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Item 1. Business

2022-03-15 compared with 2021-03-18 · 504 added, 636 removed, 642 unchanged (64% of the section changed)

We are a life sciences company dedicated to improving life through the application of our pioneering, proprietary ARCUS genome editing platform.

We leverage ARCUS in the development of our product candidates, which are designed to treat human diseases and create healthy and sustainable food and agricultural solutions.

We are actively developing product candidates in three innovative areas:

allogeneic CAR T cell immunotherapy, in vivo gene correction, and food.

We are currently conducting a Phase 1/2a clinical trial of PBCAR0191 in adult patients with relapsed or refractory, or R/R, non-Hodgkin lymphoma, or NHL, or R/R B-cell precursor acute lymphoblastic leukemia, or B-ALL.

PBCAR0191 is our first gene-edited allogeneic chimeric antigen receptor, or CAR, T cell therapy candidate targeting CD19 and is being developed in collaboration with Les Laboratoires Servier, or Servier, pursuant to a development and commercial license agreement, as amended (the “Servier Agreement”).

We have received orphan drug designation, for PBCAR0191 from the U.S.

Food and Drug Administration (“FDA”), for the treatment of acute lymphoblastic leukemia, or ALL.

In August 2020, the FDA granted Fast Track Designation for PBCAR0191 for the treatment of B-ALL.

The NHL cohort will include patients with mantle cell lymphoma (“MCL”), an aggressive subtype of NHL, for which we have received orphan drug designation from the FDA.

Made from donor-derived T cells modified using our ARCUS genome editing technology, PBCAR0191 recognizes the well characterized tumor cell surface protein CD19, an important and validated target in several B-cell cancers, and is designed to avoid graft-versus-host disease, or GvHD, a significant complication associated with donor-derived, cell-based therapies.

We believe that this trial, which is designed to assess the safety and tolerability of PBCAR0191 at increasing dose levels, as well as to evaluate anti-tumor activity, is the first U.S.-based clinical trial to evaluate an allogeneic CAR T therapy for R/R NHL.

Furthermore, we believe that our proprietary, one-step engineering process for producing allogeneic CAR T cells with a potentially optimized cell phenotype, at large scale in a cost-effective manner, will enable us to overcome the fundamental clinical and manufacturing challenges that have limited the CAR T field to date.

We expect to report updated interim data for the PBCAR0191 study in mid-year 2021.

In April 2020, we commenced patient dosing in a Phase 1/2a clinical trial with our second allogeneic CAR T cell therapy product candidate, PBCAR20A.

PBCAR20A is wholly owned by us and targets the validated tumor cell surface target CD20.

It is being investigated in R/R NHL, including those with R/R chronic lymphocytic leukemia, CLL, or R/R small lymphocytic lymphoma, or SLL.

A subset of the NHL patients will have the diagnosis of MCL and we have received orphan drug designation for PBCAR20A from the FDA for the treatment of this disease.

Based on the safety profile observed to date with PBCAR0191, the FDA allowed us to commence dosing with PBCAR20A directly at 1 x 10 6 cells/kg.

The study has continued to escalate through dose level two (3 x 10 6 cells/kg), and, in February 2021, we commenced patient dosing at dose level 3 (480 x 10 6 cell fixed dose) with a max dose of 6 x 10 6 cells/kg.

We expect to report interim data for the PBCAR20A study in 2021.

In June 2020, we commenced patient dosing in a Phase 1/2a clinical trial with our third allogenic CAR T cell therapy product candidate, PBCAR269A.

The starting dose of PBCAR269A is 6 x 10 5 cells/kg.

PBCAR269A is wholly owned by us and is designed to target the validated tumor cell surface target BCMA.

It is being investigated in subjects with R/R multiple myeloma and we have received orphan drug designation and Fast Track Designation from the FDA for this indication.

In September 2020, we announced that we entered into a clinical trial collaboration with SpringWorks Therapeutics, Inc.

(“SpringWorks”), a clinical-stage biopharmaceutical company focused on developing medicines for patients with severe rare diseases and cancer.

Pursuant to the collaboration, PBCAR269A will be evaluated in combination with nirogacestat, SpringWorks’ investigational gamma secretase inhibitor (“GSI”), in patients with R/R multiple myeloma, which is expected to commence in the first half of 2021.

In February 2021, we commenced patient dosing at the highest dose cohort, dose level 3 o f 6 x 10 6 cells/kg and we expect to report interim data on the PBCAR269A trial in 2021.

Additionally, in June 2020, Elo Life Systems (“Elo”), our wholly-owned subsidiary, established a strategic partnership with the Dole Food Company (“Dole”) and entered into a Research, Development, and Commercialization Agreement with Dole, with the aim to co-develop banana varieties resistant to Fusarium oxysporum f.

sp cubense Tropical race 4 (“Foc TR4”), utilizing proprietary computational biology workflows and the ARCUS genome editing platform.

The disease caused by Foc TR4, commonly known as Fusarium wilt, threatens the continued cultivation of the world’s most popular variety of banana called Cavendish, which is of considerable economic significance as this variety is used to produce export bananas for key markets around the globe and Dole is one of the largest producers in the industry.

Fungicides, or other traditional means of disease control have failed as the pandemic continues to spread across vital banana growing economies.

In September 2020, we regained full clinical development and commercialization rights, and all data we generated for the in vivo chronic hepatitis B virus (“HBV”) program developed under our 2018 collaboration agreement with Gilead Sciences.

We are exploring partnership or alternative opportunities to enable the continued development of ARCUS-based HBV therapies.

In October 2020, we announced the U.S.

Patent and Trademark Office’s Patent Trial and Appeal Board (“PTAB”) issued judgements in our favor in two patent interference proceedings that challenged nine U.S.

patents we owned.

The patents, which issued in 2018, relate to allogeneic CAR T cells produced by inserting a gene encoding a CAR into the T cell receptor (“TCR”) alpha chain (“TRAC”)

locus, as well as methods of using those cells for cancer immunotherapy.

In the interference proceedings, a third party argued that it had invented the technology in 2012.

The PTAB, however, found that the third-party patent application did not satisfy the written description requirement and rejected these claims while maintaining the claims in all nine of our patents.

In November 2020, we announced a research collaboration and exclusive license agreement with Eli Lilly and Company (“Lilly”) to utilize ARCUS for the research and development of potential in vivo therapies for genetic disorders, with an initial focus on Duchenne muscular dystrophy (“DMD”) and two other undisclosed gene targets.

Under the agreement, Lilly has the right to nominate up to three additional gene targets for genetic disorders over the first four years of the Development and License Agreement, which may be extended to six years upon Lilly’s election and payment of an extension fee.

In December 2020, we announced interim clinical results from our Phase 1/2a study of PBCAR0191 as a treatment of R/R NHL and R/R B-ALL.

As of the November 16, 2020 cutoff, 27 patients including 16 patients with aggressive NHL and 11 patients with aggressive B-ALL were enrolled and evaluated.

In this dose escalation and dose expansion study, PBCAR0191 had an acceptable safety profile with no cases of graft versus host disease, no cases of Grade ≥ 3 cytokine release syndrome, and no cases of Grade ≥ 3 neurotoxicity.

PBCAR0191 demonstrated longest durability of response to 11 months in B-ALL.

PBCAR0191 with enhanced lymphodepletion (“eLD”) resulted in objective response rate of 83% (5/6) in NHL and B-ALL as compared to 33% (3/9) in NHL with standard lymphodepletion (“sLD”).

Additionally, in December 2020, researchers at Elo in collaboration with Alan Chambers, Ph.D., and the Tropical Research and Education Center at the University of Florida published a paper in Nature Food , reporting a chromosome-scale, phased Vanilla planifolia genome, which revealed sequence variants for genes that may impact the vanillin pathway, and therefore influence bean quality, including its productivity, flower anatomy, and disease resistance.

In January 2021, we announced that the FDA has accepted our Initial New Drug (“IND”) application for PBCAR19B, our next-generation, stealth cell, CD19 allogenic CAR T candidate for Non-Hodgkin Lymphoma, and we expect to begin the Phase 1 study by mid-2021.

Additionally, in January 2021, we announced that we received a Notice of Allowance from the U.S.

Patent and Trademark Office for a patent application covering PBCAR19B.

The allowed composition claims of this patent application encompass genetically-modified human T cells comprising the PBCAR19B construct, which is inserted within the T cell receptor alpha constant locus.

Once issued, patents arising from this patent family will have standard expiration dates in April 2040.

In preclinical studies, PBCAR19B has shown to delay both T cell and natural killer cell mediated allogeneic rejection in vitro and may improve the persistence of allogeneic CAR T cells.

We expect to advance a program targeting the rare genetic disease primary hyperoxaluria type 1 (“PH1”) as our lead wholly owned in vivo gene correction program.

PH1 affects approximately 1-3 people per million in the United States and is caused by loss of function mutations in the AGXT gene, leading to the accumulation of calcium oxalate crystals in the kidneys.

Patients suffer from painful kidney stones which may ultimately lead to renal failure.

Using ARCUS, we are developing a potential therapeutic approach to PH1 that involves knocking out a gene called HAO1 which acts upstream of AGXT.

Suppressing HAO1 has been shown in preclinical models by us to prevent the formation of calcium oxalate.

We therefore believe that a one-time administration of an ARCUS nuclease targeting HAO1 may be a viable strategy for a durable treatment of PH1 patients.

Pre-clinical research has continued to progress, and we expect to provide an update on this program in the first half of 2021.

In January 2021, we disclosed our intention to spinout our wholly owned subsidiary, Elo.

We are continuing to explore our strategic options, and the timing of any such sale, spinout or other treatment of Elo remains uncertain.

Allogeneic CAR T Immunotherapy

We believe that we have developed a transformative allogeneic CAR T immunotherapy platform with the potential to overcome certain limitations of autologous CAR T cell therapies and significantly increase patient access to these cutting‑edge treatments.

We are a clinical stage gene editing company dedicated to improving life by developing ex vivo allogeneic CAR T immunotherapies and in vivo therapies for genetic and infectious diseases with the application of our wholly owned proprietary ARCUS genome editing platform.

The foundation of ARCUS is a natural homing endonuclease which allows us to replicate precise gene editing as it evolved in nature.

ARCUS is designed to be precise in its specificity and versatile in its design for gene knock out as well as complex edits with gene insertion and gene repair.

ARCUS is also unique in its relatively small size which potentially allows delivery to a wider range of cells and tissues using viral and non-viral gene delivery methods.

We believe our chimeric antigen receptor (“CAR”) T cells are the only allogeneic CAR T cells in human clinical trials made with a single gene editing step designed to specifically avoid the potentially deleterious effects of making multiple edits to T cells (as defined below).

We are simultaneously conducting a Phase 1/2a clinical trial evaluating PBCAR0191 as a potential first-in-class and a Phase 1 clinical trial evaluating PBCAR19B as, if approved, a potential best-in-class CD19-targeting CAR T cell therapies in adult patients with relapsed or refractory (“R/R”), B-cell malignancies.

PBCAR0191 is designed to avoid graft-versus-host disease (“GvHD”), a significant complication associated with donor-derived, cell-based therapies.

We presented updated data from the PBCAR0191 study utilizing an enhanced lymphodepletion regimen in December 2021 at the 63rd American Society of Hematology (“ASH”) Annual Meeting.

PBCAR19B is a novel immune-evading stealth cell candidate employing a single-gene edit in an effort to knock-down beta-2 microglobulin (“β2m”) designed for evading T cell rejection, while also inserting a human leukocyte antigen E (“HLA-E”) transgene to further evade rejection from natural killer cells.

We initiated a clinical trial of PBCAR19B in patients with R/R non-Hodgkin lymphoma (“NHL”) in mid-2021 and completed dosing at Dose Level one.

We plan to commence dosing at the next dose level with clinical trial material from an optimized manufacturing process once released and expect to provide a program update in mid-2022.

In January 2021, we closed a development and license agreement with Eli Lilly and Company (“Lilly”) to discover and develop in vivo gene editing product candidates incorporating our ARCUS nucleases.

Lilly has initially nominated Duchenne muscular dystrophy (“DMD”), a genetic disease affecting the muscles.

Lilly has also nominated a liver-directed target and a central nervous system (“CNS”) directed target and has the right to nominate up to three additional gene targets over the first four years of the agreement.

We will be responsible for conducting certain pre-clinical research and IND-enabling activities with respect to such gene targets.

In April 2021, we entered into a program purchase agreement (the “Program Purchase Agreement”) with Les Laboratoires Servier (“Servier”), pursuant to which we reacquired all of our global development and commercialization rights previously granted to Servier pursuant to a development and commercial license agreement (as amended, the “Servier Agreement”), and mutually terminated the Servier Agreement.

This includes our two clinical stage CD19-targeting allogeneic CAR T candidates, PBCAR0191 and PBCAR19B stealth cell, as well as four additional product targets.

In August 2021, we entered into a development and license agreement with iECURE, a mutation-agnostic in vivo gene editing company striving to cure devastating diseases with high unmet need, under which iECURE plans to advance our PBGENE-PCSK9 candidate through preclinical activities as well as a Phase 1 clinical trial for the treatment of familial hypercholesterolemia (“FH”) as partial consideration for a license to our PCSK9-directed ARCUS nuclease to develop gene-insertion therapies for four other rare genetic diseases, including ornithine transcarbamylase (“OTC”) deficiency, Citrullinemia Type 1, phenylketonuria (“PKU”), and another program focused on liver disease.

We retain rights to PBGENE-PCSK9, including all products developed for genetic indications with increased risk of severe cardiovascular events such as FH.

In September 2021, we entered into an exclusive license agreement (the “Tiziana Agreement”) with Tiziana Life Sciences (“Tiziana”) to evaluate foralumab, a fully human anti-CD3 monoclonal antibody (“mAb”), as a lymphodepleting agent in conjunction with our allogeneic CAR T cells for the potential treatment of cancers.

This agreement reflects our ongoing pursuit of a potential best-in-class allogeneic CAR T cell therapy.

In November 2021, we announced that we will not continue development of PBCAR20A based on data observed to date in a heterogeneous R/R NHL population previously treated with anti-CD20 monoclonal antibodies, as treatment with PBCAR20A did not result in compelling response rates in a Phase 1/2a clinical study .

While this study provided important information regarding allogeneic CAR T dosing and lymphodepletion regimens, we intend to focus our clinical efforts in R/R lymphoma on CD19 targeting programs, as we believe CD19 is a more robust antigenic target in R/R heterogeneous NHL populations.

All subjects enrolled in the study and evaluated for treatment with PBCAR20A had acceptable tolerability with no GvHD, no Grade ≥ 3 cytokine release syndrome, and no Grade ≥ 3 neurotoxicity.

In December 2021, we announced that we entered into an agreement with a syndicate of investors led by ACCELR8 to separate our wholly owned Elo Life Systems subsidiary (the “Elo Transaction”) and create an independent food and agriculture business (“New Elo”).

The transaction enables us to focus exclusively on human therapeutics.

Looking ahead to the remainder of 2022 and beyond, we aim to further evaluate ARCUS clinically with the goal of positively impacting human health.

In mid-2022, we plan to provide updates on PBCAR0191, PBCAR19B, and PBCAR269A, our allogeneic CAR T therapy product candidate designed to target B-cell maturation antigen (“BCMA”) for the treatment of R/R multiple myeloma in combination with nirogacestat, a gamma secretase inhibitor (“GSI”) developed by SpringWorks Therapeutics (“SpringWorks”).

In the in vivo gene editing pipeline, we expect to submit three Investigational New Drug applications (“INDs”) or Clinical Trial Applications (“CTAs”) in the next three years, including trials to evaluate:

PBGENE-PCSK9 for the treatment of FH, PBGENE-PH1 for the treatment of primary hyperoxaluria type 1 (“PH1”) and PBGENE-HBV for the treatment of chronic h epatitis B virus (“HBV”).

Ex vivo Allogeneic CAR T Immunotherapy

Cancer immunotherapy is a type of cancer treatment that uses the body’s immune system to fight the disease.

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As a consequence, the therapy is highly personalized, difficult to scale, and expensive.

Our allogeneic approach uses donor‑derived T cells that are gene edited using ARCUS and are designed for safe delivery to an unrelated patient.

Because of the patient’s illness, their cells may also not be suitable starting material for manufacturing.

Our allogeneic approach uses donor‑derived T cells with a single gene edit using ARCUS and are designed for safe delivery to patients with certain cancers.

We believe that this donor-derived approach will allow us to consistently produce a potent product by selecting donors with high quality T cells and will lessen the product-to-product variability seen in autologous therapies.

We are able to produce allogeneic CAR T cells at a large scale in a cost-effective manner and have the potential to overcome the “one patient:

We are able to produce allogeneic CAR T cells at a larger scale in a cost-effective manner and have the potential to overcome the “one patient:

one product” burden of autologous CAR T cell therapies.

Leveraging the unique gene editing capabilities of ARCUS, we have developed a one-step cell engineering process for allogeneic CAR T cells that is designed to maintain naïve and central memory T cell phenotypes throughout the CAR T manufacturing process, which we believe to be important for an optimized CAR T therapy.

Due to our one-step editing method and the decision early in the development of our allogeneic CAR T immunotherapy platform to invest in process development, we have scaled our manufacturing process and are currently producing allogeneic CAR T cells at large scale in accordance with current good manufacturing practice, or c GMP.

In February 2016, we entered into the Servier Agreement.

Pursuant to this agreement we have agreed to perform early-stage research and development on individual T cell modifications for five unique antigen targets.

Servier selected one target at the Servier Agreement’s inception and, during 2020, selected two additional hematological cancer targets beyond CD19 and two new solid tumor targets.

With the addition of these new targets, we received development milestone payments in 2020 and may be eligible to receive additional development milestone payments in 2021.

Upon selection of an antigen target, we have agreed to develop the resulting therapeutic product candidates through Phase 1 clinical trials and prepare the clinical supply of such product candidates for use in Phase 2 clinical trials.

We have the ability to opt-in to a 50/50 co‑development and co-promotion agreement in the United States on all licensed products under the Servier Agreement.

Our most advanced program, PBCAR0191, is an allogeneic CAR T cell therapy candidate targeting the well-validated tumor target CD19 and is being developed for the treatment of adult patients with NHL and B-ALL.

CD19 is a protein that is expressed on the surface of B cells.

The FDA has granted PBCAR0191 orphan drug designation for the treatment of ALL and, in August 2020 granted PBCAR0191 Fast Track Designation for treatment of B-ALL.

We reported updated interim data from our ongoing Phase 1/2a clinical trial of PBCAR0191 including response rates across R/R NHL and R/R B-ALL patient cohorts as further described in “Our Allogeneic CAR T Immunotherapy Pipeline.”

PBCAR0191, which incorporates our patented N6 co-stimulatory domain, demonstrated a clear dose dependent increase in peak cell expansion.

Compared to sLD, eLD with PBCAR0191 at DL3 resulted in approximately 95-fold increase in peak cell expansion, and approximately 45-fold increase in area under the curve.

This was associated with a higher CR rate in NHL (75%).

One NHL patient who was treated with PBCAR0191 and eLD had previously received nine prior lines of therapy before entering the trial.

The patient presented with persistent cytopenias at baseline and a history of infections, including bacterial sepsis.

The patient had an episode of sepsis at day 27 which appeared to have resolved at day 33, following which a partial response was achieved at day 34.

Unfortunately, the patient died at day 42 with grade 5 sepsis.

We reported the serious adverse event to the FDA and reported the patient death.

We are enrolling additional patients with eLD and plan to present updated interim data on this study by mid-2021.

We believe our CAR T cells are the only allogeneic CAR T cells in human clinical trials made with a single gene editing step to specifically avoid the potentially deleterious effects of making multiple edits to T cells.

With our decision early in the development of our ex vivo platform to invest in process development, we continue to scale and improve our manufacturing process and are currently producing allogeneic CAR T cells at large scale for clinical trials in accordance with current good manufacturing practice (“cGMP”).

We are conducting our Phase 1/2a clinical trial of PBCAR0191 in adult patients with R/R NHL or R/R B-cell precursor acute lymphoblastic leukemia (“B-ALL”).

Currently, we are pursuing a potential first-in-class allogeneic CAR T strategy with PBCAR0191 in patients with lymphoma.

The FDA has granted PBCAR0191 orphan drug designation for the treatment of acute lymphoblastic leukemia (“ALL”) and Fast Track Designation for treatment of B-ALL.

Updated Data from Phase 1/2a Trial of PBCAR0191 in R/R NHL and R/R B-ALL

In December 2021, we reported updated data from the PBCAR0191 clinical trial utilizing an enhanced lymphodepletion (“eLD”) regimen of fludarabine (30 mg/m 2 /day × 4 days) and cyclophosphamide (1000 mg/m 2 /day × 3 days) targeting CD19 for the treatment of R/R NHL or R/R B-ALL, which included 22 (17 NHL, 5 B-ALL) heavily pre-treated R/R subjects with predominantly advanced or aggressive B-cell malignancies who were evaluable as of November 16, 2021.

Evaluable subjects received a median 5 lines of prior treatment, including 27% (6/22) who previously received a CD19-directed autologous CAR T.

For patients that received treatment of PBCAR0191 following eLD as of November 16, 2021:

PBCAR0191 showed no ≥ Grade 3 cytokine release syndrome (“CRS”), one Grade 3 immune effector cell-associated neurotoxicity syndrome (“ICANS”) with resolution to ≤ Grade 2 in 72 hours, no evidence of graft-versus-host disease, and one infectious death at Day 54 deemed possibly related to treatment

PBCAR0191 yielded an overall response rate (“ORR”) of 73% and a complete response rate (“CR”) of 59% using a 3 x 10 6 cells/kg cell dose

Four responders among the 17 evaluable NHL subjects reached Day 180 durability assessment

Most notably, a potential signal for PBCAR0191 was observed among six subjects who relapsed after previously receiving an autologous CAR T:

These subjects experienced an ORR of 100% and a CR of 66% at ≥ Day 28

More than half of these subjects had a longer duration of response on PBCAR0191 than with the prior autologous CAR T treatment

Currently, there are no FDA approved therapeutics for lymphoma patients who have relapsed following autologous CAR T therapy.

PBCAR0191 has the potential to be developed as a salvage treatment for this growing population with high unmet need.

We are actively enrolling additional NHL patients in this relapse setting to further evaluate this observed activity.

In parallel to our development of PBCAR0191, we are also working towards developing a candidate with an allogeneic CAR T profile that has the potential to displace CD19 directed autologous CAR T with unique attributes of ARCUS, which is designed to make complex gene edits in a single step with a single dose, potentially reducing translocation safety concerns.

We have developed a second-generation “stealth cell” CAR T construct, which we believe has the potential to overcome certain limitations of rejection of allogeneic CAR T cells by the patient’s immune system.

Rejection of allogeneic CAR T cells could limit the efficacy of a CAR T therapy if the cells do not persist long enough in the patient to eradicate the tumor.

PBCAR19B is an anti-CD19 CAR T candidate built on the stealth cell platform utilizing a single-step gene edit in an effort to minimize the risk of chromosome abnormalities.

The stealth cell differs from the first-generation CAR Ts in that it has two additional modifications aimed at avoiding rejection.

The stealth cell technology is a modified CAR T vector that is designed to suppress expression of a gene called β2m, in CAR T cells using a short-hairpin RNA, or shRNA, and enable expression of a transgenic HLA-E molecule on the cell surface.

β2m is a component of the major histocompatibility complex type 1 (“MHC-I”), a cell surface receptor which enables alloreactive T cell recognition and activation.

Suppression of β2m expression leads to reduced cell-surface expression of major histocompatibility complex components HLA-A, HLA-B, and HLA-C.

In preclinical studies, we and others have observed that suppression or elimination of β2m reduces the rejection of CAR T cells by alloreactive T cells from an unrelated individual.

However, we have found that reduction of cell-surface HLA-A, HLA-B, and HLA-C expression provokes rejection of the CAR T cells by NK cells.

Decreased expression of HLA-A, HLA-B, and HLA-C therefore necessitates an additional modification to enable overexpression of HLA-E, a non-classical MHC-I that inhibits cytotoxic killing by NK cells by interacting with inhibitory receptors on the NK cell surface (Gornalusse et al, 2017;

Lanza et al, 2019).

Thus, the “stealth cell” is designed to avoid rejection by both alloreactive cytotoxic T cells and NK cells, which we believe has the potential to increase the ability of these cells to expand, persist, and mediate anti-tumor activity in unrelated recipients as summarized in the figure below.

We initiated a clinical trial of PBCAR19B in patients with R/R NHL in mid-2021 Flat doses of PBCAR19B CAR T cells following a standard lymphodepletion (“sLD”) regimen of fludarabine (30 mg/m2/day × 3 days) and cyclophosphamide (1000 mg/m2/day × 3 days) are administered starting at Dose Level 1 (2.7 × 10 8 CAR T cells).

We plan to commence dosing at the next dose level with clinical trial material from an optimized manufacturing process once released and expect to provide a program update in mid-2022.

PBCAR269A is an investigational allogeneic CAR T immunotherapy targeting BCMA for the treatment of R/R multiple myeloma.

BCMA is a protein that is expressed on the surface of mature B cells called “plasma cells” that are responsible for the disease and is a validated CAR T cell target.

Among 14 patients that have been evaluated for clinical activity and safety across four dose levels, including Dose Level 1= 0.6×10 6 cells/kg;

Dose Level 2 = 2×10 6 cells/kg;

Dose Level 3 = 6×10 6 cells/kg;

and Dose Level 4 = 960 x10 6 cells flat dose, of PBCAR269A monotherapy following sLD, we have observed no Grade ≥ 3 CRS or ICANS and a dose-dependent increase in PBCAR269A peak expansion as of December 11, 2021.

Overall, PBCAR269A monotherapy response observed in the Phase 1/2a trial was not comparable with autologous CAR T profiles.

Therefore, we are continuing to enroll subjects with PBCAR269A in combination with nirogacestat in pursuit of a potential therapeutic index comparable with or better than autologous CAR T.

An update on this combination program is expected to be presented in mid-2022.

CD19 Combination with Foralumab.

In September 2021, we announced an exclusive license agreement with Tiziana to evaluate foralumab, an investigational, novel, fully human anti-CD3 monoclonal antibody, as an agent to induce tolerance of allogeneic CAR T cells to potentially improve the clinical outcome of CAR T cell therapy.

The Cluster of Differentiation 3 (“CD3”) is a receptor on effector T cells and an anti-CD3 antibody, such as foralumab, has the potential to eliminate or tolerize patient effector T cells.

Our manufacturing process, which uses ARCUS to knock out the T cell receptor alpha chain (“TRAC”) gene and implements a CD3-depletion step, produces allogeneic CAR T candidates that are >99.9% CD3-negative.

We believe including an anti-CD3 antibody, such as foralumab, in the lymphodepletion regimen may prevent CAR T cell rejection by eliminating the anti-CAR T response and enable the CAR T cells to expand, proliferate, and persist to maximize long term clinical benefits.

Foralumab may be used in combination with any PBCAR therapy.

We will investigate foralumab first in combination with an anti-CD19 CAR T and plan to submit an IND amendment in 2022 to enable combination studies.

In vivo Gene Correction

Our goal is to cure genetic diseases by correcting the DNA errors responsible for causing them.

Our goal with our in vivo gene editing programs is to cure genetic diseases by correcting the DNA errors responsible for causing them.

In vivo gene corrections are gene corrections that take place in a living organism.

Our ARCUS platform is designed to enable safe, specific and efficient gene editing.

Since ARCUS can be delivered via adeno-associated virus (“AAV”) or lipid nanoparticles (“LNP”), it has potential utility in treating diseases in the liver as well as many genetic diseases that affect tissues beyond the liver.

In addition, the unique enzymology of ARCUS enables it to efficiently knock out genes as well as make complex gene insertion and gene repair edits.

We believe these unique attributes of ARCUS support its potential differentiation for in vivo use and its potential to treat a broader range of genetic diseases than other editing technologies.

We have advanced a deep portfolio of diverse programs toward preclinical efficacy and toxicity studies.

We have generated a significant large animal dataset that we believe to be the most comprehensive of any in the field and have observed high-efficiency in vivo genome editing in non-human primates (“NHPs”) in our preclinical studies, as highlighted in our July 2018 publication in Nature Biotechnology .

We have generated a significant large animal dataset and have observed high-efficiency in vivo genome editing in non-human primates (“NHPs”) in our preclinical studies, as highlighted in our July 2018 publication in Nature Biotechnology .

We believe this is the first peer-reviewed publication of in vivo genome editing data in NHPs.

In our preclinical studies, we observed the high-efficiency editing of the PCSK9 gene in NHPs using ARCUS and, even at the highest dose, the treatment was observed to be well-tolerated.

As published in Molecular Therapy in February 2021, the NHPs have been monitored for more than three years and have continued to show a sustained reduction in low density lipoprotein cholesterol levels while maintaining stable gene editing without any obvious adverse effects.

After the one-time vector administration more than three years ago, NHPs treated with ARCUS have experienced stable reductions of up to 85% in PCSK9 protein levels and a 56% reduction of low-density lipoprotein (“LDL”) cholesterol levels.

W e expect to advance a program for the treatment of the rare genetic disease PH1 as our lead wholly owned gene correction program, based on preclinical data we have generated high efficiency knock out of the HAO1 target gene in NHPs using ARCUS, and evidence from a mouse model of clinically meaningful biomarker changes using our approach.

We expect to provide an update on t his program during the first half of 202 1 .

As discussed above, in November 2020, we announced a research collaboration and exclusive license agreement with Lilly, pursuant to which we will be responsible for conducting certain pre-clinical research and IND-enabling activities with respect to the gene targets nominated by Lilly.

Lilly will be responsible for conducting clinical development and commercialization activities for licensed products resulting from the collaboration and may engage with us for additional clinical and/or initial commercial manufacture of licensed products.

We expect to advance a program for the treatment of the rare genetic disease PH1 as our lead wholly owned gene correction program, based on preclinical data we have generated high efficiency knock out of the HAO1 target gene in NHPs using ARCUS, and evidence from a mouse model of clinically meaningful biomarker changes using our approach.

We expect to provide an update on this program during the first half of 2021.

We are also in the discovery stage for other in vivo indications:

lipoprotein lipase deficiency, familial amyloid polyneuropathy, familial hypercholesterolemia, and autosomal dominant retinitis pigmentosa.

Our food platform, which we operate through our wholly owned subsidiary, Elo, is an integrated suite of gene discovery and crop engineering technologies that is designed to generate products in collaboration with leading food producers.

Elo has a team with in-depth experience in crop genome editing.

Over the last decade, Elo has worked with some of the largest plant biotechnology companies to edit gene targets and develop potential product candidates in a variety of crop plants.

By combining the power of the ARCUS technology platform with target discovery, transformation and high throughput trait evaluation, Elo has enabling our partners to potentially address critical issues in food and agriculture created by climate change and dramatic shifts in consumer preference toward healthier eating.

Elo’s collaboration-driven business model enables Elo to remain capital efficient throughout the product development cycle while generating revenue through various revenue-sharing models.

Elo achieved proof of concept with its ZeroMelon TM watermelon-based sweetener program and advanced the program to greenhouse trials.

This program is intended to leverage ARCUS to develop a scalable low-calorie sweetener.

As discussed above, Elo also entered into a Research, Development, and Commercialization Agreement with Dole.

with the aim to co-develop banana varieties resistant to FOC TR4, utilizing proprietary computational biology workflows and the ARCUS genome editing platform.

Elo’s ClimateSmart Chickpea program addresses the effect of climate change as a foundational trait for the plant-based protein industry.

Edited chickpea plants were successfully created at a subsidiary of Elo in Australia in collaboration with the Queensland University of Technology.

Genotypic and phenotypic screens are in progress.

We believe that our team, whom we call Precisioneers, has among the deepest scientific experience and capabilities of all genome editing companies.

Derek Jantz, Ph.D., our Chief Scientific Officer and a co-founder of Precision, and Jeff Smith, Ph.D., our Chief Technology Officer and also a co-founder of Precision, have been working with genome editing technology for more than 15 years.

As published in Molecular Therapy in June 2021, “Long-term Stable Reduction of Low-density Lipoprotein in Nonhuman Primates Following In Vivo Genome Editing,” PBGENE-PCSK9 is supported by extensive NHP data over a three-year period, which demonstrates a long-term, stable edit accompanied by up to an 82% reduction from baseline in PCSK9 levels and up to a 62% reduction in low-density lipoprotein (“LDL”) levels.

We expect that three of our preclinical programs will advance to IND or CTA submission in the next three years:

PBGENE-PCSK9.

As part of an agreement to expedite development, iECURE expects to advance our PBGENE-PCSK9 candidate for FH through preclinical activities as well as a Phase 1 clinical trial with CTA submission expected as early as the end of 2022.

Pre-clinical research continues to progress for our wholly owned in vivo gene correction program applying ARCUS to knock out the HAO1 gene as a potential one-time treatment for PH1.

In September 2021, we presented NHP data, showing on average, a 98.0% reduction in HAO1 mRNA and a 97.9% reduction in the encoded protein after a single administration of an AAV vector encoding ARCUS.

We have initiated IND-enabling activities and expect to submit an IND/CTA in 2023 for PBGENE-PH1 delivered by LNP.

Our gene editing program for chronic HBV applies ARCUS to knock out persistent covalently closed circular DNA (“cccDNA”) and potentially reduce viral persistence.

Previously reported preclinical data has shown that ARCUS efficiently targeted and degraded HBV cccDNA in HBV-infected primary human hepatocytes and reduced expression of HBV S-antigen (“HBsAg”) by as much as 95%.

Similar levels of HBsAg reduction were observed in a newly developed mouse model of HBV infection following administration of ARCUS mRNA using LNP delivery.

We expect to submit an IND/CTA in 2024 for our HBV program.

We believe that our team, whom we call Precisioneers, has among the strongest scientific experience and capabilities of all genome editing companies.

Our Chief Executive Officer, Michael Amoroso, who joined us in October 2021, brings extensive experience leading organizations focused on cell and gene therapies with a particular focus on oncology drugs, including CAR T cell therapies for hematologic malignancies.

They are pioneers in the genome editing field and developed the ARCUS genome editing platform to address what they perceived as limitations in the existing genome editing technologies.

Our Chief Executive Officer, Matthew Kane, also a co-founder of Precision, has almost 20 years’ experience in life sciences, most of which has been working in genome editing.

We have selectively expanded our team of Precisioneers to include individuals with extensive industry experience and expertise in the discovery, development and manufacture of cell and gene therapies and the creation of innovative solutions to myriad problems affecting food systems.

As of December 31, 2020, our team of Precisioneers included more than 57 scientists with Ph.D.

We have recruited our team of Precisioneers to include individuals with extensive industry experience and expertise in the discovery, development and manufacture of cell and gene therapies.

As of December 31, 2021, our team of Precisioneers included 45 full-time employees with Ph.D.

We are a purpose-driven organization, and we have carefully promoted a culture that values innovation, accountability, respect, adaptability and perseverance.

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We intend to continue to invest in comprehensive research, development, manufacturing and commercial capabilities that provide control and oversight of our product candidates from discovery through commercialization.

Capitalize on our emerging leadership position in allogeneic CAR T immunotherapies.

We believe that we have developed the first allogeneic CAR T cell platform capable of producing drug product at scale, with a potentially optimal cell profile for therapeutic efficacy and true off-the-shelf delivery without the need for harsh and potentially toxic lymphodepletion.

We have selected three validated CAR T cell targets that we believe offer the greatest chance of clinical success for our initial product candidates.

Capitalize on our emerging leadership position in ex vivo allogeneic CAR T immunotherapies which are developed from our ARCUS platform.

We believe that we have developed the first ex vivo allogeneic CAR T cell platform capable of producing drug product at scale, with a potentially optimal cell profile for therapeutic efficacy with a single gene editing step and true off-the-shelf delivery.

Our CAR T platform is modular, which we believe will allow us to leverage proof-of-concept from our ongoing and planned initial human trials for multiple other CAR T programs.

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Advance ARCUS-based in vivo gene correction programs into human clinical trials.

In our preclinical studies, we observed the high-efficiency and tolerability of in vivo genome editing using ARCUS in a non-human primate model, as published in Nature Biotechnology in July 2018 and Molecular Therapy in February 2021.

To our knowledge, we are the first company to complete this milestone, which we believe to be critical to successful in vivo genome editing therapeutic development.

We have built on this early success by diligently advancing a diverse portfolio of preclinical in vivo gene correction programs through additional large animal studies, focusing initially on gene targets occurring in the liver and eye.

As discussed above, in November 2020, we also announced a research collaboration and exclusive license agreement with Lilly to utilize ARCUS for the research and development of potential in vivo therapies for genetic disorders, with an initial focus on DMD and two other undisclosed gene targets.

Nearly five years later, NHPs in this 2017 study continue to be monitored for ongoing, sustained reduction in LDL cholesterol levels while maintaining stable gene editing and data from these trials has not shown any obvious adverse effects to date.

To our knowledge, we were the first company to complete this milestone, which we believe to be critical to successful in vivo genome editing therapeutic development.

We have built on this early success by diligently advancing a diverse portfolio of preclinical in vivo gene correction programs through large animal studies, focusing initially on gene targets occurring in the liver.

Continue investing in the optimization of ARCUS and enabling technologies.

We believe that a key to our future success is the quality of the genome editing tools that we produce.

Since our founding, we have devoted ourselves to continuously refining the precision and efficiency of our core genome editing platform.

Since our founding, we have devoted ourselves to continuously

refining the precision and efficiency of our core genome editing platform.

We intend to continue this investment in ARCUS while surrounding it with enabling technologies and expertise to retain what we believe is a leadership position in the field.

Create an environment that is a destination of choice for premier talent within the life sciences industry.

We believe that we currently have among the deepest and strongest skill set within the genome editing industry and credit much of our past success to our commitment to our team and culture.

We believe that we currently have among the strongest skill set within the genome editing industry and credit much of our past success to our commitment to our team and culture.

Our future success will depend on our ability to continue to attract and retain world-class talent within our markets of interest.

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We believe that the ARCUS genome editing platform has broad utility beyond our current areas of focus.

We intend to invest in the development of additional product platforms and seek collaborations with companies with additive expertise in areas outside of our current target markets to maximize the value of our company.

We intend to invest in the development of additional product platforms and seek collaborations with companies with additive expertise in areas within and outside of our current target markets to maximize the value of our company.

Overview of Genome Editing

Deoxyribonucleic acid, or DNA, carries the genetic instructions for all basic functions of a living cell.

DNA carries the genetic instructions for all basic functions of a living cell.

These instructions are encoded in four different molecules, called bases, which are strung together in specific sequences to form genes.

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Once the endonuclease cuts the DNA, the cell has to repair the break to survive and will generally do so in one of two ways, as shown below.

There are two primary mechanisms of DNA repair, non-homologous end joining, or NHEJ, and homology directed repair, or HDR.

As shown in A) above, NHEJ is a pathway that repairs breaks in DNA without a template.

There are two primary mechanisms of DNA repair, non-homologous end joining (“NHEJ”), and homology directed repair (“HDR”).

As shown in the figure above, NHEJ is a pathway that repairs breaks in DNA without a template.

NHEJ is the less precise method of repair that prioritizes speed over accuracy, making it prone to leaving insertions and/or deletions of DNA bases at the cut site.

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Accordingly, genome editing technologies can be used to permanently knock out a gene in a cell or organism by creating a break in the DNA sequence of that gene.

As shown in B) above, HDR is a mechanism of DNA repair whereby the cell uses a second DNA molecule with a sequence similar to that of the cut DNA molecule to guide the repair process.

As shown in the figure above, HDR is a mechanism of DNA repair whereby the cell uses a second DNA molecule with a sequence similar to that of the cut DNA molecule to guide the repair process.

Since HDR uses a “template” of similar genetic information to guide the repair process, it is the more precise mechanism of cellular repair.

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Thus, genome editing endonucleases can be used to introduce a variety of different changes to the genetic code of a cell or organism including gene knockout, gene insertion and gene repair.

There are several genome editing technologies, including ARCUS, zinc-finger nucleases, or ZFNs, TAL-effector nucleases, or TALENs, and CRISPR/Cas9.

There are several genome editing technologies, including ARCUS, zinc-finger nucleases (“ZFNs”), TAL-effector nucleases (“TALENs”), CRISPR/Cas9, and base editors.

These technologies differ from one another principally in the properties of the endonuclease that they each employ.

The different endonucleases have fundamentally different mechanisms of recognizing and cutting their DNA targets, which gives each technology advantages and disadvantages depending on how each is used.

Our Approach to Genome Editing

Our ARCUS Genome Editing Platform

We are pioneers in the field of genome editing and have extensive experience with a breadth of genome editing technologies.

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We believe that I-CreI has a number of attributes that make it attractive for the development of novel genome editing endonucleases, such as:

Complex genome editing applications, especially those involving the human body, require a high level of endonuclease specificity to limit the likelihood that the endonuclease will recognize and edit any genetic sequence other than its intended target.

Based on scientific literature, we believe that several attributes of I-CreI naturally inhibit off-target cutting.

Specificity and efficiency.

Complex genome editing applications, especially those involving the human body, require a high level of endonuclease specificity and precision to limit the likelihood that the endonuclease will recognize and edit any genetic sequence other than its intended target.

Most applications of genome editing technology require that a sufficient portion of the targeted cells are edited to achieve the desired result.

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The slow catalytic mechanism of I-CreI imparts specificity but does not impact its on-target efficiency for genome editing purposes because genome editing involves cutting only a single site in a cell.

As such, I-CreI is able to achieve a high level of on-target editing while rarely cutting off-target, as supported by scientific literature.

Size and structural simplicity affect the ease with which endonucleases can be delivered to cells for editing.

As such, I-CreI is able to achieve a high level of precise on-target editing while rarely cutting off-target, as supported by scientific literature.

Size and structural simplicity affect the ease and versatility with which endonucleases can be delivered to cells for editing.

I-CreI is very small relative to other genome editing endonucleases.

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Both of these properties significantly broaden the spectrum of potential applications for I-CreI-based genome editing endonucleases.

The three prime, or 3’, overhangs created when I-CreI cuts DNA have been shown to promote DNA repair through a mechanism called “homology directed repair,” or HDR.

The three prime , or 3’, overhangs created when I-Cre I cuts DNA have been shown to promote DNA repair through a mechanism called HDR.

3’ overhangs are stretches of unpaired nucleotides in the end of a DNA molecule.

A genome editing technology that facilitates cellular repair through HDR enables applications that require a gene insertion or gene repair.

A genome editing technology that facilitates cellular repair through HDR enables versatile applications that require a gene insertion or gene repair.

Unlike other editing endonucleases, I-CreI creates four base 3’ overhangs when it cuts its DNA site, which increases the likelihood that the cell will repair the DNA cut through HDR.

As such, the DNA cuts created by I-CreI can be exploited to efficiently insert or repair DNA, consistent with the natural role of I-CreI in catalyzing the targeted insertion of a gene in algae.

Programmability.

Intellectual Property.

I-CreI recognizes its DNA target site through a complex network of interactions that is challenging to re-program for new editing applications involving different DNA sequences.

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This engineering challenge represents a high barrier to entry and has enabled us to secure a strong intellectual property position and control over what we believe to be a superior genome editing technology.

Other than the key programming challenge, we believed that the differentiated properties of I-CreI cited above made it an ideal “scaffold” for the development of novel genome editing tools.

Other than the key programming challenge, we believed that the differentiated properties of I-CreI cited above make it an ideal “scaffold” for the development of novel genome editing tools.

Moreover, we believed those properties were differentiated enough from other editing technologies to merit substantial investment in overcoming the key challenge of programmability.

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We call our approach ARCUS.

Our ARCUS Genome Editing Platform

ARCUS is a collection of protein engineering methods that we developed specifically to re-program the DNA recognition properties of I-CreI.

In nature, the I-CreI endonuclease recognizes and cuts a DNA sequence in the genome of algae.

ARCUS is a collection of protein engineering methods that we developed specifically to re-program the DNA recognition properties of I-CreI, a homing endonuclease from Chlamydomonas reinhardtii algae evolved for precision genome editing in nature.

To apply I-CreI to genome editing in other cells or organisms, we must modify it to recognize and cut a different DNA sequence for each new application we pursue.

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Moreover, since the ARCUS process involves a sophisticated blend of protein engineering art and science, each ARCUS nuclease we create is novel and, we believe, patentable.

As of December 31, 2020, we have

obtained U.S.

As of December 31, 2021, we have obtained U.S.

patents with claims directed to six ARCUS nucleases as compositions of matter, and currently claim over 290 ARCUS nucleases as compositions of matter in pending U.S.

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This approach, called a “single-chain endonuclease,” represents a major advancement in I-CreI engineering because it enables our ARCUS nucleases to recognize and cut non -palindromic target sites using an endonuclease that, like natural I-CreI, is very small and easy to deliver to cells.

The graphic below depicts the molecular structure of natural I-CreI in comparison to an engineered ARCUS nuclease called “M1PCSK9.” The regions of the structures colored in pink or cyan represent the amino acid building blocks that are responsible for contacting the DNA target site and determining the sequence of DNA bases that the endonuclease recognizes and cuts.

The DNA target sites recognized by the two endonucleases are shown below the structures.

Since creating an ARCUS nuclease requires such extensive reengineering of I-CreI, it is, generally, an iterative process that involves multiple cycles of design and testing.

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Therapeutic ARCUS nucleases typically require two to four cycles of design and testing, often resulting in off-target cutting frequencies that are below the limit of detection with our most sensitive assays.

This process can take six months or longer and has resulted in development of “therapeutic-grade” editing endonucleases.

This process can take six months to one year and results in development of our clinical candidate nuclease.

The ARCUS process is robust and reproducible.

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We believe ARCUS nucleases are the smallest and easiest to deliver genome editing endonucleases.

Like I-CreI, in our preclinical studies, ARCUS nucleases have been observed to produce DNA cuts with 3’ overhangs that promote HDR, facilitating

gene insertions and gene repairs in addition to gene knockouts.

Like I-CreI, in our preclinical studies, ARCUS nucleases have been observed to produce DNA cuts with 3’ overhangs that promote HDR, facilitating gene insertions and gene repairs in addition to gene knockouts.

We believe that these attributes will enable us to translate ARCUS into patient-based clinical trials and a wide array of product candidates that have the potential to address the limitations of other genome editing technologies and improve life.

We believe that ARCUS is a leading genome editing platform for therapeutic and food applications.

We believe that ARCUS is a leading genome editing platform for therapeutic applications.

Realizing the potential of ARCUS, however, requires supporting technologies and capabilities.

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Our goal is to leverage ARCUS to build additional product-development platforms designed to rapidly generate new products in a given field.

Our Allogeneic CAR T Immunotherapy Platform

We are leveraging the properties of ARCUS in an integrated platform for the development and large-scale production of off-the-shelf (allogeneic) CAR T cell immunotherapies.

Our Ex Vivo Allogeneic CAR T Immunotherapy Platform

We are leveraging the properties of ARCUS in an integrated platform for the development and large-scale production of ex vivo off-the-shelf (allogeneic) CAR T cell immunotherapies.

A key to the success of this platform is our proprietary, one-step method for modifying the genetics of T cells from a healthy donor to make them detect and kill cancer cells.

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We have demonstrated that our approach yields an allogeneic product with a high proportion of naïve and central memory CAR T cells, which are the T cell phenotypes that have previously correlated best with good clinical benefit and fewer adverse events compared with terminally differentiated effector T cells.

Additionally, because these cells are derived from healthy donors and maintain the phenotypic characteristics described, it is our hypothesis that they will be more capable of controlled in vivo expansion and tumor killing without requiring harsh lymphodepletion regimens to be administered to the patient.

Additionally, because these cells are derived from healthy donors and maintain the

phenotypic characteristics described, it is our hypothesis that they will be more capable of controlled in vivo expansion and tumor killing .

As such, we believe that our allogeneic CAR T cell platform will greatly increase patient access to these cutting-edge treatments.

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Tumor cells, however, have evolved numerous ways to evade TCR-mediated killing by T cells.

In CAR T cell therapy, T cells are engineered ex vivo to express a protein called a chimeric antigen receptor, or CAR, that recognizes specific tumor cell surface targets and allows the T cells to function independently of the TCR, thus circumventing tumor cells’ evasion of the TCR.

CAR T cell therapy has been shown in clinical trials to be an effective treatment for patients who have not responded to traditional cancer treatments, and there are now two FDA approved CAR T cell products available to treat certain types of leukemia and lymphoma.

The most common form of CAR T cell therapy, which includes the two approved therapies, is referred to as “autologous” CAR T cell therapy because the CAR T cells are generated using T cells taken directly from the cancer patient.

In CAR T cell therapy, T cells are engineered ex vivo to express a protein called a CAR that recognizes specific tumor cell surface targets and allows the T cells to function independently of the TCR, thus circumventing tumor cells’ evasion of the TCR.

CAR T cell therapy has been shown in clinical trials to be an effective treatment for patients who have not responded to traditional cancer treatments, and there are FDA approved CAR T cell products available to treat certain types of leukemia and lymphoma.

The most common form of CAR T cell therapy is referred to as “autologous” CAR T cell therapy because the CAR T cells are generated using T cells taken directly from the cancer patient.

T cells are harvested from the patient, genetically engineered ex vivo to express a CAR, and then injected back into the patient.

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This high cost of treatment, along with the practical complexities described above, limits the availability of autologous CAR T cell therapies to patients.

Our Approach to Allogeneic CAR T Cells

We believe that the use of allogeneic, or donor-derived, CAR T cells will address many of the challenges associated with autologous CAR T cell therapy.

Our Approach to Ex Vivo Allogeneic CAR T Cells

We believe that the use of ex vivo allogeneic, or donor-derived, CAR T cells will address many of the challenges associated with autologous CAR T cell therapy.

An allogeneic approach allows selection of donors using specific criteria to define “healthy” T cells possessing specific phenotypes, which we believe are important to clinical efficacy and which may lessen the product-to-product variability seen in autologous therapies.

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This approach adds the DNA encoding the CAR while simultaneously disrupting the DNA encoding the TCR, essentially replacing one gene with the other.

One-step engineered allogeneic CAR T cells

We believe that our one-step engineering approach, and the differentiated attributes of the ARCUS nuclease used to implement it, will overcome many of the critical challenges associated with allogeneic CAR T cell production as follows:

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Importantly, our one-step genome editing approach avoids making multiple breaks to the T cell’s DNA and also contributes to minimizing cell processing time, which helps prevent the CAR T cells from differentiating during the process.

We believe our 10-day allogeneic manufacturing process is the shortest established process in the industry.

The figure below shows results from seven full-scale manufacturing campaigns, each of which produced a cGMP batch of PBCAR0191 with desired product specifications.

The figure below shows phenotype data from PBCAR0191 CAR T cells that were produced as drug product for our ongoing Phase 1/2a clinical trial in adult patients with R/R NHL and R/R B-ALL.

The drug product comprises naïve (T N/SCM ) and central memory (T CM ) T cells.

Novel co-stimulatory domain.

Our genetically engineered CAR T cells incorporate a novel, proprietary, costimulatory domain called N6, which enables us to enhance cell proliferation and effector function while preserving cell phenotype.

Our genetically engineered CAR T cells incorporate a novel, proprietary, costimulatory domain called N6, which may enable us to enhance cell proliferation and effector function while preserving cell phenotype.

We engineered N6 to improve on the function of the 4-1bb costimulatory domain commonly used in autologous CAR T products.

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Scaling efficiently requires scale-up at every step in the process and, as with all drug manufacturing, process development takes significant time and capital.

In July 2019, we opened our

Manufacturing Center for Advanced Therapeutics (“ MCAT ”) facility, which we believe is the first in-house cGMP compliant manufacturing facility dedicated to genome-edited, off-the-shelf CAR T cell therapy product candidates in the United States.

In July 2019, we opened our Manufacturing Center for Advanced Therapeutics (“MCAT”) facility.

We made the decision early in the development of our CAR T cell platform to invest in process development and manufacturing rather than initiating clinical trials with a process that would not fully support development and commercialization.

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As a consequence of our early investment and the one-step editing method enabled by ARCUS, we have scaled our manufacturing process today, adding in-house capabilities through the opening of our MCAT facility.

During 2020, we completed technology transfer of PBCAR0191 and PBCAR20A to MCAT, as well as manufactured the first batch and clinical trial material for PBCAR269A and produced clinical trial material for PBCAR19B stealth cell.

Key features of Precision’s allogeneic CAR T platform

Preventing CAR T Cell Rejection

A patient’s immune system is expected to recognize allogeneic CAR T cells as foreign and destroy or reject the cells.

This rejection could limit the efficacy of the CAR T therapy if the cells do not persist long enough in the patient to eradicate the tumor.

Patients who receive CAR T therapy are typically preconditioned prior to being given the cell therapy using lymphodepleting drugs such as cyclophosphamide or fludarabine, which suppress the immune system of the patient.

We believe that the degree of preconditioning can be modified by adjusting the doses of the cyclophosphamide or fludarabine to prevent CAR T cell rejection by patients who receive our treatments due to our unique approach to producing CAR T cells.

Our CAR T production process preserves T cell phenotypes that we believe are highly expansile in vivo and therefore do not require an aggressive lymphodepletion regime to survive and proliferate in the body.

We expect to begin the Phase 1 study of PBCAR19B, our next-generation, stealth cell, CD19 allogenic CAR T candidate for Non-Hodgkin Lymphoma by mid-2021.

The stealth cell technology is a modified CAR T vector that is designed to suppress expression of a gene called beta-2-microglobulin, or B2M, in CAR T cells using a short-hairpin RNA, or shRNA , and enable expression of a transgenic HLA-E molecule on the cell surface.

B2M is a component of the major histocompatibility complex type 1 (“MHC-I”) , a cell surface receptor which enables alloreactive T cell recognition and activation .

Suppression of B2M expression leads to reduced cell-surface expression of major histocompatibility complex components HLA-A, HLA-B, and HLA-C.

In preclinical studies, we and others have observed that suppression or elimination of B2M reduces the rejection of CAR T cells by alloreactive T cells from an unrelated individual.

However, we have found that reduction of cell-surface HLA-A, HLA-B, and HLA-C expression provokes rejection of the CAR T cells by an alternative immune cell called natural killer, or NK cells.

Decreased expression of HLA-A , HLA-B, and HLA-C therefore necessitates an additional modification to enable overexpression of HLA-E, a non - classical MHC -I that inhibits cytotoxic killing by NK cells by interacting with inhibitory receptors on the NK cell surface (Gornalusse et al, 2017;

Lanza et al, 2019) .

Pre-clinical studies showed anti-CD19 stealth CAR T cells resisted rejection by allo-reactive

T cells and NKs in mixed-lymphocyte reactions

Our Allogeneic CAR T Immunotherapy Pipeline

1 In partnership with Servier.

2 In combination with gamma secretase inhibitor from SpringWorks Therapeutics.

We are leveraging our CAR T cell platform to develop product candidates against validated CAR T cell targets.

By focusing on validated targets, we seek to avoid many technical hurdles associated with early clinical development and can validate our allogeneic platform in patients with fewer variables.

This approach also allows us to leverage the abundance of available public resources for these targets, including CARs, cell and animal models, and clinical protocols.

We believe that our modular CAR T platform will allow us to leverage proof-of-concept from our ongoing and planned initial human trials for multiple other CAR T programs.

We believe that the combination of these factors, along with our next generation ARCUS technology, puts us in a differentiated position to become the leader in the development of allogeneic CAR T therapies.

The first four product candidates in our allogeneic CAR T cell development pipeline are:

We are developing PBCAR0191, an allogeneic anti-CD19 CAR T cell product candidate for the treatment of adult R/R NHL and adult R/R B-cell precursor ALL.

CD19 is a protein that is expressed on the surface of B cells and is a well-validated target for CAR T cell therapy.

The three currently marketed autologous CAR T cell therapy products also target CD19.

In February 2016, we entered into the Servier Agreement, pursuant to which we have agreed to develop allogeneic CAR T cell therapies for CD19.

We are currently evaluating patients in a Phase 1/2a clinical trial of PBCAR0191 in adult patients with R/R NHL or R/R B-cell precursor ALL, the trial design of which is shown in the figure below.

The primary objective of this trial is to evaluate the safety and tolerability of PBCAR0191, as well as to determine the maximum tolerated dose.

Secondary objectives include evaluating the anti-tumor activity of PBCAR0191.

We are also evaluating the expansion, trafficking and persistence of PBCAR0191 in this trial.

NHL and ALL cohorts are evaluated independently .

The base trial design include d up to three dose levels:

3.0 x 10 5 cells/kg, 1.0 x 10 6 cells/kg and 3.0 x 10 6 cells/kg.

Recently, we have added higher dose levels in flat doses (DL4b:

500 x 10 6 cells and DL5:

750 x 10 6 cells).

Patients will be further evaluated for a follow-up period of 11 months.

Additionally, alternative lymphodepletion regimens, including enhanced doses of fludarabine and cyclophosphamide, are also being explored.

Finally, repeat dosing after initial response and progression and scheduled repeat dosing, both with repeat lymphodepletion , are also being explored.

The trial is being conducted at the multiple sites around the United States.

A listing of these sites c an be found at https://clinicaltrials.gov/ct2/show/NCT03666000 .

Updated Interim Data from Phase 1/2a Trial of PBCAR0191 in R/R NHL and R/R B-ALL

In December 2020, we reported updated interim data from our ongoing Phase 1/2a clinical trial of PBCAR0191.

As of the November 16, 2020 cutoff, 27 patients including 16 patients with R/R NHL and 11 patients with R/R B-ALL had been enrolled and evaluated.

For this study, in which patients received either sLD or eLD, response rates across R/R NHL and R/R B-ALL patient cohorts were as follows:

83% objective response rate (“ORR”) at day 28 or later for patients across NHL (n=4) and B-ALL (n=2) who received PBCAR0191 when coupled with eLD.

At day 28 or later, 75% (3/4) of NHL patients who received PBCAR0191 with eLD achieved a complete response (“CR”).

Meanwhile, 33% of NHL patients (n=9) across DL2 and DL3 using sLD achieved a CR.

The longest demonstrated response was > 11 months in a B-ALL patient at DL2.

Response Rates at Day ≥28

DL1 (3x10 5 cells) + sLD

DL2 (1x10 6 cells) + sLD

DL3 (3x10 6 cells) + sLD

DL4 (2 doses at 3x10 6 cells) + sLD

Enhanced LD Regimen

PBCAR0191, which incorporates our patented N6 co-stimulatory domain, demonstrated a clear dose dependent increase in peak cell expansion.

Compared to sLD, patients undergoing eLD with PBCAR0191 at DL3 resulted in approximately 95-fold increase in peak cell expansion, and approximately 45-fold increase in area under the curve.

This was associated with a higher CR rate in NHL (75%).

One NHL patient who was treated with PBCAR0191 and eLD had previously received nine prior lines of therapy before entering the trial.

The patient presented with persistent cytopenias at baseline and a history of infections, including bacterial sepsis.

The patient had an episode of sepsis at day 27 which appeared to have resolved at day 33, following which a partial response was achieved at day 34.

Unfortunately, the patient died at day 42 with grade 5 sepsis.

We reported the serious adverse event to the FDA and reported the patient death.

We are enrolling additional patients with eLD and plan to present updated interim data on this study by mid-2021.

Additionally, the FDA has accepted our IND application for PBCAR19B, our next-generation, stealth cell, CD19 allogeneic CAR T candidate for Non-Hodgkin Lymphoma, and we expect to begin the Phase 1 study by mid-2021.

In preclinical studies, PBCAR19B has been shown to delay both T cell and natural killer cell mediated allogeneic rejection in vitro and may improve the persistence of allogeneic CAR T cells in recipients after infusion.

Our second allogeneic CAR T therapy candidate is PBCAR20A, an allogeneic anti-CD20 CAR T cell product candidate for the treatment of NHL, including chronic lymphocytic leukemia, or CLL, and small lymphocytic lymphoma, or SLL.

Like CD19, CD20 is a protein expressed on the surface of B cells.

It is a validated target for cancer treatment and several CD20-targeted therapies, such as the monoclonal antibody Rituxan, have long histories of clinical and commercial success.

In April 2020, we commenced patient dosing in a Phase 1/2a clinical trial of PBCAR20A.

The trial will include patients with NHL, of which a subset will have the diagnosis of mantle cell lymphoma, or MCL.

We have received orphan drug designation for the treatment of MCL.

In our Phase 1/2a clinical trial, the primary objective is to evaluate the safety and tolerability of PBCAR20A, as well as to determine the maximum tolerated dose.

Secondary objectives will include evaluating the anti-tumor activity of PBCAR20A.

We also plan to evaluate the expansion, trafficking and persistence of PBCAR20A in this trial.

Based on the safety profile observed to date with PBCAR0191, the FDA allowed us to commence dosing with PBCAR20A directly at 1 x 10 6 cells/kg.

The study has continued to dose escalate through dose level two (3 x 10 6 cells/kg), and in February 2021, we commenced patient dosing at dose level 3 (480 x 10 6 cell fixed dose) with a max dose of 6 x 10 6 cells/kg.

We expect to report interim data for the PBCAR20A study in 2021.

Our accepted IND for PBCAR20A included data from our preclinical study in mice measuring cell proliferation, cytotoxic killing, and production of effector cytokines in response to co-culture with CD20+ or CD20- target cells.

PBCAR20A CAR T cells were observed to proliferate in response to stimulation by CD20+ K20 cells (K562 myelogenous leukemia cells transfected to express human CD20) at a wide range of doses (effector to target ratios ranging from 1:1 to 1:9).

These observations show that, in this study, PBCAR20A cells became activated by and killed CD20+ cells at a wide range of cell doses.

In this study, we observed that PBCAR20A cells did not proliferate in response to co-culture with CD20 negative cell K562 cells.

We also evaluated the potency of PBCAR20A in vivo .

PBCAR20A was observed to prolong survival in a mouse model of lymphoma (Raji Sub-Q model) at both doses tested (1.0 x 10 6 and 5.0 x 10 6 cells per mouse), which we believe supports further development.

PBCAR20A was observed to be well-tolerated in this study.

We are developing PBCAR269A as an allogeneic anti-BCMA CAR T cell product candidate for the treatment of R/R multiple myeloma.

BCMA is a protein that is expressed on the surface of mature B cells called “plasma cells” that are responsible for the disease and is a validated CAR T cell target.

In January 2020, the FDA cleared our IND for PBCAR269A.

In June 2020, we commenced a Phase 1/2a open-label, multi-center, dose-escalation clinical trial in patients with R/R multiple myeloma.

In this trial, the primary objective will be to evaluate the safety and tolerability of PBCAR269A, as well as to determine the maximum tolerated dose.

Secondary objectives will include evaluating the anti-tumor activity of PBCAR269A.

We also plan to evaluate the expansion, trafficking and persistence of PBCAR269A in this trial.

We expect to investigate up to three dose levels:

6.0 x 10 5 cells/kg, 2.0 x 10 6 cells/kg and 6.0 x 10 6 cells/kg and we expect to report interim data on the PBCAR269A trial in 2021.

We evaluated the potency of PBCAR269A CAR T cells in a preclinical study in mice by measuring cell proliferation, cytotoxic killing and production of effector cytokines in response to co-culture with BCMA+ or BCMA- target cells.

In this study, PBCAR269A CAR T cells were observed to proliferate in response to stimulation by BCMA+ target cells including MM.1S (a human multiple myeloma cell line) and KBCMA (K562 myelogenous leukemia cells transfected to express human BCMA) at a wide range of doses (effector to target ratios ranging from 1:1 to 1:8).

These observations show that, in this study, PBCAR269A cells became activated by and killed BCMA+ cells at a wide range of cell doses.

We further observed that PBCAR269A cells did not proliferate in response to co-culture with BCMA- K562 cells.

We also evaluated the potency of PBCAR269A in vivo .

PBCAR269A was observed to prolong survival in a mouse model of multiple myeloma, which we believe supports further development.

PBCAR269A was observed to be well-tolerated in this study.

In 2020, we manufactured the first batch and clinical trial material for PBCAR269A and produced clinical trial material for PBCAR19B stealth cell.

Manufacturing

We believe that we have strong internal scientific process development and manufacturing capabilities, including our MCAT, an in-house cGMP compliant manufacturing facility supporting our therapeutic product development platforms which we opened in 2019.

We believe that having internal manufacturing capacity and expertise is a competitive advantage that enables enhanced control over process development timelines, costs and intellectual property.

We have leased over 33,800 square feet of space for our MCAT facility at a location approximately seven miles from our headquarters in Durham, North Carolina.

We have four cleanroom production suites for CAR T cell, mRNA and AAV production for process development for our allogeneic CAR T immunotherapy platform.

Our manufacturing facility leverages single-use, disposable, closed-system operations aligned to our technology platforms to ensure both flexibility and cost effectiveness.

The initial scope is creating clinical trial material for certain of our planned clinical trials.

During 2021, MCAT continued to support our ex vivo cell therapy products through execution of our manufacturing strategy, including the manufacture of clinical trial material for use in our PBCAR0191, PBCAR19B, and BCMA studies and ensuring on time delivery of drug product to the clinic.

In addition, we completed the Commissioning, Qualification, and Validation (“CQV”) of the AAV manufacturing suites to support our in vivo gene therapy pipeline of products.

We currently contract with third parties for the manufacturing and testing of materials used in the production of our product candidates.

To date, our third-party manufacturers have met our manufacturing requirements.

Supply chain constraints affecting the industry have also impacted MCAT.

Lead times for certain single-use components have been extended but have not materially constrained our ability to produce clinical trial materials to date.

In addition to existing supply agreements for our most critical reagents and supplies , w e believe that there are alternate sources of supply that can satisfy our requirements and dual sourcing strategies are being employed in select instances to mitigate risk .

However, continued global impacts from the COVID-19 pandemic have led to longer timelines and greater costs .

The manufacturing process for our allogeneic CAR T immunotherapy platform utilizes a one-step cell engineering method in which a CAR gene is targeted directly into the TRAC locus.

We believe this single step approach not only minimizes translocation safety concerns, but also greatly streamlines the manufacturing process and have entered into a license agreement with a principal supplier for research and clinical licensed technology used in such process.

Commercial raw materials and reagents for this production are readily available.

Our manufacturing strategy for our in vivo gene correction platform is to internally control process development and manufacturing to safeguard the proprietary nature of our technology and facilitate our ability to function as an integrated life sciences company.

Our in vivo Gene Correction Platform

1 In partnership with Lilly

We expect in vivo genome editing to be a significant focus of our operations long-term because the differentiated attributes of ARCUS are particularly advantageous for this type of application.

We expect in vivo therapies for genetic and infectious diseases to be a significant focus of our operations long-term because the differentiated attributes of ARCUS are particularly advantageous for this type of application.

In vivo gene correction involves the delivery of ARCUS nucleases directly into a patient’s cells to treat disease at the level of the underlying DNA.

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Due to the demands of in vivo editing, we are taking a highly disciplined approach to managing our project portfolio that emphasizes studies in large animals, using both viral and non-viral delivery technologies.

Thus, we are generating a large animal dataset that, we believe, is the most comprehensive of any in the field.

Our two most advanced programs in this area are focused on PH1 which we wholly own and DMD in partnership with Lilly.

Treatment of Genetic Disease

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Therefore, in most cases, it is only possible to dose a patient one time.

Most importantly, although AAV-based gene therapy can be an effective treatment, it is probably not a permanent cure because AAV-delivered genes do not generally persist for more than a few years in the body.

Most importantly, although AAV-based gene therapy can be an effective treatment, it may not be a permanent cure because AAV-delivered genes do not generally persist for more than a few years in the body.

While the duration of virus persistence varies from cell-to-cell and from patient-to-patient, it is not believed to be permanent and symptoms of the disease can return once the virus is no longer present in the body.

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Delivery challenges are particularly pronounced for editing applications that require promoting DNA repair by HDR because it is necessary to deliver both the nuclease and the DNA “donor” template for HDR.

We have focused our initial development efforts on genetic disorders of the liver and eye, two tissues for which we believe we have good options for delivery and in which we have shown ARCUS to be effective in preclinical studies.

We have focused our initial development efforts on genetic disorders of the liver, tissue for which we believe we have good options for delivery via LNP or AAV and in which we have shown ARCUS to be effective in preclinical studies.

We believe the small size of our ARCUS nucleases and their ability to efficiently promote HDR will enable us to address a greater variety of genetic diseases requiring more complex delivery strategies.

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Importantly, even at the highest dose the treatment was observed to be well tolerated in the study.

As published in Molecular Therapy in February 2021, we have continued to monitor the NHPs for more than three years and have continued to show a sustained reduction in LDL cholesterol levels while maintaining stable gene editing without any obvious adverse effects.

PCSK9 and LDL Serum Levels

We believe that establishing collaborations with other groups that have additive domain expertise and access to the most relevant animal models will be important to advancing our in vivo gene correction platform, and we have entered into a number of collaborations and licensing agreements with third parties to help us advance our in vivo editing portfolio.

Primary Hyperoxaluria Type 1 (PH1) Program

We plan to advance a program designed to target the rare genetic disease PH1 as our lead wholly owned in vivo gene correction program.

Familial Hypercholesteremia (FH) Development Program (PBGENE-PCSK9)

Our gene editing program for FH seeks to knockout expression of the PCSK9 gene.

As published by Wang et al.

in Molecular Therapy in June 2021, “Long-term Stable Reduction of Low-density Lipoprotein in Nonhuman Primates Following In Vivo Genome Editing,” NHPs in this 2017 study continue to be monitored for ongoing, sustained reduction in LDL cholesterol levels while maintaining stable gene editing without any obvious adverse effects.

After the one-time vector administration, NHPs treated with ARCUS have experienced stable reductions of up to 82% in PCSK9 protein levels and a 62% reduction of LDL cholesterol levels.

PCSK9 and LDL Serum Levels

AAV was selected as the delivery technology for PBGENE-PCSK9.

The underlying genetic causes of FH result in reduced lipid uptake by the liver, which may impair LNP uptake by hepatocytes.

Primary Hyperoxaluria Type 1 (PH1) Development Program (PBGENE-PH1)

PH1 is a potentially fatal genetic disease caused by a gene mutation that leads to the accumulation of calcium oxalate crystals in the kidneys.

PH1 affects approximately 1-3 people per million in the United States and is caused by loss of function mutations in the AGXT gene.

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We therefore believe that a one-time administration of an ARCUS nuclease targeting HAO1 may be a viable strategy for a durable treatment of PH1 patients.

In preclinical studies we have demonstrated that ARCUS efficiently knocked out the HAO1 gene in NHPs.

We have also demonstrated in a mouse model of PH1 that administration of an ARCUS nuclease targeting HAO1 resulted in approximately 70% reduction in urine calcium oxalate levels.

We have also demonstrated that ARCUS efficiently reduced HAO1 mRNA levels by greater than 90% in the liver of NHPs.

Pre-clinical research has continued to progress, and we expect to provide an update on this program in the first half of 2021.

Manufacturing

We believe that MCAT is the first in-house cGMP compliant manufacturing facility in the United States dedicated to genome-edited, off-the-shelf CAR T cell therapy products.

We believe that having internal manufacturing capacity and expertise is a competitive advantage that enables enhanced control over process development timelines, costs and intellectual property.

We have leased over 33,800 square feet of space for our MCAT facility at a location approximately seven miles from our headquarters in Durham, North Carolina.

We have four cleanroom production suites for CAR T cell, mRNA and AAV production for process development for our allogeneic CAR T immunotherapy platform.

Our manufacturing facility leverages single-use, disposable, closed-system operations aligned to our technology platforms to ensure both flexibility and cost effectiveness.

The initial scope is creating clinical trial material for certain of our planned clinical trials.

In the longer term, we believe MCAT has the potential to be a commercial launch facility.

During 2020, we completed tech transfer of PBCAR0191 and PBCAR20A to MCAT, as well as manufactured the first batch and clinical trial material for PBCAR269A and produced clinical trial material for PBCAR19B stealth cell.

We currently contract with third parties for the manufacturing of materials used in the production of our product candidates.

To date, our third-party manufacturers have met our manufacturing requirements.

We believe that there are alternate sources of supply that can satisfy our requirements.

The manufacturing process for our allogeneic CAR T immunotherapy platform utilizes a one-step cell engineering method in which a CAR gene is targeted directly into the TRAC locus.

We believe this approach greatly streamlines the manufacturing process and have entered into a license agreement with a principal supplier for research and clinical licensed technology used in such process.

Commercial raw materials and reagents for this production are readily available.

Our manufacturing strategy for our in vivo gene correction platform and our food platform is to internally control process development and manufacturing to safeguard the proprietary nature of our technology and facilitate our ability to function as an integrated life sciences company.

Our Food Platform

Technology-Centric Solutions to Meet Changing Demands in Food and Agriculture

The total global food and agriculture market, estimated to be worth $5 trillion (2015), is heavily influenced by the availability of critical raw material ingredients and changing consumer behavior.

With the global population projected to reach 8.5 billion by 2030, demand for basic food and nutrition needs has already put a lot of pressure on traditional food production systems.

Many staple foods and critical ingredients, such as citrus, bananas and coffee, are under threat from environmental changes and the new pathogens it can bring.

The food and agriculture industry has also seen significant shifts in consumer preferences in which consumers are actively transitioning to high quality and healthier foods and beverages, while rejecting artificial ingredients, sugar and salt, creating a demand for natural and holistic ingredients built on a sustainable supply chain.

Traditional approaches to agricultural innovation are slow, siloed, rely heavily on non-scalable academic advancements and continue to use inefficient crop improvement practices.

We believe that many of the current pressures on the food and agriculture industry from climate-related threats and changing consumer preferences can be effectively addressed using biotechnology.

Elo Life Systems:

Innovation-Focused Technology Platform and Business Model

Elo Life Systems is our wholly owned subsidiary, dedicated to addressing the needs of consumers and consumer-facing industries in the food and agriculture sector.

Our business model is heavily partner-focused.

In the food and agriculture industry, timelines to market are long and the field is dominated by a relatively small number of entrenched companies.

Therefore, it is a very difficult to bring a product to market without a larger partner.

Thus, we seek partnerships early in the product development process to optimize our chances of market success.

Under this partnership model, we are responsible for the early phases of the project, starting from concept through production of a “lead,” which is typically a gene edited plant that has the desired trait in greenhouse testing and is ready for scale-up and testing in the field.

At that point, our partners typically assume responsibility for subsequent development and commercialization.

In general, our partners are responsible for financing all or a portion of our development costs, which greatly reduces our capital requirements.

We are then generally eligible to share in revenues derived from successfully commercialized products developed under these partnerships.

Elo’s Technology Platform

At the core of our food platform is our ARCUS editing technology.

We are one of the first to apply genome editing technology to crop plants and we believe we have the most in-depth experience in crop genome editing in the industry.

Over the last decade, we have developed highly efficient methods to improve delivery and functionality of ARCUS nucleases in plants to edit DNA.

These nucleases have been successfully validated in collaborative projects with major food and agriculture companies like Dole, Cargill, BASF, Bayer CropScience and DuPont Pioneer Hi-bred.

Importantly, ARCUS can be used to create small deletions or insertions in plants using a non-plant pest- or pathogen-based delivery approach.

As such, we believe that many of the food and agriculture product candidates we may develop have the potential to obtain nonregulated status in the United States and other territories and thereby avoid GMO labels.

This aspect of the technology platform is critical to food producers, particularly as they respond to consumer demands for healthier products.

In addition to ARCUS, Elo’s in-house capabilities include:

Many of the most attractive opportunities for Elo involve emerging and under-studied crops, such as stevia and monk fruit.

We have integrated genome sequencing and bioinformatic platforms in-house in order to identify the genome sequence of plants, enabling us to identify targets for editing with ARCUS nucleases.

Target discovery and validation.

Our informatics platform is built on principles of machine learning that allow us to synthesize, sequence and phenotype information from both public and internal datasets to correlate genome sequence with plant characteristics.

This allows us to identify genetic targets for ARCUS editing that are predicted to yield a desired phenotype.

These targets can then be validated in specific crops and at least partially validated in model systems such as tobacco and Arabidopsis using different molecular approaches such as editing or RNAi.

Multi-crop transformation.

Most of the crops of interest to Elo and our partners do not have established transformation protocols and are not readily amenable to gene editing.

To this end, we have developed a sophisticated collection of plant transformation vectors and protocols over the last decade that allow us to rapidly develop gene-edited variants of otherwise intractable species.

This technology allows us to overcome what is otherwise a significant barrier to entry into a new crop species.

Plant growth infrastructure.

Elo has a dedicated facility and capabilities of cultivating gene edited plants from incubator to greenhouse.

Fusarium wilt resistant banana varieties (in collaboration with Dole Food Company)

Fusarium wilt, caused by the Tropical Race 4 (TR4) strain of a plant pathogenic fungus called Fusarium, is a fast-spreading pandemic threatening the continued cultivation of the world’s most popular fruit in a $25 billion banana industry.

The disease was detected in Colombia in August 2019 and is expected to spread throughout Latin America.

Through our collaboration agreement with Dole, Elo intends to use its proprietary suite of tools, including cutting-edge knowledge mining platform, gene discovery pipeline, trait validation workflows, and end-to-end expertise in translational agriculture, in

combination with its proprietary homing endonuclease-based genome editing platform to develop potential TR4-resistant banana varieties in this important clonally propagated crop.

Plant-Based Proteins

In 2018, we launched Elo Life Systems Australia, a subsidiary of Elo that will support research programs in Australia.

Elo Life Systems Australia’s primary focus is developing climate-resilient legumes with improved protein and nutritional profiles, starting with chickpea.

Multiple edited events in chickpeas have been generated and are being screened in the laboratory.

Through this program, we aim for the resulting products to make a significant contribution towards the increasing demand for sustainable plant-based proteins as a healthful alternative to animal protein.

LNP was selected as the delivery technology for PBGENE-PH1 and we expect to file an IND in 2023.

In preclinical studies we have demonstrated that ARCUS treatment decreased HAO1 mRNA levels by 98% and decreased Glycolate Oxidase (“GO”) protein levels by 97.9% in NHPs .

Chronic Hepatitis B (PBGENE-HBV)

Current standard-of-care treatments for HBV suppress viral replication, but often do not clear the virus, leaving cccDNA and integrated HBV genomes that enable viral persistence.

ARCUS-mediated inactivation of cccDNA and integrated HBV through LNP delivery could result in a functional cure.

To address the challenge of a lack of an in vivo model of human HBV infection, we developed a novel in vivo model for HBV editing based on the similarities of HBV to AAV, in particular, both infect hepatocytes and both establish latency as extrachromosomal circular DNA elements.

HBV genome sequences are delivered on an AAV vector and are then deleted by ARCUS delivered by LNP.

LNP-ARCUS efficiently edited HBV sequences in an immunodeficient mouse model and a NHP model.

Duchenne Muscular Dystrophy (PBGENE-DMD)

ARCUS genome editing has previously been shown to increase expression of a shortened version of dystrophin in cultured myoblasts from a DMD patient.

The approach uses two ARCUS nucleases delivered by a single AAV to simultaneously cut and delete a large segment of the dystrophin gene that encodes exons 45 through 55 of dystrophin – a region of the gene that accounts for more than 50% of DMD-causing mutations.

License and Collaboration Agreements

Eli Lilly and Company

In November 2020, we entered into a research collaboration and exclusive license agreement (the “Development and License Agreement”) with Lilly to utilize ARCUS for the research and development of potential in vivo therapies for genetic disorders.

Lilly has initially nominated DMD and two gene targets for other genetic disorders, and has the right to nominate up to three additional gene targets for genetic disorders over the first four years of the Development and License Agreement (the “Nomination Period”).

On November 19, 2020, we entered into a development and license agreement, subsequently amended by the First Amendment to the Development and License Agreement dated August 9, 2021 (as amended, the “Development and License Agreement”) with Lilly to collaborate to discover and develop in vivo gene editing products incorporating our ARCUS nucleases.

Lilly has initially nominated Duchenne muscular dystrophy, a liver-directed target and a CNS directed target.

Under the terms of the Development and License Agreement, Lilly has the right to nominate up to three additional gene targets over the first four years of the Development and License Agreement (the “Nomination Period”).

Lilly may extend the Nomination Period for an additional two years from the date on which such initial Nomination Period ends, upon Lilly’s election and payment of an extension fee.

Additionally, under the terms of the Development and License Agreement, Lilly has the option to replace up to two gene targets upon Lilly’s election and payment of a replacement target fee.

Under the terms of the Development and License Agreement, Lilly will receive an exclusive license to research, develop, manufacture and commercialize the resulting licensed products to diagnose, prevent and treat any and all diseases by in vivo gene editing directed against the applicable gene target.

The Development and License Agreement provides that we will be responsible for conducting certain pre-clinical research and IND-enabling activities with respect to the gene targets nominated by Lilly to be subject to the collaboration, including manufacture of initial clinical trial material for the first licensed product.

The Development and License Agreement provides that we will be responsible for conducting certain pre-clinical research and IND/CTA enabling activities with respect to the gene targets nominated by Lilly to be subject to the collaboration, including manufacture of initial clinical trial material for the first licensed product.

Lilly will be responsible for, and must use commercially reasonable efforts with respect to, conducting clinical development and commercialization activities for licensed products resulting from the collaboration, and may engage us for additional clinical and/or initial commercial manufacture of licensed products.

In January 2021, we and Lilly closed the Development and License Agreement following clearance under the Hart-Scott Rodino Antitrust Improvements Act of 1976, as amended (the “HSR Act”) .

In connection with the closing, we received an upfront cash payment of $100.0 million as well as $35.0 million from Lilly’s purchase of 3,762,190 newly issued shares of our common stock pursuant to a stock purchase agreement as described below (the “Stock Purchase Agreement”).

These cash receipts are not included in the cash and cash equivalents portion of the audited consolidated balance sheet included elsewhere in this Annual Report on Form 10-K.

Upon closing of the Development and License Agreement on January 6, 2021, we received an upfront cash payment of $100.0 million.

We will also be eligible to receive milestone payments of up to an aggregate of $420.0 million per licensed product as well as nomination fees for additional targets and certain research funding.

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Lilly’s obligation to pay royalties to us expires on a country-by-country and licensed product-by-licensed product basis, upon the latest to occur of certain events related to expiration of patents, regulatory exclusivity or a period of ten years following first commercial sale of the licensed product.

We have the right to elect to co-fund the clinical development of one licensed product, which may be selected from among the third or any subsequent licensed products to reach IND filing.

If we elect to co-fund such licensed product, we would reimburse Lilly for a portion of the clinical development expenses for such product and, in exchange, each royalty tier with respect to net sales of such licensed product would be increased by a low single digit percentage.

During the term of the Development and License Agreement, we may not (and may not license or collaborate with any third party to) research, develop, or commercialize any in vivo gene editing product directed against any gene targets that have been nominated and are subject to the Development and License Agreement.

Unless earlier terminated, the Development and License Agreement will remain in effect on a licensed product-by-licensed product and country-by-country basis until the expiration of a defined royalty term for each licensed product and country.

Lilly has the right to terminate the Development and License Agreement for convenience by providing advance notice to us.

Either party may terminate the Development and License Agreement (i) for material breach by the other party and a failure to cure such breach within the time period specified in the agreement or (ii) due to a challenge to its patents brought by the other party.

In February 2016, as further described above, we entered into the Servier Agreement.

Pursuant to this Servier Agreement, we have agreed to develop allogeneic chimeric antigen receptor T cell therapies for five unique antigen targets.

Servier selected one target at the Servier Agreement’s inception and, during 2020, selected two additional hematological cancer targets beyond CD19 and two new solid tumor targets.

With the addition of these new targets, we received development milestone payments in 2020 and may be eligible

to receive additional development milestone payments in 2021.

Upon selection of an antigen target, we perform early-stage research and development on individual T cell modifications for the selected target, develop the resulting therapeutic product candidates through Phase 1 clinical trials and manufacture clinical trial material for use in Phase 2 clinical trials.

We received an upfront payment of $105.0 million under the Servier Agreement in 2016.

At Phase 2 readiness for any product candidate covered by the Servier Agreement, Servier may exercise a commercial option to proceed with development and commercialization of the product candidate.

Following the exercise of any such commercial option, Servier must use commercially reasonable efforts to develop and commercialize the product candidate.

We have the ability to receive total payments, including the upfront payment, option fees and milestone payments, in the aggregate across all five targets of up to approximately $1.4 billion.

This includes up to $1.3 billion in milestone payments, consisting of up to $329.3 million in development milestone payments and up to $925.0 million in commercial milestone payments.

We are also entitled to receive tiered royalties ranging from the mid-single digit percentages to sub-teen percentages on worldwide net sales of any products developed under the Servier Agreement, subject to customary potential reductions.

Servier’s obligation to pay royalties to us expires on a country-by-country and licensed product-by-licensed product basis upon the latest of (1) the expiration of the last to expire valid claim of all Precision patents covering a licensed product, (2) expiration of all regulatory exclusivity with respect to a licensed product in the applicable country of sale, and (3) the expiration of 10 years following the first commercial sale of such licensed product in such country.

We also have the right to participate in the development and commercialization of any licensed products resulting from the collaboration through a 50/50 co-development and co-promotion option in the United States, subject to our payment of an option fee, which is exercisable after Servier’s commercial option exercise.

So long as Servier holds a commercial license with respect to any particular licensed product, we may not develop, manufacture or commercialize any engineered human CAR T cells for use in humans directed to the same antigen target as the target of that licensed product.

Unless terminated earlier, the Servier Agreement expires upon the first to occur of (1) the expiration of the period in which Servier may nominate antigen targets, if there are no included targets under the agreement, (2) the expiration of the period in which Servier may exercise a commercial option on a licensed product candidate, if no commercial options have been exercised by Servier, or (3) the expiration of the last to expire royalty term for the licensed products and satisfaction of all of Servier’s payment obligations under the agreement.

Servier has the right to terminate the agreement for convenience, either in its entirety or on a target-by-target or product-by-product basis, by providing advance notice to us.

We may terminate immediately upon notice to Servier if Servier (itself or through the use of certain affiliates or a third party) or any sublicensee initiates or participates in a patent challenge against our patents licensed by Servier under the agreement.

In addition, the Servier Agreement may be terminated (a) by either party for the other party’s material breach that remains uncured as specified in the agreement, (b) by either party upon the occurrence of certain insolvency-related events of the other party and (c) upon mutual agreement of the parties in the event either party suffers an event of force majeure as specified in the agreement.

If Servier terminates the agreement for our uncured material breach of provisions in the agreement that restrict development, manufacture or commercialization of engineered human T cells with chimeric antigen receptors for use in humans directed to a target selected by Servier, certain licenses we grant to Servier will become royalty-free, fully paid-up, perpetual and irrevocable with respect to the licensed product candidates and licensed products directed to the target that was the subject of such breach, and Servier will be deemed to have previously exercised its commercial option for any then-existing licensed product candidates directed to such target.

On July 6, 2020, Gilead Sciences (“Gilead”) notified us of its termination of the collaboration and license agreement dated September 10, 2018, subsequently amended by Amendment No.

Simultaneously with the entry into the Development and License Agreement, we entered into a Share Purchase Agreement with Lilly

(the “Share Purchase Agreement”), pursuant to which Lilly purchased 3,762,190 shares of our common stock for a purchase price of $35.0 million.

In August 2021, we entered into a development and license agreement with iECURE under which iECURE plans to advance our PBGENE-PCSK9 candidate through preclinical activities as well as a Phase 1 clinical trial as partial consideration for a license to our PCSK9-directed ARCUS nuclease to develop gene-insertion therapies for four other rare genetic diseases, including OTC deficiency, Citrullinemia Type 1, PKU, and another program focused on liver disease (the “iECURE Agreement”).

Pursuant to the iECURE Agreement, we retain the rights to PBGENE-PCSK9, including all products developed for indications with increased risk of severe cardiovascular events such as FH.

Simultaneously with the entry into the iECURE Agreement, we entered into an Equity Issuance Agreement with iECURE, pursuant to which iECURE granted us partial equity ownership in iECURE as partial consideration for the license to use our PCSK9-directed ARCUS nuclease.

In February 2016, we entered into the Servier Agreement with Servier, pursuant to which we agreed to develop allogeneic CAR T cell therapies for five unique antigen targets.

One target was selected at the Servier Agreement’s inception.

Two additional hematological cancer targets beyond CD19 and two new solid tumor targets were selected in 2020.

With the addition of these new targets, we received development milestone payments in 2020.

Upon selection of an antigen target under the Servier Agreement, we agreed to perform early-stage research and development on individual T cell modifications for the selected target, develop the resulting therapeutic product candidates through Phase 1 clinical trials and prepare initial clinical trial material of such product candidates for use in Phase 2 clinical trials.

On April 9, 2021, we entered into the Program Purchase Agreement with Servier, pursuant to which we reacquired all of our global development and commercialization rights previously granted to Servier pursuant to the Servier Agreement, and mutually terminated the Servier Agreement.

Pursuant to the Servier Agreement, we had developed certain allogeneic CAR T candidates, including PBCAR0191 and the stealth cell PBCAR19B, each targeting CD19, as well as four additional product targets (“Servier Targets”).

Pursuant to the Program Purchase Agreement, we regained full global rights to research, develop, manufacture and commercialize products resulting from such programs, with sole control over all activities.

Additionally, per the terms of the Program Purchase Agreement we do not have an obligation to continue development of the Servier Targets.

With respect to products directed to CD19, Servier has certain rights of negotiation, which may be exercised during a specified time period if we elect to initiate a process or entertain third party offers for partnering such products.

Pursuant to the terms of the Program Purchase Agreement, we made a payment of $1.25 million in cash to Servier and agreed to waive earned milestones totaling $18.75 million that would have been otherwise payable to us.

The Program Purchase Agreement also requires us to make certain payments to Servier based on the achievement of regulatory and commercial milestones for each product, and a low- to mid-single-digit percentage royalty (subject to certain reductions) based on net sales of approved products, if any, resulting from any continued development and commercialization of the programs by us, for a period not to exceed ten years after first commercial sale of the applicable product in the United States or certain countries in Europe.

If we enter into specified product partnering transactions, the Program Purchase Agreement requires us to pay to Servier a portion of certain consideration received pursuant to such product partnering transactions in lieu of the foregoing milestones (with the exception of a one-time clinical phase development milestone) and royalties.

For additional discussion of accounting for payment obligations arising from the Program Purchase Agreement, refer to Note 7 to the consolidated financial statements, “Commitments and Contingencies.”

In July 2020, Gilead Sciences (“Gilead”) notified us of its termination of the collaboration and license agreement dated September 10, 2018, subsequently amended by Amendment No.

1 dated March 10, 2020 or (the “Gilead Agreement”), to develop genome editing tools using ARCUS to target viral DNA associated with the Hepatitis B virus.

Pursuant to the termination notice, the Gilead Agreement terminated on September 4, 2020.

Upon termination, we regained full rights and all data we generated for the in vivo chronic hepatitis B program developed under the Gilead Agreement.

Upon termination, we regained full rights and all data we generated for the in vivo chronic HBV program developed under the Gilead Agreement.

Duke University

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government funding and are therefore subject to certain federal regulations.

See Part I, Item 1A.

“Risk Factors— Risks Related to Intellectual Property—Some of our in‑licensed intellectual property has been discovered through government funded programs and thus may be subject to federal regulations such as “march-in” rights, certain reporting requirements and a preference for U.S.-based companies, and compliance with such regulations may limit our exclusive rights and limit our ability to contract with non-U.S.

manufacturers.”

Under the Duke License, in addition to upfront licensing fees, we are also required to pay Duke (1) a total of $0.3 million in milestone payments, a portion of which we paid upon the completion of our Series A financing, a further portion of which we paid upon our first signed partnership in excess of $1 million, and the remainder of which we will be required to pay upon successful commercialization of seed traits and human therapeutics, (2) royalties in the low single digit percentages on net sales of licensed products and licensed processes sold by us and our affiliates, subject to certain reductions in certain circumstances, with certain annual minimum royalties, and (3) certain percentages of sublicensing revenue received under sublicenses granted to third parties, which are creditable against annual minimum royalties and are subject to certain reductions in certain circumstances.

“Risk Factors— Risks Related to Intellectual Property— Some of our in-licensed intellectual property has been discovered through government funded research and thus may be subject to federal regulations such as “march-in” rights, certain reporting requirements and a preference for U.S.-based companies, and compliance with such regulations may limit our exclusive rights and our ability to contract with foreign manufacturers.”

Under the Duke License, in addition to upfront licensing fees, we are also required to pay Duke (1) a total of $0.3 million in milestone payments, a portion of which we paid upon the completion of our Series A financing, a further portion of which we paid upon our first signed partnership in excess of $1 million, and the remainder of which we will be required to pay upon successful commercialization of human therapeutics, (2) royalties in the low single digit percentages on net sales of licensed products and licensed processes sold by us and our affiliates, subject to certain reductions in certain circumstances, with certain annual minimum royalties, and (3) certain percentages of sublicensing revenue received under sublicenses granted to third parties, which are creditable against annual minimum royalties and are subject to certain reductions in certain circumstances.

For sublicenses of non-commercial products, the percentage of sublicensing revenue payable to Duke is in the mid-teen percentages for sublicense revenues owed from royalties received and low double-digits for sublicense revenues owed from non-royalty payments.

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If the highest negotiated royalty rate between us and our sublicensee exceeds a mid-single digit percentage, the percentage of sublicensing revenue payable to Duke will be high single digit, decreasing to low single digit as the highest negotiated royalty rate in such sublicense increases.

We closed the transactions under the Lilly Agreement on January 6, 2021 following receipt of clearance under the Hart-Scott-Rodino Antitrust Improvements Act of 1976, as amended, and, as a result we are required to make $3.0 million in payments under the Duke License in 2021, net of any outstanding credits.

See Note 14 to our audited consolidated financial statements included elsewhere in this Annual Report on Form 10-K for additional information regarding the Lilly Agreement.

The Duke License will expire upon the expiration of the last-to-expire patent that is licensed to us.

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Either party may terminate the Duke License in the event of the other party’s uncured material breach or for the other party’s fraud, willful misconduct or illegal conduct with respect to the subject matter of the Duke License.

In September 2021, we entered into the Tiziana Agreement to evaluate foralumab as a lymphodepleting agent in conjunction with our allogeneic CAR T cells for the potential treatment of cancers.

We intend to investigate foralumab first in combination with an anti-CD19 CAR T and plan an IND update in 2022 to enable combination use.

SpringWorks Therapeutics

In September 2020, we entered into a Clinical Trial Collaboration Agreement with SpringWorks.

Pursuant to such agreement, PBCAR269A will be evaluated in combination with nirogacestat, SpringWorks’ investigational GSI, in patients with R/R multiple myeloma.

Under the terms of the agreement, we will bear all costs with the conduct of the clinical trial including providing PBCAR269A for use in the trial, and SpringWorks is responsible for providing nirogacestat at its sole cost and expense.

The first patient was dosed in the combination arm in June 2021.

Trustees of the University of Pennsylvania

In January 2018, we entered into a research, collaboration and license agreement with the Trustees of the University of Pennsylvania (“Penn”) to collaborate on the preclinical development for gene editing products involving the delivery of an ARCUS nuclease.

In April 2020, both parties agreed to coordinate a wind-down of all activities in their entirety under the agreement, effective as of June 2020, however, in August 2020 and subsequently in January 2021, both parties agreed to extend certain portions of the agreement through 2022.

We will not be required to make termination payments to Penn.

Cellectis S.A.

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Cellectis granted us a non-exclusive, sublicensable, worldwide, fully paid, royalty-free license to certain modified I‑CreI homing endonuclease patents and Cellectis patents asserted in the litigation, to make, use and commercialize modified I-CreI homing nucleases and products developed using such nucleases, in all fields.

The license we received from Cellectis is subject to the rights of a preexisting license agreement that Cellectis entered into with a third party, and the license granted to us excludes any rights exclusively granted by Cellectis under such preexisting license, which preexisting license is limited to certain specific applications unrelated to the fields of human therapeutics and plant agriculture, for so long as the rights under the preexisting license remain exclusive.

The license we received from Cellectis is subject to the rights of a preexisting license agreement that Cellectis entered into with a third party, and the license granted to us excludes any rights exclusively granted by Cellectis under such preexisting license, which preexisting license is limited to certain specific applications unrelated to the fields of human therapeutics, for so long as the rights under the preexisting license remain exclusive.

We granted Cellectis a non-exclusive, sublicensable, worldwide, fully paid-up, royalty-free license to certain modified I CreI homing endonuclease patents and our patents asserted in the litigation matters (1) between Cellectis and us and (2) among Cellectis, Duke and us to make, use and commercialize modified I-CreI homing nucleases and products developing using such nucleases, in all fields except those for which we did not receive rights from Cellectis due to the preexisting license.

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As a diversified life sciences company, we compete in multiple different fields.

The biotechnology, pharmaceutical and agricultural biotechnology industries are characterized by rapidly advancing technologies, intense competition and a strong emphasis on intellectual property and proprietary products.

We principally compete with others developing and utilizing genome editing technology in the human health and plant sciences sectors, including companies such as Allogene Therapeutics, Inc., Alnylam Pharmaceuticals, Inc., Caribou Biosciences, Inc., Cellectis S.A., CRISPR Therapeutics, AG, Dicerna Pharmaceuticals, Inc., Editas Medicine, Inc., Intellia Therapeutics, Inc., Sangamo Therapeutics, Inc., and Beam Therapeutics, Inc.

The biotechnology and pharmaceutical industries are characterized by rapidly advancing technologies, intense competition and a strong emphasis on intellectual property and proprietary products.

We principally compete with others developing and utilizing genome editing technology in the human health sector, including companies such as Allogene Therapeutics, Inc., Alnylam Pharmaceuticals, Inc., Beam Therapeutics, Inc., Caribou Biosciences, Inc., Celgene Corp., Cellectis S.A., CRISPR Therapeutics, AG, Editas Medicine, Inc., Intellia Therapeutics, Inc., Sangamo Therapeutics, Inc., and Verve Therapeutics, Inc.

We compete with many biotechnology and pharmaceutical companies, academic research institutions, governmental agencies and public and private research institutions.

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Several companies, including Novartis Pharmaceuticals Corp.

and Gilead have obtained FDA approval for autologous cell therapies, and a number of companies, including Cellectis S.A., Celgene Corp., Allogene Therapeutics and CRISPR Therapeutics AG, are pursuing allogeneic cell therapies.

and Gilead Sciences, Inc.

have obtained FDA approval for autologous immunotherapies, and a number of companies, including Cellectis S.A., Celgene Corp., Allogene Therapeutics and CRISPR Therapeutics AG, are pursuing allogeneic immunotherapies.

We expect that our operations focused on developing products for in vivo treatment of genetic disease will face substantial competition from others focusing on gene therapy treatments, especially those that may focus on conditions that our product candidates target.

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Our competitors also may obtain FDA or other regulatory approval for their products more rapidly than we may obtain approval for ours, which could result in our competitors establishing a strong market position before we are able to enter the market.

Many of our current or potential competitors in the agricultural biotechnology space, either alone or with others, have significantly greater financial resources and expertise in research and development, manufacturing, testing and marketing approved products than we do.

Mergers and acquisitions in the plant science, specialty food ingredient and agricultural biotechnology, seed and chemical industries may result in even more resources being concentrated among a smaller number of our competitors.

Smaller or early-stage companies may also prove to be significant competitors, particularly through strategic relationships with large and established companies.

These competitors also compete with us in recruiting and retaining qualified scientific and management personnel, as well as in acquiring technologies complementary to, or necessary for, our food platform.

Furthermore, we rely upon a combination of patents and trade secret protection, as well as license and confidentiality agreements to protect the intellectual property related to our proprietary technologies, product candidate development programs and product candidates.

Our success depends in large part on our ability to secure and maintain patent protection in the United States and other countries with respect to the ARCUS nucleases used in our existing allogeneic CAR T immunotherapy, in vivo gene correction and food programs, as well as any future product candidates.

Our success depends in large part on our ability to secure and maintain patent protection in the United States and other countries with respect to the ARCUS nucleases used in our existing allogeneic CAR T immunotherapy and in vivo gene correction programs, as well as any future product candidates.

Moreover, the industries in which we operate are characterized by the existence of large numbers of patents and frequent allegations of patent infringement.

If, therefore, we are unable to obtain and maintain patent protection for our technology and product candidates, or if the scope of the patent protection obtained or in-licensed is not sufficiently broad or if the validity of such patent protection is threatened, we may not be able to compete effectively, as it could create opportunities for competitors to enter the market or dissuade other companies from collaborating with us to develop products and technology, any of which would hurt our competitive position and could impair our ability to successfully commercialize our product candidates in any indication for which they are approved.

If, therefore, we are unable to obtain and maintain patent protection for our technology and product candidates, or if the scope of the patent protection obtained or in-licensed is not sufficiently

broad or if the validity of such patent protection is threatened, we may not be able to compete effectively, as it could create opportunities for competitors to enter the market or dissuade other companies from collaborating with us to develop products and technology, any of which would hurt our competitive position and could impair our ability to successfully commercialize our product candidates in any indication for which they are approved.

Intellectual property

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In addition, our trade secrets may otherwise become known or be independently discovered by competitors.

For more information regarding the risks related to our intellectual property, see Part I, Item 1A.

For more information regarding the risks related to our intellectual property, see Part I.

“ Risk Factors—Risks Related to Intellectual Property.

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As of December 31, 2021, we have an exclusive license from Duke under 12 issued U.S.

patents and one pending U.S.

patent application.

patents and two pending U.S.

patent applications.

In addition, as of December 31, 2021, we own 42 issued U.S.

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patents, three issued patents in Europe, two issued patents in Japan, and one issued patent in Australia.

This family also includes two pending patent applications in the United States, and pending patent applications in each of Europe, Japan and Australia.

This family also includes pending patent applications in each of the United States, Europe, Japan, and Australia.

Patents in this family include claims directed to (1) recombinant single-chain meganucleases, and (2) methods for producing isolated genetically modified eukaryotic cells using such meganucleases.

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The third family, which we own, includes three issued patents in the United States, and two issued patents in each of Europe and Australia.

This family also includes two pending patent applications in the United States and one pending patent application in Europe.

Patents in this family include claims directed to methods of cleaving DNA at specific four base pair sites using a recombinant meganuclease.

This family also includes pending patent applications in each of the United States and Europe.

Patents in this family include

claims directed to methods of cleaving DNA at specific four base pair sites using a recombinant meganuclease.

Patents in this family have a standard expiration date of July 14, 2029, subject to potential extensions.

The fourth family, which we own, includes a pending PCT international patent application.

The fourth family, which we own, includes a pending PCT international patent application and pending patent applications in each of the United States, Europe, Australia, Canada, China, Israel, Japan, South Korea, and Mexico.

Patent applications in this family include claims directed to recombinant meganucleases engineered to cleave recognition sequences having specific four base pair sites.

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The first family includes nine issued U.S.

patents, one issued patent in each of Europe and Japan, and pending patent applications in each of the United States, Europe, Australia, Canada, China, Hong Kong, Israel, Japan, Mexico and South Korea.

patents, one issued patent in each of Europe, Australia, Israel, Hong Kong, and Japan, pending patent applications in each of the United States, Europe, Australia, Canada, China, Hong Kong, Japan, Mexico, and South Korea, and two pending patent applications in Israel.

Patents in this family include claims directed to (1) populations of genetically modified human T cells in which 20%-65% of the cells have reduced expression of an endogenous TCR and express an anti-cancer antigen CAR from DNA inserted into the cells’ TCR alpha constant region (TRAC) gene, (2) methods for using such populations of genetically modified human T cells for cancer immunotherapy, (3) pharmaceutical compositions comprising such populations of genetically modified human T cells, (4) genetically modified human T cells which have reduced expression of an endogenous TCR and express an anti-cancer antigen CAR from DNA inserted into the cells’ TRAC gene, (5) methods for using such genetically modified human T cells for cancer immunotherapy, and (6) pharmaceutical compositions comprising such genetically modified human T cells.

Patents in this family have a standard expiration date of October 5, 2036, subject to potential extensions.

The second family includes one issued patent in each of the United States and Europe, pending patent applications in each of the United States, Europe, Hong Kong, Canada and Japan, and two pending patent applications in Australia.

The second family includes one issued patent in each of the United States, Australia, Hong Kong, and Japan, two issued patents in Europe, pending patent applications in each of the United States, Europe, Australia, Canada, and Japan.

Patent applications in this family include claims directed to (1) first-generation recombinant meganucleases that cleave a target in the TRAC gene, (2) nucleic acids and vectors encoding such recombinant meganucleases, (3) methods for producing genetically modified eukaryotic cells, including CAR T cells, using such meganucleases, and (4) methods of using such genetically modified eukaryotic cells for cancer immunotherapy.

Patents in this family will have a standard expiration date of October 5, 2036, subject to potential extensions.

The third family includes a pending PCT international patent application, and pending patent applications in each of the United States, Europe, Australia, Canada, China, Israel, Japan, Mexico, and South Korea.

The third family pending patent applications in each of the United States, Europe, Australia, Canada, China, Israel, Japan, Mexico, and South Korea.

Patent applications in this family include claims directed to (1) second-generation engineered meganucleases that cleave a specific target in the TRAC gene, (2) nucleic acids and vectors encoding such recombinant meganucleases, (3) methods for producing genetically modified eukaryotic cells, including CAR T cells, using such meganucleases, (4) genetically modified eukaryotic cells or populations of cells prepared by such methods, (5) pharmaceutical compositions comprising such cells or populations of cells, and (6) methods of treating diseases using such cells, populations of cells or pharmaceutical compositions to treat diseases, including cancer immunotherapy.

Patents in this family, if issued, will likely have a standard expiration date of April 11, 2039, subject to potential extensions.

The fourth family includes one issued patent in each of the United States and Europe, pending patent applications in Europe, Canada and Japan, and two pending patent applications in the United States and Australia.

The fourth family includes one issued patent in each of the United States, Europe, Australia, Hong Kong, and Japan, pending patent applications in Europe, Australia, Canada, Hong Kong, and Japan, and two pending patent applications in the United States.

Patent applications in this family include claims directed to (1) nucleic acids encoding co-stimulatory domains having certain amino acid sequences, (2) recombinant DNA constructs and vectors comprising such nucleic acids, (3) nucleic acids and vectors encoding such recombinant meganucleases, (4) genetically modified cells comprising such nucleic acids, (5) methods for producing such genetically modified cells, (6) pharmaceutical compositions comprising such cells, and (7) methods of immunotherapy using such cells.

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Patents in this family, if issued, will have a standard expiration date of April 30, 2038, subject to potential extensions.

The sixth family includes pending patent applications in Europe, Australia, Canada and Japan, and two pending patent applications in the United States.

Patent applications in this family include claims directed to (1) recombinant meganucleases that recognize and cleave a recognition sequence within the human beta-2-microglobulin gene, (2) nucleic acids and vectors encoding such recombinant meganucleases, (3) methods for producing genetically modified eukaryotic cells, including CAR T cells, using such meganucleases, (4) populations of genetically modified eukaryotic cells in which 80% of the cells have reduced expression of an endogenous TCR and 80% of the cells have reduced expression of beta-2-microglobulin, (5) pharmaceutical compositions comprising such populations of

genetically modified eukaryotic cells, and (6) methods for using such genetically modified eukaryotic cells for cancer immunotherapy.

The sixth family includes one issued patent in each of Europe and Japan, and pending patent applications in the United States, Europe, Australia, Canada and Japan.

Patent applications in this family include claims directed to (1) recombinant meganucleases that recognize and cleave a recognition sequence within the human β2m gene, (2) nucleic acids and vectors encoding such recombinant meganucleases, (3) methods for producing genetically modified eukaryotic cells, including CAR T cells, using such meganucleases, (4) populations of genetically modified eukaryotic cells in which 80% of the cells have reduced expression of an endogenous TCR and 80% of the cells have reduced expression of β2m , (5) pharmaceutical compositions comprising such populations of genetically modified eukaryotic cells, and (6) methods for using such genetically modified eukaryotic cells for cancer immunotherapy.

Patents in this family, if issued, will have a standard expiration date of December 22, 2036, subject to potential extensions.

The seventh family includes an issued patent in the United States, and pending patent applications in the United States, Europe, Australia, Canada, Hong Kong, and Japan.

Patent applications in this family include claims directed to (1) nucleic acids encoding an engineered antigen receptor (e.g., a CAR) and an inhibitory molecule (e.g., an RNA interfering with beta-2-microglobulin expression), (2) genetically modified eukaryotic cells comprising such nucleic acids, (3) methods for producing such genetically modified eukaryotic cells using such nucleic acids and an engineered nuclease that promotes insertion of such nucleic acids, (4) genetically modified eukaryotic cells expressing an engineered antigen receptor and having expression of beta-2-microglobulin or MHC Class I molecules reduced by 10%-95%, (5) pharmaceutical compositions comprising such genetically modified eukaryotic cells, and (6) methods for using such genetically modified eukaryotic cells for immunotherapy.

The seventh family includes one issued patent in the United States, and pending patent applications in the United States, Europe, Australia, Canada, Hong Kong, and Japan.

Patent applications in this family include claims directed to (1) nucleic acids encoding an engineered antigen receptor (e.g., a CAR) and an inhibitory molecule (e.g., an RNA interfering with β2m expression), (2) genetically modified eukaryotic cells comprising such nucleic acids, (3) methods for producing such genetically modified eukaryotic cells using such nucleic acids and an engineered nuclease that promotes insertion of such nucleic acids, (4) genetically modified eukaryotic cells expressing an engineered antigen receptor and having expression of β2m or MHC Class I molecules reduced by 10%-95%, (5) pharmaceutical compositions comprising such genetically modified eukaryotic cells, and (6) methods for using such genetically modified eukaryotic cells for immunotherapy.

Patents in this family have a standard expiration date of May 8, 2038, subject to potential extensions.

The eighth family includes pending patent applications in the United States, Europe, Australia, Canada, Hong Kong, and Japan.

The eighth family includes one issued patent in the United States, and pending patent applications in the United States, Europe, Australia, Canada, Hong Kong, and Japan.

Patent applications in this family include claims directed to (1) engineered meganucleases that recognize and cleave a recognition sequence in an upstream intron of the human TRAC gene, (2) nucleic acids and vectors encoding such engineered meganucleases, (3) methods for producing genetically modified T cells using such nucleic acids or vectors, (4) genetically modified T cells in which an exogenous sequence is inserted into an upstream intron of the human TRAC gene and endogenous TCR expression is reduced, (5) populations of such genetically modified T cells, (6) pharmaceutical compositions comprising such genetically modified T cells, and (7) methods of treating disease using such genetically modified T cells and pharmaceutical compositions, including cancer immunotherapy.

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Patents in this family, if issued, will likely have a standard expiration date of October 3, 2038, subject to potential extensions.

The tenth family includes a pending provisional patent application in the United States and a pending PCT international patent application.

The tenth family includes a pending PCT international patent application, and pending patent applications in the United States, Europe, and Canada.

Patent applications in this family include claims directed to (1) methods for preparing genetically-modified immune cells, (2) populations of genetically-modified immune cells, (3) pharmaceutical compositions comprising such populations of genetically-modified immune cells, (4) methods of treating a disease using such populations of genetically-modified immune cells, (5) lipid nanoparticle compositions, and (6) kits for transfecting a eukaryotic cell with mRNA.

Patents in this family, if issued, will have a standard expiration date of April 3, 2040, subject to potential extensions.

The eleventh family includes a pending provisional patent application in the United States, a pending PCT international patent application, and a pending non-provisional patent application in the United States.

The eleventh family includes two issued patents in the United States, a pending PCT international patent application, and pending patent applications in the United States, Europe, Australia, Canada, China, Israel, Japan, Mexico, and South Korea.

Patent applications in this family include claims directed to (1) a genetically-modified immune cell comprising in its genome a nucleic acid sequence encoding a microRNA-adapted shRNA, (2) a method for reducing the expression of an endogenous protein in an immune cell, (3) immune cells made by such methods, (4) populations of such immune cells, (5) pharmaceutical compositions comprising such populations of immune cells, and (6) methods of immunotherapy for treating a disease in a subject.

Patents in this family, if issued, will have a standard expiration date of April 3, 2040, subject to potential extensions.

We own eight additional patent families that include pending provisional patent applications in the United States or pending PCT international patent applications that are directed to immunotherapies, including CAR T cell therapies, or to technologies that are useful for the manufacture of immunotherapies.

The twelfth family includes a pending PCT international patent application.

Patent applications in this family include claims directed to methods of immunotherapy comprising administering to a subject a CD3 antibody, or antigen binding fragment thereof, that binds CD3 for the purpose of lymphodepletion, in combination with the administration of genetically-modified T cells that do not have detectable CD3 expression on the cell surface.

Patents in this family, if issued, will have a standard expiration date of August 20, 2040, subject to potential extensions.

The thirteenth family includes a pending PCT international patent application.

Patent applications in this family include claims directed to (1) polynucleotides encoding a CD20-specific chimeric antigen receptor, (2) methods of producing a genetically-modified T cell comprising such polynucleotides, (3) a genetically-modified T cell comprising such polynucleotides, (4) populations of such genetically-modified T cells, (5) pharmaceutical compositions comprising such genetically-modified T cells or populations, and (6) methods of immunotherapy for treating cancer in a subject.

Patents in this family, if issued, will have a standard expiration date of October 30, 2040, subject to potential extensions.

The fourteenth family includes a pending PCT international patent application.

Patent applications in this family include claims directed to a method of immunotherapy for treating cancer in a subject.

Patents in this family, if issued, will have a standard expiration date of December 3, 2040, subject to potential extensions.

The fifteenth family includes a pending PCT international patent application.

Patent applications in this family include claims directed to methods for reducing the number of target cells, such as cancer cells, in a subject.

Patents in this family, if issued, will have a standard expiration date of May 14, 2041, subject to potential extensions.

The sixteenth family includes a pending PCT international patent application.

Patent applications in this family include claims directed to a method for reducing the number of target cells, such as cancer cells, in a subject.

Patents in this family, if issued, will have a standard expiration date of May 14, 2041, subject to potential extensions.

The seventeenth family includes a pending PCT international patent application.

Patent applications in this family include claims directed to (1) an isolated antibody, or antigen-binding fragment thereof, that specifically binds to BCMA, (2) a pharmaceutical composition comprising such an antibody, (3) a polynucleotide encoding such an antibody, and an expression vector comprising the same, (5) a method of treating cancer in a subject, (6) a polynucleotide comprising a nucleic acid sequence encoding a chimeric antigen receptor having an anti-BCMA binding domain, (7) a genetically-modified eukaryotic cell comprising such a polynucleotide, (8) a method for producing such a genetically-modified eukaryotic cell, (9) a population of such genetically-modified eukaryotic cells, (10) a pharmaceutical composition comprising such a population, and (11) a method for treating cancer in a subject.

Patents in this family, if issued, will have a standard expiration date of August 10, 2041, subject to potential extensions.

The eighteenth family includes a pending PCT international patent application.

Patent applications in this family include claims directed to (1) a lipid nanoparticle composition, (2) a method for transfecting a population of eukaryotic cells, (3) a method for introducing a nucleic acid into a population of eukaryotic cells, (4) a population of such eukaryotic cells, (5) a pharmaceutical composition comprising such a population, and (6) a method for reducing the number of target cells in a subject.

Patents in this family, if issued, will have a standard expiration date of October 6, 2041, subject to potential extensions.

We own five additional patent families that include pending provisional patent applications in the United States that are directed to immunotherapies, including CAR T cell therapies, or to technologies that are useful for the manufacture of immunotherapies.

We jointly own one patent family that includes a pending PCT international patent application directed to immunotherapies.

We jointly own one patent family that includes two pending provisional patent applications in the United States.

We will determine in the future whether to pursue each of these applications.

In October 2020, we announced the U.S.

Patent and Trademark Office’s PTAB issued judgements in our favor in two patent interference proceedings that challenged nine U.S.

patents we owned.

The patents, which issued in 2018, relate to allogeneic CAR T cells produced by inserting a gene encoding a CAR into the TRAC locus, as well as methods of using those cells for cancer immunotherapy.

In the interference proceedings, a third party argued that it had invented the technology in 2012.

The PTAB, however, found that the third-party patent application did not satisfy the written description requirement and rejected these claims while maintaining the claims in all nine of our patents.

Other Patent Families

We own three patent families directed to gene therapy for Hepatitis B virus.

The first family includes two issued patents in the United States, one issued patent in Japan, and pending patent applications in the United States, Europe, Japan, Canada, Australia, China, South Korea, Mexico, Israel, Colombia, Costa Rica, the Dominican Republic, Egypt, Eurasia, Guatemala, Hong Kong, Morocco, Malaysia, New Zealand, Nigeria, Panama, Peru, the Philippines, Saudi Arabia, South Africa, Thailand and Vietnam.

We own three patent families directed to gene therapy for HBV.

The first family includes two issued patents in each of the United States and Japan, one issued patent in South Korea, pending patent applications in the United States, Europe, Australia, Canada, China, Costa Rica, Columbia, the Dominican Republic, Egypt, Eurasia, Guatemala, Israel, Japan, South Korea, Mexico, Morocco, New Zealand, Peru, the Philippines, Saudi Arabia, South Africa, Thailand, and Vietnam, and two pending patent applications in Hong Kong.

Patents in this family will have a standard expiration date of October 13, 2037, subject to potential extensions.

The second family includes a pending PCT international patent application and patent applications in the United States, Europe, Taiwan and the Gulf Cooperation Council.

The second family includes one issued US patent, and pending patent applications in the United States, Europe, Taiwan and the Gulf Cooperation Council.

Patents in this family, if issued, will have a standard expiration date of April 11, 2039, or April 12, 2039, subject to potential extensions.

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We own two patent families directed to engineered meganucleases and methods of treatment targeting the rhodopsin gene, which is associated with retinitis pigmentosa.

The first family includes two issued patents in the United States, one issued patent in Japan, pending patent applications in the United States, Europe, Canada and Japan, and two pending patent applications in Australia.

Patents in this family will have a standard expiration date of September 8, 2036, subject to potential extensions.

The second family includes two pending provisional patent application in the United States.

The first family includes two issued patents in the United States, one issued patent in each of Australia and Japan, and pending patent applications in the United States, Europe, Australia, Canada, and Japan.

Patents in this family

will have a standard expiration date of September 8, 2036, subject to potential extensions.

The second family includes a pending PCT international patent application .

Patents in this family, if issued, will likely have a standard expiration date of May 1 1 , 204 1 , subject to potential extensions.

We own one patent family that is directed to engineered meganucleases and methods of treatment targeting the hydroxyacid oxidase 1 gene, which is associated with primary hyperoxaluria 1.

This family includes a pending PCT international patent application.

We own two patent families that are directed to engineered meganucleases and methods of treatment targeting the hydroxyacid oxidase 1 gene, which is associated with primary hyperoxaluria 1.

The first family includes pending patent applications in the United States and Europe.

Patents in this family, if issued, will have a standard expiration date of December 20, 2039, subject to potential extensions.

The second family includes three pending US provisional patent applications.

Patents in this family, if issued, will likely have a standard expiration date of January 8, 2042, subject to potential extensions.

We own two patent families that are directed to engineered meganucleases and methods of treatment targeting the Factor VIII gene, which is associated with Hemophilia A.

The first family includes pending patent applications in the United States, Europe, Australia, Canada, and Japan.

Patents in this family, if issued, will have a standard expiration date of May 3, 2037, subject to potential extensions.

The first family includes one issued patent in Europe, and pending patent applications in the United States, Europe, Australia, Canada, and Japan.

Patents in this family will have a standard expiration date of May 3, 2037, subject to potential extensions.

The second family includes pending patent applications in the United States and Europe.

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We own one patent family directed to engineered meganucleases and methods of treatment targeting the transthyretin (“TTR”) gene, which is associated with TTR amyloidosis.

This family includes a pending provisional patent applications in the United States.

Patents in this family, if issued, will likely have a standard expiration date of August 21, 2041, subject to potential extensions.

This family includes a pending PCT international patent application.

Patents in this family, if issued, will have a standard expiration date of August 20, 2041, subject to potential extensions.

We own two patent families directed to engineered meganucleases and methods of treatment targeting the dystrophin gene, which is associated with Duchenne Muscular Dystrophy.

The first family includes an issued patent in Europe, pending patent applications in Europe, Australia, Canada and Japan, and two pending patent applications in the United States.

The first family includes one issued patent in each of Europe and Japan, and pending patent applications in the United States, Europe, Australia, Canada, and Japan.

Patents in this family will have a standard expiration date of March 12, 2035, subject to potential extensions.

The second family includes a pending provisional patent application in the United States.

Patent applications in this family, if issued, will likely have a standard expiration date of November 12, 2041.

We own one patent family directed to engineered meganucleases and methods of treatment targeting genomic trinucleotide repeats, which are associated with several trinucleotide repeat disorders.

This family includes pending patent applications in the United States and Europe.

Patents in this family, if issued, will have a standard expiration date of May 2, 2036, subject to potential extensions.

The second family includes a pending provisional patent application in the United States and a pending PCT international patent application.

Patent applications in this family, if issued, will have a standard expiration date of November 12, 2041.

We own one patent family directed to engineered meganucleases and methods of treatment targeting genomic nucleotide repeats, which are associated with several nucleotide repeat disorders.

This family includes one issued patent in Europe, and pending patent applications in the United States and Europe.

Patents in this family will have a standard expiration date of May 2, 2036, subject to potential extensions.

We own one patent family directed to engineered meganucleases and methods of treating alpha-1 antitrypsin deficiency.

This family includes six pending provisional patent applications in the United States.

Patents in this family, if issued, will likely have a standard expiration date of October 19, 2042.

We own one patent family directed to engineered meganucleases that target mitochondrial genomes and methods of treating mitochondrial disorders.

This family includes four pending provisional patent applications in the United States.

Patents in this family, if issued, will likely have a standard expiration date of April 22, 2042.

We jointly own one patent family directed to engineered meganucleases that target mitochondrial genomes and methods of treating mitochondrial disorders.

This family includes three pending provisional patent applications in the United States.

Patents in this family, if issued, will likely have a standard expiration date of April 22, 2042.

We jointly own one patent family directed to methods for generating male sterile plants.

This family includes one pending provisional patent application in the United States.

Patents in this family, if issued, will likely have a standard expiration date of April 22, 2042.

We license from Duke one patent family directed to engineered fusion proteins comprising engineered meganuclease domains and effector domains which may be useful in controlling gene expression.

This patent family includes two pending patent applicatio ns in the United States.

This patent family includes one pending patent application in the United States.

Patents in this family, if issued, will have a standard expiration date of October 18, 2026, subject to potential extensions.

We own one patent family directed to engineered meganucleases that target amplifiable genetic loci and may be useful in producing cells with amplified transgenes.

This family includes two issued patents in Europe, one issued patent in the United States, and one pending patent application in each of the United States and Europe.

This family includes two issued patents in Europe, one issued patent in the United States, and pending

patent application s in each of the United States and Europe.

Patents in this family will have a standard expiration date of June 1, 2032, subject to potential extensions.

We own two patent families directed to self-limiting viral vectors (e.g., AAV vectors) that encode engineered meganucleases which eliminate the vector after gene delivery.

The first family includes an issued patent in the United States, and pending patent applications in the United States and Europe.

The first family includes one issued patent in the United States, and pending patent applications in each of the United States and Europe.

Patents in this family will have a standard expiration date of June 20, 2036, subject to potential extensions.

The second family includes one pending provisional patent application in the United States.

Patents in this family, if issued, will likely have a standard expiration date of May 11, 2041, subject to potential extensions.

The second family includes one pending PCT international patent application.

Patents in this family, if issued, will have a standard expiration date of May 10, 2041, subject to potential extensions.

We own one patent family directed to compositions and methods for sequential stacking of nucleic acid sequences into a genomic locus.

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We own one patent family directed to eukaryotic cells comprising a modified transferrin gene that includes an exogenous nucleic acid sequence encoding a polypeptide of interest.

This family includes a pending PCT international patent application.

Patents in this family, if issued, will have a standard expiration date of January 10, 2040.

This family includes pending patent applications in each of the United States and Europe.

Patents in this family, if issued, will have a standard expiration date of January 10, 2040, subject to potential extensions.

We own one patent family directed to methods for separation of empty and full AAV capsids during manufacturing.

This family includes a pending provisional application in the United States.

Patents in this family, if issued, will likely have a standard expiration date of February 6, 2041.

This family includes a pending PCT international patent application.

Patents in this family, if issued, will have a standard expiration date of February 5, 2041, subject to potential extensions.

We own an issued patent in the United States directed to engineered meganucleases which target a genetic locus in maize and methods for genetically modifying that locus in maize.

That patent has a standard expiration date of March 2, 2029, subject to potential extensions.

We own, through our Elo Life Systems subsidiary, one patent family directed to the modulation of endogenous mogroside pathway genes in watermelon and other cucurbits.

This family includes a pending provisional patent application in the United States.

Patents in this family, if issued, will likely have a standard expiration date of March 31, 2041, subject to potential extensions.

We own, through our Elo Life Systems subsidiary, one patent family directed to methods for producing vanilla plants with improved flavor and agronomic product.

This family includes a pending provisional patent application in the United States.

Patents in this family, if issued, will likely have a standard expiration date of October 23, 2041, subject to potential extensions.

For any individual patent, the term depends on the applicable law in the country in which the patent is granted.

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The term of a U.S.

patent may also be lengthened by a patent term adjustment to address administrative delays by the USPTO in granting a patent.

patent may also be lengthened by a patent term adjustment to address administrative delays by the United States Patent and Trademark Office (the “USPTO”) in granting a patent.

In the United States, the term of a patent that covers an FDA-approved drug or biologic may be eligible for patent term extension in order to restore the period of a patent term lost during the premarket FDA regulatory review process.

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Only one patent may be extended for a regulatory review period for any product, and the application for the extension must be submitted prior to the expiration of the patent.

In the future, we may decide to apply for restoration of patent term for one of our currently owned or licensed patents to extend its current expiration date, depending on the expected length of the clinical studies and other factors involved in the filing of the relevant BLA.

We or our licensors may be subject to claims that former employees, collaborators or other third parties have an interest in our owned or in-licensed patents or other intellectual property as an inventor or co-inventor.

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In addition, we may need the cooperation of any such co-owners to enforce any patents that issue from such patent applications against third parties, and such cooperation may not be provided to us.

licensors are subject to and may also become a party to similar proceedings or priority disputes in Europe or other foreign jurisdictions.

Our registered trademark portfolio currently contains four registered trademarks in the United States, including ARCUS, ARC nuclease, Elo Life Systems and Zeromelon.

We or our licensors are subject to and may also become a party to similar proceedings or priority disputes in Europe or other foreign jurisdictions.

Our trademark portfolio currently contains two registered trademarks in the United States, including ARCUS and ARC nuclease.

We also own registered trademarks for both ARCUS and ARC nuclease in Europe, China and Australia, and a registered trademark for ARCUS in Canada.

We own a registered trademark for Elo Life Systems in Australia, and pending trademark application for Zeromelon in each of Australia, Brazil, Canada, China, Europe, Germany, India, Japan, Mexico, South Korea, and the United Kingdom.

Additionally, we own pending trademark applications for Zerocanola, Precision Biotechnology and Climate-Smart in the United States, Australia, Brazil, Canada, China, Europe, Japan, and Mexico.

Additionally, we own pending trademark applications for Precision BioSciences and the Precision BioSciences logo in the United States, Europe, Australia, Canada, China, Japan, and the United Kingdom (“UK”), pending trademark applications for Evade, PBStealth, StealthCAR, and StealthCAR T in the United States, and pending trademark applications for Precision Biotechnology in the United States, Australia, Brazil, Canada, China, Europe, Japan, and Mexico.

Licensed Intellectual Property

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The process required by the FDA before biologic product candidates may be marketed in the United States generally involves the following:

completion of preclinical laboratory tests and animal studies performed in accordance with the FDA’s Good Laboratory Practice requirements, or GLPs;

demonstration of successful, reproducible manufacture of clinical trial material produced in compliance with current Good Manufacturing Practices (cGMPs) and consistent with all release specifications for the product at initial manufacture and over time when stored under defined conditions;

completion of preclinical laboratory tests and animal studies performed in accordance with the FDA’s Good Laboratory Practice requirements;

demonstration of successful, reproducible manufacture of clinical trial material produced in compliance with cGMPs and consistent with all release specifications for the product at initial manufacture and over time when stored under defined conditions;

submission to the FDA of an IND, which must become effective before clinical trials may begin, and which must be properly maintained throughout the course of clinical development;

approval by an Investigational Review Board (“IRB”) or ethics committee, and additional scientific and biosafety review committees at each clinical site before the trial is commenced;

performance of adequate and well-controlled human clinical trials following protocols agreed to by FDA to establish the safety, purity and potency of the proposed biologic product candidate for its intended purpose;

approval by an Investigational Review Board (“IRB”) or ethics committee, and potential additional scientific and biosafety review committees at each clinical site before the trial is commenced;

performance of adequate and well-controlled human clinical trials following protocols agreed to by FDA to establish the safety and effectiveness of the proposed biologic product candidate for its intended purpose;

preparation of and submission to the FDA of a BLA after completion of all pivotal clinical trials;

a determination by the FDA within 60 days of its receipt of a BLA to file the application for review;

satisfactory completion of an FDA pre-approval inspection of the manufacturing facility or facilities at which the proposed commercial product is produced to assess compliance with cGMP and to assure that the facilities, methods and controls are adequate to preserve the biological product’s continued safety, purity and potency, and of selected clinical investigation sites to assess compliance with GCPs;

satisfactory completion of an FDA Advisory Committee review, if applicable;

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A separate submission to the existing IND must be made for each successive clinical trial conducted during product development and for any subsequent protocol amendments.

While the IND is active, progress reports summarizing the results of the clinical trials and nonclinical studies performed since the last progress report, among other information, must be submitted at least annually to the FDA, and written IND safety reports must be submitted to the FDA and investigators for serious and unexpected suspected adverse events, findings from other studies suggesting a significant risk to humans exposed to the drug, findings from animal or in vitro testing suggesting a significant risk to humans exposed to the drug, and any clinically important increased rate of a serious suspected adverse reaction compared to that listed in the protocol or investigator brochure.

Furthermore, for each site proposing to conduct the clinical trial an independent IRB must review and approve the plan for any clinical trial and the informed consent form before the clinical trial begins at that site, and must monitor the study until completed.

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These so-called Phase 4 studies may be made a condition to approval of the BLA.

Development of new treatments for cancer and genetic diseases often combine phase 1 and phase 2 trials as the treatment is studied in limited patient population with the specified disease.

Concurrent with clinical trials, companies may complete additional animal studies and develop additional information about the biological characteristics of the product candidate, and must finalize a process for manufacturing the product in commercial quantities in accordance with cGMP.

The manufacturing process must be capable of consistently producing quality batches of the product candidate and, among other things, must develop methods for testing the identity, strength, quality and purity of the final product, or for biologics, the safety, purity and potency.

The manufacturing process must be capable of consistently producing quality batches of the product candidate and, among other things, must develop methods for testing the identity, strength, potency, quality and purity of the final product, or for biologics, the safety, purity and potency.

Additionally, appropriate packaging must be selected and tested and stability studies must be conducted to demonstrate that the product candidate does not undergo unacceptable deterioration over its shelf life.

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Additionally, no user fees are assessed on BLAs for products designated as orphan drugs, unless the application also includes a non-orphan indication.

Once a BLA has been submitted, the FDA’s goal is to review standard applications within ten months after it accepts the application for filing, or, if the application qualifies for priority review, six months after the FDA accepts the application for filing.

Priority review designation will direct overall attention and resources to the evaluation of applications for products that, if approved, would be significant improvements in the safety or effectiveness of the treatment, diagnosis, or prevention of serious conditions.

In both standard and priority reviews, the review process is often significantly extended by FDA requests for additional information or clarification.

Within 60 days following submission of the application, the FDA reviews all NDAs and BLAs submitted to ensure that they are sufficiently complete for substantive review before it accepts them for filing.

The FDA may request additional information rather than accept an NDA or BLA for filing.

In this event, the NDA or BLA must be resubmitted with the additional information.

The resubmitted application also is subject to review before the FDA accepts it for filing.

Once a BLA has been accepted for filing, the FDA begins an in-depth substantive review.

The FDA reviews a BLA to determine, among other things, whether a product is safe, pure and potent and the facility in which it is manufactured, processed, packed, or held meets standards designed to assure the product’s continued safety, purity, and potency.

The FDA’s goal is to review standard applications within ten months after it accepts the application for filing, or, if the application qualifies for priority review, six months after the FDA accepts the application for filing.

Priority review designation will direct overall attention and resources to the evaluation of applications for product candidates that, if approved, would represent significant improvements in the safety or effectiveness of the treatment, diagnosis, or prevention of serious conditions.

In both standard and priority reviews, the review process is often significantly extended by FDA requests for additional information or clarification.

The FDA may convene an advisory committee to provide clinical insight on application review questions.

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A REMS is a safety strategy to manage a known or potential serious risk associated with a medicine and to enable patients to have continued access to such medicines by managing their safe use, and could include medication guides, physician communication plans, or elements to assure safe use, such as restricted distribution methods, patient registries, required prescriber training, and other risk minimization tools.

The FDA also may condition approval on, among other things, changes to

proposed labeling or the development of adequate controls and specifications.

The FDA also may condition approval on, among other things, changes to proposed labeling or the development of adequate controls and specifications.

Once approved, the FDA may withdraw the product approval if compliance with pre- and post-marketing requirements is not maintained or if problems occur after the product reaches the marketplace.

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In addition, new government requirements, including those resulting from new legislation, may be established, or the FDA’s policies may change, which could impact the timeline for regulatory approval or otherwise impact ongoing development programs.

In addition, the Pediatric Research Equity Act (“PREA”) requires a sponsor to conduct pediatric clinical trials for most biologics, for a new active ingredient, new indication, new dosage form, new dosing regimen or new route of administration.

Under PREA, BLAs and supplements thereto must contain a pediatric assessment unless the sponsor has received a deferral or waiver.

The required assessment must evaluate the safety and effectiveness of the product for the claimed indications in all relevant pediatric subpopulations and support dosing and administration for each pediatric subpopulation for which the product has been determined safe and effective.

The sponsor or FDA may request a deferral of pediatric clinical trials for some or all of the pediatric subpopulations.

A deferral may be granted for several reasons, including a finding that the biologic is ready for approval for use in adults before pediatric clinical trials are complete or that additional safety or effectiveness data needs to be collected before the pediatric clinical trials begin.

The FDA must send a noncompliance letter to any sponsor that fails to submit the required assessment, keep a deferral current or fails to submit a request for approval of a pediatric formulation.

Expedited Development and Review Programs

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Specifically, new drugs and biological products are eligible for fast track designation if they are intended to treat a serious or life-threatening disease or condition and demonstrate the potential to address unmet medical needs for the disease or condition.

For a fast track product, the FDA may consider sections of the BLA for review on a rolling basis before the complete application is submitted, if the sponsor provides a schedule for the submission of the sections of the application, the FDA agrees to accept sections of the application and determines that the schedule is acceptable and the sponsor pays any required user fees upon submission of the first section of the application.

For a fast track product candidate, the FDA may consider sections of the BLA for review on a rolling basis before the complete application is submitted, if the sponsor provides a schedule for the submission of the sections of the application, the FDA agrees to accept sections of the application and determines that the schedule is acceptable and the sponsor pays any required user fees upon submission of the first section of the application.

A fast track designated product candidate may also qualify for priority review, under which the FDA sets the target date for FDA action on the BLA at six months after the FDA accepts the application for filing.

Priority review is granted pending availability of FDA review resources for the expedited review and when there is evidence that the proposed product would be a significant improvement in the safety or effectiveness of the treatment, diagnosis, or prevention of a serious disease or condition.

If criteria are not met for priority review, the application is subject to the standard FDA review period of 10 months after FDA accepts the application for filing.

Priority review designation does not change the scientific/medical standard for approval or the quality of evidence necessary to support approval.

Under the accelerated approval program, the FDA may approve a BLA on the basis of either a surrogate endpoint that is reasonably likely to predict clinical benefit, or on a clinical endpoint that can be measured earlier than irreversible morbidity or mortality, that is reasonably likely to predict an effect on irreversible morbidity or mortality or other clinical benefit, taking into account the severity, rarity, or prevalence of the condition and the availability or lack of alternative treatments.

A product candidate intended to treat a serious or life-threatening disease or condition may also be eligible for breakthrough therapy designation to expedite its development and review.

A product candidate can receive breakthrough therapy designation if preliminary clinical evidence indicates that the product candidate, alone or in combination with one or more other drugs or biologics, may demonstrate substantial improvement over existing therapies on one or more clinically significant endpoints, such as substantial treatment effects observed early in clinical development.

The designation includes all of the fast track program features, as well as more intensive FDA interaction and guidance beginning as early as Phase 1 and an organizational commitment to expedite the development and review of the product candidate, including involvement of senior managers.

Any product candidate submitted to the FDA for approval, including a product with a fast track designation or breakthrough therapy designation, may also be eligible for other types of FDA programs intended to expedite development and review, such as accelerated approval.

Under the accelerated approval program, the FDA may approve a BLA on a determination that the biologic has an effect on either a surrogate endpoint that is reasonably likely to predict clinical benefit, or on a clinical endpoint that can be measured earlier than irreversible morbidity or mortality, that is reasonably likely to predict an effect on irreversible morbidity or mortality or other clinical benefit, taking into account the severity, rarity, or prevalence of the condition and the availability or lack of alternative treatments.

Post-marketing studies or completion of ongoing studies after marketing approval are generally required to verify the biologic’s clinical benefit in relationship to the surrogate endpoint or ultimate outcome in relationship to the clinical benefit.

In addition, the FDA currently requires as a condition for accelerated approval pre-approval of promotional materials, which could adversely impact the timing of the commercial launch of the product.

FDA may withdraw approval of a drug or indication approved under accelerated approval if, for example, the confirmatory trial fails to verify the predicted clinical benefit of the product.

In addition, the Food and Drug Administration Safety and Innovation Act, or the FDASIA, which was enacted and signed into law in 2012, established the breakthrough therapy designation.

A sponsor may seek FDA designation of its product candidate as a breakthrough therapy if the product candidate is intended, alone or in combination with one or more other drugs or biologics, to treat a serious or life-threatening disease or condition and preliminary clinical evidence indicates that the therapy may demonstrate substantial improvement over existing therapies on one or more clinically significant endpoints, such as substantial treatment effects observed early in clinical development.

If the FDA designates a breakthrough therapy, it may take actions appropriate to expedite the development and review of the application, which may include holding meetings with the sponsor and the review team throughout the development of the therapy;

providing timely advice to, and interactive communication with, the sponsor regarding the development of the drug to ensure that the development program will gather the nonclinical and clinical data necessary for approval as efficiently as practicable;

involving senior managers and experienced review staff, as appropriate, in a collaborative, cross-disciplinary review;

assigning a cross-disciplinary project lead for the FDA review team to facilitate an efficient review of the development program and to serve as a scientific liaison between the review team and the sponsor;

and considering alternative clinical trial designs when scientifically appropriate, which may result in smaller trials or more efficient trials that require less time to complete and may minimize the number of patients exposed to a potentially less efficacious treatment.

Breakthrough therapy designation comes with all of the benefits of fast track designation, which means that the sponsor may file sections of the BLA for review on a rolling basis if certain conditions are satisfied, including an agreement with the FDA on the proposed schedule for submission of portions of the application and the payment of applicable user fees before the FDA may initiate a review.

The Regenerative Medicine Advanced Therapy, or RMAT, designation facilitates an efficient development program for, and expedites review of, any drug that meets the following criteria:

FDA may withdraw approval of a drug or indication approved under accelerated approval on an expedited basis if, for example, the confirmatory trial fails to verify the predicted clinical benefit of the product or the sponsor fails to conduct such confirmatory trials in a timely manner.

The Regenerative Medicine Advanced Therapy (“ RMAT ”) , designation facilitates an efficient development program for, and expedites review of, any drug that meets the following criteria:

(1) it qualifies as a RMAT, which is defined as a cell therapy, therapeutic tissue engineering product, human cell and tissue product, or any combination product using such therapies or products, with limited exceptions;

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Like breakthrough therapy designation, RMAT designation provides potential benefits that include more frequent meetings with FDA to discuss the development plan for the product candidate, and eligibility for rolling review and priority review.

Products granted RMAT designation may also be eligible for accelerated approval on the basis of a surrogate or intermediate endpoint reasonably likely to predict long-term clinical benefit, or reliance upon data obtained from a meaningful number of sites, including through expansion to additional sites.

Product candidate s granted RMAT designation may also be eligible for accelerated approval on the basis of a surrogate or intermediate endpoint reasonably likely to predict long-term clinical benefit, or reliance upon data obtained from a meaningful number of sites, including through expansion to additional sites.

RMAT-designated products that receive accelerated approval may, as appropriate, fulfill their post-approval requirements through the submission of clinical evidence, clinical studies, patient registries, or other sources of real world evidence (such as electronic health records);

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In addition, orphan drug exclusive marketing rights in the United States may be lost if the FDA later determines that the request for designation was materially defective or, as noted above, if the second applicant demonstrates that its product is clinically superior to the approved product with orphan exclusivity or the manufacturer of the approved product is unable to assure sufficient quantities of the product to meet the needs of patients with the rare disease or condition.

We plan to seek orphan drug designation for some or all of our product candidates in specific orphan indications in which there is a medically plausible basis for the use of these products.

Post-Approval Requirements

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Biosimilars and Exclusivity

The Affordable Care Act, signed into law in 2010, includes a subtitle called the BPCIA, which created an abbreviated approval pathway for biological products that are biosimilar to or interchangeable with an FDA-licensed reference biological product.

The Affordable Care Act, signed into law in 2010, includes a subtitle called the Biologics Price Competition and Innovation Act of 2009 (the “BPCIA”), which created an abbreviated approval pathway for biological products that are biosimilar to or interchangeable with an FDA-licensed reference biological product.

The FDA has issued several guidance documents outlining an approach to review and approval of biosimilars.

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Interchangeability requires that a product is biosimilar to the reference product and the product must demonstrate that it can be expected to produce the same clinical results as the reference product in any given patient and, for products that are administered multiple times to an individual, the biologic and the reference biologic may be alternated or switched after one has been previously administered without increasing safety risks or risks of diminished efficacy relative to exclusive use of the reference biologic.

However, complexities associated with the larger, and often more complex, structures of biological products, as well as the processes by which such products are manufactured, pose significant hurdles to implementation of the abbreviated approval pathway that are still being worked out by the FDA.

Under the BPCIA, an application for a biosimilar product may not be submitted to the FDA until four years following the date that the reference product was first licensed by the FDA.

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This six-month exclusivity, which runs from the end of other exclusivity protection or patent term, may be granted based on the voluntary completion of a pediatric study in accordance with an FDA-issued “Written Request” for such a study.

The BPCIA is complex and continues to be interpreted and implemented by the FDA.

In addition, government proposals have sought to reduce the 12-year reference product exclusivity period.

Other aspects of the BPCIA, some of which may impact the BPCIA exclusivity provisions, have also been the subject of recent litigation.

As a result, the ultimate impact, implementation, and impact of the BPCIA is subject to significant uncertainty.

Genetically Engineered Food Products

In the United States, the FDA and the USDA are primarily responsible for overseeing food regulation and safety, although many other federal agencies also play a role in food regulation.

USDA has jurisdiction over certain genetically engineered crops through the Animal and Plant Health Inspection Services, or APHIS.

Under the Plant Protection Act and APHIS’ Part 340 regulations, USDA requires anyone who wishes to import, transport interstate, or release into the environment a “regulated article” to apply for a permit or, in some cases, notify APHIS that the introduction will be made.

Regulated articles are defined as “any organism which has been altered or produced through genetic engineering which USDA determines is a plant pest or has reason to believe is a plant pest.” Regulated articles may be subject to extensive regulation, including both permitting requirements and inspections.

However, to the extent products are subject to APHIS regulation, APHIS may make a determination of nonregulated status for a product following the submission of a petition requesting such a determination.

The petition process can be a multi-year process that varies based on a number of factors, including APHIS’s familiarity with similar products, the type and scope of the environmental review conducted, and the number and types of public comments received.

APHIS conducts a comprehensive science-based review of the petition to assess, among other things, plant pest risk, environmental considerations pursuant to the National Environmental Policy Act of 1969, or NEPA, and any potential impact on endangered species.

If, upon the completion of the review, APHIS grants the petition, the product is no longer deemed a “regulated article” and the petitioner may commercialize the product, subject to any conditions set forth in the decision.

In January 2017, APHIS proposed significant amendments to its Part 340 regulatory framework that would, among other things, clarify the types of genetically engineered plants subject to regulation thereunder.

In November 2017, however, APHIS withdrew its proposed rule and stated that it would “begin a fresh stakeholder engagement aimed at exploring alternative policy approaches.” That process appears to remain ongoing.

On May 4, 2018, the USDA issued a proposed rule implementing the National Bioengineered Food Disclosure Standard, with a proposed compliance date of January 1, 2020.

Under this proposed rule, the label of a bioengineered, or BE, food must include a disclosure that the food is a BE food or contains a BE ingredient, with certain exceptions.

This proposed rule defines BE food as “a food that contains genetic material that was has been modified through in vitro recombinant deoxyribonucleic acid, or DNA, techniques and for which the modification could not otherwise be obtained through conventional breeding or found in nature,” except in the case of an incidental additive present in food at an insignificant level and that does not have any technical or functional effect in the food.

The USDA’s proposed rule may change significantly prior to being finalized.

The FDA’s oversight of food safety and security is primarily carried out by the Center for Food Safety and Applied Nutrition.

To execute its responsibilities, the FDA conducts inspections and collects and analyzes product samples.

Foods are typically not subject to premarket review and approval requirements, with limited exceptions, such as the requirement for premarket review and approval of food additives.

Under Section 201(s) and 409 of the FDCA, any substance that is reasonably expected to become a component of food is considered a “food additive” that is subject to premarket approval by the FDA, unless it is already subject to a food additive regulation.

Ingredients that are GRAS are exempt from the definition of food additive and from the premarket approval requirements.

Under section 201(s), and FDA’s implementing regulations, the use of a food substance may be GRAS either through a determination by qualified experts or, for a substance used in food before 1958, through experience based on common use in food.

Manufacturers of GRAS substances may voluntarily provide the FDA with a notification of GRAS determination, which includes, among other things, a description of the substance, the applicable conditions of use, the dietary exposure and an explanation of how the substance was determined to be safe for the intended use.

Upon review of such a notification, the FDA may respond with a “no questions” letter stating that while it has not made its own GRAS determination, it has no questions at the time regarding the applicant’s own GRAS determination.

Alternatively, manufacturers may self-affirm that a given substance is GRAS without the voluntary FDA notification.

A company may market a new food ingredient based on its independent determination that the substance is GRAS;

however, the FDA can disagree with this determination and take enforcement action.

The FDA regulates foods made with genetically modified organisms under the approach summarized in its 1992 “Statement of Policy:

Foods Derived from New Plant Varieties.” Under this policy, updated in 2017, the FDA regulates foods derived from genetically modified plant varieties consistent with the framework for non-genetically modified foods.

Under this framework, the FDA offers a voluntary consultation process to determine whether a food derived from a genetically modified plant variety raises any safety or other regulatory issues, such as whether any substance in the food from the plant may require premarket approval as a food additive.

Foreign Regulation

Medicinal products

Clinical trials .

Clinical trials of medicinal products in the European Economic Area (“EEA”) (which is comprised of the 27 Member States of the EU plus Norway, Iceland and Liechtenstein) must be conducted in accordance with European Union and national regulations and the International Conference on Harmonization (“ICH”) guidelines on GCPs.

Additional GCP guidelines from the European Commission, focusing in particular on traceability, apply to clinical trials of advanced therapy medicinal products.

If the sponsor of the clinical trial is not established within the EEA, it must appoint an entity within the EEA to act as its legal representative.

To market any product outside of the United States, we would need to comply with numerous and varying regulatory requirements of other countries regarding safety and efficacy and governing, among other things, clinical trials, marketing authorization, manufacturing, commercial sales and distribution of our products.

Because biologically sourced raw materials are subject to unique contamination risks, their use may be restricted in some countries.

Whether or not we obtain FDA approval of a product, we must obtain the requisite approvals from regulatory authorities in foreign countries prior to the commencement of clinical trials or marketing of the product in those countries.

The requirements and process governing the conduct of clinical trials, product licensing, pricing and reimbursement vary from country to country.

Failure to comply with applicable foreign regulatory requirements, may be subject to, among other things, fines, suspension or withdrawal of regulatory approvals, product recalls, seizure of products, operating restrictions and criminal prosecution.

Non-clinical studies and clinical trials

Similarly to the United States, the various phases of non-clinical and clinical research in the European Union, (“EU”), are subject to significant regulatory controls.

Non-clinical studies are performed to demonstrate the health or environmental safety of new biological substances.

Non-clinical studies must be conducted in compliance with the principles of good laboratory practice (“GLP”), as set forth in EU Directive 2004/10/EC.

In particular, non-clinical studies, both in vitro and in vivo, must be planned, performed, monitored, recorded, reported and archived in accordance with the GLP principles, which define a set of rules and criteria for a quality system for the organizational process and the conditions for non-clinical studies.

These GLP standards reflect the Organization for Economic Co-operation and Development requirements.

Clinical trials of medicinal products in the EU must be conducted in accordance with EU and national regulations and the International Conference on Harmonization (“ICH”) guidelines on GCPs.

Additional GCP guidelines from the European Commission, focusing in particular on traceability, apply to clinical trials of advanced therapy medicinal products (“ATMPs”).

If the sponsor of the clinical trial is not established within the EU, it must appoint an entity within the EU to act as its legal representative.

The sponsor must take out a clinical trial insurance policy, and in most countries, the sponsor is liable to provide ‘no fault’ compensation to any study subject injured in the clinical trial.

Prior to commencing a clinical trial, the sponsor must obtain a clinical trial authorization (“CTA”), from the competent authority, and a positive opinion from an independent ethics committee.

The application for a CTA must include, among other things, a copy of the trial protocol and an investigational medicinal product dossier containing information about the manufacture and quality of the medicinal product under investigation.

Currently, clinical trial authorization applications must be submitted to the competent authority in each member state in which the trial will be conducted.

Under the new Regulation on Clinical Trials, which is currently expected to take effect in 2022, there will be a centralized application procedure where one national authority takes the lead in reviewing the application and the other national authorities have only a limited involvement.

Any substantial changes to the trial protocol or other information submitted with the CTA applications must be notified to or approved by the relevant competent authorities and ethics committees.

Investigational medicinal products used in clinical trials must be manufactured in accordance with the cGMPs specified in EudraLex, Volume 4, Annex 13 and certified by a Qualified Person before use.

Other national and EEA-wide regulatory requirements may also apply.

Marketing authorizations .

To market a medicinal product in the EEA, we must obtain a Marketing Authorization (“MA”).

The regulatory landscape related to clinical trials in the EU has been subject to recent changes.

The EU Clinical Trials Regulation (“CTR”), which was adopted in April 2014 and repeals the EU Clinical Trials Directive, became applicable on January 31, 2022.

Unlike directives, the CTR is directly applicable in all EU member states without the need for member states to further implement it into national law.

The CTR notably harmonizes the assessment and supervision processes for clinical trials throughout the EU via a Clinical Trials Information System, which contains a centralized EU portal and database.

While the Clinical Trials Directive required a separate CTA to be submitted in each member state, to both the competent national health authority and an independent ethics committee, much like the FDA and IRB respectively, the CTR introduces a centralized process and only requires the submission of a single application to all member states concerned.

The CTR allows sponsors to make a single submission to both the competent authority and an ethics committee in each member state, leading to a single decision per member state.

The CTA must include, among other things, a copy of the trial protocol and an investigational medicinal product dossier containing information about the manufacture and quality of the medicinal product under investigation.

The assessment procedure of the CTA has been harmonized as well, including a joint assessment by all member states concerned, and a separate assessment by each member state with respect to specific requirements related to its own territory, including ethics rules.

Each member state’s decision is communicated to the sponsor via the centralized EU portal.

Once the CTA is approved, clinical study development may proceed.

The CTR foresees a three-year transition period.

The extent to which ongoing and new clinical trials will be governed by the CTR varies.

For clinical trials whose CTA was made under the Clinical Trials Directive before January 31, 2022, the Clinical Trials Directive will continue to apply on a transitional basis for three years.

Additionally, sponsors may still choose to submit a CTA under either the Clinical Trials Directive or the CTR until January 31, 2023 and, if authorized, those will be governed by the Clinical Trials Directive until January 31, 2025.

By that date, all ongoing trials will become subject to the provisions of the CTR.

Medicines used in clinical trials must be manufactured in accordance with Good Manufacturing Practice (“GMP”).

Other national and EU-wide regulatory requirements may also apply.

Marketing authorization

To market a medicinal product in the EU, we must obtain a marketing authorization (“MA”).

To obtain regulatory approval of a product candidate under EU regulatory systems, we must submit a marketing authorization application (“MAA”).

The process for doing this depends, among other things, on the nature of the medicinal product.

There are two types of MAs:

The Union MA, which is issued by the European Commission through the Centralized Procedure, based on the opinion of the Committee for Medicinal Products for Human Use (“CHMP”) of the European Medicines Agency (“EMA”) and which is valid throughout the entire territory of the EEA.

The Centralized Procedure is mandatory for certain types of products, such as medicinal products derived from biotechnology processes, orphan designated medicinal products, advanced therapy medicinal products (such as gene therapy, somatic cell therapy and tissue engineered products), and medicinal products containing a new active substance indicated for the treatment certain diseases, such as AIDS, cancer, neurodegenerative disorders, diabetes, auto immune and viral diseases.

The Centralized Procedure is optional for products containing a new active substance not yet authorized in the EEA, or for products that constitute a significant therapeutic, scientific or technical innovation or which are in the interest of public health in the EU.

Under the Centralized Procedure, the maximum timeframe for the evaluation of an MA application is 210 days, excluding clock stops.

“Centralized MAs” are issued by the European Commission through the centralized procedure, based on the opinion of the Committee for Medicinal Products for Human Use (“CHMP”) of the European Medicines Agency (“EMA”) and arevalid throughout the EU.

The centralized procedure is mandatory for certain types of products, such as (i)medicinal products derived from biotechnology processes, (ii) designated orphan medicinal products, (iii) ATMPs (such as gene therapy, somatic cell therapy and tissue engineered products), and (iv) medicinal products containing a new active substance indicated for the treatment certain diseases, such as HIV/AIDS, cancer, neurodegenerative disorders, diabetes, auto immune and other immune dysfunctions and viral diseases.

The centralized procedure is optional for products containing a new active substance not yet authorized in the EU, or for products that constitute a significant therapeutic, scientific or technical innovation or which are in the interest of public health in the EU.

Under the centralized procedure, the maximum timeframe for the evaluation of an MAA is 210 days, excluding clock stops.

Accelerated evaluation might be granted by the CHMP in exceptional cases when a medicinal product is of major interest from the point of view of public health and in particular from the viewpoint of therapeutic innovation.

If the CHMP accepts such request, the time limit of 210 days will be reduced to 150 days but it is possible that the CHMP can revert to the standard time limit for the centralized procedure if it considers that it is no longer appropriate to conduct an accelerated assessment.

National MAs, which are issued by the competent authorities of the Member States of the EEA and only cover their respective territory, are available for products not falling within the mandatory scope of the Centralized Procedure.

Where a product has already been authorized for marketing in a Member State of the EEA, this national MA can be recognized in another Member State through the Mutual Recognition Procedure.

“Conditional MAs” may be granted in cases where all the required safety and efficacy data are not yet available.

The conditional MA is subject to conditions to be fulfilled for generating the missing data or ensuring increased safety measures.

It is valid for one year and has to be renewed annually until fulfillment of all the conditions.

Once the pending studies are provided, it can become a “standard” MA.

However, if the conditions are not fulfilled within the timeframe set by the EMA, the MA ceases to be renewed.

Furthermore, MAs may also be granted “under exceptional circumstances” when the applicant can show that it is unable to provide comprehensive data on the efficacy and safety under normal conditions of use even after the product has been authorized and subject to specific procedures being introduced.

This may arise in particular when the intended indications are very rare and, in the present state of scientific knowledge, it is not possible to provide comprehensive information, or when generating data may be contrary to generally accepted ethical principles.

This MA is close to the conditional MA as it is reserved to medicinal products to be approved for severe diseases or unmet medical needs and the applicant does not hold the complete data set legally required for the grant of a MA.

However, unlike the conditional MA, the applicant does not have to provide the missing data and will never have to.

Although the MA “under exceptional circumstances” is granted definitively, the risk-benefit balance of the medicinal product is reviewed annually and the MA is withdrawn in case the risk-benefit ratio is no longer favorable.

“National MAs”, are issued by the competent authorities of EU member states and only cover their respective territory, and are available for products not falling within the mandatory scope of the Centralized Procedure.

Where a product has already been authorized for marketing in an EU member state, this national MA can be recognized in another member state through the mutual recognition procedure.

If the product has not received a national MA in any member state at the time of application, it can be approved simultaneously in various member states through the decentralized procedure.

Under the Decentralized Procedure an identical dossier is submitted to the competent authority of each of the member states in which the MA is sought, one of which is selected by the applicant as the reference member state.

Under the above described procedures, in order to grant the MA, the EMA or the competent authorities of the Member States of the EEA make an assessment of the risk benefit balance of the product on the basis of scientific criteria concerning its quality, safety and efficacy.

Under the above described procedures, in order to grant the MA, the EMA or the competent authorities of the EU member states make an assessment of the risk benefit balance of the product on the basis of scientific criteria concerning its quality, safety and efficacy.

MAs have an initial duration of five years.

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To qualify for PRIME, product candidates require early clinical evidence that the therapy has the potential to offer a therapeutic advantage over existing treatments or benefits patients without treatment options.

Among the benefits of PRIME are the appointment of a rapporteur to provide continuous support and help build knowledge ahead of an MA application, early dialogue and scientific advice at key development milestones, and the potential to qualify products for accelerated review earlier in the application process.

Product developers that benefit from PRIME designation can expect to be eligible for accelerated assessment but this is not guaranteed.

Many benefits accrue to sponsors of product candidates with PRIME designation, including but not limited to, early and proactive regulatory dialogue with the EMA, frequent discussions on clinical trial designs and other development program elements, and accelerated MAA assessment once a dossier has been submitted.

Importantly, a dedicated contact and rapporteur from the CHMP

is appointed early in the PRIME scheme facilitating increased understanding of the product at EMA’s committee level.

An initial meeting initiates these relationships and includes a team of multidisciplinary experts at the EMA to provide guidance on the overall development and regulatory strategies.

Innovative medicines fulfilling a medical need may also benefit from different types of fast track approvals, such as a conditional marketing authorization or a marketing authorization under exceptional circumstances granted on the basis of less comprehensive clinical data than normally required (respectively in the likelihood that the sponsor will provide such data within an agreed timeframe or when comprehensive data cannot be obtained even after authorization).

Advanced therapy classification

Based on legislation adopted in 2007, the EMA established an additional regulatory designation for products classified as an advanced therapy medicinal product (“ATMP”).

The ATMP designation offers sponsors a variety of benefits similar to those associated with the PRIME scheme, including scientific and regulatory guidance, additional opportunities for dialogue with regulators, and presubmission review and certification of the CMC and nonclinical data proposed for submission in a forthcoming MA applications for micro-,small-, or medium-sized enterprises.

Based on legislation adopted in 2007, the EMA established an additional regulatory designation for products classified as an ATMP.

The ATMP designation offers sponsors a variety of benefits similar to those associated with the PRIME scheme, including scientific and regulatory guidance, additional opportunities for dialogue with regulators, and presubmission review and certification of the chemistry, manufacturing and controls (“CMC”) and nonclinical data proposed for submission in a forthcoming MA applications for micro-, small-, or medium-sized enterprises.

To qualify for this designation, product candidates intended for human use must be based on gene therapy, somatic cell therapy, or tissue engineered therapy.

Data and marketing exclusivity

In the EEA, new products authorized for marketing, or reference products, qualify for eight years of data exclusivity and an additional two years of market exclusivity upon marketing authorization.

The data exclusivity period prevents generic or biosimilar applicants from relying on the pre-clinical and clinical trial data contained in the dossier of the reference product when applying for a generic or biosimilar marketing authorization in the EU during a period of eight years from the date on which the reference product was first authorized in the EU.

In the EU, new products authorized for marketing, or reference products, generally receive eight years of data exclusivity and an additional two years of market exclusivity upon MA.

The data exclusivity period prevents generic or biosimilar applicants from relying on the pre-clinical and clinical trial data contained in the dossier of the reference product when applying for a generic or biosimilar MA in the EU during a period of eight years from the date on which the reference product was first authorized in the EU.

The market exclusivity period prevents a successful generic or biosimilar applicant from commercializing its product in the EU until 10 years have elapsed from the initial authorization of the reference product in the EU.

The 10-year market exclusivity period can be extended to a maximum of eleven years if, during the first eight years of those 10 years, the marketing authorization holder obtains an authorization for one or more new therapeutic indications which, during the scientific evaluation prior to their authorization, are held to bring a significant clinical benefit in comparison with existing therapies.

The 10-year market exclusivity period can be extended to a maximum of eleven years if, during the first eight years of those 10 years, the MA holder obtains an authorization for one or more new therapeutic indications which, during the scientific evaluation prior to their authorization, are held to bring a significant clinical benefit in comparison with existing therapies.

There is a special regime for biosimilars, or biological medicinal products that are similar to a reference medicinal product but that do not meet the definition of a generic medicinal product, for example, because of differences in raw materials or manufacturing processes.

For such products, the results of appropriate preclinical or clinical trials must be provided, and guidelines from the EMA detail the type of quantity of supplementary data to be provided for different types of biological product.

There are no such guidelines for complex biological products, such as gene or cell therapy medicinal products, and so it is unlikely that biosimilars of those products will currently be approved in the EU.

However, guidance from the EMA states that they will be considered in the future in light of the scientific knowledge and regulatory experience gained at the time.

Pediatric development

In the EEA, MA applications for new medicinal products have to include the results of studies conducted in the pediatric population, in compliance with a pediatric investigation plan (“PIP”), agreed with the EMA’s Pediatric Committee (“ PDCO”).

In the EU, MAAs for new medicinal products have to include the results of studies conducted in the pediatric population, in compliance with a pediatric investigation plan (“PIP”), agreed with the EMA’s Pediatric Committee (“PDCO”).

The PIP sets out the timing and measures proposed to generate data to support a pediatric indication of the drug for which marketing authorization is being sought.

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Further, the obligation to provide pediatric clinical trial data can be waived by the PDCO when these data is not needed or appropriate because the product is likely to be ineffective or unsafe in children, the disease or condition for which the product is intended occurs only in adult populations, or when the product does not represent a significant therapeutic benefit over existing treatments for pediatric patients.

Once the MA is obtained in all member states of the EU and study results are included in the product information, even when negative, the product is eligible for six months’ supplementary protection certificate extension (if any is in effect at the time of authorization) or, in the case of orphan products, a two year extension of the orphan market exclusivity.

Orphan drug designation.

In the EEA, a medicinal product can be designated as an orphan drug if its sponsor can establish that (1) the product is intended for the diagnosis, prevention or treatment of a life-threatening or chronically debilitating condition;

Once the MA is obtained in all EU member states and study results are included in the product information, even when negative, the product is eligible for six months’ supplementary protection certificate extension (if any is in effect at the time of authorization) or, in the case of orphan products, a two year extension of the orphan market exclusivity.

Orphan Medicinal Products

In the EU, a medicinal product can be designated as an orphan if its sponsor can establish that (1) the product is intended for the diagnosis, prevention or treatment of a life-threatening or chronically debilitating condition;

and (2) either (a) such condition affects not more than five in ten thousand persons in the EU when the application is made, or (b) without incentives, it is unlikely that the marketing of the product in the EU would generate sufficient return to justify the necessary investment;

and (3) there exists no satisfactory method of diagnosis, prevention or treatment of the condition in question that has been authorized in the EU or, if such method exists, the product will be of significant benefit to those affected by that condition.

In the EEA, an application for designation as an orphan product can be made any time prior to the filing of a MA application.

MA for an orphan drug leads to a ten-year period of market exclusivity.

During this market exclusivity period, the EMA or the member state competent authorities, cannot accept another application for a MA, or grant a MA, for a similar medicinal product for the same indication.

The period of market exclusivity is extended by two years for medicines that have also complied with an agreed PIP.

This period may, however, be reduced to six years if, at the end of the fifth year, it is established that the product no longer meets the criteria for orphan drug designation, for example because the product is sufficiently profitable not to justify market exclusivity.

Market exclusivity can be revoked only in very selected cases, such as consent from the marketing authorization holder, inability to supply sufficient quantities of the product, demonstration of “clinical superiority” by a similar medicinal product, or, after a review by the Committee for Orphan Medicinal Products, requested by a member state in the fifth year of the marketing exclusivity period (if the designation criteria are believed to no longer apply).

Medicinal products designated as orphan drugs are eligible for incentives made available by the EU and its Member States to support research into, and the development and availability of, orphan drugs.

In the EU, an application for designation as an orphan product can be made any time prior to the filing of a MAA.

Orphan drug designation entitles a party to incentives such fee reductions or fee waivers, protocol assistance, and access to the centralized procedure.

Upon grant of a MA , orphan medicinal products are entitled to a ten-year period of market exclusivity for the approved therapeutic indications, which means the competent authorities, cannot accept another application for a MA , or grant a MA , or accept an application to extend a MA for a similar medicinal product for the same indication for a period of ten years .

The period of market exclusivity is extended by two years for orphan medicinal products that have also complied with an agreed PIP.

No extension to any supplementary protection certificate can be granted on the basis of pediatric studies for orphan indications.

The orphan exclusivity period may, however, be reduced to six years if, at the end of the fifth year, it is established that the product no longer meets the criteria for orphan drug designation, for example because the product is sufficiently profitable not to justify market exclusivity, or where the prevalence of the condition has increased above the threshold.

Granting of an authorization for another similar orphan medicinal product where another product has market exclusivity can happen at any time if:

(i) the second applicant can establish that its product, although similar to the authorized product, is safer, more effective or otherwise clinically superior, (ii) inability of the applicant to supply sufficient quantities of the orphan medicinal product or (iii) where the applicant consents to a second orphan medicinal product application.

A company may voluntarily remove a product from the orphan register.

Orphan designation does not convey any advantage in, or shorten the duration of, the regulatory review and approval process.

Genetically Modified Food Products

In the EEA food products are generally governed by Regulation (EC) No 178/2002 laying down the general principles and requirements of food law as well as the procedures in matters of food safety and establishing the European Food Safety Authority (“EFSA”).

Food business operators are regulated by, among other authorities, the European Commission and EFSA, and national food safety authorities in EEA countries.

In addition, food additives (such as substances preserving, coloring or sweetening food) are specifically regulated by Regulation (EC) No 1333/2008, which sets the conditions of use and labeling requirements for additives, and Commission Regulation (EU) No 234/2011, which establishes a common authorization procedure for food improvement agents (including food additives).

To be used on the EEA market, additives must be safe and authorized by the European Commission for that purpose.

EFSA and/or the Scientific Committee on Food assess the safety of food additives.

Authorized additives and their conditions of use are listed in a European list.

For some categories of food additives, additional requirements may apply.

A genetically modified organism (“GMO”) is an organism, with the exception of human beings, in which the genetic material has been altered in a way that does not occur naturally by mating and/or natural recombination.

In July 2018, the Court of Justice of the European Union (“CJEU”) clarified in its ruling C-528/16 that organisms from new mutagenesis techniques also fall within the scope of the European GMO legislation.

Food which contains or consists of such GMOs, or is produced from GMOs, is called genetically modified food, and is regulated by a number of specific EU and national regulations.

In particular, Regulation (EC) No.

1829/2003 on genetically modified food and feed (complemented by Commission Implementing Regulation (EU) No 503/2013) and Directive 2001/18/EC on the deliberate release of GMOs into the environment (as amended by Commission Directive (EU) 2018/350) provide that both the cultivation of GMOs and the use of GMOs in food, feed and derived products in the EEA are subject to prior authorizations.

Authorizations for these respective activities are granted by the national competent authorities of EEA countries following a thorough risk assessment (of the risks the GMO may present to the environment, human health and animal safety) by EFSA.

Authorizations are valid throughout the EEA, for a maximum of 10 years, and are renewable.

In accordance with Directive (EU) 2015/412 individual countries may further restrict or prohibit GMO cultivation on their territory.

The European Commission holds and maintains a register of genetically modified food and feed which is available to the general public.

GMO operators must also comply with traceability and labeling requirements as notably provided for in Regulation (EC) No 1830/2003.

All operators, such as farmers or food and feed producers, which introduce such products in the supply chain or purchase such products, must be able to identify their supplier and the companies to which the products have been delivered.

Operators must provide their customers with an indication that the product – or certain ingredients – contains, consists of, or is obtained from GMOs, and information on the unique identifier(s) for these GMOs.

Operators must keep a record for a five year period after every transaction.

In addition, subject to an exception of a proportion no higher than 0.9 percent of the food/feed ingredients considered individually, the list of ingredients on the labeling of pre-packed genetically modified food/feed products must indicate “genetically modified” or “produced from genetically modified [name of the organism].” For products without packaging, this information must be clearly displayed in close proximity to the product.

Specific post-authorization requirements apply.

For instance, GMO operators must implement and regularly report on a post-market environmental monitoring plan, including general surveillance for unanticipated adverse effects and case-specific monitoring to detect direct and indirect effects which have been identified in the environmental risk assessment.

In addition, post-market monitoring plans may be requested in specific cases to ensure that the conditions of use are duly applied and to monitor the consumption of the product.

Further to Regulation (EU) 2017/625, GMOs are subject to official controls by EEA countries for the deliberate release of GMOs in the EEA and the presence of GMOs and/or genetically modified material in food, feed and seeds at import stage and on the EEA market.

Official controls, which may consist of audits and inspections, verify the absence of unauthorized GMOs and genetically modified material on the EEA market and check proper traceability and labeling.

Transboundary movements of GMOs are regulated by Regulation (EC) 1946/2003 which transposes the Cartagena Protocol on Biosafety into EU law.

The Regulation obliges countries to take legal, administrative and other measures to implement their commitments under the Protocol, and in particular addresses GMOs exports, requiring a notification to importing parties, information to the Biosafety Clearing House as well as other identification and accompanying documentation.

Even though EU regulations are directly applicable in all EU Member States and – when specified – in Iceland, Liechtenstein and Norway, additional national laws, regulations, implementing rules and guidelines on specific aspects may impose further requirements on GMOs operators.

GMOs and modern biotechnologies are under scrutiny in the EEA.

As a variety of new techniques, based on advances in biotechnology, has been developed in the last decade, the European Commission follows these developments to strike a balance between innovation in the food and agricultural sector while maintaining high safety standards.

In November 2019, the Council of the European Union requested the European Commission to provide a study on new genomic techniques, the results of which are expected by April 30, 2021.

Post-Approval Requirements

Similar to the United States, both MA holders and manufacturers of medicinal products are subject to comprehensive regulatory oversight by the EMA, the European Commission and/or the competent regulatory authorities of the member states.

The holder of a MA must establish and maintain a pharmacovigilance system and appoint an individual qualified person for pharmacovigilance who is responsible for oversight of that system.

Key obligations include expedited reporting of suspected serious adverse reactions and submission of periodic safety update reports (“PSURs”).

All new MAAs must include a risk management plan (“RMP”) describing the risk management system that the company will put in place and documenting measures to prevent or minimize the risks associated with the product.

The regulatory authorities may also impose specific obligations as a condition of the MA.

Such risk-minimization measures or post-authorization obligations may include additional safety monitoring, more frequent submission of PSURs, or the conduct of additional clinical trials or post-authorization safety studies.

The advertising and promotion of medicinal products is also subject to laws concerning promotion of medicinal products, interactions with physicians, misleading and comparative advertising and unfair commercial practices.

All advertising and promotional activities for the product must be consistent with the approved summary of product characteristics, and therefore all off-label promotion is prohibited.

Direct-to-consumer advertising of prescription medicines is also prohibited in the EU.

Although general requirements for advertising and promotion of medicinal products are established under EU directives, the details are governed by regulations in each member state and can differ from one country to another.

The aforementioned EU rules are generally applicable in the European Economic Area, or EEA, which consists of the 27 EU member states plus Norway, Liechtenstein and Iceland.

Failure to comply with EU and member state laws that apply to the conduct of clinical trials, manufacturing approval, MA of medicinal products and marketing of such products, both before and after grant of the MA, manufacturing of pharmaceutical products, statutory health insurance, bribery and anti-corruption or with other applicable regulatory requirements may result in administrative, civil or criminal penalties.

These penalties could include delays or refusal to authorize the conduct of clinical trials, or to grant MA, product withdrawals and recalls, product seizures, suspension, withdrawal or variation of the MA, total or partial suspension of production, distribution, manufacturing or clinical trials, operating restrictions, injunctions, suspension of licenses, fines and criminal penalties.

Brexit and the Regulatory Framework in the United Kingdom

The UK left the EU on January 31, 2020, following which existing EU medicinal product legislation continued to apply in the UK during the transition period under the terms of the EU-UK Withdrawal Agreement.

The transition period, which ended on December 31, 2020, maintained access to the EU single market and to the global trade deals negotiated by the EU on behalf of its members.

The transition period provided time for the UK and EU to negotiate a framework for partnership for the future, which was then crystallized in the Trade and Cooperation Agreement (“TCA”), and became effective on the January 1, 2021.

The TCA includes specific provisions concerning pharmaceuticals, which include the mutual recognition of GMP inspections of manufacturing facilities for medicinal products and GMP documents issued, but does not foresee wholesale mutual recognition of UK and EU pharmaceutical regulations.

EU laws which have been transposed into UK law through secondary legislation continue to be applicable as “retained EU law”.

However, new legislation such as the EU CTR will not be applicable.

The UK government has passed a new Medicines and Medical Devices Act 2021, which introduces delegated powers in favor of the Secretary of State or an ‘appropriate authority’ to amend or supplement existing regulations in the area of medicinal products and medical devices.

This allows new rules to be introduced in the future by way of secondary legislation, which aims to allow flexibility in addressing regulatory gaps and future changes in the fields of human medicines, clinical trials and medical devices.

As of January 1, 2021, the Medicines and Healthcare products Regulatory Agency (“MHRA”), is the UK’s standalone medicines and medical devices regulator.

As a result of the Northern Ireland protocol, different rules will apply in Northern Ireland than in England, Wales, and Scotland (together “Great Britain” or “GB”);

broadly, Northern Ireland will continue to follow the EU regulatory regime, but its national competent authority will remain the MHRA.

The MHRA has published a guidance on how various aspects of the UK regulatory regime for medicines will operate in GB and in Northern Ireland following the expiry of the Brexit transition period on December 31, 2020.

The guidance includes clinical trials, importing, exporting, and pharmacovigilance and is relevant to any business involved in the research, development, or commercialization of medicines in the UK.

The new guidance was given effect via the Human Medicines Regulations (Amendment etc.) (EU Exit) Regulations 2019, or the Exit Regulations.

The MHRA has introduced changes to national licensing procedures, including procedures to prioritize access to new medicines that will benefit patients, including a 150-day assessment and a rolling review procedure.

All existing EU MAs for centrally authorized products were automatically converted or grandfathered into UK MAs, effective in GB (only), free of charge on January 1, 2021, unless the MA holder chooses to opt-out.

In order to use the centralized procedure to obtain a MA that will be valid throughout the EEA, companies must be established in the EEA.

Therefore after Brexit, companies established in the UK can no longer use the EU centralized procedure and instead an EEA entity must hold any centralized MAs.

In order to obtain a UK MA to commercialize products in the UK, an applicant must be established in the UK and must follow one of the UK national authorization procedures or one of the remaining post-Brexit international cooperation procedures to obtain an MA to commercialize products in the UK.

The MHRA may rely on a decision taken by the European Commission on the approval of a new (centralized procedure) MA when determining an application for a GB authorization;

or use the MHRA’s decentralized or mutual recognition procedures which enable MAs approved in EU member states (or Iceland, Liechtenstein, Norway) to be granted in GB.

There will be no pre-MA orphan designation.

Instead, the MHRA will review applications for orphan designation in parallel to the corresponding MA application.

The criteria are essentially the same, but have been tailored for the market, i.e., the prevalence of the condition in GB, rather than the EU, must not be more than five in 10,000.

Should an orphan designation be granted, the period or market exclusivity will be set from the date of first approval of the product in GB.

Healthcare Laws and Compliance Requirements

In the United States, our activities are potentially subject to regulation under various federal and state healthcare laws including, among others, the federal Anti-Kickback Statute, the federal False Claims Act and HIPAA.

Similar laws exist in foreign jurisdictions including the EEA, as well.

Similar laws exist in foreign jurisdictions including the EU, as well.

federal Anti-Kickback Statute prohibits, among other things, any person or entity, from knowingly and willfully offering, paying, soliciting or receiving any remuneration, directly or indirectly, overtly or covertly, in cash or in kind, to induce or in return for purchasing, leasing, ordering or arranging for the purchase, lease or order of any item or service reimbursable under Medicare, Medicaid or other federal healthcare programs.

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federal Anti-Kickback Statute, a person or entity does not need to have actual knowledge of the statute or specific intent to violate it in order to have committed a violation.

Additionally, the federal Physician Payments Sunshine Act, and its implementing regulations, require that certain manufacturers of drugs, devices, biological and medical supplies for which payment is available under Medicare, Medicaid or the Children’s Health Insurance Program (with certain exceptions) to report annually to CMS information related to certain payments or other transfers of value made or distributed to physicians (defined to include doctors, dentists, optometrists, podiatrists and chiropractors), certain other health care professionals beginning in 2022, and teaching hospitals, or to entities or individuals at the request of, or designated on behalf of, the physicians and teaching hospitals and to report annually to CMS certain ownership and investment interests held by physicians and their immediate family members.

Moreover, analogous state and non-U.S.

laws and regulations may apply to our activities, such as state anti-kickback and false claims laws, which may apply to our business practices, including, but not limited to, research, distribution, sales and marketing arrangements and claims involving healthcare items or services reimbursed by non-governmental third-party payors, including private insurers, or by the patients themselves, state laws that require pharmaceutical and device companies to comply with the industry’s voluntary compliance guidelines and the relevant compliance guidance promulgated by the U.S.

Additionally, the federal Physician Payments Sunshine Act, and its implementing regulations, require that certain manufacturers of drugs, devices, biological and medical supplies for which payment is available under Medicare, Medicaid or the Children’s Health Insurance Program (with certain exceptions) to report annually to CMS information related to certain payments or other transfers of value made or distributed to physicians (defined to include doctors, dentists, optometrists, podiatrists and chiropractors) , certain non-physician practitioners including physician assistants and nurse practitioners , and teaching hospitals, or to entities or individuals at the request of, or designated on behalf of, the physicians and teaching hospitals and to report annually to CMS certain ownership and investment interests held by physicians and their immediate family members.

Moreover, analogous state and foreign laws and regulations may apply to our activities, such as state anti-kickback and false claims laws, which may apply to our business practices, including, but not limited to, research, distribution, sales and marketing arrangements and claims involving healthcare items or services reimbursed by non-governmental third-party payors, including private insurers, or by the patients themselves, state laws that require pharmaceutical and device companies to comply with the industry’s voluntary compliance guidelines and the relevant compliance guidance promulgated by the U.S.

government, or otherwise restrict payments that may be made to healthcare providers and other potential referral sources, state and local laws and regulations that require manufacturers to report information related to payments and other transfers of value to physicians and other healthcare providers or marketing expenditures and pricing information, and state and local laws which require the registration of pharmaceutical sales representatives.

Efforts to ensure that current and future business arrangements with third parties comply with applicable healthcare laws and regulations involves substantial costs.

penalties, damages, monetary fines, disgorgement, individual imprisonment, possible exclusion from participation in Medicare, Medicaid and other U.S.

If a business is found to be in violation of any of these or any other health regulatory laws that may apply to it, it may be subject to significant penalties, including the imposition of significant civil, criminal and administrative penalties, damages, monetary fines, disgorgement, individual imprisonment, possible exclusion from participation in Medicare, Medicaid and other U.S.

healthcare programs, additional reporting requirements and oversight if subject to a corporate integrity agreement or similar agreement to resolve allegations of non-compliance with these laws, contractual damages, reputational harm, diminished profits and future earnings, and curtailment or restructuring of operations.

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Even if favorable coverage and reimbursement status is attained for one or more products for which we receive regulatory approval, less favorable coverage policies and reimbursement rates may be implemented in the future.

In the EEA, governments influence the price of products through their pricing and reimbursement rules and control of national health care systems that fund a large part of the cost of those products to consumers.

In the EU, governments influence the price of products through their pricing and reimbursement rules and control of national health care systems that fund a large part of the cost of those products to consumers.

Member states are free to restrict the range of pharmaceutical products for which their national health insurance systems provide reimbursement, and to control the prices and reimbursement levels of pharmaceutical products for human use.

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Among policy makers and payors in the United States and elsewhere, there is significant interest in promoting changes in healthcare systems with the stated goals of containing healthcare costs, improving quality and/or expanding access.

The Patient Protection and Affordable Care Act, as amended by the Health Care and Education Reconciliation Act, collectively the Affordable Care Act, enacted in March 2010, has substantially changed healthcare financing and delivery by both governmental and private insurers.

Among other things the Affordable Care Act included the following provisions:

The Patient Protection and Affordable Care Act, as amended by the Health Care and Education Reconciliation Act, collectively the ACA, enacted in March 2010, has substantially changed healthcare financing and delivery by both governmental and private insurers.

Among other things the ACA included the following provisions:

an annual, nondeductible fee on any entity that manufactures or imports certain specified branded prescription drugs and biologic agents apportioned among these entities according to their market share in some government healthcare programs;

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a licensure framework for follow on biologic products.

On December 14, 2018, a U.S.

District Court Judge in the Northern District of Texas, or Texas District Court Judge, ruled that the entire Affordable Care Act is invalid based primarily on the fact that the legislation enacted on December 22, 2017, the Tax Cuts and Jobs Act of 2017, or the TCJA, repealed the tax-based shared responsibility payment imposed by the Affordable Care Act, on certain individuals who fail to maintain qualifying health coverage for all or part of a year, which is commonly referred to as the “individual mandate.” On December 18, 2019, the U.S.

Court of Appeals for the 5th Circuit upheld the district court’s decision that the individual mandate was unconstitutional but remanded the case back to the District Court to determine whether the remaining provisions of the ACA are invalid as well.

Supreme Court is currently reviewing the case, although it remains unclear when or how the Supreme Court will rule.

It is also unclear how other efforts, if any, to challenge, repeal or replace the Affordable Care Act will impact the Affordable Care Act.

In addition, other legislative changes have been proposed and adopted since the Affordable Care Act was enacted.

Since its enactment, there have been judicial, administrative, executive, and legislative challenges to certain aspects of the ACA.

On June 17, 2021, the U.S.

Supreme Court (the “Supreme Court”) dismissed the most recent judicial challenge to the ACA brought by several states on procedural grounds without specifically ruling on the constitutionality of the ACA.

Thus, the ACA will remain in effect in its current form.

Prior to the Supreme Court's decision.

President Biden issued an executive order that initiated a special enrollment period from February 15, 2021 through August 15, 2021 for purposes of obtaining health insurance coverage through the ACA marketplace.

The executive order also instructed certain governmental agencies to review and reconsider their existing policies and rules that limit access to healthcare, including among others, reexamining Medicaid demonstration projects and waiver programs that include work requirements, and policies that create unnecessary barriers to obtaining access to health insurance coverage through Medicaid or the ACA.

It is unclear how other health reform measures of the Biden administration will impact our business.

In addition, other legislative changes have been proposed and adopted since the ACA was enacted.

On August 2, 2011, the Budget Control Act of 2011 was signed into law, which, among other things, included reductions to Medicare payments to providers of 2% per fiscal year, which went into effect on April 1, 2013 and, due to subsequent legislative amendments to the statute will remain in effect through 2030, with the exception of a temporary suspension from May 1, 2020 through March 31, 2022, unless additional Congressional action is taken.

On January 2, 2013, the American Taxpayer Relief Act of 2012 was signed into law, which, among other things, reduced Medicare payments to several providers, including hospitals, and increased the statute of limitations period for the government to recover overpayments to providers from three to five years.

Additionally, on May 30, 2018, the Right to Try Act was signed into law.

The law, among other things, provides a federal framework for certain patients to access certain investigational new drug products that have completed a Phase 1 clinical trial and are undergoing investigation for FDA approval.

Under certain circumstances, eligible patients can seek treatment without enrolling in clinical trials and without obtaining FDA permission under the FDA expanded access program.

There is no obligation for a drug manufacturer to make its drug products available to eligible patients as a result of the Right to Try Act.

Finally, there has been heightened governmental scrutiny recently over pharmaceutical pricing practices in light of the rising cost of prescription drugs and biologics.

Such scrutiny has resulted in several recent Congressional inquiries and proposed and enacted federal and state legislation designed to, among other things, bring more transparency to product pricing, review the relationship between pricing and manufacturer patient programs, and reform government program reimbursement methodologies, rebates and price negotiation for pharmaceutical products.

How the incoming Biden Administration chooses to prioritize such reforms and other policy initiatives, and how such events may impact our ability to realize returns on our product development investments remains to be seen.

At the state level, legislatures have increasingly passed legislation and implemented regulations designed to control pharmaceutical product and medical device pricing, including price or patient reimbursement constraints, discounts, restrictions on certain product access and marketing cost disclosure and transparency measures, and, in some cases, designed to encourage importation from other countries and bulk purchasing.

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In the United States, numerous federal and state laws and regulations, including data breach notification laws, health information privacy and security laws, including HIPAA, and federal and state consumer protection laws and regulations (e.g., Section 5 of the FTC Act), that govern the collection, use, disclosure, and protection of health-related and other personal information could apply to our operations or the operations of our partners.

In addition, certain state and non-U.S.

laws, such as the California Consumer Privacy Act, or the CCPA, the California Privacy Rights Act, or the CPRA, and the EU General Data Protection Regulation, or the GDPR, govern the privacy and security of personal information, including health-related information in certain circumstances, some of which are more stringent than HIPAA and many of which differ from each other in significant ways and may not have the same effect, thus complicating compliance efforts.

In addition, certain state foreign laws, such as the California Consumer Privacy Act (“CCPA”), the California Privacy Rights Act (“CPRA”), and the EU General Data Protection Regulation (“GDPR”) and the UK GDPR, govern the privacy and security of personal information, including health-related information in certain circumstances, some of which are more stringent than HIPAA and many of which differ from each other in significant ways and may not have the same effect, thus complicating compliance efforts.

Failure to comply with these laws, where applicable, can result in the imposition of significant civil and/or criminal penalties and private litigation.

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Human Capital

We are a purpose-driven organization, and we have carefully promoted a culture that values innovation, accountability, respect, adaptability and perseverance.

We are a purpose-driven organization, and we believe we have carefully promoted a culture that values innovation, accountability, respect, adaptability and perseverance.

We strive to ensure that our open, collaborative culture empowers Precisioneers to be their best selves and do their best work.

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This isn’t just a statement supporting the products that we are developing – it is a statement that speaks to our collective desire to do our part in improving the lives of those around us.

Through our newly launched Diversity and Inclusion initiative, we are actively fostering an environment that attracts the best talent, values diversity of life experiences and perspectives, and encourages innovation in pursuit of our mission.

With guest lectures, new trainings, employee resource groups, and other activities, we are supporting a workplace that reflects and embraces the gender, race, ethnicity, sexual orientation, age, physical ability, as well as all cultural backgrounds in our community.

Through our Diversity and Inclusion initiative, we are actively fostering an environment that attracts the best talent, values diversity of life experiences and perspectives, and encourages innovation in pursuit of our mission.

With guest lectures, new trainings, development of employee resource groups, and other activities, we are supporting a workplace that reflects and embraces the gender, race, ethnicity, sexual orientation, age, physical ability, as well as all cultural backgrounds in our community.

As of February 24, 2022, our workforce was self-reportedly approximately 49% women and approximately 27% Asian, Black, Latinx, two or more races, or not defined.

Our senior leadership team and department heads were self-reportedly approximately 28% women and 12% Asian or Black as of February 25, 2021.

Notable benefits we offer to our full-time Precisioneers include:

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We have implemented measures to mitigate exposure risks and support operations.

We initiated a health and safety program addressing mandatory use of face masks, social distancing, sanitary handwashing practices, use of personal protective equipment stations, stringent cleaning and sanitization of all facilities and measures to reduce total occupancy in facilities.

We initiated a health and safety program addressing mandatory use of face masks, mandatory vaccinations, social distancing, sanitary handwashing practices, use of personal protective equipment stations, stringent cleaning and sanitization of all facilities and measures to reduce total occupancy in facilities.

We have implemented temperature and symptom screening procedures at each location, and we have continuously communicated to all our Precisioneers that if they are not comfortable coming to work, regardless of role, then they do not have to do so.

Throughout this crisis, our focus has been on keeping our workplace as safe as possible, while ensuring business continuity and positioning ourselves well for the future.

As of December 31, 2020, we had 231 full-time Precisioneers, comprised of 208 from our Therapeutics Segment and 23 from our Food Segment.

As of December 31, 2021, we had 198 full-time Precisioneers.

Of these full-time employees, 156 are engaged in research and development activities and 45 have Ph.D.

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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-K

Item 1. Business