Editas Medicine, Inc. 10-Q

Item 1. Financial Statements. Editas Medicine, Inc. Condensed Consolidated Balance Sheets (unaudited) (amounts in thousands, except share and per share data) June 30, 2024 December 31, 2023 ASSETS Current assets: Cash and cash equivalents $ 64,441 $ 123,652 Marketable securities 214,671 199,459 Accounts receivable 244 10,187 Prepaid expenses and other current assets 6,998 7,531 Total current assets 286,354 340,829 Marketable securities 39,195 104,024 Property and equipment, net 14,156 12,032 Right-of-use assets 36,951 33,680 Restricted cash and other non-current assets 8,145 8,588 Total assets $ 384,801 $ 499,153 LIABILITIES AND STOCKHOLDERS’ EQUITY Current liabilities: Accounts payable $ 13,769 $ 8,269 Accrued expenses 27,669 34,563 Deferred revenue, current 14,684 8,221 Operating lease liabilities 18,184 12,164 Total current liabilities 74,306 63,217 Operating lease liabilities, net of current portion 20,514 24,372 Deferred revenue, net of current portion 54,204 60,667 Other non-current liabilities 3,768 1,800 Total liabilities 152,792 150,056 Stockholders’ equity Preferred stock, $ 0.0001 par value per share: 5,000,000 shares authorized; no shares issued or outstanding — — Common stock, $ 0.0001 par value per share: 195,000,000 shares authorized; 82,429,514 and 81,767,263 shares issued and outstanding at June 30, 2024 and December 31, 2023, respectively 8 8 Additional paid-in capital 1,593,350 1,580,241 Accumulated other comprehensive (loss) income ( 442 ) 198 Accumulated deficit ( 1,360,907 ) ( 1,231,350 ) Total stockholders’ equity 232,009 349,097 Total liabilities and stockholders’ equity $ 384,801 $ 499,153 The accompanying notes are an integral part of the condensed consolidated financial statements. 3 Table of Contents Editas Medicine, Inc. Condensed Consolidated Statements of Operations (unaudited) (amounts in thousands, except share and per share data) Three Months Ended June 30, Six Months Ended June 30, 2024 2023 2024 2023 Collaboration and other research and development revenues $ 513 $ 2,887 $ 1,649 $ 12,738 Operating expenses: Research and development 54,210 29,779 102,997 67,583 General and administrative 18,206 17,202 37,545 40,211 Total operating expenses 72,416 46,981 140,542 107,794 Operating loss ( 71,903 ) ( 44,094 ) ( 138,893 ) ( 95,056 ) Other income, net: Other (expense) income, net ( 1 ) ( 7 ) 5 ( 1,590 ) Interest income, net 4,297 3,811 9,331 7,320 Total other income, net 4,296 3,804 9,336 5,730 Net loss $ ( 67,607 ) $ ( 40,290 ) $ ( 129,557 ) $ ( 89,326 ) Net loss per share, basic and diluted $ ( 0.82 ) $ ( 0.56 ) $ ( 1.58 ) $ ( 1.27 ) Weighted-average common shares outstanding, basic and diluted 82,310,368 71,376,678 82,124,603 70,157,204 The accompanying notes are an integral part of the condensed consolidated financial statements. 4 Table of Contents Editas Medicine, Inc. Condensed Consolidated Statements of Comprehensive Loss (unaudited) (amounts in thousands) Three Months Ended June 30, Six Months Ended June 30, 2024 2023 2024 2023 Net loss $ ( 67,607 ) $ ( 40,290 ) $ ( 129,557 ) $ ( 89,326 ) Other comprehensive loss: Unrealized (loss) gain on marketable debt securities ( 116 ) ( 6 ) ( 640 ) 1,316 Comprehensive loss $ ( 67,723 ) $ ( 40,296 ) $ ( 130,197 ) $ ( 88,010 ) The accompanying notes are an integral part of the condensed consolidated financial statements. 5 Table of Contents Editas Medicine, Inc. Condensed Consolidated Statements of Stockholders’ Equity (unaudited) (amounts in thousands, except share data) Common Stock Additional Paid-In Capital Accumulated Other Comprehensive Income (Loss) Accumulated Deficit Total Stockholders’ Equity Shares Amount Balance at December 31, 2023 81,767,263 $ 8 $ 1,580,241 $ 198 $ ( 1,231,350 ) $ 349,097 Exercise of stock options 21,975 — 192 — — 192 Vesting of restricted common stock awards 445,713 — — — — — Stock-based compensation expense — — 7,585 — — 7,585 Unrealized loss on marketable debt securities — — — ( 524 ) — ( 524 ) Net loss — — — — ( 61,950 ) ( 61,950 ) Balance at March 31, 2024 82,234,951 $ 8 $ 1,588,018 $ ( 326 ) $ ( 1,293,300 ) $ 294,400 Stock-based compensation expense — — 5,010 — — 5,010 Vesting of restricted common stock awards 121,643 — — — — — Issuance of common stock under employee stock purchase plan 72,920 — 322 — — 322 Unrealized loss on marketable debt securities — — — ( 116 ) — ( 116 ) Net loss — — — — ( 67,607 ) ( 67,607 ) Balance at June 30, 2024 82,429,514 $ 8 $ 1,593,350 $ ( 442 ) $ ( 1,360,907 ) $ 232,009 Editas Medicine, Inc. Condensed Consolidated Statements of Stockholders’ Equity (unaudited) (amounts in thousands, except share data) Common Stock Additional Paid-In Capital Accumulated Other Comprehensive Loss Accumulated Deficit Total Stockholders’ Equity Shares Amount Balance at December 31, 2022 68,847,382 $ 7 $ 1,442,405 $ ( 3,601 ) $ ( 1,078,131 ) $ 360,680 Vesting of restricted common stock awards 146,209 — — — — — Stock-based compensation expense — — 4,507 — — 4,507 Unrealized gain on marketable debt securities — — — 1,322 — 1,322 Net loss — — — — ( 49,036 ) ( 49,036 ) Balance at March 31, 2023 68,993,591 $ 7 $ 1,446,912 $ ( 2,279 ) $ ( 1,127,167 ) $ 317,473 Issuance of common stock from public offering, net commissions, underwriting discounts and offering costs 12,500,000 1 117,078 — — 117,079 Exercise of stock options 3,122 — 11 — — 11 Stock-based compensation expense — — 5,215 — — 5,215 Vesting of restricted common stock awards 64,492 — — — — — Issuance of common stock under employee stock purchase plan 55,704 — 435 — — 435 Unrealized loss on marketable debt securities — — — ( 6 ) — ( 6 ) Net loss — — — — ( 40,290 ) ( 40,290 ) Balance at June 30, 2023 81,616,909 $ 8 $ 1,569,651 $ ( 2,285 ) $ ( 1,167,457 ) $ 399,917 The accompanying notes are an integral part of the condensed consolidated financial statements. 6 Table of Contents Editas Medicine, Inc. Condensed Consolidated Statements of Cash Flows (unaudited) (amounts in thousands) Six Months Ended June 30, 2024 2023 Cash flow from operating activities Net loss $ ( 129,557 ) $ ( 89,326 ) Adjustments to reconcile net loss to net cash used in operating activities: Stock-based compensation expense 12,595 9,722 Depreciation 2,829 3,084 Loss on disposal of fixed assets — 1,583 Net amortization of premiums and discounts on marketable securities ( 3,596 ) ( 1,473 ) Other non-cash items ( 415 ) — Changes in operating assets and liabilities: Accounts receivable 9,943 2,859 Prepaid expenses and other current assets 535 611 Right-of-use assets ( 3,271 ) 8,837 Other non-current assets 443 — Accounts payable 5,967 ( 1,256 ) Accrued expenses ( 6,538 ) ( 2,360 ) Operating lease liabilities 2,162 ( 6,760 ) Other non-current liabilities 1,969 — Net cash used in operating activities ( 106,934 ) ( 74,479 ) Cash flow from investing activities Purchases of property and equipment ( 5,365 ) ( 3,173 ) Purchases of marketable securities ( 86,221 ) ( 68,183 ) Proceeds from maturities of marketable securities 138,795 107,605 Net cash provided by investing activities 47,209 36,249 Cash flow from financing activities Proceeds from offering of common stock, net of issuance costs — 117,079 Proceeds from exercise of stock options 192 11 Proceeds from issuance of common stock under employee stock purchase plan 322 435 Net cash provided by financing activities 514 117,525 Net (decrease) increase in cash, cash equivalents, and restricted cash ( 59,211 ) 79,295 Cash, cash equivalents, and restricted cash, beginning of period 127,529 145,399 Cash, cash equivalents, and restricted cash, end of period $ 68,318 $ 224,694 Cash and cash equivalents, end of period 64,441 220,817 Restricted cash 1 3,877 3,877 Cash, cash equivalents, and restricted cash, end of period $ 68,318 $ 224,694 1 As of June 30, 2024, restricted cash of $ 3,877 was included in Restricted cash and other non-current assets on the Consolidated Balance Sheet 1 As of June 30, 2023, restricted cash of $ 3,877 was included in Restricted cash and other non-current assets on the Consolidated Balance Sheet Supplemental disclosure of cash and non-cash activities: 7 Table of Contents Fixed asset additions included in accounts payable and accrued expenses $ 54 $ 212 Offering expenses included in accounts payable and accrued expenses — 230 Cash paid in connection with operating lease liabilities 7,683 5,738 Remeasurement of operating lease liabilities and right-of-use assets due to lease modification 794 1,069 Commencement of right-of-use asset 7,844 — The accompanying notes are an integral part of the condensed consolidated financial statements. 8 Table of Contents Editas Medicine, Inc. Notes to Condensed Consolidated Financial Statements (unaudited) 1. Nature of Business Editas Medicine, Inc. (the “Company”) is a clinical stage gene editing company dedicated to developing potentially transformative genomic medicines to treat a broad range of serious diseases. The Company was incorporated in the state of Delaware in September 2013. Its principal offices are in Cambridge, Massachusetts. Since its inception, the Company has devoted substantially all of its efforts to business planning, research and development, recruiting management and technical staff, and raising capital. The Company has primarily financed its operations through various equity financings, payments received under a research collaboration with Juno Therapeutics, Inc., a wholly-owned subsidiary of the Bristol-Myers Squibb Company (“BMS”), payments received under a strategic alliance and option agreement with Allergan Pharmaceuticals International Limited (together with its affiliates, “Allergan”) and payments received in connection with the Company’s license agreement with Vertex Pharmaceuticals, Inc. (“Vertex”). The Company is subject to risks common to companies in the biotechnology industry, including but not limited to, risks of failure of preclinical studies and clinical trials, the need to obtain marketing approval for any drug product candidate that it may identify and develop, the need to successfully commercialize and gain market acceptance of its product candidates, dependence on key personnel, protection of proprietary technology, compliance with government regulations, development by competitors of technological innovations and ability to transition from pilot-scale manufacturing to large-scale production of products. Liquidity In June 2023, the Company completed a public offering in which it sold 12,500,000 shares of its common stock and received net proceeds of approximately $ 117.1 million after deducting underwriting discounts and commissions and other offering costs. In May 2021, the Company entered into a common stock sales agreement with Cowen and Company, LLC (“Cowen”), under which the Company from time to time can issue and sell shares of its common stock through Cowen in at-the-market offerings for aggregate gross sale proceeds of up to $ 300.0 million (the “ATM Facility”). The Company amended the common stock sales agreement with Cowen in February 2024 in connection with filing a new registration statement. As of June 30, 2024, the Company has not sold any shares of its common stock under the ATM Facility. The Company has incurred annual net operating losses in every year since its inception. As of August 7, 2024, the issuance date of the consolidated financial statements, the Company expects that its existing cash, cash equivalents and marketable securities will be sufficient to fund its operating expenses and capital expenditure requirements for at least twelve months from the issuance date of the consolidated financial statements. The Company had an accumulated deficit of $ 1.4 billion at June 30, 2024, and will require substantial additional capital to fund its operations. The Company has never generated any product revenue. There can be no assurance that the Company will be able to obtain additional debt or equity financing or generate product revenue or revenues from collaborative partners, on terms acceptable to the Company, on a timely basis or at all. The failure of the Company to obtain sufficient funds on acceptable terms when needed could have a material adverse effect on the Company’s business, results of operations, and financial condition. 2. Summary of Significant Accounting Policies Unaudited Interim Financial Information The condensed consolidated financial statements of the Company included herein have been prepared, without audit, pursuant to the rules and regulations of the Securities and Exchange Commission (the “SEC”). Certain information and footnote disclosures normally included in financial statements prepared in accordance with generally accepted accounting principles in the United States of America (“GAAP”) have been condensed or omitted from this report, as is permitted by such rules and regulations. Accordingly, these condensed consolidated financial statements should be read in conjunction with the financial statements and notes thereto included in the Company’s Annual Report on Form 10-K for the fiscal year ended December 31, 2023 (the “Annual Report”). The unaudited condensed consolidated financial statements include the accounts of the Company and its wholly owned subsidiaries, Editas Securities Corporation and Editas Medicine, LLC. All intercompany transactions and balances 9 Table of Contents of the subsidiaries have been eliminated in consolidation. In the opinion of management, the information furnished reflects all adjustments, all of which are of a normal and recurring nature, necessary for a fair presentation of the results for the reported interim periods. The Company considers events or transactions that occur after the balance sheet date but before the financial statements are issued to provide additional evidence relative to certain estimates or to identify matters that require additional disclosure. The three months ended June 30, 2024 and 2023 are referred to as the second quarter of 2024 and 2023, respectively. The results of operations for interim periods are not necessarily indicative of results to be expected for the full year or any other interim period. Summary of Significant Accounting Policies The Company’s significant accounting policies are described in Note 2, “Summary of Significant Accounting Policies,” to the consolidated financial statements included in the Annual Report. There have been no material changes to the significant accounting policies previously disclosed in the Annual Report. 3. Cash Equivalents and Marketable Securities Cash equivalents and marketable securities consisted of the following at June 30, 2024 (in thousands): Amortized Cost Allowance for Credit Losses Gross Unrealized Gains Gross Unrealized Losses Fair Value Cash equivalents and marketable securities: Government agency securities $ 39,937 $ — $ — $ ( 117 ) $ 39,820 U.S. Treasuries 205,360 — 18 ( 309 ) 205,069 Money market funds 64,441 — — — 64,441 Corporate notes/bonds 9,011 — — ( 34 ) 8,977 Total $ 318,749 $ — $ 18 $ ( 460 ) $ 318,307 Cash equivalents and marketable securities consisted of the following at December 31, 2023 (in thousands): Amortized Cost Allowance for Credit Losses Gross Unrealized Gains Gross Unrealized Losses Fair Value Cash equivalents and marketable securities: Government agency securities $ 103,507 $ — $ — $ ( 327 ) $ 103,180 Money market funds 123,652 — — — 123,652 Corporate notes/bonds 30,920 — — ( 86 ) 30,834 U.S. Treasuries 168,858 — 611 — 169,469 Total $ 426,937 $ — $ 611 $ ( 413 ) $ 427,135 As of June 30, 2024, the Company held 15 marketable securities that were in a continuous unrealized loss position that amounted to $ 0.04 million. The Company neither intends to sell these marketable securities, nor does it believe that it is more-likely-than-not to conclude that the Company will have to sell the securities before recovery of their carrying values. The Company also believes that it will be able to collect, in full, both principal and interest amounts due at maturity. Furthermore, the Company has determined that there were no material changes in the credit risk of the securities. As of June 30, 2024, the Company holds 5 securities with an aggregate fair value of $ 39.2 million that had remaining maturities greater than one year . There were no realized gains or losses on available-for-sale securities during the six months ended June 30, 2024 or 2023. 10 Table of Contents 4. Fair Value Measurements Assets measured at fair value on a recurring basis as of June 30, 2024 were as follows (in thousands): June 30, 2024 Quoted Prices in Active Markets for Identical Assets (Level 1) Significant Other Observable Inputs (Level 2) Significant Unobservable Inputs (Level 3) Cash equivalents: Money market funds $ 64,441 $ 64,441 $ — $ — Marketable securities: Government agency securities 39,820 — 39,820 — Corporate notes/bonds 8,977 — 8,977 — U.S. Treasuries 205,069 205,069 — — Restricted cash and other non-current assets: Money market funds 3,877 3,877 — — Total financial assets $ 322,184 $ 273,387 $ 48,797 $ — Assets measured at fair value on a recurring basis as of December 31, 2023 were as follows (in thousands): December 31, 2023 Quoted Prices in Active Markets for Identical Assets (Level 1) Significant Other Observable Inputs (Level 2) Significant Unobservable Inputs (Level 3) Cash equivalents: Money market funds $ 123,652 $ 123,652 $ — $ — Marketable securities: Government agency securities 103,180 — 103,180 — Corporate notes/bonds 30,834 — 30,834 — U.S. Treasuries 169,469 169,469 — — Restricted cash and other non-current assets: Money market funds 3,877 3,877 — — Total financial assets $ 431,012 $ 296,998 $ 134,014 $ — 5. Accrued Expenses Accrued expenses consisted of the following (in thousands): June 30, 2024 December 31, 2023 External research and development expenses $ 15,879 $ 16,204 Employee related expenses 8,130 11,280 Sublicense and license fees 540 5,063 Intellectual property and patent related fees 1,975 983 Professional service expenses 530 750 Other expenses 615 283 Total accrued expenses $ 27,669 $ 34,563 11 Table of Contents 6. Property and Equipment, net Property and equipment, net consisted of the following (in thousands): June 30, 2024 December 31, 2023 Laboratory and manufacturing equipment $ 28,635 $ 25,043 Leasehold improvements 11,715 9,648 Computer equipment 1,426 1,062 Construction-in-progress 807 2,060 Furniture and office equipment 264 264 Software 271 215 Total property and equipment 43,118 38,292 Less: accumulated depreciation ( 28,962 ) ( 26,260 ) Property and equipment, net $ 14,156 $ 12,032 7. Commitments and Contingencies The Company is a party to a number of license agreements under which the Company licenses patents, patent applications and other intellectual property from third parties. As such, the Company is obligated to pay licensors for various costs including upfront licenses fees, annual license fees, certain licensor expense reimbursements, success payments, research funding payments, and milestones triggerable upon certain development, regulatory, and commercial events as well as royalties on future products. These contracts are generally cancellable, with notice, at the Company’s option and do not have significant cancellation penalties. The terms and conditions as well as the accounting analysis for the Company’s significant commitments and contingencies are described in Note 8, “Commitments and Contingencies” to the consolidated financial statements included in the Annual Report. There have been no material changes to the terms and conditions, or the accounting conclusions, previously disclosed in the Annual Report. Licensor Expense Reimbursement The Company is obligated to reimburse The Broad Institute, Inc. (“Broad”) and the President and Fellows of Harvard College (“Harvard”) for expenses incurred by each of them associated with the prosecution and maintenance of the patent rights that the Company licenses from them pursuant to the license agreement by and among the Company, Broad and Harvard, including the interference and opposition proceedings involving patents licensed to the Company under the license agreement, and other license agreements between the Company and Broad. As such, the Company anticipates that it has a substantial commitment in connection with these proceedings until such time as these proceedings have been resolved, but the amount of such commitment is not determinable. The Company incurred an aggregate of $ 2.5 million and $ 4.6 million in expense during the three and six months ended June 30, 2024, respectively, for such reimbursement. The Company incurred an aggregate of $ 1.6 million and $ 4.6 million in expense during the three and six months ended June 30, 2023, respectively, for such reimbursement. 8. Collaboration Agreements The Company has entered into multiple collaborations, out-licenses and strategic alliances with third parties that typically involve payments to or from the Company, including up-front payments, payments for research and development services, option payments, milestone payments and royalty payments to or from the Company. The terms and conditions as well as the accounting analysis for the Company’s significant collaborations, out-licenses and strategic alliances are described in Note 9, “Collaboration Agreements” to the consolidated financial statements included in the Annual Report. There have been no other material changes to the terms and conditions, or the accounting conclusions, previously disclosed in the Annual Report. 12 Table of Contents Collaboration Revenue As of June 30, 2024, the Company’s contract liabilities were primarily related to the Company’s collaboration with BMS. The following table presents changes in the Company’s accounts receivable and contract liabilities for the six months ended June 30, 2024 (in thousands): Balance at December 31, 2023 Additions Deductions Balance at June 30, 2024 Accounts receivable $ 10,187 $ 271 $ ( 10,214 ) $ 244 Contract liabilities: Deferred revenue $ 68,888 $ — $ — $ 68,888 Amendment to BMS Collaboration Agreement In March 2024, the Company entered into an amendment (“2024 Amendment”) to the Second Amended and Restated Collaboration and License Agreement, dated as of November 11 2019, by and between the Company and June (the “2019 Collaboration Agreement”) extend the collaboration to November 2026, with options to extend the collaboration for up to an additional two years , and provided BMS the ability to select up to three new gene targets for research. The 2019 Collaboration Agreement, as amended by the 2024 Amendment, is herein referred to as the 2019 Amended Collaboration Agreement. Accounting Assessment The Company evaluated the 2024 Amendment and concluded that the agreement qualifies as a contract with a customer under Accounting Standards Codification 606 (“ASC 606”). The contract modification was accounted for on a prospective basis as if it were a termination of the existing contract and the creation of a new contract since the promised goods and services were distinct from the goods and services that were transferred on or before the effective date of the amendment. The Company has identified the following performance obligations under the 2024 Amendment: eighteen material rights for additional development and commercialization licenses for other gene editing tools specific to a gene target and enzyme combination (or a “Program”). As of the amendment date and June 30, 2024, the total transaction price was appropriately $ 56.7 million, comprised of the remaining deferred revenue balance that was not recognized pursuant to the 2019 Amended Collaboration Agreement. The Company utilized the most likely amount method to estimate any development and regulatory milestone payments to be received, as well as extension term fees. As of June 30, 2024, there were no milestone or extension term fees included in the transaction price. The Company considers the stage of development and the risks associated with the remaining development required to achieve the milestone, as well as whether the achievement of the milestone is outside the control of the Company or BMS. The outstanding milestone payments and extension term fees were fully constrained as of June 30, 2024, as a result of the uncertainty of whether any of the milestones will be achieved or the term would be extended. The Company has determined that any commercial milestones and sales-based royalties will be recognized when the related sales occur. The Company reevaluates the transaction price at each reporting period and as uncertain events are resolved or other changes in circumstances occur. The Company concluded that rights and attributes of each of the development and commercialization licenses are identical for both the license granted at inception and the licenses that may be issued in the future upon exercise of the associated option. Each development and commercialization license is differentiated only by the Program to which it relates. The Company has considered the early stage of the science and the uncertainty of success and concluded that the probability of scientific success and opt-in is equal amongst all Programs. In addition, each Program is multi-functional, and a combination of Programs can be utilized in the development of a product candidate. As such, the Company concluded that the standalone selling price of each material right is the same. The Company will recognize the transaction price allocated to each material right when the material right is exercised, lapsed or expired. During the three months ended June 30, 2024 and six months ended June 30, 2024, the Company did not recognize any of the $ 56.7 million transaction price. As of June 30, 2024, $ 6.5 million was classified as short-term deferred revenue and $ 50.2 million as long-term deferred revenue in the accompanying consolidated balance sheets. 13 Table of Contents 9. Stock-based Compensation Total compensation cost recognized for all stock-based compensation awards in the condensed consolidated statements of operations was as follows (in thousands): Three Months Ended June 30, Six Months Ended June 30, 2024 2023 2024 2023 Research and development $ 2,125 $ 2,525 $ 5,033 $ 4,611 General and administrative 2,885 2,690 7,562 5,111 Total stock-based compensation expense $ 5,010 $ 5,215 $ 12,595 $ 9,722 Restricted Stock Unit Awards The following is a summary of restricted stock unit awards activity for the six months ended June 30, 2024: Shares Weighted Average Grant Date Fair Value Per Share Unvested restricted stock unit awards as of December 31, 2023 2,107,147 $ 11.96 Issued 1,407,339 $ 9.53 Vested ( 567,356 ) $ 12.54 Forfeited ( 328,769 ) $ 15.12 Unvested restricted stock unit awards as of June 30, 2024 2,618,361 $ 10.13 The restricted stock units issued in the six months ended June 30, 2024 include 422,000 units granted to certain employees that contain performance-based vesting provisions. The expense related to the performance-based vesting of restricted stock units was $ 3.5 million for the six months ended June 30, 2024. There was no expense related to the performance-based vesting of restricted stock units for the six months ended June 30, 2023. As of June 30, 2024, total unrecognized compensation expense related to unvested restricted stock unit awards was $ 2.8 million, which the Company expects to recognize over a remaining weighted-average period of 2.78 years. Stock Options The following is a summary of stock option activity for the six months ended June 30, 2024: Shares Weighted Average Exercise Price Remaining Contractual Life (years) Aggregate Intrinsic Value Outstanding at December 31, 2023 6,149,645 $ 16.47 6.89 $ 3,195 Granted 2,530,273 $ 8.78 Exercised ( 21,975 ) $ 8.72 Cancelled ( 389,153 ) $ 26.41 Outstanding at June 30, 2024 8,268,790 $ 15.26 7.62 $ 68 Exercisable at June 30, 2024 3,607,857 $ 22.07 5.74 $ 68 As of June 30, 2024, total unrecognized compensation expense related to stock options was $ 1.6 million, which the Company expects to recognize over a remaining weighted-average period of 2.9 years. 14 Table of Contents 10. Net Loss per Share Basic net loss per common share is calculated by dividing the net loss attributable to common stockholders by the weighted average number of shares of common stock outstanding during the period, without consideration for potentially dilutive securities. Diluted net loss per share is computed by dividing the net loss attributable to common stockholders by the weighted average number of shares of common stock and potentially dilutive securities outstanding for the period determined using the treasury stock and if converted methods. Contingently issuable shares are included in the calculation of basic loss per share as of the beginning of the period in which all the necessary conditions have been satisfied. Contingently issuable shares are included in diluted loss per share based on the number of shares, if any, that would be issuable under the terms of the arrangement if the end of the reporting period was the end of the contingency period, if the results are dilutive. For purposes of the diluted net loss per share calculation, unvested restricted stock unit awards and outstanding stock options are considered to be common stock equivalents, but they were excluded from the Company’s calculation of diluted net loss per share allocable to common stockholders because their inclusion would have been anti-dilutive. Therefore, basic and diluted net loss per share applicable to common stockholders were the same for all periods presented. The following common stock equivalents were excluded from the calculation of diluted net loss per share allocable to common stockholders because their inclusion would have been anti-dilutive: June 30, 2024 2023 Unvested restricted stock unit awards 2,618,361 2,083,088 Outstanding stock options 8,268,790 6,188,331 Total 10,887,151 8,271,419 15 Table of Contents