What changed in this filing

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Item 2. Management’s Discussion and Analysis

2024-08-07 compared with 2024-05-08 · 151 added, 79 removed, 199 unchanged (54% of the section changed)

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In 2022, we dosed the first patient in the RUBY trial, and after completing sequential dosing of the first two patients, we commenced concurrent patient dosing in the first quarter of 2023.

We have completed enrollment of the adult cohort and continue to dose patients in the RUBY trial.

We also have enrolled multiple patients in the adolescent cohort in the trial.

In December 2021, the the U.S.

Food and Drug Administration (the “FDA”) cleared our Investigational New Drug (“IND”) application for a Phase 1/2 clinical trial of reni-cel for the treatment of TDT, which we refer to as our EdiTHAL

We previously completed enrollment of the adult cohort and continue to dose adult patients.

In the second quarter of 2024, we completed enrollment of the adolescent cohort and are concurrently manufacturing drug product and scheduling dosing for the initial adolescent cohort patients.

Based on our discussions to date with the U.S.

Food and Drug Administration (the “FDA”), we expect any future biologics license application package for reni-cel for the treatment of severe SCD to be similar in number of patients and duration of follow-up to the package submitted for a previously FDA-approved gene editing medicine for severe SCD.

In December 2021, the FDA cleared our Investigational New Drug (“IND”) application for a Phase 1/2 clinical trial of reni-cel for the treatment of TDT, which we refer to as our EdiTHAL trial.

We dosed the first patient in this trial in the first quarter of 2023 and commenced concurrent patient dosing in the second quarter of 2023.

We continue to enroll and dose patients in the trial.

In December 2023, we presented new safety and efficacy data in 17 patients treated with reni-cel in both the RUBY and EdiTHAL trials.

This clinical data, which remained consistent with and further confirmed earlier clinical results shared in June 2023 and December 2022, supports our belief that reni-cel can be a clinically differentiated, one-time, durable medicine that can provide life-changing clinical benefits to patients with SCD and TDT, specifically driving early and robust correction of anemia and sustained increases in fetal hemoglobin.

For additional information regarding these clinical data, please see “Business—Our Gene Editing Medicine Programs—Ex Vivo Hemoglobinopathies” in the Annual Report.

We remain on track to present additional clinical data from both the RUBY and EdiTHAL trials in mid-2024 and further data by year-end 2024.

We have completed enrollment of the adult cohort in the trial and continue to dose patients.

In June 2024, we presented new safety and efficacy data as of a May 8, 2024 data cutoff date in 18 patients treated with reni-cel in the RUBY clinical trial and in seven patients treated with reni-cel in the EdiTHAL clinical trial.

We remain on track to present additional clinical data from both the RUBY and EdiTHAL trials by year-end 2024.

In the RUBY clinical trial, all 18 patients were free of vaso-occlusive events since reni-cel infusion with follow-up ranging from 2.4 to 22.8 months.

Patients demonstrated early normalization of total hemoglobin (“Hb”) with a mean within the normal range at more than 14g/dL and rapid and sustained improvements in fetal hemoglobin (“HbF”) well above levels of over 40%.

Across patients with at least six months follow-up, at month six, the mean total Hb was 14.3 g/dL for nine patients with a mean HbF of 48.5% for 10 patients.

The mean percentage of F-cells increased early and were sustained at over 90% from month four through subsequent follow-ups for all 12 patients with at least four months follow-up.

Mean corpuscular fetal hemoglobin of HbF-containing red cells (F-cells) was sustained above the anti-sickling threshold of 10 pg/F-cell by month three after reni-cel infusion for all 14 patients with at least three months follow-up.

All patients in the RUBY trial showed sustained high levels of editing in the HBG1 and HBG2 promoter regions.

Markers of hemolysis had been normalized or improved in patients treated with reni-cel.

Reni-cel was well-tolerated and demonstrated a safety profile consistent with myeloablative conditioning with busulfan, the regimen that is necessary for current gene editing therapies for SCD and TDT, and autologous hematopoietic stem cell transplant by all 18 evaluated RUBY trial patients.

Patients in the RUBY trial underwent a median of two apheresis and mobilization cycles.

After reni-cel infusion, all 18 patients demonstrated successful neutrophil and platelet engraftment.

Neutrophil engraftment occurred at a median of 23 days, and platelet engraftment occurred at a median of 24 days.

No serious adverse events related to reni-cel treatment in the RUBY trial have been reported.

In the EdiTHAL clinical trial, patients demonstrated early and robust total Hb and HbF increases, with total Hb rising above the transfusion independence threshold of 9.0 g/dL.

For the six patients with at least six months follow-up, the mean total Hb and HbF concentrations at month six were 12.1 g/dL and 10.9 g/dL, respectively, which were sustained at or above the transfusion threshold from six months through subsequent follow-ups.

All seven patients were transfusion free for a range of 4.1 to 12.8 months after receiving the last red blood cell transfusion at 0.5-2.2 months post-reni-cel infusion.

All patients in the EdiTHAL trial showed sustained high levels of editing in the HBG1 and HBG2 promoter regions.

Reni-cel was well-tolerated and demonstrated a safety profile consistent with myeloablative conditioning with busulfan and autologous hematopoietic stem cell transplant by all seven evaluated EdiTHAL trial patients.

All patients in the EdiTHAL trial underwent one apheresis and mobilization cycle.

After reni-cel infusion, all seven patients demonstrated successful neutrophil and platelet engraftment.

Neutrophil engraftment occurred at a median of 23 days, and platelet engraftment occurred at a median of 38 days.

No serious adverse events related to reni-cel treatment in the EdiTHAL trial have been reported.

We are also pursuing the development of next generation in vivo administered gene editing medicines, in which the medicine is injected or infused into the patient to edit the cells inside their body.

We are initially focused on editing HSCs through targeted delivery of our AsCas12a enzyme to our clinically validated HBG1 and HBG2 promotor site.

Our internal development efforts leverage the indel CRISPR technology we use to upregulate gamma globin expression through direct editing of the HBG1/2 promotor site in our ex vivo reni-cel program.

Our in vivo approach is aimed at functional upregulation of gene expression in genetic diseases in rare and orphan disease patient populations, from which we intend to expand to more common disease populations.

Our internal development efforts leverage our indel CRISPR technology we use to upregulate the expression of the gamma globin gene, a functional homolog of the beta globin gene, through direct editing of the HBG1/2 promotor site in our ex vivo reni-cel program.

Using this approach, we are pursuing an in vivo strategy aimed at driving functional upregulation of gene expression to address loss of function or deleterious mutations in genetic diseases in rare and orphan disease patient populations, from which we intend to expand to diseases with larger patient populations.

We are evaluating lipid nanoparticles for delivery of gene editing cargo into multiple tissue types with multiple companies, and are also evaluating additional, next generation delivery technologies.

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We are pursuing the right combination of gene editing and targeted delivery tools through internal development and the in-licensing of complementary technologies, while also leveraging our intellectual property portfolio to drive potential out-licensing and partnership discussions that can accelerate the achievement of our goal of delivering lifesaving medicines to patients with previously untreatable diseases.

In December 2023, we and Vertex Pharmaceuticals Incorporated (“Vertex”) entered into a license agreement, under which Vertex obtained a non-exclusive license for our Cas9 gene editing technology for ex vivo gene editing medicines targeting the BCL11A gene in the fields of SCD and TDT, including Vertex’s CASGEVY TM (exagamglogene autotemcel).

medicines targeting the BCL11A gene in the fields of SCD and TDT, including Vertex’s CASGEVY TM (exagamglogene autotemcel).

We received a $50.0 million upfront cash payment in the fourth quarter of 2023 and the 2024 annual license fee of $10.0 million in the first quarter of 2024.

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We have not generated any revenue from product sales.

We have primarily financed our operations through various equity financings, payments received under our research collaboration with BMS, our former strategic alliance with Allergan Pharmaceuticals International Limited (together with its affiliates, “Allergan”), which was terminated in August 2020, and payments received in conjunction with our license agreement with Vertex.

Since inception, we have incurred significant operating losses.

Our net losses were $62.0 million and $49.0 million for the three months ended March 31, 2024 and 2023, respectively.

As of March 31, 2024, we had an accumulated deficit of $1.3 billion.

Our net losses were $129.6 million and $89.3 million for the six months ended June 30, 2024 and 2023, respectively.

As of June 30, 2024, we had an accumulated deficit of $1.4 billion.

We expect to continue to incur significant expenses and operating losses for the foreseeable future.

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We no longer receive research funding support.

During the three months ended March 31, 2024, we recognized $0.5 million of revenue related to our collaboration with BMS, none of which was previously deferred.

We did not recognize any revenue related to our collaboration with BMS during the three months ended March 31, 2023.

As of March 31, 2024, we recorded $56.7 million of deferred revenue in relation to our collaboration with BMS, of which $6.5 million was classified as short-term deferred revenue and $50.2 million was classified as long-term deferred revenue on our consolidated balance sheet.

During the three months ended June 30, 2024 and three months ended June 30, 2023, we did not recognize revenue related to our collaboration with BMS.

As of June 30, 2024, we had $56.7 million of deferred revenue in relation to our collaboration with BMS, of which $6.5 million was classified as short-term deferred revenue and $50.2 million was classified as long-term deferred revenue on our consolidated balance sheet.

Under this collaboration, we will recognize revenue upon delivery of option packages to BMS or upon receipt of development milestone payments.

We expect that our revenue will fluctuate from quarter-to-quarter and year-to-year as a result of the timing of when we deliver such option packages or receive such milestone payments.

Upon execution of the license agreement with Vertex, we received a $50.0 million upfront cash payment in the fourth quarter of 2023 and the 2024 annual license fee of $10.0 million in the first quarter of 2024.

Pursuant to the license agreement with Vertex, we received a $50.0 million upfront cash payment in the fourth quarter of 2023 upon execution of the agreement and the 2024 annual license fee of $10.0 million in the first quarter of 2024.

We are eligible to receive an additional $50.0 million contingent upfront payment.

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Management’s Discussion and Analysis of Financial Condition and Results of Operations—Critical Accounting Policies and Estimates—Revenue Recognition” included in the Annual Report.

For the foreseeable future we expect substantially all of our revenue will be generated from our license agreements with Vertex and VorBio, collaboration with BMS, and any other collaborations or license agreements we may enter into.

For the foreseeable future we expect substantially all of our revenue will be generated from our license agreements with Vertex and Vor Bio, collaboration with BMS, and any other collaborations or license agreements we may enter into.

Research and Development Expenses

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These increases will include increased costs related to the hiring of additional personnel and fees to outside consultants.

We also anticipate increased expenses related to reimbursement of third-party patent-related expenses and expenses associated with operating as a public company, including costs for audit, legal, regulatory, and tax-related services, director and

officer insurance premiums, and investor relations costs.

With respect to reimbursement of third-party intellectual property-related expenses specifically, given the ongoing nature of the opposition and interference proceedings involving the patents licensed to us under our license agreement with Broad and Harvard, we anticipate general and administrative expenses will continue to be significant.

Other Income, Net

For the three months ended March 31, 2024 and March 31, 2023, other income, net consisted primarily of interest income and the amortization of premiums or discounts on marketable securities.

For the six months ended June 30, 2024 and June 30, 2023, other income, net consisted primarily of interest income and the amortization of premiums or discounts on marketable securities.

Critical Accounting Policies and Estimates

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Results of Operations

Comparison of the Three Months ended March 31, 2024 and 2023

The following table summarizes our results of operations for the three months ended March 31, 2024 and 2023, together with the changes in those items in dollars (in thousands) and the respective percentages of change:

Comparison of the Three Months ended June 30, 2024 and 2023

The following table summarizes our results of operations for the three months ended June 30, 2024 and 2023, together with the changes in those items in dollars (in thousands) and the respective percentages of change:

Three Months Ended

March 31, Dollar Change Percentage Change

June 30, Dollar Change Percentage Change

Collaboration and other research and development revenues $ 513 $ 2,887 $ (2,374) (82) %

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Other income, net

Other income (expense), net 6 (1,584) 1,590 n/m

Other expense, net (1) (7) 6 (86) %

Interest income, net 4,297 3,811 486 13 %

Total other income, net 5,041 1,925 3,116 n/m

Total other income, net 4,296 3,804 492 13 %

Net loss $ (67,607) $ (40,290) $ (27,317) 68 %

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Collaboration and Other Research and Development Revenues

Collaboration and other research and development revenues were $1.1 million for the three months ended March 31, 2024 compared to $9.9 million for the same period in 2023.

The decrease from the three months ended March 31, 2023 is primarily attributable to the sale of our wholly-owned oncology assets and related licenses in January 2023.

Collaboration and other research and development revenues were $0.5 million for the three months ended June 30, 2024 compared to $2.9 million for the same period in 2023.

The decrease from the three months ended June 30, 2023 is primarily attributable to reduced drug supply activity with collaborators.

Research and Development Expenses

Research and development expenses increased by $11.0 million to $48.8 million for the three months ended March 31, 2024 compared to $37.8 million for the same period in 2023.

The following table summarizes our research and development expenses for the three months ended March 31, 2024 and 2023, together with the changes in those items in dollars (in thousands) and the respective percentages of change:

Research and development expenses increased by $24.4 million to $54.2 million for the three months ended June 30, 2024 compared to $29.8 million for the same period in 2023.

The following table summarizes our research and development expenses for the three months ended June 30, 2024 and 2023, together with the changes in those items in dollars (in thousands) and the respective percentages of change:

Three Months Ended

March 31, Dollar Change Percentage Change

June 30, Dollar Change Percentage Change

Employee related expenses $ 13,661 $ 10,312 $ 3,349 32 %

External research and development 17,588 12,401 5,187 42 %

External research and development 27,025 7,117 19,908 n/m

Facility expenses 7,370 5,299 2,071 39 %

Stock-based compensation expenses 2,125 2,525 (400) (16) %

Sublicense and license fees 857 1,007 (150) (15) %

Other expenses 3,172 3,519 (347) (10) %

Total research and development expenses $ 54,210 $ 29,779 $ 24,431 82 %

The increase in research and development expenses for the three months ended June 30, 2024 compared to the three months ended June 30, 2023 was primarily attributable to:

• approximately $19.9 million in increased external research and development expenses primarily related to clinical and manufacturing costs related to the accelerated progression of our reni-cel program as well as costs attributable to in vivo research and discovery;

• approximately $3.3 million in increased employee-related expenses related to increased headcount to support manufacturing, quality, and clinical work related to our reni-cel program;

• approximately $2.1 million in increased facility expenses primarily related to increased rent expense incurred in connection with a lease commencement for manufacturing space in the second quarter of 2024.

These increases were partially offset by the following:

• approximately $0.4 million in decreased stock-based compensation expense due primarily to a reduction in the market price of our common stock, resulting in a lower valuation of equity awards granted;

• approximately $0.3 million in decreased other expenses;

• approximately $0.2 million in decreased sublicense and license fees.

General and Administrative Expenses

General and administrative expenses increased by $1.0 million to $18.2 million for the three months ended June 30, 2024 compared to $17.2 million for the three months ended June 30, 2023.

The following table summarizes our general and administrative expenses for the three months ended June 30, 2024 and 2023, together with the changes in those items in dollars (in thousands) and the respective percentages of change:

Three Months Ended

June 30, Dollar Change Percentage Change

Employee related expenses $ 4,800 $ 4,625 $ 175 4 %

Professional service expenses 3,893 4,503 (610) (14) %

Intellectual property and patent related fees 3,845 2,886 959 33 %

Stock-based compensation expenses 2,885 2,690 195 7 %

Facility and other expenses 2,783 2,498 285 11 %

Total general and administrative expenses $ 18,206 $ 17,202 $ 1,004 6 %

The increase in general and administrative expenses for the three months ended June 30, 2024 compared to the three months ended June 30, 2023 was primarily attributable to:

• approximately $1.0 million in increased intellectual property and patent related fees due to increased legal activity;

• approximately $0.3 million in increased facility and other expenses primarily related to increased facility operation costs and information technology costs;

• approximately $0.2 million in increased stock-based compensation expenses;

• approximately $0.2 million in increased employee related expenses.

These increases were partially offset by approximately $0.6 million in decreased professional service expenses related to expenses to support strategic initiatives and business development activities in 2023.

Other Income, Net

For the three months ended June 30, 2024, and June 30, 2023 other income, net was $4.3 million and $3.8 million, respectively, which primarily relates to interest income and accretion of discounts and premiums associated with marketable securities.

The increase is attributable to favorable market rates.

Comparison of the Six Months ended June 30, 2024 and 2023

The following table summarizes our results of operations for the six months ended June 30, 2024 and 2023, together with the changes in those items in dollars (in thousands) and the respective percentages of change:

Six Months Ended

June 30, Dollar Change Percentage Change

Collaboration and other research and development revenues $ 1,649 $ 12,738 $ (11,089) (87) %

Operating expenses:

Research and development 102,997 67,583 35,414 52 %

General and administrative 37,545 40,211 (2,666) (7) %

Total operating expenses 140,542 107,794 32,748 30 %

Other income, net

Other income (expense), net 5 (1,590) 1,595 n/m

Interest income, net 9,331 7,320 2,011 27 %

Total other income, net 9,336 5,730 3,606 63 %

Net loss $ (129,557) $ (89,326) $ (40,231) 45 %

Collaboration and Other Research and Development Revenues

Collaboration and other research and development revenues decreased by $11.1 million to $1.6 million for the six months ended June 30, 2024 compared to $12.7 million for six months ended June 30, 2023.

The decrease was primarily related to the sale of our wholly owned oncology assets and licenses in January 2023.

Research and Development Expenses

Research and development expenses increased by $35.4 million to $103.0 million for the six months ended June 30, 2024 compared to $67.6 million for the six months ended June 30, 2023.

The following table summarizes our research development expenses for the six months ended June 30, 2024 and 2023, together with the changes in those items in dollars (in thousands) and the respective percentages of change:

Six Months Ended

June 30, Dollar Change Percentage Change

Employee related expenses $ 27,344 $ 23,772 $ 3,572 15 %

External research and development expenses 44,613 19,518 25,095 n/m

Facility expenses 12,589 10,980 1,609 15 %

Stock-based compensation expenses 5,033 4,611 422 9 %

Sublicense and license fees 6,753 2,312 4,441 n/m

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Total research and development expenses $ 102,997 $ 67,583 $ 35,414 52 %

The increase in research and development expenses for the three months ended March 31, 2024 compared to the three months ended March 31, 2023 was primarily attributable to:

• approximately $5.2 million in increased external research and development expenses primarily related to clinical and manufacturing costs related to the continued progression our reni-cel program;

The increase in research and development expenses for the six months ended June 30, 2024 compared to the six months ended June 30, 2023 was primarily attributable to:

• approximately $25.1 million in increased external research and development expenses primarily related to clinical and manufacturing costs related to the accelerated progression of our reni-cel program as well as costs attributable to in vivo research and discovery;

• approximately $4.4 million in increased sublicense and license fees paid in connection with licensing activity;

• approximately $0.8 million in increased stock-based compensation expenses due to the achievement of certain performance-based vesting of restricted stock units;

• approximately $0.6 million in increased other expenses to support reni-cel, including medical affairs and patient advocacy initiatives;

• approximately $0.2 million in increased employee-related expenses.

These increases were partially offset by approximately $0.5 million in decreased facility expenses.

• approximately $3.6 million in increased employee related expenses related to increased headcount to support manufacturing, quality, and clinical work related to our reni-cel program;

• approximately $1.6 million in increased facility expenses primarily related to increased rent expense incurred in connection with a lease commencement for manufacturing space;

• approximately $0.4 million in increased stock-based compensation expense;

• approximately $0.3 million in increased other expenses.

General and Administrative Expenses

General and administrative expenses decreased by $3.7 million to $19.3 million for the three months ended March 31, 2024 compared to $23.0 million for the three months ended March 31, 2023.

The following table summarizes our

general and administrative expenses for the three months ended March 31, 2024 and 2023, together with the changes in those items in dollars (in thousands) and the respective percentages of change:

Three Months Ended

March 31, Dollar Change Percentage Change

General and administrative expenses decreased by $2.7 million to $37.5 million for the six months ended June 30, 2024 compared to $40.2 million for the six months ended June 30, 2023.

The following table summarizes our general and administrative expenses for the six months ended June 30, 2024 and 2023, together with the changes in those items in dollars (in thousands) and the respective percentages of change:

Six Months Ended

June 30, Dollar Change Percentage Change

Employee related expenses $ 9,690 $ 8,752 $ 938 11 %

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Total general and administrative expenses $ 37,545 $ 40,211 $ (2,666) (7) %

The decrease in general and administrative expenses for the three months ended March 31, 2024 compared to the three months ended March 31, 2023 was primarily attributable to:

• approximately $6.1 million in decreased professional service expenses related to one-time expenses to support strategic initiatives and business development activities in 2023;

• approximately $1.1 million in decreased intellectual property and patent related fees due to reduced legal activity.

These decreases were partially offset by the following:

• approximately $2.3 million in increased stock-based compensation expenses due to the achievement of certain performance-based vesting of restricted stock units;

• approximately $0.8 million in increased employee related expenses related to increased headcount;

• approximately $0.5 million in increased facility and other expenses primarily related to increased facility operation costs.

The decrease in general and administrative expenses for the six months ended June 30, 2024 compared to the six months ended June 30, 2023 was primarily attributable to:

• approximately $6.7 million in decreased professional service expenses primarily related to one-time expenses to support strategic initiatives and business development activities in 2023;

• approximately $0.1 million in decreased intellectual property and patent related fees due to reduced legal activity related to reductions in intellectual property defense.

These decreases were partially offset by:

• approximately $2.5 million in increased stock-based compensation expenses due primarily to the achievement of certain performance-based vesting of restricted stock units in 2024;

• approximately $0.9 million in increased employee related expenses related to increased headcount to support business operations;

• approximately $0.8 million in increased facility and other expense primarily related to increased facility operation costs and information technology costs.

Other Income, Net

For the three months ended March 31, 2024, and March 31, 2023 other income, net was $5.0 million and $1.9 million, respectively, which primarily relates to interest income and accretion of discounts and premiums associated with marketable securities.

The increase is attributable to increased invested balances and favorable market rates.

For the six months ended June 30, 2024 and June 30, 2023, other income, net was $9.3 million and $5.7 million, respectively, which was primarily attributable to interest income, partially offset by accretion of discounts associated with other marketable securities.

The increase for the six months ended June 30, 2024 is attributable to increased invested balances and favorable market rates.

Liquidity and Capital Resources

Sources of Liquidity

As of March 31, 2024, we have raised an aggregate of $1.0 billion in net proceeds through the sale of shares of our common stock in public offerings and at-the-market offerings .

As of June 30, 2024, we have raised an aggregate of $1.0 billion in net proceeds through the sale of shares of our common stock in public offerings and at-the-market offerings .

We also have funded our business from our research collaboration with BMS, our former strategic alliance with Allergan, and payments received under the license agreement with Vertex.

As of March 31, 2024, we had cash, cash equivalents and marketable securities of $376.8 million.

As of June 30, 2024, we had cash, cash equivalents and marketable securities of $318.3 million.

In May 2021, we entered into a common stock sales agreement with Cowen and Company, LLC (“Cowen”), under which we from time to time can issue and sell shares of our common stock through Cowen in at-the-market offerings for aggregate gross sale proceeds of up to $300.0 million (the “ATM Facility”).

We amended the common stock sales agreement with Cowen in February 2024 in connection with filing a new registration statement.

As of March 31, 2024, we have not sold any shares of our common stock under the ATM Facility.

As of June 30, 2024, we have not sold any shares of our common stock under the ATM Facility.

In addition to our existing cash, cash equivalents and marketable securities, we are eligible to earn milestone and other payments under our collaboration agreement with BMS and our other collaboration and license agreements.

Our ability to earn applicable milestone and other payments and the timing of earning these amounts are dependent upon the

timing and outcome of development, regulatory and commercial activities and, as such, are uncertain at this time.

As of March 31, 2024, our right to contingent payments under our collaboration agreement with BMS and our license agreement with Vor Bio, as well as our contingent upfront payment and annual license fees with Vertex, are our only significant committed potential external source of funds.

The following table provides information regarding our cash flows for the three months ended March 31, 2024 and 2023 (in thousands):

Three Months Ended

Our ability to earn applicable milestone and other payments and the timing of earning these amounts are dependent upon the timing and outcome of development, regulatory and commercial activities and, as such, are uncertain at this time.

As of June 30, 2024, our right to contingent payments under our collaboration agreement with BMS and our license agreement with Vor Bio, as well as our contingent upfront payment and annual license fees with Vertex, are our only significant committed potential external source of funds.

The following table provides information regarding our cash flows for the six months ended June 30, 2024 and 2023 (in thousands):

Six Months Ended

Net cash (used in) provided by:

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Financing activities 514 117,525

Net decrease in cash, cash equivalents, and restricted cash $ (54,425) $ (12,501)

Net (decrease) increase in cash, cash equivalents, and restricted cash $ (59,211) $ 79,295

Net Cash Used in Operating Activities

The use of cash in all periods resulted primarily from our net losses adjusted for non-cash charges and changes in components of working capital.

Net cash used in operating activities was approximately $49.9 million for the three months ended March 31, 2024, which primarily consisted of operating expenses that related to increasing our research efforts, the focused progression of clinical and manufacturing activities in support of the reni-cel program, sublicense and license payments, and supporting business operations.

Net cash used in operating activities was approximately $35.8 million for the three months ended March 31, 2023, which primarily consisted of progressing our reni-cel program and supporting business operations.

Net Cash (Used in) Provided by Investing Activities

Net cash used in investing activities was approximately $4.7 million for the three months ended March 31, 2024, primarily related to purchases of marketable securities of $86.2 million, partially offset by the proceeds from the maturities of marketable securities of $83.4 million.

Net cash provided by investing activities was approximately $23.3 million for the three months ended March 31, 2023, primarily related to proceeds from maturities of marketable securities of $65.9 million, partially offset by purchases of marketable securities of $40.8 million and purchases of property and equipment of $1.8 million.

Net cash used in operating activities was approximately $106.9 million for the six months ended June 30, 2024, which primarily consisted of operating expenses that related to increasing our research efforts, the focused progression of clinical and manufacturing activities in support of the reni-cel program, sublicense and license payments, and supporting business operations.

Net cash used in operating activities was approximately $74.5 million for the six months ended June 30, 2023, which primarily consisted of progressing our reni-cel program and supporting business operations.

Net Cash Provided by Investing Activities

Net cash provided by investing activities was approximately $47.2 million for the six months ended June 30, 2024, primarily related to the proceeds from the maturities of marketable securities of $138.8 million, and partially offset by the purchases of marketable securities of $86.2 million and purchases of property and equipment of $5.4 million.

Net cash provided by investing activities was approximately $36.2 million for the six months ended June 30, 2023, primarily related to proceeds from maturities of marketable securities of $107.6 million, partially offset by purchases of marketable securities of $68.2 million and purchases of property and equipment of $3.2 million.

Net Cash Provided by Financing Activities

Net cash provided by financing activities was approximately $0.2 million for the three months ended March 31, 2024, related to the proceeds received from exercises of options for our common stock.

No cash was provided by or used in financing activities for the three months ended March 31, 2023.

Net cash provided by financing activities was approximately $0.5 million for the six months ended June 30, 2024, related to the proceeds received from issuance of common stock under the employee stock purchase plan of $0.3 million and exercises of options for our common stock of $0.2 million.

Net cash provided by financing activities was approximately $117.5 million for the six months ended June 30, 2023, primarily related to proceeds from offering of common stock of $117.1 million after deducting underwriting discounts and commissions and other offering costs, and proceeds received from issuance of common stock under the employee stock purchase plan of $0.4 million

Funding Requirements

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and incur costs associated with operating as a public company.

In addition, if we

obtain marketing approval for any product candidate that we identify and develop, we expect to incur significant commercialization expenses related to product sales, marketing, manufacturing, and distribution to the extent that such sales, marketing, and distribution are not the responsibility of a collaborator.

In addition, if we obtain marketing approval for any product candidate that we identify and develop, we expect to incur significant commercialization expenses related to product sales, marketing, manufacturing, and distribution to the extent that such sales, marketing, and distribution are not the responsibility of a collaborator.

We do not expect to generate significant recurring revenue unless and until we obtain regulatory approval for and commercialize a product candidate.

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If we are unable to raise capital when needed or on attractive terms, we would be forced to delay, reduce, or eliminate our research and development programs or future commercialization efforts.

We expect that our existing cash, cash equivalents and marketable securities on March 31, 2024, together with the near-term annual license fees and the contingent upfront payment payable under our license agreement with Vertex, will enable us to fund our operating expenses and capital expenditure requirements into 2026 .

We expect that our existing cash, cash equivalents and marketable securities on June 30, 2024, together with the near-term annual license fees and the contingent upfront payment payable under our license agreement with Vertex, will enable us to fund our operating expenses and capital expenditure requirements into 2026 .

Our forecast of the period of time through which our existing cash and cash equivalents and investments will be adequate to support our operations is a forward-looking statement and involves significant risks and uncertainties.

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We could utilize our available capital resources sooner than we currently expect.

The amount and timing of future funding requirements, both near- and long-term, will depend on many factors, including, but not limited to:

amount and timing of future funding requirements, both near- and long-term, will depend on many factors, including, but not limited to:

• the costs of progressing the clinical development of reni-cel to treat SCD and TDT;

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Contractual Obligations

As of March 31, 2024, we had non-cancelable operating leases with future minimum lease payments for a total of $40.3 million, of which $11.5 million will be payable in 2024.

As of June 30, 2024, we had operating leases with future minimum lease payments for a total of $44.6 million, of which $10.8 million will be payable in 2024.

These minimum lease payments exclude our share of the facility operating expenses, real-estate taxes and other costs that are reimbursable to the landlord under the leases.

In the second quarter of 2023, we entered into a license and service agreement pursuant to which we will lease manufacturing space for our continued research and development activities.

As of March 31, 2024, the lease had not commenced for accounting purposes and it is not expected to commence until the second quarter of 2024.

The license and service agreement provides for total remaining lease payments of up to $85.4 million over a 10-year lease term.

We may terminate the license and service agreement in our discretion upon twelve months' prior written notice.

During the three months ended June 30, 2023, we entered into a license and service agreement pursuant to which we will lease manufacturing space for our continued research and development activities.

The lease commenced April 1, 2024.

We may terminate the license and service agreement at our discretion upon twelve months' prior written notice.

Our agreements with certain institutions to license intellectual property include potential milestone payments and success fees, sublicense fees, royalty fees, licensing maintenance fees, and reimbursement of patent maintenance costs that we may be required to pay.

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

What changed 10-Q

Item 2. Management’s Discussion and Analysis