The changes in our net operating assets and liabilities were due to decreases of $16.9 million in deferred revenue and $0.6 million in operating lease liabilities, partially offset by increases of $5.7 million in accrued expenses and other current liabilities, $1.8 million in accounts payable, and decreases of $1.8 million in prepaid expenses and other current assets and $0.8 million in contract assets.

Our 2024 non-cash charges were primarily comprised of (i) $16.7 million of stock-based compensation, (ii) $3.9 million of depreciation and amortization expense, (iii) $2.2 million of non-cash lease expense, and (iv) $1.6 million of acquired in-process research and development;

which were partially offset by (i) accretion of discounts on marketable securities of $4.7 million, (ii) change in the fair value of the MSKCC success payments liability of $2.2 million, and (iii) non-cash consideration for licensing and collaboration revenue of $1.6 million.

The changes in our net operating assets and liabilities were primarily due to (i) increases of $3.9 million in other assets and $0.4 million in prepaid expenses and other current assets, and (ii) decreases of $2.5 million in deferred revenue, current and long-term, $0.6 million in operating lease liabilities, and $0.4 million in accounts payable;

partially offset by (i) decreases of $0.5 million in other receivables and $0.3 million in contract assets, and (ii) an increase of $2.1 million in accrued expenses and other current liabilities.

Cash used in operating activities in the year ended December 31, 2023, was primarily due to our net loss of $102.1 million, adjusted by non-cash charges of $16.1 million and net changes in our net operating assets and liabilities of $7.3 million.

Our 2022 non-cash charges were primarily comprised of $11.7 million of stock-based compensation, $2.0 million of non-cash lease expense, $1.6 million of depreciation and amortization expense, and $0.6 million of acquired in-process research and development, which were partially offset by the change in the fair value of the MSKCC success payments liability of $2.4 million, and accretion of discounts on marketable securities of $0.8 million.

The changes in our net operating assets and liabilities were due to decreases of $4.8 million in deferred revenue, $2.7 million in accounts payable, $0.4 million in operating lease liabilities, and increases of $1.0 million in prepaid expenses and other current assets, $0.8 million in contract assets, and $0.6 million in other assets, partially offset by increases of $2.0 million in accrued expenses and other current liabilities, and decreases of $3.3 million in other receivables, and $1.0 million in accounts receivable.

Cash Used in Investing Activities

During the year ended December 31, 2023 and 2022, cash used in investing activities was $68.2 million and $93.2 million, respectively.

Our 2023 non-cash charges were primarily comprised of (i) $13.8 million of stock-based compensation, (ii) $3.5 million of depreciation and amortization expense, (iii) $2.0 million of non-cash lease expense, and (iv) change in the fair value of the MSKCC success payments liability of $1.3 million, which were partially offset by accretion of discounts on marketable securities of $4.4 million.

The changes in our net operating assets and liabilities were due to decreases of $16.9 million in deferred revenue and $0.6 million in operating lease liabilities, partially offset (i) by increases of $5.7 million in accrued expenses and other current liabilities, $1.8 million in accounts payable, and (ii) decreases of $1.8 million in prepaid expenses and other current assets and $0.8 million in contract assets.

Cash Provided by (Used in) Investing Activities

Net cash provided by investing activities was $86.6 million for the year ended December 31, 2024.

Net cash used in investing activities was $68.2 million for the year ended December 31, 2023.

Cash provided by investing activities for the year ended December 31, 2024, was primarily due to proceeds from the maturities of marketable securities of $397.5 million;

partially offset by purchases of marketable securities of $304.4 million, purchases of property and equipment of $4.9 million, and payments to acquire in-process research and development of $1.6 million.

Cash used in investing activities for the year ended December 31, 2023, was primarily due to purchases of marketable securities of $394.8 million and purchases of property and equipment of $11.6 million, partially offset by the proceeds from sales and maturities of marketable securities of $338.2 million.

Cash used in investing activities for the year ended December 31, 2022 was primarily due to our purchases of marketable securities of $339.1 million, purchases of property and equipment of $6.5 million, and in-process research and development of $0.6 million, partially offset by the proceeds of maturities of marketable securities of $252.9 million.

Cash Provided by Financing Activities

During the years ended December 31, 2023 and 2022, cash provided by financing activities was $154.3 million and $2.1 million, respectively.

Cash provided by financing activities for the year ended December 31, 2023 was due to proceeds from a follow-on public offering, net of offering expenses, of $134.4 million, proceeds from issuance of common stock in a private placement with Pfizer of $17.3 million, the exercise of stock options and purchases of common stock under the 2021 Employee Stock Purchase Plan (“ESPP”) of $1.6 million, and proceeds from issuance of common stock related to an at-the-market offering, net of offering expenses, of $1.0 million.

Cash provided by financing activities for the year ended December 31, 2022 was due to the exercise of stock options and purchases of common stock under the 2021 Employee Stock Purchase Plan of $2.1 million.

Net cash provided by financing activities was $16.7 million and $154.3 million for the years ended December 31, 2024, and 2023, respectively.

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Cash provided by financing activities for the year ended December 31, 2024, was primarily due to net proceeds from our at-the-market equity offering program of $15.2 million, the issuances of common stock under the 2021 Employee Stock Purchase Plan (“ESPP”) of $0.9 million, and the exercises of stock options of $0.6 million.

Cash provided by financing activities for the year ended December 31, 2023, was due to proceeds from a follow-on public offering, net of offering expenses, of $134.4 million, proceeds from issuance of common stock in a private placement with Pfizer of $17.3 million, the exercise of stock options and purchases of common stock under the ESPP of $1.6 million, and proceeds from issuance of common stock related to our at-the-market equity offering program, net of offering expenses, of $1.0 million.

Critical Accounting Policies and Significant Judgments and Estimates

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Revenue for the material right for license renewals is recognized at the point in time the annual license fee is paid by the licensee and the renewal period begins.

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Our collaboration and license agreements may include contingent milestone payments.

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As part of the process of preparing our financial statements, we are required to estimate and accrue expenses.

Research and development expenses are charged to expense as incurred.

Research and development expenses are expensed as incurred.

Research and development expenses include those for certain payroll and personnel;

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Although we do not expect our estimates to be materially different than the actual amounts incurred, the estimates for the status and timing of services performed relative to the actual status and timing of services performed may vary and could result in us reporting amounts that are too high or too low in any one period.

Our accrual is dependent, in part, upon the receipt of timely and accurate reporting from CROs, CMOs, and other third-party vendors.

Our accrual is dependent, in part, upon the receipt of timely and accurate reporting from CROs, CMOs, and other third-party service providers.

Variations in the assumptions used to estimate accruals including, but not limited to, the number of patients enrolled, the rate of patient enrollment and the actual services performed, may vary from our estimates, resulting in adjustments to clinical trial and manufacturing expenses in future periods.

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If the actual timing of the performance of services or the level of effort varies from our estimate, we adjust the accrual or prepaid expense accordingly.

Stock-Based Compensation Expense

Stock-based compensation expense related to awards to employees is measured at the grant date based on the fair value of the award.

We determine the grant-date fair value of the options using the Black-Scholes option-pricing model.

The fair value of restricted stock units (“RSUs”) and performance-based RSUs (“PSUs”) awards is determined based on the number of units granted and the closing price of our common stock as of the grant-date.

The fair value of the award that is ultimately expected to vest is recognized as expense on a straight-line basis over the requisite service period of the awards, which is generally the vesting period, and is adjusted for pre-vesting forfeitures in the period in which the forfeitures occur.

We use the Black-Scholes valuation model as the method for determining the estimated fair market value of stock options and stock purchases under our ESPP with the following assumptions:

Fair Market Value of Common Stock — Prior to our IPO, the fair market value of our common stock was determined by our board of directors with assistance from management and external valuation experts.

Our approach to estimating the fair market value of our common stock was consistent with the methods outlined in the American Institute of Certified Public Accountants’ Practice Aid, Valuation of Privately-Held-Company Equity Securities Issued as

Compensation.

Following our IPO, the fair market value of our common stock is based on its closing price on Nasdaq as reported on the date of the stock option grant.

Expected Term — Expected term represents the period that our stock-based awards are expected to be outstanding and is determined using the simplified method.

The expected term for our ESPP is the offering period.

Expected Volatility — Expected volatility is estimated based on the average historical volatilities of common stock of comparable publicly traded entities over a period equal to the expected term of the stock option grants , as we do not have sufficient trading history for our common stock.

Comparable companies are chosen based on their size, stage in the life cycle, or area of specialty.

We will continue to apply this process for stock options awards and ESPP stock purchases until enough historical information regarding the volatility of our stock price becomes available.

Expected Dividends — Expected dividends is zero as we have never paid dividends on our common stock and have no plans to do so in the foreseeable future.

Risk-Free Interest Rate — Risk-free interest rate is based on the U.S.

Treasury zero-coupon issued in effect at the time of grant for periods corresponding with the expected term of the award.

We recorded stock-based compensation expense of $13.8 million and $11.7 million for the years ended December 31, 2023 and 2022, respectively.

As of December 31, 2023, there was $25.8 million of unrecognized stock-based compensation expense related to employee stock options that is expected to be recognized over a weighted-average period of 2.5 years.

As of December 31, 2023, the total unrecognized stock-based compensation expense related to unvested RSUs was $0.8 million, which is expected to be recognized over the remaining weighted-average vesting period of 1.0 years.

We expect to continue to grant equity-based awards in the future, and to the extent that we do, our stock-based compensation expense recognized in future periods will likely increase.

We account for income taxes using the asset and liability method.

We recognize deferred tax assets and liabilities for the expected future tax consequences of events that have been included in our consolidated financial statements or tax returns.

Deferred tax assets and liabilities are determined based on the difference between the consolidated financial statements and tax basis of assets and liabilities using enacted tax rates in effect for the year in which the differences are expected to reverse.

Valuation allowances are provided if, based upon the weight of available evidence, it is more likely than not that some or all of the deferred tax assets will not be realized.

Tax benefits related to uncertain tax positions are recognized when it is more likely than not that a tax position will be sustained during an audit.

Interest and penalties related to unrecognized tax benefits are included within the provision for income tax.

Recently Issued Accounting Pronouncements

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Under the JOBS Act, emerging growth companies can delay adopting new or revised accounting standards issued subsequent to the enactment of the JOBS Act until such time as those standards apply to private companies.

We have elected to use this extended transition period for complying with new or revised accounting standards that have different effective dates for public and private companies until the earlier of the date that we (a) are no longer an emerging growth company or (b) affirmatively and irrevocably opt out of the extended transition period provided in the JOBS Act.

We have elected to use this extended transition period for complying with new or revised accounting standards that have different effective dates for public and private companies until the earlier of the date that we (i) are no longer an emerging growth company or (ii) affirmatively and irrevocably opt out of the extended transition period provided in the JOBS Act.

As a result, our consolidated financial statements may not be comparable to those of companies that comply with the new or revised accounting pronouncements as of public company effective dates.

We expect to use the extended transition period for any other new or revised accounting standards during the period in which we remain an emerging growth company.

We are also a “smaller reporting company.” If we are a smaller reporting company at the time we cease to be an emerging growth company, we may continue to rely on exemptions from certain disclosure requirements that are available

to smaller reporting companies.

Specifically, as a smaller reporting company, we may choose to present only the two most recent fiscal years of audited consolidated financial statements in our Annual Report on Form 10-K and, similar to emerging growth companies, smaller reporting companies have reduced disclosure obligations regarding executive compensation.

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emerging growth companies, smaller reporting companies have reduced disclosure obligations regarding executive compensation.

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-K

Item 7. Management’s Discussion and Analysis